Iran's Deadly Ambition (2 page)

A LIFELINE FOR IRAN’S AYATOLLAHS

The process began just days after the signing of the JPOA, when the Obama administration announced that it was unblocking some $8 billion in assets from frozen Iranian oil sales as a confidence-building measure.
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That step was seen as just the beginning: Abbas Araqchi, Iran’s deputy foreign minister for legal and international affairs, intimated that Iran had been
assured “access” to a further $15 billion under the terms of the agreement.
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In all, Iran appeared poised to receive at least $20 billion of sanctions relief, equivalent to roughly one-fifth of the country’s estimated foreign reserves and a sum far greater than originally envisioned by the White House.
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The real figure was more modest. All told, a July 2014 study by the Foundation for Defense of Democracies and Roubini Global Economics found that the Islamic Republic received $11 billion in direct sanctions relief during the six months of the JPOA (November 2013 to June 2014).
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But the real economic benefits to Iran were substantially broader. The terms of the Geneva agreement included a significant easing of restrictions on investment in a number of Iran’s financial sectors, paving the way for a host of companies that had previously curtailed their business in the Islamic Republic to broaden their presence there.
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An August 2014 Bloomberg report noted what amounts to a massive surge of foreign commercial interest in the Islamic Republic, with European, Asian, and African companies all now viewing Iran as an emerging market.
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The reasons are clear: as one German corporate executive explained, “the market will explode the moment the embargo is lifted.”
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International business, in other words, is fully expecting some sort of diplomatic détente with Iran that will make it possible for the world to go back to business as usual with Iran’s ayatollahs.

Iran’s oil clients have also dived back in. In the aftermath of the November 2013 signing of the JPOA, the State Department signaled that the White House was, at least temporarily, suspending application of the 2010 Comprehensive Iran Sanctions, Accountability, and Divestment Act, under which countries must certify that they are decreasing their acquisitions of Iranian oil in order to avoid sanctions by the United States.
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Predictably, foreign importers of Iranian oil wasted no time in resuming their energy trade with the Islamic
Republic. In August 2014,
The Diplomat
reported that overall Asian imports of Iranian crude had increased by 25 percent, to 1.2 million barrels per day, in the first half of that year.
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As of December 2014, that figure remained largely the same: 1.1 million barrels per day, or some 20 percent above 2013 levels.
¹⁴

As a result, Iran’s economy has begun to experience a modest but sustained recovery. Inflation has dropped appreciably, from some 45 percent in the summer of 2013 to less than 18 percent today.
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The Tehran Stock Exchange has risen in value by more than 50 percent, as eager investors circle the Iranian market. Iran’s national currency, the rial, has also stabilized somewhat. After plummeting to historic lows (between 39,000 and 40,000 rials to 1 U.S. dollar) in February 2013 as a result of Western sanctions, it regained more than a quarter of its value by December 2014.
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Similarly, Iran’s GDP has begun to trend positive once again. According to Iran’s central bank, gross domestic product grew by 4 percent between March and October 2014 (the first half of the Iranian calendar year).
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Overall, Iran’s economy—which constricted by 5.8 percent in 2012 and a further 1.7 percent in 2013—is estimated by the International Monetary Fund to have grown by 1.5 percent in 2014.
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As a result, Iranian officials say, the Islamic Republic has avoided recession and begun an “economic revival.”
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This has not, however, translated into political compromise with the West. The July 20, 2014, deadline for the JPOA came and went without meaningful results. The White House, hopeful as ever of an impending diplomatic breakthrough with the Islamic Republic, agreed to extend talks for another four months in hopes that the additional time would allow the P5+1 to bridge “major differences” with Iran over its nuclear rights, leading the
Wall Street Journal
to wryly comment that the Islamic Republic was taking
the United States on what amounts to a “nuclear carpet ride.”
²⁰
When those talks did not yield an agreement by their new deadline of November 24, 2014, they were extended yet again—this time, until June 30, 2015. (As of this writing, the conclusion of a deal by that time appears likely, although by no means assured.)

In the meantime, the White House has resolutely prevented an expansion of economic leverage against the Islamic Republic. In his 2014 State of the Union address, President Obama announced that he would veto any legislation passed by Congress that might derail the current nuclear talks.
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That threat succeeded in holding in abeyance major legislative initiatives aimed at strengthening the U.S. sanctions regime against Iran, chief among them the Nuclear Weapon Free Iran Act of 2013, introduced by Senators Robert Menendez (D-NJ) and Mark Kirk (R-IL).
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And while Congress has pledged new activism on the sanctions front
²³
in the wake of the Republican party’s resounding victory in the November 2014 midterm elections, it promises to be exceedingly difficult—if not impossible—to rebuild the broad, effective sanctions coalition that brought Iran’s ayatollahs to the diplomatic negotiating table in the first place.

That is because the Iranian regime has used its time wisely. In recent months, Iranian officials have made frenzied efforts to attract international business and foreign economic stakeholders, thereby lessening the Iranian regime’s fiscal isolation. Quite prudently, they have also used the breathing room gained by the Geneva process to “sanctions-proof” their economy, eliminating costly economic subsidies and tightening the country’s collective fiscal belt as a hedge in the event that talks break down and the West reverts to economic pressure.
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In such a way, Iran has strengthened its economic defenses and transitioned from the so-called resistance economy that was championed by its leadership just a few years ago to
an economic sector defined by “resilience.”
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Needless to say, all this has made the job of Western nations hoping to stave off the advent of a nuclear Iran without resorting to the use of force much, much more difficult.

But more worrisome still is the reality that, in its eagerness to conclude some sort of agreement with Iran over its nuclear program, the United States has systematically diluted its Iran policy. It has turned a blind eye to the Islamic Republic’s fomentation of international terrorism, its support of rogue foreign regimes, such as the Assad dictatorship in Syria and Kim Jong-un’s Stalinist regime in North Korea, and its rampant domestic repression.

OLD WINE IN NEW BOTTLES

On the surface, all this might seem a bit surprising. After all, Iran is a country in profound flux. The median age of its population of nearly 81 million is just 28.3 years, making most Iranians considerably younger than the Islamic Republic itself.
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Iran is profoundly Westward-looking and a country of first-world expectations, widespread educational and technological advancements, and a populace increasingly chafing under the clerical status quo.
²⁷
Back in 2005, Thomas Friedman, of the
New York Times
, observed these stirrings and went so far as to label Iran the “ultimate red state.”
²⁸

Iran, in other words, seems inexorably headed toward political transformation. Yet exactly when such change will occur is profoundly uncertain. Over the years, successive administrations in Washington have attempted to tilt the balance of power in Iran toward greater freedom. Most conspicuously, the so-called freedom agenda of President George W. Bush led his administration to emphasize its support for Iran’s urge for democracy.
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As a practical matter, however, it did little to concretely encourage a more pluralistic, democratic future for ordinary Iranians.

The Obama administration, for its part, has done even less. In the early days of President Obama’s first term in office, as grassroots ferment coalesced in Iran, the White House avoided weighing in on the side of pro-democracy forces and against Iran’s clerical establishment. The reasons for its silence were practical: at the time, the administration still hoped that the president’s “outstretched hand” to Iran’s ayatollahs would receive a warm reception in Tehran. As a result, administration officials shied away from backing opponents of the regime they were trying to engage. And at least in part because they did so, Iran’s freedom wave withered on the vine.

A lack of Western support for the pro-democracy drive during the summer of 2009, and only sporadic attention from the international community in the months that followed, empowered a concerted campaign of repression on the part of the Iranian regime, leading to the decisive dismantling of regime opposition following the fraudulent reelection of Mahmoud Ahmadinejad to the Iranian presidency. So complete was the rout of the Green Movement that, in the months leading up to Iran’s summer 2013 presidential election, the most vital question occupying Iran’s embattled democrats became not whether to field their own candidate, but if they should boycott the elections altogether.
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The debate was a telling indicator that the Iranian regime had succeeded in well and truly neutralizing Iran’s pro-democracy forces.

The June 2013 election of Hassan Rouhani as Ahmadinejad’s successor must be understood in this context. Iran’s new president may be a moderate by the comparative standards of the Islamic Republic. His rhetoric was certainly more progressive than that of the seven other candidates cleared to run for the office by Iran’s powerful Guardian Council. While still on the campaign trail, Rouhani ran on a political platform that included pledges to improve economic conditions within the Islamic Republic, reduce tensions with the
West, and improve domestic human rights conditions. Indeed, these promises set Rouhani apart from other presidential hopefuls and garnered him a resounding electoral victory that summer.

Most of those promises, however, remain unmet. A December 2013 survey compiled by the University of Toronto’s Munk School of Global Affairs in conjunction with the Iranian research group ASL19 found that after his first one hundred days in office, just 4 of Rouhani’s 46 official promises were fully achieved, and only 15 others were “in progress.” The rest—27 pledges relating to Iran’s domestic and foreign policies—had not been attempted.
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Today, the situation remains largely the same. There has been no measurable movement on systemic economic reform of the type promised by Rouhani on the campaign trail. Meanwhile, domestic repression has deepened, as has the persecution of minorities. Since he took office in August 2013, Rouhani’s most substantive contribution has been to begin to reduce and lift international sanctions—something he has accomplished through nuclear negotiations with the West.

This state of affairs illustrates that, contrary to popular perceptions in the West, Rouhani is no trailblazing reformer. He is, rather, an integral part of the ancien régime in Tehran, albeit one with a friendlier façade. An original compatriot of Ayatollah Khomeini, Rouhani agitated for Iran’s revolutionary-in-chief while the latter was in exile in France, eventually joining him there in the late 1970s. After the Islamic Republic was established, he assumed a succession of top posts in government, culminating with a stint as secretary of Iran’s powerful Supreme National Security Council and as the Iranian regime’s chief nuclear negotiator with the European Union in the fruitless diplomacy of the early 2000s. Rouhani’s longevity in Iranian politics is a testament to his embrace of core
regime principles and his good standing with Ayatollah Ali Khamenei, Khomeini’s successor as supreme leader.

For all of his temperate rhetoric, then, Rouhani is nothing so much as a faithful representative of the regime he serves. His willingness to engage with the West over Iran’s nuclear program represents more a tactical effort to lessen the Islamic Republic’s political isolation and economic pain than a true ideological about-face. Indeed, on the international scene, Iran remains very much in the role of insurgent, and one with a clear will to power in its immediate periphery and far beyond.

The pages that follow sketch the contours of that global ambition. They demonstrate convincingly that Iran, a regime in profound demographic and political flux, is still animated by an uncompromising religious worldview that sees itself at war with the West. They also show that, even as Iran’s leaders engage in negotiations with the West over their nuclear program, they are busy translating their vision of world influence into action.

The resulting picture is profoundly at odds with the prevailing view of Iran that now exists within Washington’s corridors of power. But it is a vitally important part of the puzzle, insofar as it helps to explain why Iran’s regime (albeit not its people) continues to see itself as engaged in an existential conflict with America, and why its actions are so deeply inimical to U.S. interests and to the safety and security of our allies abroad.

CHAPTER

I

Iran’s Manifest Destiny

W
hat makes Tehran tick? More than three and a half decades after Ayatollah Ruhollah Khomeini swept to power in Tehran on a wave of revolutionary fervor, transforming an erstwhile ally of the United States into a mortal enemy practically overnight, policy makers in Washington still understand precious little about the inner workings of his Islamic Republic. As a result, they consistently misjudge, misunderstand, and misinterpret what the Iranian regime says and does and what its leaders truly believe.