Patrick Clawson is senior fellow at the National Defense University's Institute for National Strategic Studies and senior editor of Middle East Quarterly. The views expressed here are his alone. This article derives from a longer study, Business as Usual? Western Policy Options toward Iran, published by the American Jewish Committee.
The U.S. government speaks with strong language about Tehran's unacceptable behavior, and has followed up that talk with vigorous action: instituting a near total ban on trade, lobbying hard against politically loaded loans and investments, and pressuring Russia to cancel the sale of a nuclear-power reactor.
This policy is not popular among U.S. foreign-policy experts, specialists on Iran, or the other major powers, most of whom prefer a "critical dialogue" with Tehran, as the European Union (EU) calls its policy. What explains these differences? Which side is right?
The debate centers on three major points of disagreement: commercial factors, geostrategic visions, and the possibility of reinforcing moderates. On each point, it turns out, the U.S. government's position fits the facts far better than does that of its critics. Washington has read correctly the historical record, whereas its critics have not absorbed the lessons from the last fifteen years about what does and does not work with Tehran. Washington also understands Iran's basic weakness, while the critics exaggerate Iran's importance.
Commercial motivations go far to explain European and Japanese attitudes toward Iran. As France's Prime Minister Edouard Balladur said in March 1995, while "we French want to respect human rights . . . we have an economic position to defend in the world," so France would have to "find a good balance" between the two.1 This emphasis on the value of commercial ties with Iran has led Tehran to conclude that, in the words of the Financial Times, "whatever Iran may say, and perhaps do, the commercial self-interest of competing nations will ultimately work in Iran's favor."2
Americans might find it tempting to argue that the United States has taken a principled stand while the Europeans and Japanese are ready to sell their souls. And it is true that the U.S. government historically has placed less importance on market considerations than the other major powers. However, commercial factors have in fact influenced the foreign-policy stance of recent U.S. governments, and most especially of the Clinton administration (think of China). On Iran, U.S. policy reflects not so much the lesser weight given to economics by the United States as a lesser perception of the importance of Iran's business. Europeans see Iran as a market worth selling their soul for access to, leading to vigorous business pressure for better relations with Iran. U.S. firms are not impressed with this market, and so have not lobbied for compromise and accommodation with Tehran (in contrast, again, to their activities on behalf of China). This raises the issue: just how attractive is the Iranian market?
Europeans and Japanese consider Iran to be an important market because they have in mind the experience of the 1970s, when Iran was a major trading partner: in 1977, the country imported $14 billion, or 1.5 percent of total world imports, an impressive figure. But Iran's economic importance faded as the world oil shortage gave way after 1985 to an oil glut. Imports in 1994 were less than 0.5 percent of total world imports, a fall of two-thirds.
A temporary import boom in the early 1990s may have convinced the Europeans and Japanese that Iran remains a lucrative market. In 1988, the year before `Ali Akbar Hashemi Rafsanjani became president, Iranian imports were $8 billion. In 1992, as he finished up his first term as president, imports were $23 billion, almost three times as high. But the Iranian import boom of 1989-92 was built on sand. Of the $72 billion in imports during those four years, only 60 percent was financed by Iran's earnings; the remaining 40 percent, or $30 billion, was borrowed. It should have surprised no one that Iran ran into a debt crisis in 1992-93, and that Iran's imports fell to $13 billion in 1994.
The U.S. government and its critics differ in their assessment of Iran's geostrategic position. Washington understands that Tehran no longer matters much on the world strategic plane, while Europeans retain the out-of-date view that Iran is a strategic prize.
Germany has a special historical relationship with Iran, having since the late nineteenth century sought influence in the northern tier of the Middle East from Turkey to Iran to Afghanistan. Iranians recall Germany's key role in creating the modern economic institutions of Iran (such as the Central Bank and the railroad) during Reza Shah's rule, 1921-41; and Germany has enjoyed a particularly large share of Iran's trade through most of the postwar period. Iran and Germany have each found the other an attractive partner to bypass, check, or counterbalance the weight of other great powers (for Iran, Britain and then the United States; for Germany, usually Moscow).
The other powers, lacking Germany's historical ties to Iran, focus much more on oil. In addition, they look at Iran's geographic position and its influence on the world's Muslims.
Oil. For many decades, and especially in the period of oil crises, 1973-80, energy security depended on political alliance. Government-to-government ties mattered more than market forces. For example, American oil companies received a larger share of Iranian production after the Central Intelligence Agency helped Shah Mohammed Reza Pahlavi return to power in 1953. Today, many political leaders continue to think about the oil trade in terms of politics: from this perspective, the United States has a lock on the Persian Gulf oil giants (Saudi Arabia, Kuwait, and the United Arab Emirates), leaving other major powers to scamper for political relations with the remaining oil exporters. French policy toward Iraq and Iran is intended to break a perceived Anglo-Saxon oil monopoly. Similarly, many politicians in Germany and Japan seek a special relationship with Iran.
But the oil industry has changed profoundly since 1980: the free market now reigns. The price of oil is set far more at the commodity exchanges than by decisions of the Organization of Petroleum Exporting Countries. Political friendships no longer have their former value. Therefore, a special relationship with Iran matters little for oil security.
Further, Iran's importance as an oil exporter is declining. Its oil fields are old and its reserves expensive to develop. Iran has to strain to maintain production at the current 3.6 million barrels per day (mbd), which is less than what it produced in 1970 (3.8 mbd). In that year, Iran produced almost 9 percent of the world's oil; today, it produces only about 5 percent. Exports have declined even more, from 3.3 mbd in 1970 to about 2.5 mbd today. And the numbers keep falling: Iran's deputy oil minister, Hamid Chitchian, has warned that if present trends continue, "Iran will use all its energy production at home within ten to fifteen years" and will have none available for export.3
This situation has reached the point where the world could do quite nicely without Iran's oil exports, which could be made up for with unused Saudi capacity. Notice how well the world has adjusted to the absence since 1990 of Iraqi oil. This condition of amply supply looks set to persist. In sum, times have changed and politicians have not kept pace.
Geostrategic location. During the cold war, Iran had an important geostrategic location for the United States. Its oil and warm-water ports offered a potentially tempting target for Soviet expansionism. This worry explains the otherwise mysterious Iran/contra affair.4 Today, Americans no longer worry about Russian occupation of Iran, and so Iran's geopolitical importance has faded. Those who see Iran as occupying a strategic piece of real estate are, yet again, out of date.
Influence on Muslims. Tehran claims that it is the spokesman for Muslims worldwide, and that they recognize its supreme guide, Sayed `Ali Khamene'i, as their senior religious leader. These claims have little basis in fact. Many Muslims are sympathetic to parts of the Iranian message (its anti-Westernism, its strict application of modest dress), and its actions and positions are widely noted. But Iran has limited influence over the Muslim world. Non-Persian Sunnis are not about to follow any Iranian cleric. A radical movement or government can benefit from Tehran's moral and propaganda support, but endorsement by Iran is not a major factor in its success. Similar to views that Iran is an important market or that Iran occupies a vital geostrategic position, worries about Iran's influence are out of date: the Iranian revolution had much more impact in 1980 than it does today.
The Japanese and European governments hold that working with the current Iranian government reinforces moderate elements in Tehran. Japan's Prime Minister Tomiichi Murayama notes that "Iran is not made up only of radicals, and it is necessary to support the moderates."5 American officials are skeptical about two points: the very existence of moderates in Iran's government and the extent to which the major powers can influence the balance of power in Iranian politics.
Do moderates exist? U.S. officials have bitter memories about moderates' consolidating power and changing government policy. This hope first welled up in December 1979, when the election of Abo'l-Hassan Bani Sadr as president was said to foreshadow a release of the American embassy hostages. The hope was repeated in the Iran/contra affair of 1985-86, when President Reagan shipped arms to Tehran in the expectation that this would reinforce Iranian moderates; all it did was expose the radicalism and insincerity of those in power.
Serious differences about policy do exist in Iranian government circles, with two distinct political camps having emerged since the revolution. Once known as radicals (tundro) and moderates (mianehro), the two argue primarily about domestic policy, as explained by a newspaper close to the radicals:
Everybody knows that there have been two major trends of thought in our society since the revolution. . . . One tendency believed "social justice" to be the central theme of the economy and regarded the fundamental duty of the Islamic government as support for the deprived and the barefoot. . . . The other tendency emphasized giving a free hand to the private sector in the economic arena. . . . It regarded any effort to support the deprived and the poor as an influence of Marxist and socialist beliefs.6
These domestic positions have foreign-policy implications. Moderate bazaar merchants and technocrats are primarily concerned with economic growth, and so seek good economic relations with the major powers, irrespective of political tensions. In contrast, radicals place less emphasis on economic growth or material well-being. Their highest priority has to do with combatting Western influence. They deplore the lack of action "protecting our Islamic-Iranian character and identity from the cultural conspiracy of those who fear and dislike our revolution."7
At the same time, a broad consensus exists among the Iranian leadership about the foreign-policy issues that most concern the West. All major political figures believe Iran has a central role in world affairs, a belief that has deep roots in Iranian culture. All agree on a tough political stance toward the West and on opposition to the Arab-Israeli peace process. The moderate camp is not prepared to pay a political price to achieve better economic relations. Moderates have done little to curb terrorism, which continued undiminished after Rafsanjani became president in 1989. Indeed, it was precisely under his leadership that Tehran stepped up its opposition to Israel's existence, adding to the budget approved by the Majlis (parliament) a $30 million allocation for the Palestinian revolution. It also launched a campaign to murder Iranian opposition leaders abroad, striking in Vienna, Geneva, Paris, Rome, and Berlin during 1989-92. The State Department's report on international terrorism notes that under Rafsanjani's leadership, Iran was the "most active and most dangerous" sponsor of terrorism in the world.8
In short, Iranian moderates want better relations with the West -- but only better economic relations; the radicals want confrontation with the West -- but mostly cultural confrontation. Both moderates and radicals agree on many policies the West finds unacceptable.
Influence the balance of power? The foundation of German and Japanese policy toward Iran is the belief that aid and loans, as well as high-level exchanges, reinforce Iran's moderates. Is this assumption correct? In other words, can the West make a difference in the domestic balance of power?
Attempts by foreign powers to boost moderates in Iran face two fundamental difficulties. First, Iranian politicians do not care that much about the outside world. As in most countries, politics is foremost local. In addition, the Iranian political classes have good reason to concentrate on domestic issues, for the country faces major problems. The economic situation is bad. The regime's claim to religious leadership is widely rejected; the regime is not seen by the people or by the senior clergy as being the embodiment of religious values, which challenges its entire self-conception. Major urban riots have become a regular feature since spring 1992, repeated on average every six months. In response, the regime has held periodic exercises with up to 280,000 soldiers in 170 cities practicing the seizing of public buildings and radio stations from rioters, including exercises that close a section of downtown Tehran while troops "recapture" the Majlis.9 In this atmosphere, a little more aid from abroad, a few friendly words from a foreign official, or a visit by a high-ranking foreigner is not going to change the balance of power.
Secondly, Iranian politicians do not appear convinced that they need to change their policies to secure what they want from the major powers. Iranians believe Europe and Japan will continue trade and investment irrespective of Iranian actions because of Iran's importance as an oil supplier and as a market. This Iranian confidence has some basis in fact. Tehran has paid little price for its campaign of assassination of Iranians living in Europe, owing to a respect for the country's commercial clout and a willingness to attribute Iranian terrorism to freelancers rather than to the government.
TALKING TO IRAN
Given these three major disagreements, it comes as something of a surprise to find that the U.S. government and its critics substantially agree on the need to keep talking to Tehran. There are some differences in style (what to talk about and how), but those are quite secondary to the agreement among them that talks are a good idea.
The U.S. government is ready to engage in an official dialogue with the Islamic Republic of Iran. Washington declares itself prepared for discussions -- even secret discussions -- anywhere and anytime with representatives of the Iranian government. If President Rafsanjani were to call President Clinton, the State Department has declared, Clinton would pick up the phone.10 American offers to hold discussions have repeatedly been made in print, at public meetings, and in private.
Tehran adamantly refuses to reciprocate. Out of hand, it dismisses diplomatic relations with the United States. As an editorial headline in the most moderate Persian-language paper puts it, "Negotiations and Talks with the U.S., Never!"11 The avoidance of Americans is not something imposed by the government; the Ministry of Islamic Guidance in May 1994 invited a delegation of U.S. newspaper editors to Iran; on arrival, they found that every Iranian newspaper editor refused to talk to them.12 Some radicals are even upset that Iranian athletes appeared in the United States at the world wrestling championships in 1995 and might do so again at the Olympics in 1996. The radicals' opposition to contact with Americans also extends to economic dealings; Ayatollah Khamene'i has deemed drinking Coca-Cola or Pepsi a religiously dubious act,13 and the Majlis has considered a bill to ban all U.S. trademarked products.14
Washington and other major powers also differ on how to conduct talks with the Iranian government. The former does not want regular high-level visits conducted in a way that suggests a close political relationship. This precludes the kind of frequent high-profile exchanges that have blossomed in German-Iranian relations, including telephone contacts and correspondence between the heads of government, biannual meetings of foreign ministers, many other ministerial meetings, a joint economic commission, joint cultural meetings, a parliamentary friendship group, and even intelligence cooperation -- all done without raising differences on human rights, terrorism, and the Arab-Israeli peace process.15
READING THE HISTORICAL RECORD
What explains these many and deep disagreements between the U.S. government and its critics? At base, they follow from contrary readings of the historical record: the seriousness of Iranian terrorism, the achievements of a soft policy toward Tehran, and the results of a tough policy.
How serious is Iranian terrorism? U.S. government analysts argue that Iran's leaders have personally approved direct Iranian involvement in a multitude of terrorist episodes (such as the bombing of a Jewish community building in Buenos Aires in July 1994); that they directly subsidize the most extreme anti-Israel elements in Lebanon; and that they support armed Islamist opposition movements in Turkey, Jordan, Egypt, and Algeria. Bruce Reidel, the national intelligence officer for the Middle East, argued that "these policies are approved and directed by the highest level of the Iranian government. There is no credible evidence to suggest these actions are the work of rogue factions."16 This analysis implies that terrorism will continue until the Iranian leadership sees that it has to pay a heavy price for its actions.
Many private analysts in the United States and most governments in Europe and Asia dispute this interpretation. Yes, they say, some elements in the Iranian government continue to provide support for attacks on Iranian opposition figures abroad and on Israeli and Jewish targets, but the terrorism is not directed at Western interests generally. Its sponsors are primarily on the edges of the government in Iran, not fully under the control of the president and the cabinet. The Japanese foreign ministry forwards this view. "The United States claims Iran is behind many terrorist bombings around the world, but there is not solid evidence," a senior Foreign Ministry official told The Japan Times.17 Kunihiko Saito, foreign vice minister and former Japanese ambassador to Iran, is a prominent exponent of the thesis that the best anti-terrorism approach is to encourage the moderate and technocratic faction in the Iranian government. He is credited with Japan's 1993 decision to be more accommodating to Iran.18
The difference in interpretation is not easy to resolve on the basis of publicly available material. The U.S. government case rests on classified information that Washington does not release (doing so could endanger lives or compromise intelligence operations). As a result, it has not convinced the majority of Iran analysts in the United States, much less those in other countries. However, one indication is the record of Iranian embassy involvement in murders in Europe, which suggests that Foreign Minister `Ali Akbar Velayati, a leading moderate, may personally approve terrorist acts; but there is no smoking gun in the public record.
Europeans and Japanese often ascribe the U.S. hard line to past troubles with Iran -- the 1980-81 embassy takeover, the 1983 Marine-barracks bombing, and the 1985-86 Iran/contra affair. But European governments have been hurt as much by Iranian terrorism. To name just a few of the most prominent episodes: the 1989 edict against British citizen Salman Rushdie for his novel The Satanic Verses directly challenged the core values of European intellectuals. The 1991 murder of Shahpour Bakhtiar, a French war hero and champion of French culture, under the nose of his elite French guards seriously embarrassed Paris; as Bonn was embarrassed by the 1992 gunning down in Berlin of Sadeq Sharafkandi, a Kurdish political leader attending a meeting of the Socialist International; and Rome by the 1993 killing of dissident and former Iranian chargé to Italy Mohammad Hussein Naghdi, who was under Italian police protection. As for Japan, Itashi Igarashi, the Japanese translator of Rushdie's Satanic Verses, was murdered in 1991.
What comes from a soft policy toward Tehran? American skepticism about a policy of accommodation toward Tehran results in part from its experiences with Iraq. Brent Scowcroft, the national security advisor to President Bush, explains that in the late 1980s, U.S. policy "was to convince Iraq that moderate international and domestic behavior would be rewarded[;] to attempt to convince Saddam that he had more to gain from peaceful relations with the West and southern Gulf states than from confrontation, radicalism, and aggression."19 Toward these ends, the U.S. government provided Iraq with $1.6 billion in agricultural credits in fiscal years 1989 and 1990,20 and turned a blind eye to the extension of additional loans from a U.S. branch of an Italian bank, and to Saddam Husayn's purchase of large amounts of dual-use high-technology equipment. The attempt to bring Saddam into the family of nations did not work, as George Bush acknowledged. Americans are understandably reluctant to repeat this experience with another Persian Gulf state.
The EU governments can offer little evidence that cooperation with Iran has had any impact on Tehran's behavior. Take the Rushdie matter, the issue most consistently raised by the EU states in discussions with Iran. While France held the EU presidency, Paris made a push to resolve the issue during the first half of 1995. In March 1995, during a meeting with Rushdie, French Foreign Minister Alain Juppé pledged that France would work to have the EU states extract a statement from Iran, failing which "new pressures" might be applied.21 The statement Juppé sought from Tehran was a letter to each EU state similar to the one sent to Denmark in February, which declared that "the Iranian government never has, is not about to, and will not in the future send anyone to kill Salman Rushdie" in Denmark. Tehran's response was to send Foreign Minister Velayati on a round of visits making soothing statements during press interviews, for example that the death threats were protected free speech by private citizens, not government policy.22 But when the official "critical dialogue" meeting was held on June 22, Deputy Foreign Minister Mahmoud Vaezi refused to sign any statement, telling the Europeans they "should respect Islamic values and God's monotheistic religions, so that there would be more understanding between us and the European countries."23 German Foreign Minister Klaus Kinkel responded, "I expressly criticize the Iranian delegation for being unprepared to make a clear statement on the Rushdie case" -- overlooking that a clear Iranian position does in fact exist, namely, that Rushdie must be killed.
When it comes to terrorist attacks in France, Paris seems again to have gained little from an accommodating policy. Interior Minister Charles Pasqua negotiated the departure to Iran of the bomber who had held Paris in terror during September 1986, only to be rewarded with further assassinations of Iranian dissidents in Paris.
Japan can make a more plausible case that it has been able to influence Iranian behavior. For years, Iran placed priority on acquisition of medium-range missiles, for which purpose it had strong motivation to cooperate with North Korea. This ended when Tokyo make clear that further Tehran-Pyongyang collaboration on missiles would lead the Japanese government to cancel $1 billion in low-interest loans for a dam that Japan has been helping build in Iran. There is every reason to assume that Iran would have proceeded with its cooperation with Pyongyang had the Japanese not made such strong representations to Tehran on the matter.
What comes from being tough on Iran. The other major powers criticize Washington for not having produced positive results, and even for reinforcing the radicals in Tehran. A soft policy may have only a few positive results so far, they say, but at least it does not make matters worse, as does the tough U.S. policy.
But that tough policy has achieved some important successes. It was a major factor in forcing Tehran to curtail an ambitious 1989 five-year plan to acquire a large, modern military force. That plan, announced with great fanfare in the Iranian press, foresaw $10 billion in arms purchases in 1989-94, primarily from the Soviet Union. It was shelved when Iran was locked out of world capital markets, thanks to its own inept economic practices and to U.S. pressure. In the end, Iran's arms purchases in 1989-94 came to only half of what Tehran had intended to buy. The difference is highly significant. Had Tehran carried out its 1989 plan, it would have had a conventional force capable of slowing down or impeding U.S. activities in the Persian Gulf. Tough policies also secured the release of American hostages seized in Lebanon by Iranian allies.
But the most important effect of a tough policy was a largely unintended one. In 1987-88, Washington took a series of actions seen in Tehran as steps toward direct U.S. involvement in the Iran-Iraq War: the protection of tanker convoys, the reflagging of Kuwait tankers, the sharing of intelligence with Iraq, and a day-long battle at sea in which the United States sank half the Iranian navy. The culminating event, in Iran's eyes, was the July 1988 shooting down of a civilian Airbus, which Tehran still sees as a deliberate plot rather than a tragic accident. Convinced that the United States was entering the war, and realizing that Iran could not win against a superpower, Khomeini "swallowed the bitter poison" (in his words) and accepted a cease-fire with Iraq a few weeks later.
The most obvious case of a tough U.S. policy that is widely said to have little chance of success is U.S. trade restrictions. For several years, the Clinton administration tried a moderate policy, based on the distinction of encouraging normal economic relations while discouraging politically motivated ones. The policy did not work. U.S. commentators and European leaders continually pointed to what they saw as hypocrisy when the United States urged limiting economic transactions with Iran while U.S. firms purchased annually some $4 billion of Iranian oil for delivery to third countries. To end this apparently anomalous situation, President Clinton in May 1995 announced a tougher policy: a ban on nearly all trade with Iran. "If we are to succeed in getting other nations to make sacrifices in order to change Iran's conduct," he explained, "we too must be willing to sacrifice and lead the way."24
The opinion of most experts and economists was that, in the phrasing of the Financial Times editorial headline, "Iran sanctions won't work."25 But in fact, despite lack of support from allies, the comprehensive unilateral U.S. sanctions are having a significant effect on the Iranian economy. To be sure, the direct impact is not spectacular: probably a reduction in Iran's income by a few hundred millions of dollars each year (due to less income from oil sales and higher costs to renovate aging oil fields). In May through July, Iran was forced to find storage capacity for 35 million barrels of oil. This suggests that it was not able to market all of its oil, in spite of offering discounts of 30 to 80 cents per barrel compared to similar crude from other countries.26 In August 1995, the Iranian news agency, IRNA, acknowledged that Iran was having trouble finding alternate buyers for the 200,000 barrels per day that the U.S. had previously bought.27 Assuming Iran is able to resume selling all its oil, a 30 cent per barrel discount translates into $300 million lost per year.
Much as the drop in oil income will hurt, the indirect effects of the U.S. sanctions are even more serious. Comprehensive U.S. sanctions add to the impression that Iran is a politically risky place to do business, shaking the confidence of European bankers in Iran and, even more important, scaring Iranian businessmen. As the latter watched Iran become more isolated, they sent more of their money abroad, causing a run on Iran's already tottering currency, the rial. As U.S. pressure on Iran increased, the currency fell from 2,700 to the dollar at the start of the year to 4,340 at the end of April. The announcement of comprehensive sanctions on May 2 caused the rial to fall to 6,500 per dollar by May 9 (Tehran then banned the free foreign-exchange market and imposed an artificial rate at which little trade is done). Unilateral U.S. sanctions, in other words, have singlehandedly caused serious economic problems for Iran.
POLICY OPTIONS TOWARD IRAN
Western states have a range of policy options toward Iran, from acceptance to gentle persuasion, inducements, containment, and destabilization. Which is most suitable?
Accept Iran as it is. All the Western powers find at least some aspects of current Iranian behavior not acceptable. Therefore, this option is not likely to be pursued.
Gentle persuasion. Some Westerners and Japanese find it tempting to think Iranians could be persuaded by thoughtful arguments to abandon their terrorism, opposition to the peace process, and pursuit of nuclear weapons. Skillful diplomacy, in other words, is the key. More contact with the West will lead Iran to become prosperous and satisfied with the world as it now is, rather than be a destabilizing and terrorist force. President Clinton expressed this hope in March 1993: "I wish Iran would come into the family of nations. They could have an enormous positive impact on the future of the Middle East in ways that would benefit the economy and the future of the people of Iran."28
It is difficult to see how a policy of persuasion would work. The Islamic Republic has adopted its current policies not out of ignorance or stupidity but based on a careful calculation of where its interests lie and, especially, of the lack of real opposition it will encounter from Western countries. Islamic Iran simply does not share the West's priorities; as Tehran Radio has stated, "creating an opportunity for Muslims to comply freely with Islamic principles and act in accordance with the provisions of Islam is far more important than economic relations."29
Inducements. Most Western powers seem to hope to modify Iranian behavior through a nuanced policy of rewarding positive steps and penalizing negative ones. But if European governments talk about carrots and sticks, the former have been more in evidence than the latter. In contrast, the U.S. government relies more heavily on the stick. This may be a useful division of labor. In discussions with Iran, the Europeans can use the American bogey, while the Americans can offer to stop impeding European and Japanese loans and investment. Such a policy allows flexibility and permits half-steps by each side, rather than requiring an all-or-nothing approach. To induce Tehran to give up a nuclear-power reactor, for example, Washington wielded the stick of strong pressure on international suppliers while Japan offered the carrot of aid.
But this division of labor faces several problems. First, as the Iran/contra debacle and other examples show, foreign governments have very limited influence on Iranian foreign policy, which is driven primarily by domestic imperatives. Rafsanjani might decide, for example, to quiet radical criticism about his economic and social policy by supporting anti-Israel terrorists.
Secondly, the West is unlikely to offer Iran inducements sufficient to achieve Iran's economic aims. U.S. sales of arms to Iran in 1985-86 did not induce Tehran even to release American hostages in Lebanon. The $30 billion in loans extended to Iran during 1989-92 was not enough to bring about a change in Iranian policy, and it is not likely that the West will find more than $30 billion for Iran in the future.
Thirdly, inducements to Iran may only worsen the West's problems by strengthening the Islamic Republic. It is difficult to imagine the current Iranian leadership's being content with prosperity for the citizenry; it seeks to dominate the Persian Gulf and become the leader of world Islam. These goals are unacceptable to the West.
Containment. The phrase "dual containment" for current U.S. policy toward Iran and Iraq emphasizes that the U.S. government does not seek relations with either state to balance the other one; instead, it relies on its own military force to limit both. The policy is not meant to be hostile to the Islamic Republic. Rather, Washington accepts the Islamic Republic in Iran and wants only to change its behavior. Martin Indyk's speech setting out the "dual containment" policy carefully holds out the hope for normal relations with Islamic Iran:
I should emphasize that the Clinton administration is not opposed to Islamic government in Iran. Indeed, we have excellent relations with a number of Islamic governments. Rather, we are firmly opposed to these specific aspects of the Iranian regime's behavior, as well as its abuse of the human rights of the Iranian people. We do not seek a confrontation, but we will not normalize relations with Iran until and unless Iran's policies change, across the board.30
The implicit thesis behind this policy seems to be: limit excesses while awaiting the triumph of the moderates.
A different kind of containment would be the policy George Kennan proposed for the Soviet Union: lay down clear markers to avoid military confrontation, demonstrate a willingness to use force if those markers are crossed, and wait until internal problems eventually cause the regime to implode. As an example of the difference between a Kennan-style containment policy and dual containment, the former would mean no more statements by U.S. officials such as those of Assistant Secretary of State Robert Pelletreau that the U.S. government accepts the Islamic Republic as "deeply rooted" and a "permanent feature."31 A vigorous and strict containment policy would acknowledge the right of the Iranian people to a government of their own choosing, and look forward to their exercising that choice more freely under a government that respects human rights.
Precisely because the Islamic Republic suffers from poor political, social, and economic circumstances, a policy of full containment might work. The regime has exacerbated social tensions. It has alienated many of the devout and the senior clergy, who resent political interference in religious affairs. Six million Afghans and Sunnis bitterly detest Shi`a chauvinism. Rafsanjani is quite right to warn, "Do you think the people who have no medicine and no school, we can tell them we had a revolution and keep them busy with slogans?"32
The reservoir of support for the clerics, fed by the waters of hatred for the shah, has run dry. Many remember the shah's time with nostalgia as an era of riches and social freedom. Iranians of prime rioting age are too young to have hated him. The Islamic Republic survives simply because there is no credible alternative. Like the shah's regime, it could collapse quickly if any such alternative emerged; if there is no alternative, it could survive another decade or more. It quite possibly will not last into a second generation.
Destabilization. In February 1995, House Speaker Newt Gingrich described "replacement of the current regime in Iran" as "the only long-range solution that makes any sense," and his press secretary implied that covert operations to this end should be considered.33 Some Israeli officials publicly proclaim this view as well. Uri Lubrani, formerly the head of Israel's mission in Iran, has called for a policy to replace the Islamic Republic, which he said has become a "malignant tumor" in the region.34
Were Washington publicly to call for a replacement of the Islamic Republic, European and Japanese governments would probably continue with their current policies, that is, they would refuse to work with Washington on this matter. So the United States would have to rely on its own efforts, with some support from Israel and some Arab states concerned about Iran.
It is difficult to see how Washington, even aided by its Middle East allies, could have much effect on who rules in Tehran. The U.S. government does not have a major influence on Iranian domestic policy. The record of covert operations does not offer much reason to think that the United States can promote activities that would bring down the Islamic Republic, and there is no prospect at all that the U.S. government would use armed force to replace it. Washington has no interest in a military conflict with Iran, for such a clash would only cause problems in U.S. relations with the Persian Gulf states, the Western allies, and Russia, without necessarily bringing any change in Iranian behavior.
On the other hand, were an opposition group to gain credibility in the eyes of the Iranian people and cause a collapse of the Islamic Republic, U.S. policy might help accelerate that collapse. No such group presently exists, despite the People's Mojahedin's claim to present a serious threat to Tehran's continued rule.
Just as the West cannot expect to shore up moderates, neither can it expect to bring about the Islamic Republic's downfall. The fate of the Islamic Republic will be decided largely by internal political factors, not by the strength of its international economic ties.
In light of the continued bitter opposition by the only government on earth that refuses to have talks with the United States, there is no realistic prospect that a U.S. initiative would improve relations with Islamic Iran. Rather than keep butting heads against a brick wall, Washington is better advised to seek ways to go around the wall -- which in this case means going around the Islamic Republic to reach the people of Iran. Two examples of what this might entail would be: (1) more broadcasting to Iran by putting into effect the "Radio Free Iran" proposal mooted in Washington by Senator Alfonse D'Amato (Republican of New York); and (2) statements by high-level officials not about the permanency of the Islamic Republic but the common interests between the Iranian and American peoples, interests undermined by a regime in Tehran that sacrifices national interests for radical ideological goals.
1 The Los Angeles Times, Mar. 21, 1995.
2 Financial Times, Apr. 30, 1994.
3 Keyhan Havayi, Mar. 15, 1995.
4 According to the Tower Commission Report (New York: Times Books, 1987), pp. 112-13, the "intellectual formulation" of the initiative to Iran was a May 1985 CIA memorandum by Graham Fuller warning, "The US has almost no cards to play [in Iran]; the USSR has many," making imperative a "bolder, perhaps even riskier policy."
5 Quoted in The Los Angeles Times, Feb. 15, 1995 (the statement was made the month before).
6 Salaam, July 28, 1993, as printed in Akhbaar Ruz (a Tehran-based daily translation of Iranian news sources). Unless otherwise noted, all references to Akhbaar Ruz are to translations that appeared on the same day as the item cited..
7 Keyhan International, Dec. 23, 1993.
8 United States Department of State, Patterns of Global Terrorism, 1993 (Washington, D.C.: Department of State Publication, 1994), p. 1.
9 Four such exercises were reported in 19 months: Iran Brief, June 16, 1995; Tehran Radio, Nov. 26, 1994, in Akhbaar Ruz; Tehran Radio, Aug. 18, 1994, in Foreign Broadcast Information Service, Daily Report: Near East and South Asia (hereafter FBIS), Aug. 18, 1994; and Iran Times, Dec. 3, 1993.
10 Assistant Secretary of State for the Near East and South Asia Robert H. Pelletreau, Jr., Mideast Monitor, Feb. 3, 1994. President Bush did once speak by phone with an impostor posing as President Rafsanjani.
11 Resalat, Nov. 1, 1994, as printed in Akhbaar Ruz.
12 Jomhuri Islami, May 15, 1994, as printed in Akhbaar Ruz.
13 Iran Times, Jan. 13, 1995.
14 Iran Times, May 12, 1995.
15 Iranian ambassador to Germany Hossein Moossavian, Abrar, Nov. 2, 1994, as printed in Akhbaar Ruz.
16 Bruce Reidel, "The Middle East: What is Our Long-Term Vision?" Middle East Policy, Dec. 1994, p. 7.
17 The Japan Times Weekly International Edition, Aug. 15-21, 1994.
18 Financial Times, Oct. 19, 1994.
19 Brent Scowcroft, "We Didn't 'Coddle' Saddam," The Washington Post, Oct. 13, 1992.
20 U.S. General Accounting Office, Iraq's Participation in U.S. Agricultural Export Programs, Nov. 1990, p. 15.
21 For this and the statement Juppé sought quoted in the next sentence, Iran Times, Mar. 24, 1995. See also Le Monde, June 11, 1995, and The Los Angeles Times, Mar. 21, 1995.
22 Independent (London), May 31, 1995, reprinted in FBIS, June 6, 1995.
23 Iran Times, June 30, 1995.
24 Washington Post, May 1, 1995.
25 Financial Times, May 2, 1995.
26 The Washington Post, Aug. 9, 1995; Petroleum Intelligence Weekly, July 31, 1995; and Financial Times, July 26, 1995.
27 Financial Times, Aug. 15, 1995.
28 Interview with CBS News, quoted in Iran Times, Sept. 2, 1994.
29 Tehran International Radio, Mar. 23, 1989.
30 Martin Indyk, "Clinton Administration Policy Toward the Middle East," a special report of The Washington Institute for Near East Policy, May 21, 1993.
31 Both statements quoted in The Washington Times, Oct. 20, 1994.
32 Jomhuri Islami, Dec. 10, 1989, as printed in Akhbaar Ruz,.
33 The Washington Post, Feb. 9, 1995.
34 Iran Brief, Dec. 5, 1994.