On Monday, July 1 new Executive and Congressional sanctions on Iran, put in place before Iran’s recent elections, came into force. These new sanctions target the shipping and automobile sectors, financial transactions involving gold, and holdings of Iran’s currency, the rial. These latest sanctions come amid a growing debate over whether sanctions could undermine diplomatic opportunities and moderates within Iran in the wake of Iran’s recent elections. However, there is little sign that the sanctions will abate, with the House of Representatives considering a floor vote on new, sweeping sanctions in the weeks before Iran’s President-elect, Hassan Rouhani, even enters office.
Rouhani’s ability to deliver and change the policies of the Iranian government remains a question mark. During his campaign, the former nuclear negotiator pledged to “pursue a policy of reconciliation and peace” with the outside world, release political prisoners, and potentially to make Iran’s nuclear program more transparent in order to ease tensions with the West. But his political flexibility may be limited in the face of intensifying economic pressure and fear that the United States is only interested in regime change.
Some in Congress have been spurred by outside groups hostile towards a diplomatic resolution to the standoff with Iran. On June 28 dozens of members of the House Committee on Foreign Affairs sent a letter, sponsored by the American Israel Public Affairs Committee (AIPAC), to President Obama expressing their support for additional sanctions and urging the President to “increase the pressure on Iran in the days ahead.” The 46 members that signed the letter stated that “Iran’s election unfortunately has done nothing to suggest a reversal of Iran’s pursuit of a nuclear weapons capacity,” and that “Iran’s nuclear program and foreign policy rest mainly in the hands of Iran’s Supreme Leader Khamenei.”
However, others in Congress have warned against a new round of sanctions. Representatives Keith Ellison (D-MN) and Jim McDermott (D-WA) wrote in Politico on Monday, “It would be a mistake to impose new sanctions on Iran before giving Rouhani the chance to put his words into action.” They argue that further sanctions would “jeopardize a crucial opening” for Iranian moderates and be perceived negatively by Iranians who voted for change. The Congressmen wrote that doing so would send a message to Iran that “no matter what you do, the United States will respond only with more crippling pressure,” which would provide no incentive for Iran to seek a negotiated solution.
For his part, President Obama expressed “cautious optimism” in light of Iran’s election. Denis McDonough, Obama’s Chief of Staff, stated on CBS’s “Face the Nation,” that the election of Hassan Rouhani is potentially a “hopeful sign.” Further, McDonough said that “the question for us now is, if he (Rouhani) is interested in, as he has said in his campaign events, mending Iran’s relations with the rest of the world, there’s an opportunity to do that.”
Iran, meanwhile, condemned the new sanctions and instead called for the removal of sanctions as a “confidence building measure.” Iranian Foreign Ministry Spokesman Abbas Araqchi stated that the new sanctions put in place last week were the “wrong step at the wrong time” and that they would only further complicate measures to resolve the standoff.
U.S. policymakers and experts, while not calling for sanctions to be removed, have urged that no further sanctions be ratcheted up ahead of Rouhani’s inauguration and that existing sanctions be exchanged in negotiations for Iranian nuclear concessions.
Former Obama Defense Department official Colin Kahl and senior policy analyst at the RAND Corporation Alireza Nader argued, “Rouhani needs some time to get his bearings, form his government, and convince regime hard-liners to give him a chance.” They add that, “Piling on additional sanctions now, in apparent disregard of the election results, could undermine this process.” Only two weeks after the election and nearly a month away from taking office, Rouhani has not yet had time to alter the course Iran has taken under Ahmadinejad.
The reaction of the western world will be critical to how far Rouhani can go to alter that course. “The Iranians missed a major opportunity in 2009 when they assumed that President Obama would be no different from previous US leaders and then acted according to that assumption. Tehran’s non-responsiveness rendered Obama’s job to change the relationship more difficult”, stated Trita Parsi, the President of the National Iranian American Council. “Washington should be careful not to commit that mistake” says Parsi.
The Obama administration, despite allowing new Executive sanctions to proceed as planned, has shown some signs of wariness toward the imposition of further sanctions at this time. Secretary of State John Kerry argued before the Senate Foreign Relations Committee in April that increasing economic penalties on Iran just a few months before the elections could close the window to “work the diplomatic channel.” With the election now concluded, and a major potential opportunity for new negotiations, it remains to be seen whether the administration will delay consideration of new sanctions or continue to ratchet up economic pressure on Iran indefinitely.