Senate Passes Sanctions Despite White House Objections
Despite strong opposition from Obama Administration officials, the Senate unanimously passed legislation to force the President to impose sanctions on countries and companies that do business with Iran's central bank or purchase Iranian oil.
Washington D.C. – Despite strong opposition from Obama
Administration officials, the Senate unanimously passed legislation to force
the President to impose sanctions on countries and companies that do
business with Iran’s central bank or purchase Iranian oil. The provision
was adopted as an amendment to Congress’ annual defense policy bill and must be
approved by the House of Representatives before going to the President.
“The irony of this amendment is…there’s absolutely a risk
that in fact the price of oil would go up, which means that
Iran would in fact have more money to fuel its nuclear ambitions, not
less, ” Undersecretary of State Wendy Sherman told the Senate Foreign
Relations Committee hours before the vote.
The sanctions, sponsored by Senators Robert Menendez (D-NJ)
and Mark Kirk (R-IL), have been endorsed as the harshest measure
possible against Iran short of military strikes. It would
impose a near total ban on any foreign government or financial
institution from conducting transactions related to
Iran. Critics have argued that similar to measures were
taken against Iraq in the 1990s and contributed to humanitarian suffering
that punished ordinary people and left the Saddam Hussein regime undeterred.
warned Senate backers of the proposal, which was offered as an amendment to the
annual defense authorization bill, that it could increase the cost of gas
and threaten economies in Europe and Asia.
There is “real concern that the amendment…has the potential
to actually increase revenues to Iran,” testified Undersecretary of
Treasury David Cohen.
Treasury Secretary Tim Geithner, sent a letter to the
Senate this morning ahead of a planned vote on the
sanctions proposal, conveying the Administration’s
“strong opposition” to the amendment, warning that it would
undermine international efforts to undermine Iran.
“Rather than motivating
these countries to join us in increasing pressure on Iran,” wrote
Geithner, “they are more likely to resent our actions and resist following
our lead – a consequence that would serve the Iranians more than it harms
While the U.S.
does not conduct any transactions with Iran’s central bank, supporters of the
sanctions proposal reason that the U.S. can use sanctions against
other countries to force them to end all business regarding
Cohen, however, argued
that the “threat of coercion that is contained in the amendment” would
alienate, rather than unite, the international community regarding
the United States’ Iran strategy.
Cohen said that the
Obama Administration’s efforts had led to a significant withdrawal by
other countries and entities from Iran’s economy. He said
the Senate’s proposal could “result in less cooperation because of the
reaction to the threat that is being visited on their financial institutions.”
Senate supporters of
the sanctions were unconvinced.
“We need to cut off
the fuel!” exclaimed Senator Menendez, who excoriated the Administration
officials for opposing his measure.
Members of the
committee accused the Administration of attempting to “torpedo” the
central bank sanctions effort at the last minute. Earlier
versions of the proposal had been deemed controversial because of the
impact they would have on gas prices in the U.S. and the impact
they could have on European economies at risk of recession. The
amendment’s supporters had agreed to a new version of the amendment
that provides limited waivers aimed at preventing
such outcomes. But concerns persist that the practical
effect would still not prevent an oil price spike.
The officials assured
the committee that the Administration shares the same goal as the Senators
supporting central bank sanctions. “We have a disagreement with the
tactics,” added Cohen. “There’s a better way to go about it.”
to sanction Iranian oil exports by the European Union were reportedly put
on hold today due to opposition from Greece, which is relying on
credit purchases of Iranian oil in lieu of other willing sellers.
However, the measure moved
forward as an amendment in the Senate with no opposing votes. It was
attached to a bill authorizing military programs for 2012, which passed the
Senate and is expected to go to the President later this month. Although
an annual defense authorization bill has passed Congress each of the past
forty-eight years, the White House has issued a veto threat regarding separate
unresolved provisions in this year's bill.