Washington, DC – “We don’t really have evidence at this stage that sanctions work,” said Brookings Institution senior fellow Suzanne Maloney on Friday. “They haven’t produced compromise, even though … the sanctions regime is far more muscular than it has ever been.” Maloney was joined by Johns Hopkins doctoral candidate Kevan Harris at a Woodrow Wilson Center event focused on the Iranian economy under the sanction regime. The panel discussion was moderated by United States Institute of Peace (USIP) senior fellow Robin Wright and was the third event based on USIP’s Iran Primer.

Maloney argued that, while the Iranian economy is the “central factor in the evolution of the Islamic Republic,” the only effect of recent sanctions on Iran’s policies has been to “persuade the Iranians to institute measures of greater economic efficiency, including the subsidy reform program.”

Harris also emphasized that incorrect assumptions frame much of the discourse on Iran’s economy. “You read the newspaper sometime and they say that ‘we have to negotiate with Iran and understand that they have a bazaari mentality,’” he said. “That’s like the Iranians saying ‘we have to negotiate with the United States and understand that they have a used car salesman mentality’ – some kind of cliché that is not only a little bit insulting but just not accurate.” Although the bazaar was able to mobilize people to weaken the Pahlavi regime, Harris argued that the bazaar today is a far weaker economic actor in Iran, and it would be a mistake to assume that the bazaar would form alliances with other political and economic actors against the present regime.

Maloney stated that the sanctions are “painted with a fairly broad brush,” making it difficult to finesse their complexities. The result is that “there is almost nothing that can be done to reward small, confidence-building measures from Tehran in terms of compensatory or commensurate, modest relaxation of sanctions.” Because of this all-or-nothing structure, Maloney said, “I think we haven’t yet seen evidence that sanctions can actually create an effective path to a negotiated solution.”

Given the success of the Tunisian and Egyptian revolutions, Maloney also called attention to the unintended consequences of sanctions and international isolation on the Iranian people. The young people in Egypt and Tunisia who propelled their countries’ pro-democracy movements had opportunities and access to technologies, she argued. In a warning to U.S. policy-makers, Maloney cautioned, “If we create a young Iranian population who has none of these opportunities, who sees none of that future in front of them, I worry that we’re creating an Iran that will someday look more like Pakistan or Iraq than like Egypt or Tunisia do today.”