Pompeo and Trump Plan to Exploit and Silence Iranian Americans

FOR IMMEDIATE RELEASE
Contact: Jamal Abdi
Phone: 202-386-6408
Email: jabdi@niacouncil.org

Washington, D.C. – Jamal Abdi, the Vice President for Policy of the National Iranian American Council, issued the following statement in response to Secretary of State Mike Pompeo’s announcement that he will address Iranian Americans in Simi Valley later this month:

“The quest for human rights and democracy in Iran can only be owned by the Iranian people. It cannot be owned by the U.S., Israel, or Saudi Arabia. It cannot be decided by Iran’s government or even Iranian exiles.

“What President Trump and Secretary Pompeo want is to exploit Iranian Americans and co-opt the Iranian people to provide legitimacy for the Trump Administration’s Iraq War redux for Iran. Just as the Bush Administration cultivated a few Iraqi exiles and talked about human rights to provide legitimacy for a disastrous invasion of Iraq, the Trump Administration appears intent on using Iranian exiles to advance dangerous policies that will leave the Iranian people as its primary victims.

“If Sec. Pompeo really wants the Iranian-American community to embrace the Trump agenda, he must start with a sincere apology and rescind Trump’s ban that is dividing Iranian Americans from their friends and loved ones in Iran. He should apologize for the Administration’s move to banish the most prominent Iranian-American national security official from policymaking decisions due to her heritage. Moreover, he should apologize for the decision to strip the Iranian people of their hope for relief from sanctions and greater connections with the outside world, instead ensuring they will be crushed between U.S. sanctions and resurgent hardline forces in Iran’s government that have benefited from Trump’s withdrawal from the nuclear accord.

“It should be abundantly clear that Secretary Pompeo, who called for bombing Iran instead of negotiations, is no friend of the Iranian people. Similarly, Trump – whose national security advisor and lawyer have elevated the voices of an undemocratic, human rights abusing cult, the MEK, to become the next leadership of Iran – does not have the Iranian people’s best interests at heart. The Trump Administration’s close coordination with Benjamin Netanyahu and Mohammad Bin Salman, who are motivated by their own political gain and regional power dynamics rather than any love for democracy or the Iranian people, should dispel any notion this campaign is about helping ordinary Iranians.

“As Americans, we have a vital role to play in ensuring our democratically elected government does not start wars on false pretenses or destroy lives in our names. As Iranian Americans, our voices are particularly vital when it comes to the U.S. government’s efforts regarding our ancestral homeland. We will not be exploited or silenced at this critical moment in history.”

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Dollar-Clearing Battle: First Step to Killing Iran Nuclear Deal

Lawmakers and advocacy groups undertook many steps to weaken the Iran nuclear deal during the Obama era to set up President Trump’s unilateral termination. Last week, Republicans on the Permanent Subcommittee on Investigations released a 50-page report delving into the Obama administration’s efforts in early 2016 to ensure that Iran was able to repatriate its own frozen assets held at Bank Muscat in Oman.

Lead author Senator Rob Portman (R-OH) and others, including President Trump, have spun this arrangement as a nefarious side deal aimed at permitting Iran access to the U.S. financial system. However, the report offers key insight into how deal opponents succeeded in hobbling Iran’s relief by securitizing the debate over sanctions relief for Iran, ensuring that any relief for Iran was falsely viewed as a negative for regional and global security and a political liability. 

That the U.S. was obligated to take affirmative steps to ensure effective sanctions relief under the Joint Comprehensive Plan of Action (JCPOA) has been greatly under-appreciated and often ignored in Washington. Yet, the text of the agreement is clear that the U.S. and other parties would “agree on steps to ensure Iran’s access in areas of trade, technology, finance, and energy.” This goes beyond U.S. commitments to prevent the re-imposition of sanctions or “interference with the realization of the full benefit by Iran of the sanctions lifting,” which were also commitments under the JCPOA. Instead, it entails affirmative steps that had not been decided to ensure that Iran reconnects with the global economy.

The Oman Connection

At the outset of the JCPOA, Iran was granted access to billions of dollars of its own assets that had been frozen in accounts around the globe. Yet, the repatriation of those assets became a major complication, as detailed by the subcommittee report. In January 2016, Iran sought to convert its assets at Bank Muscat in Oman into euros for future purchases. However, there was a hang-up, as Bank Muscat notified the Treasury Department’s Office of Foreign Assets Control (OFAC) that it would need a U.S. bank to first convert the funds into dollars before they could be converted into euros. Given that the dollar is the world’s reserve currency, dollar-clearing transactions that briefly transit through the U.S. financial system are common. However, dollar clearing through the U.S. financial system for transactions involving Iran had been barred since November 2008 and was not formally lifted by the JCPOA. Absent a license from the Treasury Department to permit the dollar clearing, the conversion of the assets would be far more complicated.

Starting in January 2016, the Iranians asserted that the JCPOA was clear that Iran would have the right to convert its assets “without any qualifications and conditions.” Treasury officials then looked into what sections of the JCPOA would obligate the U.S. to authorize the dollar conversion. They found many—to the apparent surprise of at least one Treasury official.

There was a great deal riding on the JCPOA’s successful implementation. Iran had rolled back its nuclear program and subjected it to intrusive inspections, forestalling the twin threats of both a nuclear-armed Iran and war with Iran over its nuclear program. As Secretary Lew detailed in a speech in March 2016, “to pressure bad actors to change their policy, we must be prepared to provide relief from sanctions when we succeed. If we fail to follow through, we undermine our own credibility and damage our ability to use sanctions to drive policy change.” Thus, not only was the nuclear deal at stake, but also the U.S. ability to trade in the extensive sanctions that remained on the books for further concessions from Iran.

The Obama administration wanted to ensure that it was complying with both the letter and spirit of the JCPOA. It therefore decided to issue a license to Bank Muscat to enable dollar clearing, provided a U.S. bank was willing to engage in the transaction. Despite assurances from the administration, two banks rejected the proposal in February and March 2016 due to reputational risks and fears of being tangled up in ongoing litigation against Iran.

Rising Opposition

Amid these efforts to enable Iran to repatriate the funds as envisioned under the JCPOA, deal opponents began to put pressure on the administration’s plans. In March, leading Congressional Republicans Ed Royce and Jeb Hensarling pressed Secretary of the Treasury Jack Lew on whether Iran would have access to the U.S. financial system, to which he responded “[p]art of the agreement was to give Iran access to money that it has a right to. We will work on making that happen.” Then the Foundation for Defense of Democracies (FDD)—the epicenter of nongovernmental efforts to dismantle the Iran nuclear deal—jumped into the fray. It issued a warning in the Wall Street Journal that Obama was “dollarizing the Ayatollahs” and hinted that Congress would block the administration’s plans. Much more pushback from FDD and congressional Republicans followed.

Sanctions relief for Iran had been effectively securitized. A brief transit from third-party banks to the U.S. and back again involving Iranian assets had been exaggerated as “the ultimate prize” for Iran, generating significant congressional opposition. Such indirect access posed neither a threat nor a cost to the U.S., though it represented a key choke point where deal opponents could limit Iran’s relief under the accord.

With rising domestic opposition and without a U.S. bank willing to engage in the exchange, the Obama administration appears to have backed down from both efforts involving the Bank Muscat assets and additional plans to put forward a general license to permit dollar clearing. The administration continued to insist publicly that Iran would not have access to the U.S. financial system, while discussions aimed at resolving the issue with both the Federal Reserve Bank and German Central Bank in April 2016 “faded with no resolution.” That same month, Secretary Kerry boasted that predictions of an Iranian windfall were inaccurate since Iran had only received roughly $3 billion of its frozen assets abroad to date. This, of course, angered the Iranians who were still trying to get their assets repatriated. According to the subcommittee report, by January 2017—a full year later—the assets were still sitting in Bank Muscat. The report indicates that Bank Muscat may have “eventually found a way to make small fund transfers without the use of the U.S. financial system,” a far more painstaking approach that apparently took some time to arrange.

Disincentive for Business

The subcommittee report details how important the dollar-clearing issue was for many banks and businesses considering transactions involving Iran. In the hundreds of “roadshows” the Obama administration engaged in to clarify U.S. sanctions policy between August 2015 and July 2016, “one of the most asked questions at these meetings concerned details about access to the U.S. dollar,” according to the report. Licensing banks to clear dollars through the U.S. financial system would have provided substantial reassurance to foreign firms considering reentry into the Iranian market as permitted by the JCPOA. Given the tremendous complication of engaging in any substantial trade with Iran while avoiding the U.S. financial system, combined with a murky political situation in both Tehran and Washington, many businesses chose to stay out of the Iranian market entirely. A May 2016 survey of companies interested in doing business in Iran showed that more than half were wary of reengaging in the Iranian market out of fear of running afoul of U.S. sanctions.

The end result was many deals inked, including the sale of U.S. manufactured Boeing aircraft to Iran, but few realized. With less ongoing business in Iran, Trump’s decision to snap back sanctions and kill the deal despite Iran’s compliance with its nonproliferation obligations was made all the easier. Congressional Republicans, and JCPOA opponents like FDD that sought to stifle Iran’s benefits under the accord, deserve a tremendous share of the blame for the agreement’s ultimate collapse.

Likely the greatest tragedy to this episode is that the Iranian people have been denied the sanctions relief that they made possible by pushing, against the odds, for greater moderation from their government. Sanctions empower authoritarian regimes, as they did previously in Iran by expanding the political and commercial power of the Islamic Revolutionary Guard Corps (IRGC). Now, rather than incentivize moderation by effective implementation of sanctions relief under the JCPOA, the U.S. has empowered the hardliners in Iran who warned that the U.S. could never be trusted to lift sanctions.

This piece originally appears in Lobe Log.

Iran Hawk Accuses Lawmaker of Supporting Iranian Repression During Hearing

WASHINGTON, DC – “It’s imperative that the administration change its direction and work with Congress, along with our European partners, to mitigate the very destabilizing consequences of our withdrawal from the Iran nuclear agreement,” declared Ranking Congressman Peter Welch (D-VT). On June 6, 2018, the Subcommittee of National Security of the Committee on Oversight and Government Reform met to discuss the U.S. withdrawal from the Joint Comprehensive Plan of Action (JCPOA). Rep. Welch put hawkish witnesses on the defensive regarding U.S. options after the collapse of the JCPOA, noting the increased risk that the U.S. will be backed into supporting war and regime change. This led to a shocking moment where one panelist accused him of acquiescing in the repression and torture of citizens by the Islamic Republic of Iran.

When pressed by the Chairman of the subcommittee, Rep. Ron DeSantis (R-FL), on whether the US was pushing toward war with its goal of regime change, Senior Advisor at the Foundation for Defense of Democracies Richard Goldberg dismissed the notion. He claimed that no official “on this panel and certainly in the administration…is coming anywhere near such a policy [of direct military engagement].”

Congressman Welch then asked if statements made by National Security Advisor John Bolton and President Trump’s attorney Rudy Giuliani, who have both been clear in their desire for U.S.-backed regime change in Iran, should be dismissed. He asked Goldberg, “[John Bolton]’s the national security adviser for the president, he said to the American people that our goal should be regime change in Iran. Now you just want to blow him away and say that he didn’t mean it?”

Goldberg pushed on and suddenly accused the congressman of condoning the Iranian regime’s violations of human rights, asking Rep. Welch, “Congressman, are you for repression of the Iranian people, yes or no?” In an incredibly disparaging action towards the congressman, he immediately charged, “Are you for the repression and torture of [Iranians]?”

“There is no one in this Congress, no one in this country, that condones repression anywhere by any dictator in any country, and you know that. I’m asking the questions here,” Welch replied, taken aback by the wild accusation.

Congressman Welch pressed on in questioning the panelists on the Trump Administration’s policy if Iran were to aggressively ramp up its nuclear activities. He posited, “Let me ask this question, what’s the option for the United States, should Iran aggressively restart its activities towards building a nuclear weapon? Who on the panel would favor the use of military action at that point? Just raise your hands.”

David Albright, President for the Institute for Science and International Security, replied “Absolutely,” and Michael Pregent, Senior Fellow at the Hudson Institute, proceeded to raise his hand in favor of future military force against Iran. Dr. Michael Rubin, resident scholar at the American Enterprise Institute who pushed for the 2003 invasion of Iraq and military action against Iran in the past, said: “There’s episodes of overwhelming pressure that has caused Iran to back down…I’ll let history be the precedent on this, Mr. Ranking Member.”

When Congressman Welch pressed the panelists on post-JCPOA policy recommendations, the sole JCPOA supporter on the panel – Jim Walsh, Senior Research Associate in the Massachusetts Institute of Technology Security Studies Program – declared, “We don’t have a strategy and that this puts on a path to war, either by design – regime change – or we back into it as we respond to them a bit – beginning to reinstall their nuclear program.”

The ‘support for the Iranian people’ that Secretary of State Pompeo claims is the Trump Administration’s position was critiqued by Walsh, who stated: “On this issue of the Iranians whom everyone professes such great concern for…the Iranian people are not happy with us – Muslim ban, number one.”

Any military confrontation with Iran will not only embolden hardliners within the country, but will inevitably result in Iranian civilians actively resisting any foreign military aggression, Walsh continued. “A [private] poll came out last month that…asked the Iranian people… ‘How should we respond to the U.S pulling out?’” Walsh noted. “67 percent of Iranians said that Iran should retaliate. Why? Because they’re rallying around their flag.”

Walsh reiterated the fact that if Iran is attacked militarily by the United States, such an attack would damage U.S credibility in the eyes of Iranians. Any direct military strike by the Trump Administration is counterproductive to U.S. interests and only further alienates the Iranian people from any favorable view of America’s agenda in the region. As Dr. Walsh explained, “They may not like the corruption. They may not like the economy. But if you threaten to attack their country, we’re going to help the hardliners. We’re not going to strike a blow for democracy.”

NIAC Calls on Bank of America to End Discriminatory Practices Against Iranian Americans

FOR IMMEDIATE RELEASE
Contact: Jamal Abdi
Phone: 202-386-6408
Email: jabdi@niacouncil.org

Washington, DC – The National Iranian American Council is calling on Bank of America to immediately end discriminatory practices against Iranians and Iranian Americans and to conduct a full review of its procedures related to the suspension bank accounts held by individuals of Iranian descendant.

“Closing bank accounts on the basis of national origin or heritage is discriminatory,” said Jamal Abdi, NIAC Vice President for Policy. “If Bank of America is unable to comply with the myriad of U.S. sanctions on Iran without discriminating against persons of Iranian heritage, it needs to take that up with the U.S. government instead of passing the burden onto ordinary people.”

NIAC has received numerous inquiries and complaints from Iranian visa holders and permanent residents, as well U.S. citizens of Iranian descent, regarding closures of their bank accounts by Bank of America. In one case, and individual was unable to access their own funds when they needed to pay for medical expenses for their pregnant spouse. In other cases, Bank of America has closed accounts and sent reimbursement checks that have been lost in the mail.

“As tensions rise between the U.S. and Iran, we are concerned that ordinary Iranians and Iranian Americans will be caught in the middle,” said Abdi. “ We cannot allow entities like Bank of America to protect themselves at the expense of the rights and protections of their customers.”

Following the discriminatory measures taken by Bank of America in the wrongful closing and seizure of bank accounts belonging to Iranian Americans, NIAC delivered a letter to Bank of America CEO, Brian T. Moynihan, voicing the concerns of the Iranian-American community. NIAC had previously been in contact with Bank of America over related concerns in 2014 and received only perfunctory responses and no willingness by Bank of America to review or adjust its policies.

NIAC has addressed similar concerns with several banks and businesses that have engaged in discriminatory practices in the name of complying with U.S. sanctions on Iran, including other major banks and large corporations like Apple. In some cases, NIAC was able to help facilitate policy changes by the business, in other cases NIAC was able to secure necessary adjustments to U.S. sanctions policies.

NIAC is open to working with Bank of America to ensure that the rights of its customers are protected. NIAC will continue to to protect against violations of civil liberties targeting the Iranian-American community and ensure that all possible avenues for resolving such violations are pursued.

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Why Trump’s Strategy for Iran Is Likely to Lead to War

Iranian protesters burn a US flag in Tehran on May 11, 2018, following President Donald Trump’s decision to end the 2015 nuclear deal. (Reuters / Tasnim News Agency)

Secretary of State Mike Pompeo’s speech on May 21 only reinforced what was already known about Donald Trump’s strategy for Iran: Either the president is ratcheting up the pressure on Tehran to get a “better deal,” which is the official story and the gist of Pompeo’s message, or he is merely pretending to be interested in new negotiations, while putting into place the building blocks for a military assault on Iran. Yet even if Trump genuinely seeks new negotiations, he is more likely to end up in a war, because the very premise of Pompeo’s speech is false. That’s because more pressure on Iran would not have secured a better nuclear deal in 2015—it would only have led to war, or to a nuclear Iran.

A persistent mythology on the right insists that President Obama botched his own Iran strategy because he lacked the backbone to fully squeeze Tehran. Obama had assembled an impressive sanctions regime that was doing significant damage to Iran’s economy. With the value of its currency cut in half, its oil sales reduced to a trickle, and its GDP contracting by roughly 34 percent, Iran was on its knees, this narrative claims. All Obama had to do was to tighten the screws a bit more and give it another six months, and the mullahs in Tehran would have surrendered: No more Iranian nuclear program, no more challenges to US primacy in the Middle East, and no more defiance of Israel.

But, alas, Obama opted for compromise instead of forcing a capitulation. Rather than squeeze the country until it broke, he offered to lift the sanctions if Iran agreed to restrict its nuclear program. Tehran smelled Obama’s weakness, this mythology claims, and happily accepted the undeserved lifeline. The result was the 2015 nuclear agreement, officially known as the Joint Comprehensive Plan of Action (JCPOA), which granted Iran relief from nuclear-related sanctions in exchange for a large reduction in its stockpile of enriched uranium and its number of centrifuges, as well as periodic intrusive inspections of every element of its nuclear-fuel cycle by the International Atomic Energy Agency. Iran would still be able to enrich uranium, but only to 3.67 percent—well below what’s needed to produce a nuclear weapon.

Now Trump is seeking to reverse this alleged mistake by reimposing sanctions. Then, once the moment is right, he will go back to the negotiating table—this time not to negotiate, however, but to accept Iran’s capitulation. It all sounds so wonderful, simple, and tidy. What could possibly go wrong?

Everything. Indeed, the very premise of the right-wing narrative is wrong: Iran was not about to capitulate, and US leverage over the country was waning—not growing. When Obama first sought to cripple Iran’s economy to force Tehran to submit, Iran responded by doubling down on its nuclear program. When Obama took office in 2009, Iran operated roughly 8,000 centrifuges; by 2013, it had added another 14,000. Iran had also increased its stockpile of low-enriched uranium eightfold and significantly advanced its nuclear know-how, all of which provided Tehran with counter-leverage. In January 2012, the United States estimated that Iran’s breakout capacity—the time it would take to have enough material for one nuclear bomb—was 12 months. By 2013, that time had shrunk to eight to 12 weeks.

As a result, Iran was outpacing the United States in building leverage. By early 2013, Obama realized that if nothing changed, Washington would soon have only two options: Either accept Iran as a de facto nuclear power, or go to war. Iran would be able to achieve a near-zero breakout capacity before its economy collapsed, so letting the sanctions bite for another six months would only increase the likelihood of war—not the likelihood of Iran’s surrender.

This is why, in March 2013, Obama did the unthinkable. In secret negotiations, he broke with past US policy and offered to accept, given sufficient transparency and limitations, the enrichment of uranium on Iranian soil. This was Iran’s bottom line: It was willing to endure almost any economic hardship before it gave up enrichment. (Most nations, including some involved in the negotiations leading up to the JCPOA, accept Iran’s right to enrich uranium under the Non-Proliferation Treaty, to which it is a signatory, but this had been a sticking point for US and European Union negotiators.)

Obama knew all along that no nuclear deal would be possible unless he conceded this point. But the plan was to play the enrichment card at the end of the negotiations, since it was the United States’ most valuable concession. Instead, Obama had to play it at the outset. It was this move, not the sanctions policy, that ultimately elicited Iranian flexibility and paved the way for a nuclear deal.

Yet the Obama administration also planted the seeds of the right-wing narrative that Trump is now using. Recognizing that domestic political opposition to a deal with Iran might shoot through the roof if the administration admitted the limits of its sanctions policy—as well as the reality that Tehran had outpaced Washington in the leverage department—the Obama team insisted that sanctions had brought Iran to the table.

It was a formulation that falsely credited sanctions, rather than the US concession on enrichment, for the diplomatic breakthrough and gave the impression that the United States had been operating from a position of strength. In fact, the full details of the secret negotiations with Iran, including the intricacies around the enrichment concession, first came to light through the publication of my book Losing an Enemy: Obama, Iran, and the Triumph of Diplomacy.

By using language that insisted the United States was operating from a position of overwhelming strength, the Obama administration helped to give birth to a persistent question: If the sanctions were so successful in forcing Iran to the negotiating table, why didn’t the administration continue the sanctions until Iran capitulated fully? In response, Obama had to gently walk back his claims. “Iran is not going to simply dismantle its program because we demand it to do so,” he admitted on April 2, 2015. “That’s not how the world works, and that’s not what history shows us. Iran has shown no willingness to eliminate those aspects of their program that they maintain are for peaceful purposes, even in the face of unprecedented sanctions.”

Other officials, speaking privately, put it more bluntly. “The Iranians simply won’t capitulate,” even if faced with war, a senior Obama official said during a closed briefing at the White House that I attended in July 2015. “Because they’re Iranians,” he added after a brief pause.

But the damage had already been done, and the right-wing mythology started to take hold. Today, it constitutes the basis for Pompeo’s speech and Trump’s Plan B. But even if the Trump team manages to rebuild the sanctions coalition against Iran—which remains unlikely, given the strong support for the JCPOA by the European Union as well as by Russia and China, all signatories to the agreement—it is difficult to imagine Trump succeeding where Obama failed: That is, by overwhelming Iran with pressure that would force it to surrender rather than expand its nuclear program.

When Obama realized the limits of sanctions and pressure, he avoided war by going to the negotiating table. There’s little indication that Trump is capable of the same courage and prudence. Indeed, with Mike Pompeo as secretary of state and John Bolton as national-security adviser—both anti-Iran hard-liners—Trump’s strategy seems designed to fail. Instead of a Plan B aimed at securing Iran’s capitulation, it appears designed to pave the way for Plan C: War.

This piece originally appeared in The Nation.

Iran’s Leadership After Trump Abandons The JCPOA

With Donald Trump abandoning the JCPOA, all eyes are now on Tehran. How will Trump’s unilateralism affect the balance of power in Iranian politics? As America seeks to re-impose sanctions, conventional wisdom presumes that Hassan Rouhani and his team are now marginalized. However, declarations of their demise are premature and ignore Iran’s motivations for coming to the negotiating table: maintaining unity among the ruling elite and deflecting responsibility for successful diplomacy onto Washington.

Rouhani and Supreme Leader Ali Khamenei have made a concerted effort to portray unity on policy issues – nuclear deal or not – regardless of their respective disagreements. Neither wants to encourage extremists who created the political and economic mess that plagued Iran prior to Rouhani’s election. To that end, it is widely understood that Rouhani needs Khamenei’s support to govern effectively, but the degree to which Khamenei also needs Rouhani is drastically underestimated.

Extremists controlled the presidency from 2005 to 2013, and the results are clear: Iran isolated on the world stage, and a steady deterioration in state-society relations. Mahmoud Ahmadinejad’s presidency caused massive political and economic damage to Iran, presenting Khamenei with daunting challenges: unemployment, inflation, brain drain, domestic industrial malaise, and scant foreign investment. Sanctions exacerbated these problems but did not cause them. Mismanagement and corruption plagued Iran’s economy before America’s previous economic assault – and will continue to do so after this latest barrage.

Khamenei cannot fix these problems alone because the only alternative to Rouhani’s team is the same motley crew responsible for Iran’s aforementioned strategic ineptitude. Precisely because Khamenei is not suicidal, he will use Rouhani’s consensus-building skills and technocratic team to help stabilize the economy and manage state affairs – especially as Iran is under siege. Iranian politics are fractious, but the same majority of elites who backed Tehran’s nuclear negotiations strategy remains intact today. The people attacking Rouhani now have done so since he entered office.

Rouhani also helped Khamenei achieve an arguably more important strategic objective: Reducing domestic political pressure by shifting the onus of U.S.-Iran conflict onto Washington. During JCPOA negotiations, Khamenei repeatedly reassured Iranian society that the government would only accept a deal that safeguards their rights and interests. His emphasis on Iranian society highlights his concern over who bears responsibility for the conflict: Tehran or Washington. For Iran’s leadership, it is more important to ensure that Iranian society will not blame the government for sanctions than it is to get sanctions lifted.

Rouhani’s team sold negotiations to Khamenei by arguing that proving Tehran’s openness to diplomacy puts the onus on Washington to produce a viable deal and adhere it to. Khamenei then sold the JCPOA to Iran’s state and society by arguing that a deal puts the onus on Washington to compromise and live up to its commitments. With Trump walking away, Khamenei will say “I told you so” – but also support negotiations with everyone not named America to show that Washington, not Tehran, is the intransigent actor.

Both Khamenei and Rouhani have positioned themselves so that they cannot fully lose. If the JCPOA dies, neither Khamenei nor Iranian society will blame Rouhani because they can correctly accuse Trump of killing the deal despite Iranian compliance. Rouhani and Iranian society will not blame Khamenei for the same reason. Political unity will be largely intact, and Iranian officials will also have shifted the blame – at home and abroad – for the failure of diplomacy back onto America.

Not only will Washington fail to coax Tehran into capitulation, it will also help strengthen Iran’s position at home and abroad – at the expense of America’s. Strategic foresight is not the Trump administration’s strong suit. As for Rouhani, he lives to fight another day.

This piece originally appeared in The Progressive Post.

NIAC Statement on Designation of CBI Officials

FOR IMMEDIATE RELEASE
Contact: Jamal Abdi
Phone: 202-386-6408
Email: jabdi@niacouncil.org

Washington, DC – NIAC Vice President for Policy Jamal Abdi issued the following statement regarding the Trump administration’s designation of the governor and a senior official of the Central Bank of Iran:

“Today’s move shows clearly that the Trump administration intends to strong-arm the world into compliance with its march to war and is willing to risk a global financial crisis to do so. Trump is now engaged in an effort to bully the international community into complying with renewed U.S. sanctions rather than sustaining the nuclear agreement that the U.S. helped to negotiate and endorsed through the UN Security Council.

“As European governments are desperately trying to save the Joint Comprehensive Plan of Action, the Trump Administration is attempting to shock European companies to pull out of the Iranian economy. If successful, Trump will fully dismantle the accord – including freeing Iran’s nuclear program from the significant constraints and inspections currently in place.This abuse of the secondary sanctions tool increases the likelihood that Iran will join the U.S. in abandoning the accord, leading to an escalation towards war.

“The Trump administration has made painfully clear to Congress, the Europeans and other international actors that it does not value their cooperation or partnership. It is up to the U.S. Congress, European countries and others to take measures now to preserve the JCPOA and prevent Trump from escalating towards war with Iran.”

Trump Vindicates Iranian Hardliners And Victimizes Ordinary Citizens

When the Joint Comprehensive Plan of Action was announced in 2015, the Iranian people poured into the streets to celebrate what they thought was the beginning of a new era.

Long squeezed by both U.S. pressure and their own government, they had just cause for optimism. The threat of war was receding, and the sanctions that had stifled Iran’s economy were soon to be lifted. Many hoped that Iranian President Hassan Rouhani ― vindicated by his success at the negotiating table ― would leverage his political capital and ease Iran’s harsh security environment at home.

Today, as U.S. President Donald Trump tears up the agreement, the Iranian people are once again those who will suffer most. Iranian hardliners, empowered by the deal’s failure, are sharpening their knives for Rouhani and Foreign Minister Javad Zarif, and the chances of catastrophic war are undoubtedly greater.

Iran did everything it needed to to comply with the accord’s terms, destroying the core of its reactor at Arak, empowering International Atomic Energy Agency inspectors and dramatically limiting its uranium enrichment program. Sanctions were initially lifted under President Barack Obama, and Iran saw some limited relief. But that long-overdue optimism was quickly halted by the election of Trump, who vowed to terminate the agreement struck under his predecessor. Iran’s hopes for a brighter future had been turned over to a reality TV star turned demagogue.

Doubts about whether Trump actually meant what he said during his volatile campaign were put to rest in the first week of his presidency, when he banned Iranians and many others from entering the United States on the basis of little more than bigotry.

Shortly after the ban, Trump began subjecting the nuclear deal to a death by a thousand cuts. Major deals with international companies like Boeing never came to fruition. European banks, fearful of U.S. sanctions that remained on the books, refused to re-enter the Iranian market. Moreover, Trump and his top officials repeatedly violated the accord, warning foreign companies against doing business with Iran while leaving the implementation of U.S. commitments in doubt. 

And in March, Trump began elevating the most caustic voices on Iran to key national security positions. John Bolton, who has never stopped calling for bombing Iran and took money from a despised Iranian terrorist cult that seeks regime change, became national security adviser. Mike Pompeo, one of the foremost opponents of the nuclear deal, is now secretary of state. The threat of war has returned, this time more imminent than ever before.

Many Iranians are again feeling hopeless ― due to a variety of factors, not the least of which is an economy stifled by sanctions ― a fact that manifested in December and January when Iran was rocked by the largest protests since the 2009 Green Movement. Yet, many stayed home ― not out of support for the regime but out of fear for what might come next.

Iranian students protest at the University of Tehran during a demonstration driven by anger over economic problems, in the capital Tehran on December 30, 2017. (AFP/STR/Getty Images)

Now the hardline narrative ― that the United States cannot be trusted and will never lift the sanctions ― has been vindicated by Trump’s shortsighted and self-serving decision to abrogate the nuclear accord. The hardliners seek to seize back all levers of power from moderates like Rouhani and Zarif, to destroy hopes for reform and to ensure the elevation of a hardline successor to Iranian Supreme Leader Ali Khamenei. If they succeed in doing so, it will mean greater repression at home and escalation abroad.

Yet, much like hardliners in Washington, Iranian hardliners have no good “plan B” for what comes after the deal. And, given the suddenness of Trump’s decision to rip up the deal without an Iranian violation, Rouhani and Zarif have been given one last chance to salvage nuclear compromise and to prevent Trump’s war cabinet from finding a justification to put their war and regime change plans into place.

European Union foreign policy chief Federica Mogherini has vowed that Europe will stick with its commitments under the deal, acting within its security interests and protecting its economic investments. French President Emmanuel Macron has warned that Trump’s decision threatens the very fabric of the nonproliferation regime. Critically, Rouhani as well has indicated that Iran can achieve benefits under the JCPOA without the United States. This sets the stage for a last-ditch effort for Europe, Russia, China and Iran to negotiate a follow-on deal, with Europe taking steps to mitigate the effects of U.S. sanctions re-imposition and protecting companies doing business with Iran.

But the chances for such a follow-on agreement, even absent Trump, are slim.

Europe, in particular, is extremely vulnerable to U.S. sanctions, and Europe has been slow to recognize that its best hope for keeping the nuclear deal rests not with cultivating Trump but in blocking Trump. Israel and Saudi Arabia also hold many cards that could short-circuit diplomacy and drag the United States into direct military confrontation.

The majority of the Iranian people, though, have little choice but to hope that Rouhani and Zarif can navigate these treacherous waters, lest Iran be torn apart by outside powers, just like Iraq and Syria before them.

This piece originally appeared in The Huffington Post.

That Was No Typo On Iran’s Nuclear Program

Many were surprised Monday night when, responding to Netanyahu’s presentation digging up old details of Iran’s nuclear program, the White House issued a statement claiming the details verified what the U.S. has long known: that “Iran HAS a robust, clandestine nuclear weapons program that it has tried and failed to hide from the world and from its own people.”

However, Iran signed a nuclear deal in 2015 that ensures that Iran does NOT have an active nuclear weapons program, as the International Atomic Energy Agency has verified repeatedly since the deal went into place in January 2016. The White House quickly backtracked, correcting the statement to say that Iran “had” a nuclear weapons program and describing the error as a “typo.” Unfortunately, there is strong evidence that it was not a typo, but instead exactly what Trump’s national security advisers want the public to believe and are telling the President behind closed doors. The end result is likely to be the unraveling of a working nonproliferation agreement and an escalation toward another disastrous war of choice in the Middle East.

The word choice was likely that of John Bolton, Trump’s national security advisor who has repeatedly and unabashedly called for bombing Iran, discounting basic facts about the nuclear accord in the process. Bolton, of course, believes that Iran HAS an active nuclear weapons program. In January, a few months before his appointment to the White House, hewrote in The Wall Street Journal that “there is no evidence Iran’s intention to obtain deliverable nuclear weapons has wavered.” To arrive at that assertion, one must discount the facts that Iran ripped out 13,000 of its centrifuges, halted uranium enrichment at the deeply buried Fordow nuclear facility, destroyed the core of its reactor at Arak and invited nuclear inspectors in to inspect its entire nuclear cycle. Yet, Bolton did so just before arriving in the White House.

Perhaps you think Bolton miswrote in the Wall Street Journal? Think again. In October, when detailing a plan to withdraw from the nuclear deal and prepare for war and regime change in Iran, Bolton stated that the deal shields Iran’s “ongoing efforts to develop deliverable nuclear weapons.” There are 159 pages of the Iran nuclear deal, not to mention countless IAEA reports, that could be entered into evidence to disprove Bolton’s notion. You could also go back further. Bolton addressed the cult-like Mujahedin-e-Khalq in July, which was designated as a terrorist organization until 2011 and still seeks the violent overthrow of the Iranian regime, stating contrary to any evidence that Iran continues to “work with North Korea on nuclear weapons.”

View the full post on The Iranian…

Kicking the Hornet’s Nest: Consequences of Trump’s May 12 Iran Deal Decision

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President Trump has threatened to put the U.S. into material breach of the Iran nuclear deal, also known as the Joint Comprehensive Plan of Action (JCPOA), by failing to renew nuclear sanctions waivers by the May 12 deadline. As a result, it is necessary for policymakers to think clearly regarding the consequences of a U.S. material breach of the accord, including the collapse of the JCPOA, Iranian nuclear expansion, diminished U.S. influence with its allies, and a growing threat of war under Trump and his hawkish advisors.

Immediate Breach of the Accord

If the President refuses to waive sanctions on May 12, nuclear-related sanctions on the Central Bank of Iran passed via Section 1245 of the FY2012 National Defense Authorization Act (NDAA) would snap back into place, resulting in an immediate material breach of the JCPOA. Under this provision, countries must reduce their oil purchases from Iran or the U.S. will cut off that country’s financial institutions that transact with Iranian banks from the American economy. This would not reimpose all of the sanctions that the U.S. is obligated to waive – the next sanctions waiver deadline is 60 days later and pertains to the vast majority of nuclear-related sanctions. But by targeting both oil sales and banking, driving down oil sales and forcing companies to withdraw from the Iranian market, the U.S. would not just violate the agreement but would be unravelling the core of Iran’s incentives to remain compliant with the terms of the JCPOA.

Even if the administration seeks to dull the initial impact by delaying enforcement, as some have suggested may be its plan, the failure to waive will result in a material breach of the agreement. The text of the JCPOA also makes clear that a failure to waive sanctions on May 12 would result in an immediate breach. The U.S. is obligated to “cease the application” of  nuclear-related sanctions including the Central Bank sanctions contained in Section 1245 of the FY12 NDAA. Moreover, the U.S. has committed to “refrain from re-introducing or re-imposing the sanctions” lifted under the deal, while the JCPOA indicates Iran will treat such re-imposition “as grounds to cease performing its commitments under this JCPOA in whole or in part.” As former administration officials Rob Malley and Colin Kahl recently wrote, “in the absence of Iranian violations of the deal, the United States would be in material breach of the agreement the moment Trump refuses to waive U.S. sanctions, even as the deal’s other signatories remain party to it.”

The Trump administration has already violated the JCPOA repeatedly by any objective measure, including by actively warning foreign companies against doing any business in Iran, refusing to issue licenses for the sale of aircraft to Iran and holding U.S. implementation of the accord in doubt. While these violations have been serious, they have not struck directly at the core of the bargain. Reinstating oil sanctions would be a direct attack on the core benefit and put the U.S. in material breach.

Death of the Deal

Iranian Foreign Minister Javad Zarif has indicated that if the U.S. withdraws from the accord, Iran will do the same. The JCPOA includes a dispute resolution mechanism wherein Iran would be able to file an official complaint regarding U.S. failure to meet its sanctions-lifting obligations, a forum where the U.S. would be isolated following a U.S. breach. If Trump refused to correct the breach, Iran “could treat the unresolved issue as grounds to cease performing its commitments, in whole or in part, and/or notify the UN Security Council that it believes the issue constitutes significant non-performance,” according to the text of the agreement. In other words, Iran would have sufficient grounds to orchestrate a withdrawal from its JCPOA obligations while pinning the blame on the United States.

Other Iranian officials have suggested that Iran will resume many of its nuclear activities that deeply concerned the international community prior to the JCPOA. While it is unclear precisely how far Iran would go, Iran could:

  • Bring advanced centrifuges online or resume enrichment at the deeply-buried Fordow nuclear site;
  • Begin enriching uranium beyond 3.67%, potentially up to 20% or higher;
  • Expand beyond 300 kg of enriched uranium to sufficient quantities for multiple nuclear weapons with further enrichment;
  • Limit International Atomic Energy Agency (IAEA) inspector access, including access to suspect undeclared sites, uranium mines and mills and centrifuge production facilities.

Iranian officials have also suggested that their commitment to the Non-Proliferation Treaty – the foundation of the non-proliferation regime – could be jeopardized by a JCPOA withdrawal. While that would be an extreme measure that could ratchet up tensions significantly, the possibility cannot be ruled out in the event of a shocking unilateral U.S. rupture of a carefully-crafted diplomatic agreement that was narrowly secured against the opposition of many hardline interests in Tehran..

Isolated from Allies

It is no coincidence that both French President Emmanuel Macron and German Chancellor Angela Merkel traveled to Washington the same week, shortly before the May 12 deadline, to speak with Trump about the JCPOA. America’s European allies are extremely concerned that Trump will follow through and terminate a deal that is in the best interests of the transatlantic relationship, global security and the nonproliferation regime, with devastating results.

Macron has made clear that he is willing to work with Trump to address issues outside the scope of the JCPOA, including Iran’s missile program and regional security issues such as Syria, as part of a “grand bargain.” There are numerous uncertainties regarding Macron’s approach – after all, Iran would likely be unwilling to engage on a new deal when the U.S. has failed to implement the JCPOA. However, it is also clear that the U.S. would forfeit such coordination with its allies if the foundation of the JCPOA is terminated by a unilateral U.S. withdrawal, as Macron warned is still the most likely outcome.

As more than 500 members of the United Kingdom, French and German parliaments recently warned in an unprecedented letter to the U.S. Congress, “if the deal breaks down, it will well-nigh be impossible to assemble another grand coalition built around sanctions against Iran. We must preserve what took us a decade to achieve and has proven to be effective.” Absent the leverage provided by close cooperation with our allies, there is no chance for a “better deal,” and serious risks that there would be no deal after the JCPOA whatsoever.

If Trump follows through and terminates the JCPOA, the U.S. will be put in the difficult position of threatening sanctions on the foremost companies of many friendly countries – including those in Europe, South Korea, India and beyond. This could result in a trade war if those countries take actions to protect their companies from U.S. sanctions enforcement. Moreover, as former Treasury Secretary Jacob Lew warned in 2016, “if foreign jurisdictions and companies feel that we will deploy sanctions without sufficient justification or for inappropriate reasons—secondary sanctions in particular—we should not be surprised if they look for ways to avoid doing business in the United States or in U.S. dollars.”

Another War of Choice    

The elevation of John Bolton to National Security Advisor and Mike Pompeo to Secretary of State ensures that at least two individuals who prefer an Iran war to Iran diplomacy will be advising Trump on the JCPOA and broader Iran policy. Moreover, Trump himself has previewed his hawkish inclinations, warning that if Iran restarts their nuclear program “they will have bigger problems than they ever had before” and “if Iran threatens us in any way, they will pay a price like few countries have ever paid.” In unraveling the nuclear accord and freeing Iran to resume their nuclear activities, Trump would be triggering the very situation where he strongly hinted that he would use military force.

Amid an already ruinous regional proxy war in the Middle East, a war against Iran could be even more disastrous for global security than the 2003 invasion of Iraq. Iran is nearly four times the size of Iraq, with influence in military conflicts from Syria to Yemen and with missiles capable of striking U.S. ships and bases in the region. Bombing cannot erase Iran’s nuclear know-how and would only empower those in Iran eager to obtain a nuclear deterrent. Moreover, it would set the region aflame and draw the U.S. into a prolonged quagmire that would cost American blood and treasure and set U.S. security back decades.

Congress can intervene to check Trump, including by clarifying that the administration does not have authorization to launch a war against Iran. Yet, the clock is quickly running out to save the JCPOA and prevent an escalation to war.

 

NIAC Pushes for Broader Sanctions Exemptions for Humanitarian Relief

Washington, DC – In response to Iran’s deadly 2017 earthquake in Kermanshah province, hundreds of thousands of U.S. citizens donated to humanitarian relief efforts to rebuild devastated areas. Humanitarian relief efforts have long been exempt from U.S. sanctions law, though in practice there continue to be sanctions-related hurdles both in how American citizens contribute to relief efforts and how humanitarian NGO’s are able to finance relief work on the ground. On numerous occasions, NIAC has raised concerns regarding these complications and pushed the administration to ensure that U.S. sanctions were not standing in the way of urgent relief. In November, Sen. Bernie Sanders (I-VT) and four other Senators led a letter urging the administration to broaden its sanctions exemptions to facilitate relief.

On March 22, the Department of Treasury solicited feedback on the effectiveness of its current licensing procedures for humanitarian aid to Iran and Sudan. Given the importance of this issue to both the people of Iran and the Iranian-American community, NIAC submitted comments recommending opportunities for improvements, including by encouraging the Treasury Department to authorize a direct banking channel between the U.S. and Iran to finance relief work. This is of critical importance, as we have heard directly from humanitarian organizations regarding the continued difficulty of finding banks willing to transact with them given the perceived risk of running afoul of U.S. sanctions.

We will continue to work to advance our recommendations and ensure that U.S. sanctions do not inadvertently impede humanitarian relief to the people of Iran. You can see the text of NIAC’s comment below:

ATTN: Request for Comments (TSRA)
Office of Foreign Assets Control
United States Department of the Treasury
Freedman’s Bank Building
1500 Pennsylvania Avenue NW
Washington, D.C. 20220

Re: NIAC’s Comments Regarding OFAC’s TSRA Licensing Procedures

Dear Sir or Madam:

            On March 22, 2018, the United States Department of the Treasury’s Office of Foreign Assets Control (“OFAC”) announced that it was “soliciting comments on the effectiveness of OFAC’s licensing procedures for the exportation of agricultural commodities, medicine, and medical devices to Sudan and Iran.”[1]  OFAC is required to solicit such comments as part of its biennial report to Congress on the operation of the licensing procedures pursuant to § 906 of the Trade Sanctions Reform and Export Enhancement Act of 2000 (“TSRA”) and will consider any such comments during the development of its report to Congress.  

By means of this instant submission, the National Iranian American Council (“NIAC”), the largest grassroots organization in the United States representing the interests of Iranian Americans, submits its comments regarding the effectiveness of OFAC’s licensing procedures for the export of agricultural commodities, medicine, and medical devices to Iran for the time period between October 1, 2014 to September 30, 2016. NIAC submits such comments with the sole intent of encouraging the robust facilitation of humanitarian trade between the United States and Iran in order to benefit the Iranian people, as is the purpose of the underlying TSRA legislation.

  1. Factual Background

            The Trade Sanctions Reform and Export Enhancement Act (“TSRA”), 22 U.S.C. § 7201 et seq., terminates any unilateral agricultural sanction or unilateral medical sanction in effect as of October 28, 2000 against a foreign country or foreign entity and prohibits the President from imposing any such unilateral agricultural sanction or unilateral medical sanction unless a proposed sanction is enacted into law by a joint resolution of the Congress.[2]  However, this provision does not direct the termination of, or prohibit the imposition of, any unilateral agricultural sanction or unilateral medical sanction that prohibits, restricts, or conditions the provision or use of any agricultural commodity, medicine, or medical device that is controlled on the United States Munitions List (“USML”), controlled on any control list established by the Export Administration Act of 1979 (“EAA”) or any successor statute, or used to facilitate the development or production of chemical or biological weapons or weapons of mass destruction.[3]

            Moreover, TSRA provides that the export of agricultural commodities, medicine, or medical devices to Cuba or to any U.S.-designated state sponsor of terrorism shall only be made pursuant to one (1) year licenses issued by the U.S. government for contracts entered into during the one (1) year period of the license and shipped within the twelve (12) month period beginning on the date of the signing of the contract.[4]  OFAC applies the licensing procedures required by this latter provision to all exports and re-exports of agricultural commodities, medicine, and medical devices to U.S.-designated state sponsors of terrorism – including Iran and Sudan – that are within the current scope of OFAC’s licensing jurisdiction.[5]

            Iran remains a U.S.-designated state sponsor of terrorism; and, as such, TSRA’s licensing procedures are applicable to the export of agricultural commodities, medicine, or medical devices to Iran.  These licensing procedures are codified in the Iranian Transactions and Sanctions Regulations (“ITSR”), 31 C.F.R. Part 560.  Section 560.530 of the ITSR promulgates a general license and specific licensing procedure for the sale, export, and re-export to Iran of agricultural commodities, medicine, and medical devices, while § 560.532 of the ITSR identifies authorized means of making payment for and financing any such licensed sales, exports, or re-exports of agricultural commodities, medicine, and medical devices to Iran. 

  1. NIAC’s Comments Regarding OFAC’s TSRA Licensing Procedures

            The most significant impediment to U.S. person engagement in humanitarian trade with Iran remains the lack of a financial channel to remit payment for humanitarian goods.  Despite licensing the making of payments and financing for sales, exports, and re-exports of agricultural commodities, medicine, and medical devices to Iran, OFAC’s licensing procedures have failed to provide U.S. persons with reliable options for receiving payment for the provision of permissible humanitarian items to Iran.  Unable to reliably receive payment for their provision of humanitarian goods to Iran or receive financing to permit the sale of such humanitarian items to Iran, a substantial number of U.S. persons that otherwise would have made use of OFAC’s licensing procedures for humanitarian trade with Iran have elected not to pursue such trade.  This undermines U.S. foreign policy interests vis-à-vis Iran, as well as the purposes underlying TSRA’s legislation, by enacting a de facto embargo on the sale, export, or re-export of agricultural commodities, medicine, and medical devices to Iran. 

            Pursuant to 31 C.F.R. § 560.532(a), OFAC provides general license authorization for the following payments terms for sales authorized under § 560.530(a)

(1)       Payment of cash in advance;

(2)       Sales on open account, provided that the account receivable may not be transferred to the person extending the credit;

(3)       Financing by third-country financial institutions that are not U.S. persons, entities owned or controlled by U.S. persons and established or maintained outside the United States, Iranian financial institutions, or the Government of Iran.  Such financing may be confirmed or advised by U.S. financial institutions and by financial institutions that are entities owned or controlled by U.S. persons and established or maintained outside the United States; or

(4)       Letter of credit issued by an Iranian financial institution whose property and interests in property are blocked solely pursuant to 31 C.F.R. Part 560. Such letter of credit must be initially advised, confirmed, or otherwise dealt in by a third-country financial institution that is not a U.S. person, an entity owned or controlled by a U.S. person and established or maintained outside the U.S., an Iranian financial institution, or the Government of Iran before it is advised, confirmed, or dealt in by a U.S. financial institution or a financial institution that is an entity owned or controlled by a U.S. person and established or maintained outside the United States. 

Section 560.532(c)(2) further states that “[n]othing in this section authorizes payment terms or trade financing involving debits or credits to Iranian accounts, as defined in § 560.320.” 

            OFAC’s licensing procedures prohibit direct interaction between U.S. and Iranian financial institutions, as evidenced above.  Indeed, OFAC itself has stated that “it is contrary to U.S. foreign policy to allow U.S. financial institutions to maintain active correspondent relationships with Iranian banks.”  As a result, any financing for or receipt of payment from the licensed export of agricultural commodities, medicine, and medical devices to Iran must involve a third-country financial institution prior to the involvement of a U.S. financial institution, and U.S. person engagement in humanitarian trade involving Iran is contingent on the willingness of third-country financial institutions to issue letters of credit or otherwise process transactions involving the export or re-export of agricultural commodities, medicine, or medical devices from the United States or by a U.S. person, wherever located, to Iran.

            Unfortunately, OFAC has ample precedent at this time demonstrating that third-country financial institutions are generally unwilling to aid U.S. persons seeking to engage in humanitarian trade with Iran authorized pursuant to 31 C.F.R. § 560.530(a).  As a result, U.S. persons have not taken advantage of the permitted trade openings to the extent that would otherwise be possible if there were a reliable, authorized financial channel to remit funds from Iran to the United States.  OFAC has been presented with numerous options to resolve this ongoing problem, including, but not limited to, a direct financial channel between the United States and Iran for licensed dealings between the two countries.  For reasons that remain unclear, OFAC has chosen not to pursue these solutions and has persisted with an authorization that fails to produce the desired outcome.

            It is NIAC’s hope that OFAC will revisit its licensing procedures, including, most especially, its authorization for making payments and financing for the export and re-export of agricultural commodities, medicines, and medical devices to Iran, and will broaden the scope of current license authorizations to ensure that U.S. persons are able to timely and reliably receive payment and financing for humanitarian trade with Iran.

            III.      Conclusion

            NIAC submits this comment pursuant to OFAC’s March 22, 2018 Request for Comment and hopes that the agency will consider this feedback concerning its TSRA licensing procedures.  It is our considered view that while the agency has made important progress expanding the scope of license authorizations relating to the sale, export, and re-export of agricultural commodities, medicine, and medical devices to Iran – including by broadening the scope of medical devices that are generally authorized for export or re-export to Iran – OFAC should ensure that these license authorizations can be fully utilized by ensuring reliable options exist for making payments for and financing the export of such humanitarian items.  For the reasons explained above, NIAC believes that OFAC’s license authorizations have been under-utilized as a result of the lack of a reliable financial channel to facilitate payments for humanitarian items, and only new solutions – including, for example, a direct financial channel between the United States and Iran – can ease this ongoing problem for U.S. exporters and re-exporters.

[1]Effectiveness of Licensing Procedures for Exportation of Agricultural Commodities, Medicine, and Medical Devices to Sudan and Iran; Comment Request, U.S. Dep’t of Treasury, 83 Fed. Reg.12513, March 22, 2018, available athttps://www.gpo.gov/fdsys/pkg/FR-2018-03-22/pdf/2018-05638.pdf.

[2]See 22 U.S.C. § 7201 et seq.

[3]Resource Center: Trade Sanctions Reform and Export Enhancement Act of 2000 (TSRA) Program, U.S. Dep’t of Treasury, January 13, 2017, https://www.treasury.gov/resource-center/sanctions/programs/pages/tsra_info.aspx. See also22 U.S.C. § 7203.

[4]22 U.S.C. § 7205.

[5]Resource Center: Trade Sanctions Reform and Export Enhancement Act of 2000 (TSRA) Program, U.S. Dep’t of Treasury, January 13, 2017, https://www.treasury.gov/resource-center/sanctions/programs/pages/tsra_info.aspx.

 

FDD Scholar: War with Iran ‘Is On’

“The war is on”, declared Michael Ledeen, a “Freedom Scholar” with the anti-Iran deal Foundation for Defense of Democracies, at an event to discuss Iran policy following President Trump’s appointment of John Bolton and nomination of Mike Pompeo. “We’re in the war now. So all these people who keep on saying, ‘well if we sign, or if we don’t re-sign, or if we renew or we don’t renew (the Iran nuclear deal) then war,’ that’s all crazy. The war — we are in the war.”

Speaking on a panel at the Hudson Institute last week, Ledeen asserted his belief that the Iranian people had asked the U.S. for help in toppling the regime. His assertion was challenged by an Iranian American supporter of NIAC in the audience who asked Ledeen why he felt Iranians would want the United States’ help. “All they have to do is look at the neighboring countries and see that every country the United States has tried to change the leadership there, it has created a stateless country,” she said. “It’s like asking me to go to a doctor who all of his patients have died in the hospital, and asking ‘could you please operate on me?’ Why would they want the United States to aid them for any sort of help in the regime change?”

Ledeen’s response was to insult and bully rather than to engage in serious debate. Ledeen stated, “the question from this woman right here is not a question, but a provocation. So I am sorry that you’ve wasted your time coming here today to voice the line of your friends in Tehran…The reason why the Iranian people look to us for help, support, guidance in carrying out a revolution against the regime is because they hate the regime.” Ledeen then rudely told her to “sit there quietly” as the moderator moved on to the next question. The tense exchange showed both the stakes of the Iran debate in the months ahead – that Trump’s supporters think “war is on” with Iran – and that so-called “freedom scholars” will go out of their way to stifle debate on the road to confrontation.

Hawkishness and dismissiveness of alternative views was not limited to Ledeen. Richard Goldberg, another FDD adviser who served as a staffer for the hawkish former Senator Mark Kirk (R-IL), predicted that Trump would kill the deal. Goldberg indicated that with negotiations between Trump and the Europeans stalled and Bolton and Pompeo poised to enter the administration, “we have set the stage now for the likely exit of the U.S. from the nuclear deal and the potential for re-imposition of sanctions – at least on the Central Bank on May 12th, and perhaps much more.” Goldberg went on to argue that the reimposition of such sanctions, which he helped to initially pass as a staffer in Congress, would help topple the Iranian regime but avoid harming the Iranian people.

I asked Goldberg how the re-imposition of sanctions on Iran could be designed to be in favor of the Iranian people and avoid causing mass devastation. “With respect to our sanctions policy, the Iranian people are our greatest asset and we do not target the Iranian people, we do not target them, we have no quarrel with them,” Goldberg said. “And so our policy, when it targets the Central Bank of Iran (CBI), when it targets government banks, when it targets the Supreme Leader’s empire, this is about the lifeblood that keeps the Islamic Republic in business of oppressing its people.”

Goldberg’s answer might sound persuasive, yet the reality is that ordinary Iranians themselves are intricately connected to the Iranian economy and banking system – not just the regime. There is absolutely no way a country’s entire banking system can be sanctioned without its people suffering the consequences of the sanctions. We saw this at the height of nuclear sanctions, where the Iranian people suffered from mass unemployment and sanctions while the Islamic Revolutionary Guard Corps (IRGC) expanded its business empire.

Michael Pregent, a fellow with the Hudson Institute, stated that president Trump “has his Iran team in place,” with John Bolton in as National Security Advisor and Mike Pompeo hoping to be confirmed as Secretary of State. If Pompeo and Bolton share the Hudson panelists’ proclivities, it appears that war could be very difficult to avoid.

“Peace is not the opposite of war,” Ledeen ominously concluded. “Peace is the result of war. Peace happens when a war is fought and one side beats the other.”