The Middle East Policy Council convened its 93rd Capitol Hill Conference on Friday, July 20th: “After the Withdrawal from the JCPOA: Strategies for the Trump Administration.” Following the U.S. pullout from the nuclear deal with Iran, there has been limited debate about what follows. The panelists expressed skepticism about the Trump administration’s sanctions-focused strategy towards Iran, while offering subtle suggestions for how the United States can more effectively exert pressure on Iran in the future.
Richard J. Schmierer (former U.S. Ambassador to Oman; President and Chairman of the Board of Directors, Middle East Policy Council) moderated the event and Thomas R. Mattair (Executive Director, Middle East Policy Council) was the discussant. The panelists were David Albright (Founder and President, Institute for Science and International Security); Karen Young (Senior Resident Scholar, Arab Gulf States Institute in Washington); Michael Eisenstadt (Senior Fellow, Program Director, Military and Security Studies at the Washington Institute for Near East Policy); and Norman Roule (Former Officer, CIA; Former National Intelligence Manager for Iran, DNI).
Mr. Albright outlined the inherent problems with the JCPOA. The deal’s sunset provision could allow Iran to build a nuclear weapon within the next decade. The JCPOA also didn’t resolve past questions about Iran’s nuclear weapons program. Given the high probability for future confrontation with Iran even if the U.S. had stayed in the JCPOA, Mr. Albright explained that the Trump administration decided to confront Iran now rather than pursue smaller fixes to the agreement. The Trump administration appears to be calculating that re-imposing sanctions will entice Iran back to the negotiating table eventually. But as the U.S. has also moved the enrichment goalpost from “limited enrichment” to “zero enrichment,” this outcome is far from certain. Mr. Albright does see a high probability for a future “trainwreck” in U.S. – Iran relations, but hopes that continued IAEA inspections can at least gather some new information on Iran’s past nuclear program and its present compliance with the terms of the JCPOA.
Dr. Young elaborated on the economic dimension of the U.S. withdrawal and how this may impact geopolitics. Clearly, Iran will be more isolated as U.S. sanctions become harsher again, and there is a high probability of a major financial crisis on the horizon there. Already, there have been numerous pre-emptive exits from the Iranian market, and the EU has less ability to intervene on behalf of EU firms operating there. While the U.S. and EU never were large trading partners with Iran, the U.S. withdrawal is likely to impact Russia and China more significantly. Iran stood to be a competitor to Russia in natural-gas exports under the JCPOA, and Iran’s weakened market position after the U.S. withdrawal could bolster Russia. China also stands to benefit, “free riding” off the U.S. security umbrella in the region while being the largest consumer of Iranian oil exports. Dr. Young noted how these dynamics with Russia and China illustrate some of the ways that the “America First” approach benefits U.S. rivals.
Mr. Eisenstadt views the U.S. strategy towards Iran as being unbalanced and overly reliant on sanctions. Admittedly, some of the Trump administration’s Iran policy is rooted in domestic U.S. politics, as candidate Trump made repeated vows to exit the JCPOA. But timing is everything, and the U.S. withdrawal seems badly timed and lacks a back-up plan in the event the current “maximum pressure” approach does not work. Mr. Eisenstadt imagined what a more comprehensive approach could look like, arguing that the U.S. has a credibility gap not having responded more forcefully to Iranian proxies and cyberattacks against the U.S. and its allies. Establishing clearer “red lines” in these areas, as well as pushing back more forcefully (as the U.S. has been doing in Syria against Iranian assets over the past year) could make an impression on Iranian leadership. And while it is possible that the Trump policy might work in the long run, there are always unintended consequences to policy shifts like the JCPOA withdrawal. The U.S. needs to be better prepared for them.
Mr. Roule highlighted how the Iran threat is strategic (markets, geopolitics), lethal (terrorism), and urgent (posing a direct security threat to U.S. allies like Saudi Arabia). The Iranian threat has actually expanded considerably since 2011, particularly through the use of proxies in Yemen, Syria, Lebanon, Bahrain and Iraq, not to mention various arrests in Europe over the past year of Iranian agents planning terrorist activities there. But despite this expansion, Mr. Roule suggested that the Iranian regime is in a period of uncertainty, and this may limit pursuit of further nefarious activities. The regime needs the financial relief provided by the JCPOA, and may continue to adhere to it in order to preserve ties to the EU. As senior leadership changes in Iran in the coming years and faces growing domestic frustration about living up to the ideals of the revolution, Iranian leadership will face growing pressure to deliver on economic promises to its people.
The full video from the event is available on the Middle East Policy Council website. A full transcript from the event will be posted in a few days at www.mepc.org and published in the next issue of the journal Middle East Policy. For members of the media interested in contacting these speakers or other members of the Middle East Policy Council’s leadership, please email [email protected].
RICHARD J. SCHMIERER: Good morning, everyone. I’m Richard Schmierer, the president and chairman of the board of the Middle East Policy Council. I am pleased to welcome you on behalf of the Council to our 93rd quarterly Capitol Hill Conference. And today we will address the issue of policy options towards Iran following the U.S. withdrawal from the Iran nuclear deal. As many of you are aware, in January of this year we conducted a similar session focusing on Iranian advances in the Arab world. Let me mention up front that our focus today will be different. We have asked our panelists to look at how, realistically, the Trump administration and our partners in the region can address those actions of Iran which they object to. The seed for such a discussion was planted by Secretary Pompeo’s 12 points speech in May, in which he listed 12 actions which the Trump administration is calling on Iran to take. Today, we are fortunate to have a truly expert panel to discuss if and how it might be possible to get Iran to take such actions.
However, before I turn to today’s program, I would like to say a few words about the Middle East Policy Council. The Council was established in 1981 for the purpose of promoting dialogue and education concerning the U.S. and the countries of the Middle East. We have three flagship programs: our quarterly Capitol Hill conferences, such as today’s event; our quarterly journal Middle East Policy, copies of which you saw on the table outside which has 11,000 subscribers and is found in libraries throughout the region and throughout the U.S.; and our educational outreach program Teach Mideast, which provides educational resources for Middle East – on the Middle East, geared towards secondary-school teachers and students. So I would encourage you to visit our website, www.MEPC.org or our Teach Mideast website, at www.TeachMideast.org to find out more about our programs.
Now, to today’s event. This program is being carried live on C-SPAN and is also being livestreamed on our website. And so I’m pleased to also welcome all of those who have joined us, either through C-SPAN or online. The conference proceedings will be posted in video and transcript form on our website, and a recap of the event will be posted there as well. And an edited transcript of the program will be published in the next issue of our journal, Middle East Policy.
So now let me briefly introduce our panelists. We’ll begin the discussion with David Albright, the founder and president of the Washington, D.C.-based Institute for Science and International Security. David will be followed by Karen Young, a senior resident scholar at the Arab Gulf States Institute in Washington, and an adjunct faculty member at George Washington University and the John Hopkins School of Advanced International Studies. Next will be Michael Eisenstadt, who is the Kahn fellow and the director of the Military and Security Studies Program at the Washington Institute for Near East Policy. And our fourth panelist will be Normal Roule, a former officer at the Central Intelligence Agency. Norman has also served as national intelligence manager for Iran in the Office of the Director of National Intelligence and as a senior advisor to the counter-extremism project and United Against Nuclear Iran.
Each panelist will deliver brief opening remarks. There will then be a discussion session followed – following the presentation by our panelists. The discussion will be moderated by my colleague, Mr. Tom Mattair, executive director of the Middle East Policy Council. Note that we have placed index cards on all of the seats. Please use these to write down any questions which you have as the speakers are speaking, and then hold up the card. Our staff will collect these during the presentations and give them to Dr. Mattair, so he can consolidate the questions for the discussion session. And thank you for helping us with that.
And with that, let me turn the panel over – the podium over to David.
DAVID ALBRIGHT: Thank you very much, Richard. And thank you, Tom, for the invitation. Happy to be here.
I must confess, for the last three weeks I’ve been crashing to finish a book on Taiwan’s former nuclear weapons program. And I can’t help but contrast that with Iran. I mean, it was an incredibly difficult, 20-year, intensive struggle the United States waged quietly behind the scenes to make sure that Taiwan didn’t build nuclear weapons in the 1970s and 1980s. And we had tremendous leverage. Taiwan was totally dependent on us for nuclear energy and for military supplies. And I think I can’t help but first drawing the comparison, this is all about Iran wanting to build nuclear weapons.
Despite comments from Iran, I remain convinced that that’s what this is really about. And I think the Trump administration recognized that the JCPOA or the nuclear deal needed to be fixed in order to make that future less likely. While there were many strong aspects of the deal, but it on balance was working to accomplish what it set out to do. But inherent in it, there were problems that really reflect how difficult this issue really is to work on. And so when President Trump gave his speech last January, I think he outlined three major problems that to this day require fixing.
One is the sunsets in the deal, that the deal was temporary. I can remember discussions in 2013, actually, 2014 that the idea would get a deal that would last – the limitations would last 20 or 30 years. In reality, they start to sunset after eight to 10. That was the best that could be gotten. Well, that’s a problem. What happens? And in fact – and the E3, as it’s called, Britain, Germany and France, engaged quite rigorously with the Trump administration to work on these issues. And there was a tremendous amount of agreement on this issue, that Iran increasing its enrichment program is a threat.
There is no credible reason – civilian reason for Iran to have a uranium enrichment program that grows in size over time. And so they couldn’t agree on the modalities of that or what does it mean if in the context of negotiations seven, eight years from now Iran increases its centrifuge program, as it’s allowed to do under the nuclear deal. What do you do? U.S. set automatic – automatic in quotes – snap-back of all sanctions. The Europeans said, well, that would violate the JCPOA and we want to do something else. But they were actually pretty close to a solution.
Another one which had rapid agreement between the E3 and the United States was another weakness in the deal. It didn’t resolve past questions about Iran’s nuclear weapons work. And as anyone who studies history, you can’t – the present depends on what happened in the past. Iran had a robust effort to build nuclear weapons and hid that and lied about that. The deal did not ensure that that issue would be addressed before it was implemented. And in fact, in a sense the IAEA was, for those of us who work in inspections, forgive the bluntness, was kind of thrown under the bus and put in a position that if you demand Iran settle these past questions, this deal will go down. And of course, the International Atomic Energy Agency is not a strong agency. It can confront when needed, but it has to have the support of countries like the United States and European countries. It blinked. So this issue was not settled.
In the E3-U.S. negotiations, within days a new arrangement was – between them was worked out to strengthen inspections, particularly to be able to get some military sites, which Iran has generally refused to allow the inspectors to visit. And most of the Iran secretive activities took place at military sites or military contractors or part of the military industry. So getting there was critical if you want to understand the nuclear weapons program, make sure we at least have some assurance it’s not restarting.
There was also something called Section T which was not being implemented that has to do, in its heart, that there’s equipment that you need to use if you’re going to develop nuclear weapons. And that equipment is fine for Iran to use for non-nuclear weapons purposes – it could be military, anti-tank experiments. But it has to be declared and monitored by the IAEA. And its use has to be subject to the approval of the executive body of the – of the agreement, the joint commission. That has not been implemented at all, and clearly there was equipment that was covered by this.
So but that was agreed. There was also quick agreement on that an ICBM is really part of the nuclear deal. You can’t segregate an ICBM from the nuclear deal. I mean, what are you going to put on it? What would Iran put on it other than a nuclear weapon? And so the E3 and the United States agreed that ICBM development by Iran would be a trigger for massive sanctions. Again, how you deploy those sanctions was really not worked out. So I think the – it was, in my view, a tragedy not to have finished this negotiation and, in that sense, fixed the deal. But, you know, it is what it is.
And President Trump and some of his advisors decided that it was more important to confront Iran now – e.g., reapply the most critical U.S. sanctions – rather than have a fix that really pushes the problem off. And I will admit that, that the strategy of this fix was that essentially you would enforce it, better the inspections, put down a marker on ICBMs, and then you would do nothing for six to eight years. It would just stay in place. And Iran would get the message that at a future point when you go to increase your enrichment program, in a sense all hell will break loose, and that would then trigger them to negotiate or to not do it.
And so the administration decided, or President Trump decided, that they want this confrontation now, and they’ve re-imposed all the sanctions. And I think we’re faced with what will Iran do. And one of the interesting developments is that the United States decided not to bring down a deal. I won’t have time to talk about this nuclear archive, but I’m sure you all saw it in the – I think it was covered again in The New York Times, Washington Post, and The Wall Street Journal. Very dramatic evidence of Iran’s past nuclear weapons program, and efforts to kind of keep it together potentially to use it in a – in a breakout.
But the – just lost my place. I apologize. I’ve actually been very preoccupied with Taiwan and keeping me up late at night. But what I’d like to – maybe I’ll just switch to some policy recommendations. So I apologize for losing my place. The – if Iran is going to live by the deal or not is unsettled. And maybe that’s the place where I wanted to go, is in some ways the administration – what is the phrase – wanted it cake and eat it too. That they re-imposed sanctions, which are going to hurt Iran. There’s no doubt about it. But they put Iran in a position that if you violate the limitations of the deal, the EU will then re-impose sanctions. And they’ve told them that formally in a joint commission. France and others announced to Iran: If you violate the limitations you will face EU snap-back. And then there will also be snap-back of U.N. sanctions.
So I think Iran is in a bind of how do they – what do they do? And I think most estimates – at least of people I work with – is they’re not going to increase or violate these limitations for this year. They’re going to make all kinds of noises. They’re going to talk about this and that, and they’re going to threaten this. But I think they haven’t made up their mind. And I think they’ll wait to see how it goes with sanctions. The Trump administration thinks that that’s going to lead to a negotiation that’ll create a deal that’s more favorable. And one of the things Secretary of State Pompeo put on the table was that when this withdrawal – or, this non-participation announcement happened, was that they now want zero enrichment in Iran. So they’ve moved the goalposts from limited enrichment to zero enrichment.
And there is an argument for that. If you look at Iran’s enrichment program, there’s absolutely no need – no need for it. They’ll never have an enrichment program that’ll produce low-enriched uranium for nuclear power reactors that’ll be cheaper than what they can simply buy on the international market. And in fact, that’s what they’re doing now with the Bushehr Reactor and reactors they’re planning in the future, is to buy the fuel. So when the E3 and the United States agreed that any increase in enrichment is really – doesn’t have a credible, civil justification, they actually mean it. Where Trump has gone farther to say, OK, let’s just get rid of this enrichment. It certainly strengthens U.S.’s hand in negotiating this with Saudi Arabia on the 123 Agreement. It puts North Korea on notice that there will be no Iranian deal kind of exemption on enrichment in North Korea. North Korea will want the same thing.
So but whether Iran can get that is really an open question. And one of the issues that I – certainly I spend a lot of time in Europe and I hear is that, OK, fine, You maximize the pressure. Iran really is going to be – really resist violating the limits. But at some point, it may decide to do it. And it may just do it because it’ll look at North Korea and say, well, if we increase our nuclear effort we’ll have better leverage when we go to negotiate with the United States. But will Trump in the end really negotiate? I mean, that’s what they say, but is that what this is about?
And so I think there is – in some way, there’s a little bit of a train wreck coming. We don’t know when, and hopefully it’s put off and Iran doesn’t want to – will make the decision not to increase the sanctions on itself and will try to keep building kind of an anti-U.S. mindset in places like Europe, which isn’t hard to do right now, and try to weaken the United States’ position. But at some point, they have their own pressures and they may not be willing to live with intensive sanctions and with no nuclear increase.
And let me just end at – how am I doing for time? Is it – I’ll just – OK. Let me just end that whatever happens with the future of the nuclear deal, whatever Iran decides, inspections continue. Iran signed the Nonproliferation Treaty. It has what’s called a Comprehensive Safeguards Agreement. It has the additional protocol, which gives – essentially just gives the inspectors more tools, kind of more pre-arranged inspections and information that would be delivered by Iran. Fundamentally, the comprehensives safeguards agreement gives the IAEA the right to go anywhere it deems necessary in Iran. And I think one of the critical things to support is that the IAEA get to the bottom of Iran’s past nuclear weapons program.
I mean, I know that from Taiwan. They don’t – if you don’t get to that program and make sure that it’s halted, you will never stop them from building nuclear weapons. You can – going after the fissile material was critical. It’s measure – much more measurable than a nuclear weapons program. But if they keep together teams in the military to build nuclear weapons, good chance those teams will eventually build nuclear weapons, unless it’s stopped. And the easiest, non-military tool that we have now – in fact, one of the only non-military tools to get to the heart of their nuclear weapons program – is through robust, vigorous, confrontational International Atomic Energy Agency inspections with Iran over this issue. And I think the United States is willing and I think the E3 is more than willing to do this. So let me – let me just end it there. thank you.
KAREN E. YOUNG: Thank you. Well, I agree with David, there are a lot of train wrecks happening these days. Thank you. Thank you for the invitation to speak here today with such distinguished colleagues. The title of the event seeks to address options to the Trump administration after the withdrawal to the JCPOA. But I think the better question is what options are there for the other parties to the agreement and, more directly, what options are there to Iran and its neighbors in their current economic and political relations?
The Trump decision to withdraw has indeed put Iran on watch, as it was intended to do, but I think it also increases the likelihood of conflict, of the train wreck, between Iran and its neighbors, and further has created or exacerbated tensions in trade and financial flows within the immediate gulf. Most evident are increasing strains of the GCC rift, weakening economic cooperation and integration, and making Iran a go-to asset for food security and, for Qatar, a co-guardian of its most precious asset in the South Pars North Field.
Oman and Kuwait are also put in difficult diplomatic and economic positions. Saudi Arabia and the UAE are pushing for a confrontation with Iran, though – through increased financial sanctions, but also as a way, I think, to create leverage with the U.S. in oil markets. As they need the U.S. to back any escalation in the region with security assurances, the U.S. now needs cooperation on oil markets, which places major oil producers in the Gulf and, arguably, also Russia in an interesting position vis-à-vis U.S. policy in Iran.
Iran is now effectively cornered, isolated, and its economy will surely suffer in ways that we have seen under previous sanctions regimes. I’ll share some evidence of recent experience with sanctions between 2012 and 2015, but I believe this time is different in that America’s choice will also punish its allies in Europe, further exacerbate tensions within the GCC, and give China and arguably India, Russia, and even Turkey, more mediating power within south-south financial flows and new financial institutions.
Key sanctions to be re-imposed, as you know, in August will hurt the trade sector most in construction materials, aluminum and steel, and any large currency transactions in U.S. dollars on behalf of the central bank. We’re seeing a number of preemptive corporate exits from Iran, from Asian, American and European firms, but mostly the latter. The oil and gas sector, along with shipping, will be most affected with sanctions on November 4th. Most affected will be transactions by foreign financial institutions with the central bank of Iran. And I think this is the death-knell for the Iranian economy.
But it’s not just Iran that will suffer. The fissures will be transatlantic and within the GCC and will work to the advantage of those Asian consumers of Gulf energy products who are beneficiaries of the U.S. security umbrella in the waters of the Gulf and also the Bab al-Mandab. Saudi Arabia and the UAE will likely encourage U.S. financial pressure on Iran, and they are anticipating and are willing to accept greater risk of confrontation between U.S. and Iranian actors in the Gulf, particularly in transit waterways. And while the JCOPA was no panacea, we’re sliding towards confrontation with very little regard for what a collapse of Iran, with 80 million people, many young and already agitated, might do to the wider MENA region.
The European Union emerges as less able to intervene on behalf of Iran, as we’ve seen the withdrawal of many private firms. The beneficiaries in the short term are those states that can manage to maintain buying Iran’s oil, or withstand U.S. pressure. And this happens to be a U.S. adversary, China. China’s Iran’s number-one customer. It’s also Saudi Arabia’s number-one customer – or, sorry – China has been gradually increasing its share Iranian oil exports since 2011, where it held 20 percent of exports. Now it accounts for nearly 40 percent of Iranian exports. China imports about 700,000 barrels of oil per day, and Iran produces just over 3 million. India’s an important by-stander, with about 550,000 barrels a day.
But these are – you know, there are some efforts to provide a lifeline to Iran. We’ve seen some proposals involving the European Investment Bank. But this is not going to be sufficient to create the amount or kinds of finance that Iran requires to create jobs and to build infrastructure. Moreover, the EU political commitment to engaging and lending doesn’t obligate EU financial institutions, like the European Investment Bank, to actually allocate programs. And they’ve made the wise choice that that’s not a business-savvy thing to do. Open liberal economies have their limits in these political crises.
Even if the EU is able to create a lifeline to Iran via export lines of credit or targeted investment, or a third way of EU members facilitating payments by formal Iranian government accounts in central banks of EU members, this is risky. It’s not going to be easy, because the U.S. will very likely place sanctions on staff members of those central banks, as they have done to staff members of the central bank of Iran. I think the EU is right, however, to preface the option to Iran with demands for transparency and reforms in its bank sector, but, again, it’s not likely to be a popular moment inside of Iran for these kind of measures.
The EU doesn’t really need to trade with Iran. It’s not at risk of losing a major market share for its export. Iran’s not a major trading partner. Trading goods to Iran’s about 10 billion euros last year in 2017, which is 0.1 percent of the euro area’s gross domestic product. In the case of Russia, I think the re-imposition of sanctions on Iran and those countries and entities doing business with Iran is definitely more complex. So Iran, under the terms of the JCOPA, stood to become a major competitor to Russia in supplying gas to Europe. Iran requires massive investments in its gas production, and the construction of a new pipeline via Turkey to make that competition a reality. But in the current political status, Iran is mothballed, the EU will continue to pursue alternative energy supply strategies, including renewable energy, even coal power plants, and trying to reduce its dependency on Russia.
Russia and Iran then become frenemies, I think, in this respect, at least in their Middle East strategies. Russia’s playing an interesting game with Iran, particularly in new promises of foreign direct investment in its oil and gas sector, a recent announcement of a $50 billion commitment, which I think was more likely to be about 5 billion (dollars) in the near term, would allow Russia to be a stakeholder in any transition or future opening of Iran to global markets. It’s like walking by a going-out-of-business sale and buying something just because you think you might need it in the future, not because you need it now.
In the short term, there are some clear winners and losers in the U.S. re-imposition of sanctions. And I think that the America first confrontational posture is including a very clear protection of Chinese economic interest in the region, though maybe not on purpose. A case in point is Iran’s South Pars gas field and new development there. Because Total withdrew, it basically gives a 70 percent ownership to China National Petroleum Corporation in development there. This was clearly an unintended consequence. China has been a consistent investor in Iran, even under previous sanction regimes. China was a major investor in Iranian infrastructure between 2005 and 2015 and has ramped up again in 2016.
China’s export-import bank has financed many transport programs in Iran, including a subway system, railways and roads. China has also taken advantage of being able to settle purchases of Iranian oil and non-oil products in local currency, avoiding U.S. financial institutions. They’re creating new financial products and new institutions really preemptively before the U.S. withdrawal from the deal, including a new yuan-denominated crude futures contract ability on the Shanghai Energy Exchange, which started in April, before the U.S. withdrawal.
For the Gulf states, the economic outlook and repercussions from the U.S. sanctions I think are mixed. Both Oman and the UAE saw an increase in trade with Iran between late 2016 and 2017. According to IMF data, UAE-Iran trade increased from $2 to $7 billion in this period. In Oman, it also doubled, but much lower numbers – from $100 to $200 million. The regional outlook for the GCC I think is, therefore, very mixed after the U.S. withdrawal. The political risk premium has raised considerable. Oil prices are reflecting that anxiety, providing some short-term gain and fiscal balances for oil exporters. But I think the medium-term outlook is less clear.
For the euro area, this points to a potential decline in GDP, but for GCC oil exporters they are moving into fiscal surplus this year. This means weakening the political momentum for economic reforms. But I don’t think it’s the rising comfort with higher oil revenue that increase the risk of confrontation between Saudi Arabia, the UAE and Iran. I think the displacement of oil markets is just one area of economic cooperation between Saudi OPEC and the U.S., but this should not be seen as a quick fix. It’s not just Iran that affects oil market. We’re dealing with production crises in other places, like Venezuela and Libya.
The other political risk factor is in transit points, which you’re well-aware of, notably the Strait of Hormuz. But I think the Bab al-Mandab is important too, a crucial point for the Saudi-Emirati war against the Houthis and, some would argue, their Iranian supporters in Yemen. Thirty percent of global sea-borne oil goes through the Strait of Hormuz, but so does 11 percent of rice. The Bab al-Mandab sees 18 percent of rice traded globally, 15 percent of global wheat, and 32 percent of global fertilizers. So crisis in either of these transitways affects more than oil. It’s going to create food crisis.
Inside Iran, we should be bracing for an economic collapse, likely more severe than the recession that occurred after 2012 when GDP per capita fell sharply by 10 percent year on year. Like its neighbors across the Gulf, Iran has a serious unemployment problem, especially among young people. It will struggle with a currency devaluation, erasing the savings of the middle class. This matters in Iran, but it also reflects weaknesses in other regional economies. Youth unemployment is about 30 percent in Iran, but it’s 44 ½ percent in Saudi Arabia. Just as the current protest in Basra among unemployed young people demonstrate that many of the structure grievances that motivated the 2011 Arab uprisings remain unresolved in the region, this is a shared problem. Agitation from economic crisis is certain to pick scabs at these regional wounds.
In closing, baiting Iran will have regional and international consequences. And I think these are likely to be very destabilizing. Thank you.
THOMAS R. MATTAIR: Do any of you have questions on these cards? And yes, could staff – MEPC staff please collect these questions and bring them to me? Thank you.
MICHAEL EISENSTADT: I’d like to start off by thanking Tom Mattair, Ambassador Schmierer, and Middle East Policy Council for the invitation to speak here, as well as for organizing this event and the opportunity to be on this panel of people whose works I’ve learned a great deal from over the years.
Let me just start off with a few comments about my kind of take on the administration’s strategy towards Iran. I think we’ve had, by my count, at least two authoritative policy statements thus far on Iran strategy – first by the president last fall, in October, where he rolled out the strategy, where he talked about countering Iran’s destabilizing regional activities, its support for terrorist proxies, and its proliferation of missiles, and on fixing the serious flaws in the JCPOA. At the time, he was largely silent about the specific steps he intended to take to achieve these goals, or how the various parts of the strategy fit together, and how to prioritize and phase these various elements – although, to be fair, most public strategy documents don’t go into that much detail.
I think Secretary of State Pompeo’s statement in May of this year put some flesh on the bone with his 12 points. Yet, I would argue still that the strategy is a work in progress. And I would argue we have a – maybe an unbalanced strategy because it’s based almost entirely on a single pillar, which is sanctions. So I would argue that what we need is a more comprehensive strategy, more comprehensive approach, which more effectively utilizes all the instruments of national power. I would also say that, to a certain extent, some of the major decisions made thus far have been driven by politics and the president’s campaign promise to withdraw from the JCPOA.
So let me just say, you can’t – politics and policy and strategy will always be intertwined, and that’s just a fact of life. But like in much of life, timing is everything. I have no inherent objection to the idea of withdrawing from the JCPOA, I just would quibble with the timing of this decision. And I guess it, you know, comes down to whether you think it would have been better to have a crisis, if Iran remained compliant with the JCPOA, 10 years from now when if it decided to start – when if the policies of the Islamic Republic hadn’t changed and it started ramping up its nuclear program again, we decided to withdraw then, or we withdraw now. But, again, as some of the other speakers have said, it is what it is. So we are where we are, and we have to find the best way to move forward with regard to where we are.
I would argue, though, it would be desirable to have a more structured process where at least the tradeoffs and the cost and benefits of the various decisions we make are more explicitly highlighted and the risks involved in the policy of maximum pressure, which we have adopted, are made more explicit. One of the other things I would say is it seems that there’s also a need for a plan B here. More hedging measures in case the strategy, as I understand it, does not work as intended. So if, for instance, maximum pressure does – is not sufficient to cause Iran to come back to renegotiate a nuclear deal, if maximum pressure maybe causes – contributes to the existing unrest, but the regime is able to keep a lid on things, then what?
OK, so if Iran maybe stays in the JCPOA, that’s fine. But that’s not the administration’s goal. So I’m not sure how they’ll hand it at that point. And if Iran decides to push back by exceeding the JCPOA limits, even, you know, dealing with the potential possibility of European and other countries, you know, snapping back the JCPOA deal, you know, writ large, then what do we do? And is the only option we have then the military instrument? And is this administration willing to go that route? And it’s not clear to me at this point that it is. And that, of course, maybe their idea is that the Israelis will handle it at that point, but I think we saw in 2012 that their preference is not to do this thing – kind of thing alone if they have to do it.
So I see – I see a gap in the logic, at least as I understand it, in the administration’s current strategy. So you need to have kind of some other non-military instruments to backstop the current policy and the current, you know, strategy that we’re pursuing. And one of the things we could, you know, perhaps consider I what some people refer to as political warfare or kind of, you know, policy of destabilization to kind of further foment instability domestically as a source of pressure. And I would argue this for pressure, not for regime change because, again, I’m skeptical of our ability to induce regime change from without anyhow. But we could, perhaps, focus on certain pressure points in order to increase pressure domestically to incentivize the regime to come to the negotiating table. Although, again, I’m kind of skeptical of all this. And I’m not sure this has been totally – these kind of ideas have been thought out. I, myself, I’m kind of – still kind of working out my own thinking on how this would be accomplished.
Another thing we have to consider, that in response to American nuclear pressure, Iran might link – push back in the regional arenas – in Syria or Afghanistan or Iraq, where they really haven’t, since 2011, been attacking – their proxies haven’t been attacking American personnel. What happens if Americans are targeted in a more focused way going forward? Then what do we do? And one of the things we could do is – and I think the message has been already passed. I think Dan Coats said that he passed the message on to Qassem Soleimani, you know, last year, that if Americans are targeted, that we will do so accordingly as well. I think that point needs to be underscored going forward.
There also needs to be a regional component to our pressure. And I think Syria is the area where it is probably most – the arena where we could do that most effectively, although I think by abandoning the opposition we’ve kind of given up the most potentially useful tool in this regard. But by staying in northern – northeast Syria, at least we deny the Syrian regime access to the most fertile land in the country and oil resources. And if we combine that with pressure in the form of sanctions on the Syrian regime, then maybe that will cause – it’ll force the Iranians and others to further increase their financial assistance to the regime and therefore, you know, impose costs on the people that have to support Syria and the Assad regime to keep it afloat. So maybe that should also be, I think, part of our strategy.
We should also keep in mind that the other guy gets a vote. So in the past, in response to our past pressure campaigns, we’ve seen that Iran has often responded to pressuring incrementally increasing its enrichment capabilities and threatening even more dramatic progress to convince its adversaries of the futility of their efforts. So it’s quite possible that at first they’ll go up to JCPOA limits, but it’s possible that they’ll eventually go past it if the pressure becomes sufficiently onerous. We have also seen in the past that they’ve accepted temporary freezes on their activities when the pressure is large enough. So they are tactically flexible and that’s possible that, again, that might, you know, kind of work itself out in kind of going up to the limit, but not exceeding the limits of the JCPOA.
But in the past, we’ve seen as foreign pressure intensified and broadened, they generally responded in kind. So in response to cyberattacks launched by the United States and Israel, and in response to sanctions on their petroleum sector, they responded with cyberattacks on Aramco and then distributed denial of service attacks on American banks and financial institutions, and with threats to close the Straits of Hormuz, which we could talk about. They’re doing that again now. I think that’s something they do only in extremis because they depend on the Strait of Hormuz to export, you know, just about all their oil and import a lot of the necessities of life in Iran. So that’s something they only do in extremis. But I think the threat is very useful in order to kind of – as a form of psychological pressure on their enemies. And then we also – in response to assassinations of their nuclear scientists, they launched attacks on Israeli diplomats in 2012. And then in response to a surge of American UAV overflights in 2011-2012, they attacked American UAVs in the Gulf. So expect pushback.
And we have to be prepared. It’s also possible, as I mentioned before, they’ve tended in the past to decouple their regional activities from nuclear pushback in Syria, Iraq, and Afghanistan. But in the future, they might link those together to ways they haven’t in the past, especially in Iraq, where we haven’t been attacked since 2011. So that’s something that could ultimately – I’m not saying immediately – but down the road as one of the escalation – rungs in the escalation ladder, that the Iranians might choose to take advantage of.
One of the other things that we have to keep in mind is that we’ve had, of course, a long history of interacting with the Iranians. And as a result of the way we’ve responded to past Iranian attacks – whether it be the Beirut bombings in ’83, the Khobar Towers bombings in Saudi Arabia in 1996, the support for insurgents attacking Americans in Iraq after 2003, Tehran has learned that it can wage proxy warfare against us without risking – at least until now – a military response. As a result, I would argue we have something of a credibility gap in dealing with the Iranians. And this is something which could come into play kind of in the way that we shape or don’t shape Iran’s response to the pressure campaign we’re waging now.
I would argue that the pushback that the United States has conducted in Syria in the last year has been helpful. The things we did to respond to their pressure against the U.S. forces at Tanf, with the rebel forces there, and in the east by Deir ez-Zor, the attack in February on Syrian Democratic Forces there, where we ended up killing a couple of hundred pro-Iranian, pro-regime militiamen, including some Russian mercenaries, I think has gone part of the way to kind of giving Iran pause in terms of how it deals with the United States and causing them to back off, at least in Syria.
Although, I think in response to that they’ve actually intensified the pressure on our allies, Israel and Saudi Arabia, since from their point of view that’s probably – at least until February, they thought that was – that was maybe safer. But they’re still continuing the pressure in Syria, even after the Israeli strikes in May. So we – there’s working to be done in terms of enhancing our credibility – with regard to the credibility of the military instrument in dealing with Iran, and the role that the military instrument plays as a backstop to American diplomacy.
And then finally, the last point I’m going to make, is the need to strike the right balance in the way that we use our pressure on the Islamic Republic. On the one hand, we need to use sufficient pressure to impose sufficient costs to bring them back to the negotiating table, which, again, I’m kind of skeptical about the possibility of that. And in fact, as, you know, Karen made clear, it’s not – it’s not clear how all these sanctions are going to work out in terms of what kind of costs it’s going to impose on Iran and how effective the sanctions will be. But we have to, you know, impose sufficient pressure to get them back to the negotiating table, without prompting Iranian actions that we are ill-prepared to deal with or that could spark a broader conflict.
So I don’t know if there’s a policy sweet spot here to be hit, but I would argue max – you don’t want to exert, to the degree that we’re able to do so, maximum pressure. You want something less than maximum. And I would argue that there’s – it actually would be desirable from the point of view of American policy not to completely eliminate Iran’s oil exports or ability to recover its money – although I’m not sure that we have the ability to do that – but it’s not desirable to completely zero out Iranian oil exports, simply because they’ve always said: If we can’t export oil, nobody’s going to export oil from the Gulf. And that simply incentivizes them to engage in destabilizing actions in the Gulf.
And likewise, with regard to regime change, I don’t think this should be an explicit element of American policy. It is not thus far, although there are clearly people in the administration that would like to make it as such. But, again, if they believe that they are facing not just, you know, the kind of usual American – what they believe is American soft war to kind of undermine the regime, but an active campaign, again, that’ll be – that’ll cross an Iranian red line which will, you know, incentivize them to use the military instrument against us, and cause us to – and cause probably military escalation.
So my final point is this: The administration’s policy might work. I’m skeptical, but, you know, we’re kind of entering into kind of terra incognita here. So it might work. But there’s always unintended consequences, as some of the other speakers have said. And I think we need to have a plan B in case it doesn’t. And we also have to hedge and be ready for what the Iranians might do in response. And I’m not – it’s not clear to me that all the possibilities have been thought through as well as they should be. So thank you very much. And I look forward to hearing Norm and the discussion after.
MR. MATTAIR: Are there any more questions you can bring? Thank you.
NORMAN T. ROULE: Thank you and good morning. I’d like to join my colleagues in thanking Tom, Rich, and the Middle East Policy Council for holding this distinguished panel of experts today to discuss a very complicated issue. I would also like to thank those of you in the audience who have left what I know are very busy schedules to attend this, and to the C-SPAN audience. This is a complicated issue. And it requires an informed citizenry and policy dynamic. And finally, just to put the plug in for those of you who are not a member of the Middle East Policy organization and get their magnificent journal, please sign up and get the journal. It is magnificent. I’ve been reading it for decades.
I’d like to take my comments in a slightly different direction today as we look at the JCPOA deal and the ramifications of the withdrawal. Policymakers here, in Iran and elsewhere will see their response to this action in – under an umbrella of other Iranian activity. I’d also like to begin by offering two concepts that I ask observers of the Iran issue to keep in mind. Unlike any other foreign policy problem, the threat posed by Iran is simultaneously strategic, urgent, and lethal. And if you’re a policymaker, you can’t get out of that concept.
It is strategic because it touches the Bab al-Mandab and the Persian Gulf. It touches oil prices. It is lethal because there is terrorism being conducted fairly routinely, as we have seen by recent actions in Europe. It is potentially urgent because an Iranian-enabled missile from Yemen that might strike a target in Saudi Arabia could take Middle Eastern policy into a dramatically new direction.
Secondly, an effective Iran policy for this country requires bipartisan support. And perhaps one of my few comments I would offer on policy is in the last few years we have had a less bipartisan approach to the Iran issue, and that is unfortunate. It also requires multilateral pressure. We need our European partners, our Arab partners to be standing next to us. In the absence of this bipartisan or multilateral support, Iran’s leadership will likely believe that any pressures will be incomplete and, thus, endurable.
Regarding the overall nature of the Iran threat to the United States, of which the nuclear program is just one element, despite Iran’s adoption of the nuclear deal Tehran has grown from a largely localized threat in 2011 to a significant and regionwide threat, with offensive capabilities, generally deployed via proxies, that pressure multiple U.S., international interests and partners. Directly or via proxies, Iran is in the capacity to exert pressure on the Strait of Hormuz and the Red Sea economic corridor, which Karen so eloquently described, has a powerful potential to disrupt global trade and to impact the economies of not just those Red Sea states, Egypt, but also, in particular, southern Europe.
We have a stream of almost daily press reports that show that Iran recruits, trains, and, to varying degrees, directs a seasoned transnational Shia militancy, capable of fighting against different opponents on disconnected battlespaces simultaneously. This is significant, and this is unprecedented in the history of the regime. Iran’s Revolutionary Guard Quds Force, often in conjunction with Lebanese Hezbollah, has now enabled a missile war against Riyadh and threatens the United Arab Emirates. The Quds Force is attempting to establish a more sophisticated missile and drone architecture to Syria to threaten Israel. The same element has armed Houthi proxies with explosive boats along, again, this critical Red Sea commercial corridor. And finally, the Quds Force has empowered terrorism in Bahrain, the home of thousands of American U.S. military personnel. And Qassem Soleimani has repeatedly gone on Facebook and publicly to show how is attempting to influence the political future of Iraq.
Iran’s missile force is now the largest in the Middle East and includes thousands of short and medium-range missiles. The problem this poses for military personnel of a variety of country in the – countries in the Gulf area is significant. Some of these systems are capable of carrying nuclear warheads, should Tehran ever decide to pursue this technology. But in a very disturbing development, and also unprecedented, Iran has provided advanced missile technology to Yemen’s Houthis and to the – and to Lebanese Hezbollah, changing dramatically their capacity for their punch, but also meaning that their adversaries, their targets may come up with a preemptive attack or counterpunch that could, again, take the region into dramatic new areas.
Iran’s acts of terrorism have spiked in the last year. Recent press reports highlight what certainly appears to have been an aborted Iranian attack on an opposition conference in Paris, using explosive supplied by an Iranian intelligence officer in Vienna. In June, the Netherlands expelled two Iranian diplomats, apparently also for involvement in terrorism. In January, Germany announced arrests relating to, again, an Iranian-led effort to target Israelis and Jewish facilities in Germany. Finally, Iran has also continued to build its offensive cyber capability. It is one of the top four threats to the United States and, I would argue, probably number three on that list. And it’s – we’re likely to see it increase its cyber activities against its Arab neighbors and the United States as sanctions are reintroduced.
The absence of an effective international response to these actions, in my view, has contributed to Iran’s sense that its aggression can be conducted at little cost, that its defiance of the international community brings little cost. And for those who are looking at how to reconstitute, to reenergize the nuclear deal process, this needs to be kept in mind. Iran, in continuing to undertake these aggressive actions, also risks that they will miscalculate Western or regional red lines, and thus could spark the broader conventional conflict.
Regarding the nuclear deal, and per multiple IAEA reports, the JCPOA successfully constrained Iran’s nuclear program, at least temporarily – per David’s excellent comments – although many would argue, and I would agree, that there are aspects of the deal – important aspects of the deal which are permanent. Iran importantly reduced the amount of time that it would take to produce its first weapon’s worth of highly enriched uranium, were it ever to decide to take that route, to about one year from a couple of months. That’s significant. It was compelled to destroy the critical element of its plutonium reactor at Arak, effectively destroying the reactor. The deal also introduced an unprecedented level of international scrutiny on Iran’s civilian nuclear enterprise, important elements of which, as I stated, were intended to be permanent.
But perhaps most importantly in the nuclear deal, the end of nuclear-related sanctions allowed the Iranian people see that it was their own government’s mismanagement and not international sanctions that lay behind the erosion of their standards of living. When you looked at many of the demonstrations, most of the demonstrations, all of the demonstrations in January, you rarely – I didn’t hear death to America or death to Israel. Their complaints were, rightfully, against their government’s mismanagement.
However, in light of Iran’s egregious behavior in the non-nuclear areas, it is not unreasonable to say if you can’t trust them anywhere else, how can you trust them here? And also, the Israeli capture of a vast amount of weaponization documentation, which is not in itself a nuclear program – papers and CD-ROMs are not a weaponization program – but it does show that Iran at least kept open the option to restart nuclear weaponization. And therefore it’s certainly reasonable to insist that any deal’s provisions be further tightened and we seriously look at possible military dimensions of their program, and asking Iran to reveal that.
I also believe that any future nuclear deal will almost certainly draw upon many, most, perhaps all of the major provisions of JCPOA and its oversight architecture, in large part because it represents – no matter your views of the deal – a tremendous amount of hard diplomacy by very hardworking policy staff, policymakers, diplomats, Department of Energy personnel, and others smart people. But in the wake of this deal, we ought to think: How is Iran going to react in coming months? They will continue to posture defiance, victimization, and they will press Europe, Russia, and China to ignore U.S. sanctions. They will also gradually expand, or at least claim they’re expanding – because Iran is a master of embellishment – that they are attempting – they’re going to expand its dismantled nuclear equipment and facilities – again, likely embellishing some of that.
But they will likely stay within the bounds of JCPOA, if in part to demonstrate their willingness to be part of a deal and also with their defiance demonstrate the ineffectiveness of external pressure. Tehran will maintain heavy diplomatic engagement with sympathetic European partners to place further stress on European-U.S. relations. Although some hardliners in Iran chafe at JCPOA restrictions, it is often said that hardliners in Iran oppose the deal. Now, that is certainly the rhetoric, but it’s not the reality. They also understand that Iran’s political and economic stability depend upon the sanctions relief provided by the deal. Despite their statements that they would like an immediate pullout of the deal, they’re unlikely to make such a decision until they believe the deal no longer provides the economic benefits that are so important to sustain the political stability of Iran’s regime.
There is little reason to believe, however, that Iran’s leadership will negotiate further on its nuclear program in the foreseeable future. It’s not just that distrust of the U.S. is high and it’s not just that pressure is not yet perceived as unilateral. Iran is going through a leadership transition period, and this is not the time for anyone in Iran to stand up and say: I think we should make concessions with the West. I think we should deal with the Americans. In the end, Iran’s decision-making on this deal will depend on how Iran’s leaders perceive their own domestic stability. Therefore, it is not unreasonable to believe that it will take several years of multilateral sanctions and diplomatic pressure, as well as, in my view, the arrival of a new supreme leader, before Iran returns to the negotiating table.
For the near term, Iran is unlikely to establish weaponization or cover nuclear sites, in light of the recent Israeli seizure of Iran’s nuclear weapons archives, an intelligence coup of extraordinary proportions. It’s just extraordinary. But Iran’s leadership, you must now well-imagine, is probably thinking: Can any aspect our nuclear program be kept secret from the West? If we undertake these activities, how long before they appear at a press conference at the U.N.? And compromised – any such weaponization efforts, they know, would not only compromise their diplomatic program, but would risk a nuclear – I’m sorry – a military option by the West.
Regarding the – Iran’s regional behavior, it’s certainly an overstatement to stay that Iran controls events in Iraq, Lebanon, Syria and Yemen. But its activities have exacerbated the instability in these countries, they’ve extended the conflicts in these countries, and they’re – the proxies they have created, who will seek to dominate the key security and policy institutions in their capitals, are changing the DNA of the region. That is also inescapable. Iran’s goal remains to be a dominant, if not the dominant player in the Middle East, while reducing the influence of the United States and Sunni states.
And Iran has exploited the turmoil to sustain or establish new allies, to establish itself as the sole protector of the region’s Shia population – something I think we should be stepping in on as a policy move. We should stand up for the beleaguered Shia of the Middle East, not just Iran, as well as to bleed our partners in Saudi Arabia and the Emirates, in the Yemen conflict, and obviously to confront Israel’s new and more capable enemies. Regarding reports of U.S. and Israeli engagement with Moscow, that Russia will convince Iran to leave the area, I am skeptical. Iran is unlikely to reduce its pressure – presence in Syria for multiple strategic reasons. And there is no evidence of which I am aware that Russia has the influence of the political will to compel Iran to change one of its most strategic locations in the Middle East.
What is also important is the openness by which Iran undertakes its regional operations is remarkable. Iran now insists it has the right to undertake these interventions, a powerful statement on how Iran views its role in Arab capitals in which it has no influence in modern history. This new determination is likely driven, in part, by the extensive financial and personnel investments Iran has expended in these conflicts. Iran’s Revolutionary Guard leaders routinely express pride in the service of their personnel in Syria. Soleimani’s – Qassem Soleimani, the head of the Quds Force’s, presence has been splashed all over the internet. But in a worrying development, Lebanese Hezbollah and Iraqi Shia militias have now adopted an expeditionary profile. And we should consider how these external operations for the Iranian personnel and for the militias will change their own perspective of their role in their country and impact their long-term evolution.
Iran’s operations in the regions remain vulnerable to the disruption of their logistic chain. But this would come with some policy consequences. Looking forward, as the Quds Force is learning from ongoing events in Basra, it’s much easier to empower military groups than it is to solve the economic and political challenges in proxy territories. Iran has got a lot of headaches coming for its personnel in its proxies in this region. We’ve seen that Iran’s population is increasingly unhappy with the expenditure of Iran’s forces outside of Iran. But they themselves only know about these events through what information leaks into Iran. And I think it would useful if we could push more data into Iran to show the Iranian people what these conflicts are costing them.
Iran’s domestic and political foundations continue to erode as a result of these new sanctions. But this is also compounded by decades of mismanagement, of political infighting which has made decision making very difficult, environmental problems which have a very real impact on the lines of Iran’s people, unprecedented corruption, and a crumbling infrastructure. Protests have been fairly common in Iran over the years. And if you were to look at sort of a chart, if you were to put this out, Iran is actually a protest-rich culture. But they are now magnified by social media. And they represent a drumbeat of genuine despair.
But Iran’s unrest also remain leaderless, rudderless. The protests are disconnected and generally driven by local economic complaints. Security forces appear to be cohesive, well-resourced. And the harsh sentences given to women, outrageously, for dancing and refusing to wear the hijab represent the hardline leadership’s refusal to tolerate even a modicum of liberal reform. But having endured severe sanctions under the Bush and Obama administrations, Iran’s leaders certainly recognize that impending sanctions touch their stability. The flight of international companies, especially banks and oil firms, entirely predictable. And I have never understood those pundits who said this would not happen or might be open to an issue. Companies vote to protect their shareholders, and that’s that.
This process appears unstoppable, and European efforts to develop alternative financial mechanisms outside of the sanctions’ reach will likely have little impact on this trend. Iran’s oil exports have declined, and Tehran’s limited influence in OPEC was highlighted in the recent conference. Iran has few options to restore confidence in its currency, and we’re now watching unemployment rise, we’re watching inflation start to creep up in Iran. In addition to its diplomatic activities, the regime’s primary focus in coming months will be to import as much hard currency as possible, certain commodities they need to sustain the illusion of self-reliance, the resistance economy, and prevent further domestic turbulence. It will also seek to retain remaining oil contracts and establish new commercial relations with China and Russia.
Although these will not be effective in overcoming the fundamental pains of sanctions, Iran’s development with – relationships with small and medium Russian and Chinese commercial partners, with no exposure to the U.S. financial system – and there aren’t many of those – will offer at least propaganda opportunities and modest sanctions relief. In the medium term, Iran’s leaders have much reason for concern. The revolution has aged badly and few maintain the fiction that its failure to achieve fundamental social goals is due to U.S. interference. All of the regime’s leaders, to include Rouhani, the supreme leader, and even popular Quds Force leader Soleimani were heavily criticized in recent demonstrations.
Iran’s security forces have used these demonstrations, however, no doubt to identify ringleaders behind the protest, and will use whatever forces necessary to cease this unrest. There is no indication that the Iranian regime will collapse in the near future, but there is also no evidence that the regime is capable of arresting this erosion to its long-term stability. The selection of Iran’s next supreme leader will be a critical inflection point in the regime. Khamenei has already shaped the selection architecture to ensure the appointment of a hardliner who can be trusted to sustain the ideals that he supports and to protect regime key stakeholders.
Let me conclude with a few thoughts on potential policy options, quickly. The primary goal of U.S. policy always should be one thing: We want to develop a multilateral effort to encourage debate within Iran’s society and inner leadership as to whether its support for a nuclear program with a domestic industrial enrichment capacity, terrorism, regional interventions, its unreasonably large ballistic missile program, the detention of U.S. and other nationals – are these worth the pain of economic sanctions, which will inevitable erode, first, Iran’s economic stability and then the political stability of a fragile regime? At that point, however, we need to be ready to engage Iran with incentives to be part of any diplomatic approach.
But there is a caution here. People usually don’t come to the table at the point of collapse. They come to the point when they fear collapse. Which means, when Iran came to the table for the JCPOA deal they did not come to the table to accept any deal. That is why the negotiations took so long. Secondly, we need Europe and the Arab world at our side. Our relations are currently strained, it’s not secret, but we need this multilateral approach. But this means also that Europe must adopt a tougher action against Iran’s nuclear activities and must employ the most severe available sanctions to deter those activities.
It makes no sense to say to Iran that in exchange for sticking with JCPOA the only sanctions options left to policymakers will be minor personnel and minor companies. In your policy decision making you usually have diplomatic demarches – people don’t hurt me again – sanctions to threaten economic pain, or a military conflict. We cannot deny the space in that second category simply to protect the nuclear deal alone. Our public diplomacy needs to be clear and loud. And I support the secretary’s plans to engage the Iranian community internationally – the Iranian community outside of Iran and the international community. But Iran must understand that any effort to develop a nuclear weapons program will be met immediately by a military response. Iran must also understand that a cyberattack in coming months against the United States or regional partners will be met by an equally severe response.
Finally, it is up to the Iranian people to choose the direction of their country. I am not a believer in regime change in that regard. But they also have the responsibility of pressing their own government to end its intervention in other countries. Iran chooses its own government. It doesn’t have the right to choose other governments. Next, the U.S. should lead an international campaign against Iran to end the activities – indeed, the external existence, of the Quds Force. If there is one thing that can be done against Iran that would change the paradigm of Iran’s leadership of what they can get away with and Western resolve, it would be this. The organization is unique in the planet. Its sole goal is to enable terrorists and create militia groups and to defy proliferation sanctions. Its activities violation multiple international standards and the very concept of Westphalian sovereignty.
Final two points: We need a multilateral process to dismantle Iran’s regional militia structure. This is something we don’t have our head arounds yet. Iran’s militias will not only impede the development of stable societies in these countries, but it allows hardliners inside of Iran to say: Look what we can get away with. Look how the West does not respond. My final comment would be regarding detainees, an issue for which I believe there needs to be more comment. And with Europe as a partner, Iran needs to understand that its continued detention of Americans and other nationals will deny it acceptance into the international community. The detention of such innocent individuals as Princeton graduate students – student Xiyue Wang and Iran’s refusal to cooperation on missing American Robert Levinson cannot be forgotten.
With this, I conclude my comments. Apologize for the length. And look for forward to your questions.
MR. MATTAIR: Thanks to all four of you. There’s a lot of ground to cover here. David, could I start with you, about this JCPOA? I believe you said that the Trump administration is going to seek zero uranium enrichment if there is a new negotiation, but you’re not even sure that the Trump administration is willing to have any negotiation. On this question of uranium enrichment, and on the question of the military plans that have been discovered, how long would it take Iran to move from enrichment at, you know, almost 4 percent uranium-235 to the 19.75 percent they had mastered a few years ago, to the 90 percent enrichment that would be required for a nuclear weapon? How long would that take? How long would it take for IAEA to discover it? And would they have any incentive to do anything like that if they don’t have nuclear designs perfected for the warhead and the placing of the warhead on a ballistic missile, and the technical aspects of detonating the weapon at the right time? Would they ever risk anything like that?
MR. ALBRIGHT: Yeah, it’s hard to answer all those questions. But one – the breakout timeline is really based on the idea that Iran makes a decision to race to being able to produce enough, essentially, weapon-grade uranium, greater than 90 percent, enriched uranium in as short a time as possible. And there’s quite extensive debate on that. I mean, I was just in a European capital several weeks ago where their view is the breakout time is, you know, 13 to 15 months, in the sense if they start now that’s what it’ll take. They assume that advanced centrifuges wouldn’t be deployed in that breakout. I mean, we do – our breakout is seven to 12 months, or maybe even a little longer. But there’s some that think it’s within three months, I’ve heard.
So I think one of the things we’re facing is that the uncertainty about their centrifuge program is growing. We don’t know how many they have hidden away – or, let’s say, partial construction of centrifuges. I mean, would they trust their advanced centrifuges? I mean, a lot of their program is a disaster. I mean, they – we know that from the International Atomic Energy Agency. They went off to build advanced centrifuges, many different types, when most programs would focus on a few. And many of them have failed. I don’t know if you follow this – something they used to talk about a lot, the IR-8. It’s a – it’s – I don’t think it’ll ever be built, the way it’s developed.
And so they have real problems. And I think that gets to this issue of they may not want to build up their program too much. I mean, it was interesting, the other day Salehi, who certainly has been around a long time and knows the program probably better than anybody, he talked about the IR-6. We know the IR-6 itself probably doesn’t work. I mean, it’s four or five years from deployment. There’s a variant of it which – called the IR-6S that maybe they could build and deploy.
MR. MATTAIR: That's a centrifuge.
MR. ALBRIGHT: Yeah, centrifuge. But I think they’re faced with a real serious development issue. So I think – I would agree with Norm, I don’t think they’re going to – I’d maybe say it a little differently, maybe emphasize the fissile material – I don’t think they’re in a position to want to try to break out to nuclear weapons, unless – you know, if you look at the South African case, use their terminology – if, you know, my back’s the wall, you know, all bets are off. And I think – and to kind of emphasize what Mike said – I think you don’t want to pressurize too much to where they feel that their only out is to build nuclear weapons, or that the – and so I don’t know how you balance that because this administration wants to increase the pressure.
And as you’ve probably all seen, it’s turned down a recent request from the Europeans for exemptions on the sanctions. So it does want to drive the oil exports of Iran towards zero. And so I think it – again, it – my institute is often in the mode of, you know, we can see problems. We have a harder time visualizing the solutions. But I think one of which would – I would argue, would be that we need to think through what it is we’re trying to accomplish, and that there – what Michael said – that there is a plan B that is in place to help us in case it doesn’t work out quite as we expected.
MR. MATTAIR: OK, but can I ask, again, is there – in the materials that have been discovered, seized in the warehouse, or that were known to our intelligence agencies in 2007 about prior military dimensions of their work, is there evidence that they actually have the capability to build a warhead?
MR. ALBRIGHT: Yes. Yes. No, no, they could – I mean, could they deliver it on a Shahab in a reliable manner? It’s not clear. But I think there’s – this information shows a bigger, more advanced program than was understood. And so I think – yes, I think they could build a nuclear weapon. I mean, the – again, I mentioned the French could tell you, they could do it – if they had the fissile material, they could do it in three months. Now, again, I mean, there certainly would be arguments – as there have been with North Korea – could they deliver it reliably on a ballistic missile, and are they willing to take that risk that it may just miss or pre-detonate or not detonate at all?
MR. MATTAIR: Well, you’d have to test before you take a chance like that.
MR. ALBRIGHT: No, you don’t. On this kind of weapon, you don’t have – I mean, you’d have to flight test. But you don’t have to test the nuclear device. They won’t have to do that. I mean, that – their program, from what I understand, it was designed to avoid that. I mean, certainly part of the information is they were looking to at least consider building an underground nuclear test site. And they picked five possible locations. But I don’t think their first device would have needed that kind of test.
MR. MATTAIR: Someone from the audience is asking about the negotiations between the EU, E3, and whether they did get close to some agreement with Iran, and what the Trump administration view of it was.
MR. ALBRIGHT: I think they got very close. I mean, it – certainly on the re-imposition of sanctions. But I know from the legislative side of this, which was a parallel effort, there was no intention to require an automatic snap-back of sanctions. I mean, that was the rhetoric perhaps publicly. But underneath it, there was a recognition that a president doesn’t want to give up that kind of power, neither does Congress. And so there would have been, we call them, off-ramps for the automatic snap-back of sanctions. The Europeans wanted certain assurances and certain approaches.
The – and there was sticking language over this idea of a 12-month breakout, which I must admit I was one of the developers of and actually wrote the legislative part of this using that as a criteria. But it had been interpreted and developed not as a theoretical concept of, well, let’s all estimate the breakout timeline. But it was defined as Iran does this, builds this number of centrifuges, or this amount of enriched uranium, so it was quantified in a very specific way. And so I think, again, that breach or that distance between the Europeans and the U.S. could have been managed if given a little more time.
But I think this administration decided that they want a conflict now. They think now is better than later. And they think they want their – in a sense – these fancy financial and other sanctions the U.S. – actually, U.S. Congress created. They want them out of the Cabinet and fully deployed. And they did not like, in the end, the idea of fixing the deal. And so I think the problem for those of us who believed in fixing the deal is can we trust the next thing President Trump does? And I think if you’re in European capitals you’re going to hear this, is that can you trust the bureaucrats which are everybody but him? Do they have credibility to articulate a policy? So I think that’s one of the unfortunate casualties of the way this has worked out.
MR. MATTAIR: OK. Norman, do you want to comment on any of that?
MR. ROULE: I would have a different view on a few points. This president came into office with very stark views on the nuclear deal. No surprise to anyone. Europe’s response, silence. On October 13th, the president of the United States gives a speech stating he is going to terminate the deal. Europe’s response, mainly silence, although there has been robust international – robust diplomatic discussion between the United States and our European partners, but no hard solutions. In January, he states it again – no decision. The issue of what sanctions can be left off – can be pulled off the table that you will not use against Iran for its other activities, I don’t know – I don’t think was ever resolved. The issue of the sunsets in the deal – I don’t know if that was ever resolved.
So simply to say that Iran will not build an ICBM – which I believe the public discourse is it’s not planning to do right now; there’s no public evidence of that – that’s important but that’s not critical. What is critical is, can you trust this country going down the road in a few short years? Two other side points of the deal which are not often discussed. On October 2020, the convention – the restrictions on Iran’s conventional weapons program as part of the JCPOA deal would expire. Does anybody thing it would be safer for Iran to sell conventional weapons to Hezbollah openly? On October 2023, the U.N. restrictions on Iran’s missile program would expire under JCPOA. Does anybody think the world would be safer if Iran could purchase openly ballistic missile parts and sell same to Lebanese Hezbollah?
So there were a number of aspects to these negotiations, as I say, that are fairly complicated beyond just the nuclear deal.
MR. MATTAIR: Yes. I mean, the compliant about the agreement was that it was limited to the nuclear program itself, did not – and did not sufficiently restrain Iran’s development of other weaponry, and certainly did not restrain Iran’s other behaviors in the region, and so that, you know, we needed a strategy that would be more comprehensive and address all those issues. Whether we needed to withdraw from the agreement or not is debatable, but we have.
Now, what is the strategy? As Michael was talking about needing one. Part of it certainly is the economic pressure. And Karen believes that this is really going to be successful. You are basically predicting collapse.
MS. YOUNG: I don’t think it’s successful. (Laughs.)
MR. MATTAIR: No, no, I mean, the sanctions – no, I used the wrong word. But what you mean is the sanctions are going to be so severe that you are going to have severe economic repercussions in Iran, possibly economic collapse. Now, somebody from the audience was asking, is there any way China can rescue them from that?
MS. YOUNG: No.
MR. MATTAIR: And maybe India.
MS. YOUNG: No. And I don’t think – the Indians are very divided, between the government and the kind of business community, so they’re not going to help very much at all. China can help create a bit of – a cushion, but they can’t save the Iranian economy. I think there are some possible innovative ideas. As I mentioned, I think, you know, a lot of the challenges of the Iranian economy are shared on both sides of the Gulf. So this is in the delivery of electricity. There’s also electricity shortages in Saudi Arabia, across the Gulf. But there are – the ability to build new plants, to invest in them. There are many South Korean firms which has been poised and which had begun investment inside of Iran. South Korean firms that actually received investments themselves from Saudi Arabia. So, ironically, there was cooperation between the Gulf states and Iran in terms of energy, electricity delivery.
They also have these massive youth unemployment problems that are shared, and just basic service delivery. In Iran, the bank sector, as Norman mentioned, is really a mess. There could be ideas for intermediation, perhaps even from international financial institution with help from the EU to help clean up some of these practices to create a cushion for some structural reforms in Iran. So I think there are avenues that could alleviate what it seems like we’re walking into, a very severe situation. And it’s not that – the reason why I think it’s not successful, I should say, is because it doesn’t punish the right people. It destroys the savings of the middle class. It hurts youthful generation, which is well educated, especially among women, who – why would the United States want to alienate these people across the Middle East, but in Iran in particular? So that’s, for me, I think, very much the downside.
MR. MATTAIR: Mmm hmm. And Michael, while this is taking place, while Iran is suffering economically, what are your major proposals for dealing with Iran’s behavior in the region, if they have a history of pushing back under circumstances like this? And is it likely that we are going to see, as Karen has said she fears, actual conflict?
MR. EISENSTADT: OK, let me just say that in the past they have decoupled pushback in the regional arena from their nuclear pushback. So by and large they responded to nuclear pressure by moving forward with their nuclear program to kind of say that – you know, to quote, you know, Khamenei’s quote from the ’80s, you can’t do a damn thing about it. You know, that we’re going to continue to move forward and that your sanctions are ineffective. They responded to American cyber and Israeli cyber with cyber as well. But my concern is that they might do stuff in the naval arena. Actually, since last year they haven’t been engaged in, you know, what the U.S., you know, NAVCENT would call unprofessional and unsafe behavior.
MR. MATTAIR: In the Strait of Hormuz.
MR. EISENSTADT: In the Strait of Hormuz and in the Gulf. So they could ramp that up again. And if you remember, before the JCPOA was concluded, there were a couple of incidents where they kind of diverted a tanker, it was related to a dispute with the company. But there were a number of – there were a number of incidents in the Gulf before then. But by and large, I don’t think that was related to nuclear pressure or kind of nuclear – you know, pushback against American nuclear pressure.
But in the future, that could change. So I would argue, again, we need to have – there needs to be a credible military option in order to limit Iran’s options for pushback, because if they feel they could push back without accepting, you know, significant risk, they’ll do so in those domains. Again, what we did in Syria last year I think has been helpful, even though it was very constrained, and it was related to force protection, the stuff we did, and it was all in response to actions by pro-regime militias against the United States advisors who were embedded with rebel forces. I think it had a useful impact.
But I think we need to continue to – along those lines. And statements by the president that we’re going to withdraw from Syria are not helpful in that regard, although it seems that at least for now he’s backtracked from that – at least for now – and he’s done an Afghanistan, so to speak, in northeastern Syria, that he was perhaps convinced by his senior military officers that it’s not a good idea for us to leave there. So that’s useful to have us there. And the precedent we’ve set in the last year is useful. But I think we also have to continue – it’s not enough just to set red lines, but you have to tend to them.
So the reports that Dan Coats sent a message to Qassem Soleimani, don’t attack American forces in Iran or elsewhere, they’re effective attacking U.S. forces in Afghanistan and Syria, you know, at this point by supporting the Taliban and their tests last year of the – their tests at Tanf and in the east. But we don’t want that to happen in Iraq. And so, again, setting these red lines, tending to them, and conveying credibly that if they target our people we’ll target their people. And we have a whole decade and a half of targeting al-Qaida and ISIS leaders in the region. We have very robust capabilities in this area that we’ve never turned against the Iranians. And indicate to them, for deterrence purposes, that unless you want this turned on you, don’t touch our people. So that’s what I would argue – those are elements of a policy to deter them from pushing back in the regional arena against us in response to nuclear pressure – or, pressure on their nuclear program.
MR. MATTAIR: Norman, can you comment on that? Because, I mean, Iran’s behavior in the region is already a problem for us in Syria, and Lebanon, and Yemen, and Iraq. Somehow this pressure on Iran, by imposing sanctions and withdrawing from JCPOA, is meant to help us restrain Iran in the region. So what do you expect them to be doing? And what do you think we should be doing while we wait for them to come back to the table, because you said you wouldn’t expect them to come back for several years.
MR. ROULE: That is correct. And I still – I still maintain that – maintain that position. The impact of sanctions will be erosive. They will take a fair amount of time. Iran is a large economy. And I don’t anticipate that there will be the pressures placed on the regime sufficient to cause the supreme leader and others to come back for any deal immediately.
This said, a couple of points on Iran’s position in the region. Iran has been able to – is able to establish or has been able to establish its front lines in a one-way fashion against all of its adversaries in the region. And when we talk about a conflict in the Middle East, well, we have Iran and Hezbollah, as per the statements of the State Department and our ambassador to the U.N., enabling missiles being fired upon Saudi Arabia, where there are thousands of Americans and thousands of other foreign nationals. So we have a missile war underway. They are using drones into Israel, armed. And they have used drones, as stated earlier, against U.S. forces. We have a drone force underway – a drone war underway. They have enabled explosive boats used by the Houthis in the Bab al-Mandab and the Red Sea. You have a naval conflict underway.
I think the question of conflict is often shaped in terms of another Gulf War, whereas conflict through gray zone or hybrid war activity, it’s underway. And our response to that is not just – it shouldn’t just be attacking the fellow on the other end of the drone, but it’s got to be a game aimed at Tehran. And to Karen’s excellent point that the sanctions don’t strike the right people, that’s a very good point. It’s something policymakers have deliberated with for hundreds of hours of meetings that I’ve attended in my career. But as I also say, if anyone has the name of the company that we can sanction that won’t do that, come up with it. I’m sure the State Department, Department of Treasury would welcome the suggestion, because it doesn’t exist. The IRGC and others are so corrupted the economy that they are the economy that touches the Iranian people. And the Iranian people have – should have a voice in their government.
When it comes to pressure on Iran, what they will do next, they will test us. They will test our will. And they have put serious skin in the game. So if you look at Syria – and I’ll close on this point – they have lots a couple of dozen, per press reports, flag-ranked officers. And they continue to replace them. So we have to recognize that as we push they will push back. But that is the nature of the Iran problem. If you don’t want to do that, then you have just the option of giving in.
MR. MATTAIR: Do other panelists agree with Karen about economic collapse? Or do we have disagreements about how long this will take and how long Iran will be able to continue with its current behaviors, and how long they’ll be able to wait before there’s a – before there’s a political crisis and they’re willing to negotiate? Karen, how long do you think this –
MS. YOUNG: Yeah. I should say when I say collapse, I really didn’t define that. What I mean is severe damage – so a severe currency crisis, an inaccessibility to have foreign exchange. I mean, that creates essentially hyperinflation. So that’s why it hurts ordinary people. But I agree with Norm’s point about the real saturation of the Iranian economy by the Revolutionary Guards. That’s true. And I think it’s widely understood how deeply corrupt and just ineffective the Iranian financial system currently is.
But I actually see this as a point of entry, a point of leverage for multilateral negotiation. And the European Union is trying to do that right now. And I think they’re right to do it. So in order to allow the Iranian central bank to have funds in European Union, member central banks would be adopting some measures in financial transparency. Doesn’t fix everything, but it would be an in-road. And I think that’s a very, very good policy idea – of the few we have on the table right now.
MR. ALBRIGHT: Tom, can I add one thing?
MR. MATTAIR: Sure.
MR. ALBRIGHT: Yeah, I think it – I guess I agree with what Karen’s saying. I think when I look at collapse, though, I – also comes – the issue rises at how repressive can the regime be? You look at North Korea in the 1990s, where there was widescale famine and they were expected by the United States administration at the time to collapse. And they didn’t. And so, again, in Iran, they probably are pretty capable of repressing dissidents or those – and intimidating the others. And so I think I wouldn’t want to link collapse to regime change or regime collapse, that it may – their economy may, but I think they probably will stay in power, is what I would – at least, what our experts or the people I listen to would say, that we’re not – we’re not quite like the Soviet Union in the mid to late 1980s. We haven’t – we’re not quite at that point yet. It’s an earlier point.
MR. EISENSTADT: If I could – if I could jump in on that, if you don’t mind, Tom?
MR. MATTAIR: Well, yeah, actually, there is a question from the audience asking if regime collapse is really what we’re aiming for, and whether that is realistic given their monopoly of use of force and their longevity.
MR. EISENSTADT: I’ll use that as a kind of segue here. I suspect the way that – you know, probably the way the administration has thought about it is that they have kind of a – they have kind of branches in the strategy in terms of if maximum pressure works to create greater instability domestically, that’s another pressure point on the regime, which might cause them to finally yield and decide to reengage with diplomacy. And if they don’t decide on that, it might then lead to a meltdown or regime change or at least massive unrest, which then forces Iran to focus a great deal on its internal situation.
And, you know, the resources they spend –
MR. MATTAIR: And pull back from their Syria –
MR. EISENSTADT: Well, you know, the Quds Force, the Iranian contingent in Syria, as far as we know, is only a couple thousand IRGC fighters. Subsidizing the Syrian government has cost them a lot more. I mean, the estimates that the administration puts out in public are 16 billion (dollars). I have no ability to judge that. But that’s a fair sum of money. So the point is, you put them on the horns of – horns of a dilemma, that if they don’t negotiate, then they have to deal with the possibility of greater unrest. And if the unrest gets to the point that they’re worried about it getting out of hand, then maybe that will cause them to come back to the negotiating table.
And then I would just like to, you know, elaborate on Dave’s point in that regard. There are two things in the past. You know, if you look at how Iran, the Islamic Republic, has responded to past domestic unrest, they’ve been very – because they made a revolution and they know how the kind of heavy-handed response by the security forces can actually get things – kind of exacerbate things, because that’s in a way what happened with the Shah’s forces. You had them killing protestors, and then you had the 40-day mourning period, and they’d come back, and the protest would snowball. So they’ve been trying to avoid that in 1999, in 2009, and more recently.
So they’ve actually, in many ways, have – you haven’t seen Tiananmen Square type of response, where tanks are out in the street and roll over people. They’ve been – in many ways, they tried to use nonlethal means by and large. I’m not saying that people haven’t been killed, they have, and by snipers and others. But by and large, it’s hand-to-hand. But as a result of what happened last December, it was reported that the Majilis quadrupled funding for the purchase of weapons for the law enforcement forces. So I think they realize that things are – could escalate in the future, and they won’t come out with just truncheons and chains, but they’ll have firearms.
And also, because they feared in the past – they had concerns about the reliability of the security forces, because in the past the Rev Guard was a conscript force and reflected the society at large and the trends within the society. So they had questions about the lack of reliability. That’s another reason why I think they by and large didn’t push too hard when they responded on the streets. They kind of protracted the conflict and used indirect means to deal with it. But now they’ve been doing things in terms of recruiting for the IRGC only from the besieged, people who are besieged members.
So they’re trying to ensure the reliability and the capability of the security forces, because they realize things might get worse in the future. And they will use more force in the future. So never underestimate the ability of these kind of regimes to hang on. You saw it in Iraq in the ’90s, which of course Iraq was very different. But David mentioned North Korea, which is also very different. But, you know, never underestimate the resiliency of these regimes. On the other hand, there are – there are fissures in the system. So it could go both ways. I don’t rule it out, no.
MR. MATTAIR: Norman, do you want to comment?
MR. ROULE: I think there are a couple of points I’d mention. The first is, this regime will have no compulsion about using the coercion needed to put down unrest. But there’s a calculation that goes into that. And I think the last comment was spot on, and that that is you don’t necessarily need tanks to put down unrest. You need a small, capable force around what have been relatively small demonstrations in January. The numbers were in the thousands, not in the millions. You can control demonstrations capably without tanks and shooting a number of people. And there is a post-demonstration, pre-demonstration planning effort involving such things as turning of Telegram and following up afterwards by identifying people in the crowd through cameras. And the Iranians have done this extensively.
But this regime I believe will use whatever violence is needed to put down unrest. It is a – I think it’s a foundation of this regime that isn’t often appreciated. But that said, in case of a full, we’ll call it – go back to the complete economic breakdown, meltdown of the regime – no, we have a failed, I’m not sure you can even call it economy, in North Korea. It hasn’t changed the North Korean government. You have an unprecedented collapse in Venezuela. It hasn’t changed the government. I think we need to be careful about solely – sanctions are a tool, but they’re not a policy, as many wise people say.
And I think what you want to look for in terms of conflict with Iran domestically is the evolution of the country. Their supreme leader is facing mortality. His successor will lack his iconic status, likely his religious status, certainly his political status, and absolutely his relationship with the IRGC. You’ve got a presidential election coming up in 2020. You’ve got events in Jordan, Iran, Tunisia, and Iraq that have a very – an echo of unemployed youth, a lack of foreign investment, a lack of public services. The seeds of Arab Spring remain throughout the region. I think the Iranians are very aware of this. And for that reason, they’re going to be very careful about the amount of force they put in.
But I think at the same time – and I’ll conclude with this – sanctions are the best way to compel a debate among Iran’s leaders as to whether or not they want to risk the stability of the regime at these – at this important period.
MR. MATTAIR: OK. One topic we haven’t touched on yet is the role of our partners and our allies in the region, and why they were so critical of the JCPOA, and what role they’re willing to play with us now in dealing with Iran on the ground in the region. And whether they’re willing to put skin in the game if we take ours out. And whether they think that somehow our relationship with Russia can be leveraged to help them get Iran out of the region. Can people comment on all that?
MR. ROULE: So, again, one of the problems I mentioned earlier was the lack of a sort of bipartisan approach to some issues. And the role of our Arab allies in the region often seems to have a you’re for them or you’re against them. So we have asked our Arab allies in the region to develop – to handle their own problems. They’re doing it. The Yemen War is taking a very long time, and it’s a tragedy. How long did that Iraq War take? How long is Afghanistan taking? Wars in the Middle East consume calendars as well as lives. You have the Saudis and you have the Emiratis basically saying when it comes to Yemen they will not allow the creation of a Hezbollah-type entity on the southern border, next to the strategic Bab al-Mandab, which has about 15 percent of the globe’s trade going through it every day. And they’re doing the job.
You have the Emirates in this week – it’s a fascinating development that’s ongoing and it’s not receiving I think enough coverage – and that is they’re changing their relationship with China dramatically. And it’s happening while we speak. Well, that is an offset against Iran. You have the Saudis and the Russians talking about oil issues. And, frankly, Iran’s performance in the last OPEC conference was pretty sad. They came in rather tough, and they left saying, well, you know, we didn’t quite get everything, we got something. And that’s because the Saudis and the Russians have now the relationship that didn’t exist in past years.
Now, is all of this going to be positive? No. Will some if it take a lot longer than people like it to take? Absolutely. But they’re moving in the right direction. And they’re risking lives and they’re risking – they’re risking dollars and lives and they’re not asking for Americans to die on their behalf, as many people would have thought.
MR. MATTAIR: In Yemen, yes, absolutely. You know, they –
MR. EISENSTADT: Yeah, if I could just add to Norm’s comments. I think the Israelis have emerged as perhaps our most effective proxy, if you will, in dealing against the Iranians in Syria, in that – and I think, you know, the Israelis in a way kind of found themselves kind of backed into this position because they would have preferred to have been working with the United States in Syria against the Iranians. But kind of – you know, kind of concluded that, by and large, I think the administration is leaving it them. And they – as a result, we’ve seen greater cooperation between – or greater coordination, at least, between the Israelis and the Russians in terms of the parameters by which the Israelis can operate in Syria against the Iranians to prevent them from transforming Syria into a platform for power projection in the Levant.
So we’ve seen these series of strikes in response to Iranian UAV overflight and then – you know, kind of and then Israel’s response to the Iranians response, which then basically tied to kind of zero out all of Iran’s kind of infrastructure that they’ve been building in the recent years in terms of logistical sites and barracks and also intelligence collection sites that were, you know, directed against Israel, but also, you know, kind of part of Iran’s emerging infrastructure there. So, you know, I think that’s the way that the administration prefers to deal with it. To, you know, kind of have our proxies – to have our allies act as proxies and acting on their own. And thus far I think, you know, this is – Israel has been very effective in this role, but it will depend going forward on Russia’s, you know, continued acquiescence to this.
It serves Russia’s purposes right now to have the Iranians cut down to size in Syria. But that could change. And if it does, then Israel’s ability to play this role will potentially suffer. And then we’re going to have to figure out what to do about it. So I think it’s in our interest to kind of reinforce the messages that the Israelis have been sending to the Russians, to say that we also are – you know, it’s very important for us that Israel be able to have continued military freedom of action in Syria and kind of reinforce the Israeli message. I’m not sure that’s being sent at this point, but I really don’t know. But not publicly, at least, it seems.
MR. MATTAIR: Norman, is that – is that enough for Gulf Arab states?
MR. ROULE: No, but I’m not sure what the – what else we would ask them to do. I mean, are we asking for an Arab military force to invade Syria? I’m not sure that’s the smartest thing. But you’ve also got the Saudis engaging Muqtada al-Sadr, which – and he’s an individual with an interesting background. And that takes some diplomatic boldness on the part of the Saudis and the Emirates. And their willingness to do this is – shows they’re willing to look at unconventional methods. And the Israeli actions in Syria – like, our missile strikes against Syria had no Russian response, which I think shows perhaps Russian weakness in many ways, but at the same time Russia’s willingness to risk its broader relationships for Iran.
My final comment would be, as we look at activities in the region, sometimes it’s just allies standing with us. Bahrain is under routine or pretty frequent attack by trained personnel in – from Iran, often trained by Iraqis, which their reporting says. So you have the inter-awareness of Iran surrogates. And I think you’re developing an inter-awareness of America’s partners in the region. At the end of the day, this is relatively cheap for the Iranians. I mean, the Iranian people just have to be told: A tanker of oil is about $250 million to Syria. Would you like that spent there or on water facilities of Khorramshahr? And that’s the decision the Iranian people have to make. And I think it’s something we can send home. And our Arab partners can help communicate that message home as well.
MR. MATTAIR: Yes, it’s good that you pointed that out, because I think not everyone is aware of the record of how extensive Iranian support for proxies is in the region, including inside Bahrain.
MR. ROULE: If I could – if I could add, a line I sometimes put forward is: When you look at a traditional proxy group, and the definition needs to have training, assistance in weaponry, not just financial support, cyber support, intelligence support, training camps, this is a structure. This isn’t just giving somebody a bag of money and a gun. If I were to ask you to name a proxy group run in that fashion by a Sunni Arab state, you can’t name one. If I were to ask you to name all of the Iranian proxy groups in the region in one breath, you can’t do it. And they are ecumenical in terms of there are Sunnis, elements of the Taliban, Hamas, Palestine Islamic Jihad, as well as a myriad number of Shia militia partners.
And what I think – where policymakers need to look at, when I mentioned the Shia groups is, what happens to Kata’ib Hezbollah in the political revolution of Iraq? Will they give up their weaponry? Napoleon has often stated: You can do anything with a bayonet except sit on it. If you were the Kuwaitis, how would you feel about having an armed Kata’ib Hezbollah on your border? These are – these are realities in Iran’s relationship with these countries. Again, it’s unprecedented. I can’t think of another country in the last century that has engaged in this activity.
MR. MATTAIR: Well, Michael – I’m going to ask people if they have final thoughts or final comments. But before I do, you’ve written a lot – the way I came to know you was, you know, your writings about Iranian conventional capabilities, asymmetric capabilities, which they can use in the coming years while they’re undergoing economic distress. How would you evaluate our ability to deal with that – you know, thinking back to the 1980s when everything we did in the Gulf was – conformed to international law and what was necessary and proportionate. What do you anticipate in the next few years in terms of actual encounters between the United States and Iran and our ability to handle that?
MR. EISENSTADT: I’ll say that we’ve been focused on this target, and Norm knows a lot better than I, for a great deal of the past 30 or 40 years and developing capabilities to deal with the threat they pose. Since 9/11, the capability – the counterterrorism capabilities we’ve developed to deal with al-Qaida and ISIS also I think have been very important in enabling us – and then also the relationships we’ve built with other countries in terms of intelligence sharing and cooperation – have also helped us vis-à-vis Iran, and it’s been a lot more difficult for Iran and its proxies to engage in terrorism in recent years. Efforts by Hezbollah and Iran to retaliate for the killing of Imad Mughniyah have been, except for one – except for one exception, have been largely thwarted. Likewise, their efforts to employ proxies in the Gulf have often been disruptive. So we’ve done very good in that area.
In the Gulf, I think we’re facing the possibility in the long term that the Gulf will become a very dangerous environment for our naval – our Navy there. And that eventually it might be very – during times of crisis, we might not want to put carrier strike groups in the Gulf, that we might want to keep them outside the Gulf in times of crisis because the capabilities that Iran are developing, and the constrained geography may make it too dangerous for them to operate safely there. But that’s just a fact of life. It doesn’t mean in the end we can’t deal with the threat. It’ll just be more complicated in the future.
But I think the most important thing that we deal with now is that we’ve been able to focus on the Middle East almost uninterruptedly for several decades now. And that’s no longer the case. History has returned. We haven’t the Russians and the Chinese and the North Koreans now vying for the – for resources of our military, intelligence resources as well as the attention of our decision-makers. And as a result, we can no longer focus on this part of the world as exclusively as we had in the past. And we’re going to – you know, our resources are going to be split between – to a greater extent than in the past, between several theaters.
So this is – this is a fact of life. And so it’s a more challenging international environment, especially the preparations for the possibility of a conflict with North Korea have had a big impact on what we’re willing to do in the Middle East. So all of these kind of – you know, kind of – there’s countervailing, you know, factors I would – I would just say, that missile defenses have improved dramatically in the last 15 years. But Iran’s ability to threaten our allies have outstripped the ability of – probably, the ability of the missile defenses to be effective, because they can simply saturate them – probably.
So, you know, again, we’ve made some improvements. But in some areas, the Iranians have not been able to respond. In other areas, they probably have outstripped what we’re trying to accomplish. And it’s a much more complicated international environment today than it was in the past.
MR. MATTAIR: Well, can I come to final comments? David. Maybe let’s go in the order of the way you spoke?
MR. ALBRIGHT: Yeah, no. I think listening to this discussion, which I find fascinating, I mean, one of the challenges is how do you ensure Iran roughly abides by its nuclear limits, even if the nuclear deal fails? I think that’ll – if you don’t think they’re going to breakout and build nuclear weapons, you don’t think they want to negotiate in the short term, then you do want to keep them with a very limited nuclear program. And it just seems like that’s doable. One way to help that is to reinvigorate the confrontation – if I can use that term – at the International Atomic Energy Agency, and particularly at the Board of Governors meetings, over Iran’s secret – or, well, past secret nuclear weapons work, part of which may continue.
And that tactic was used very effectively in 2003 and ’(0)4 to elevate the issue, to put Iran on the defensive, and to keep – you know, find some time for a diplomatic solution to take place, because if Iran is on the defensive in the sense that it’s being accused of violating or potentially violating the Nonproliferation Treaty, its Safeguards Agreement, and certainly one can argue it’s violate the JCPOA, that you’re in a better position than just letting things go quiet and hoping for the day the negotiations start.
MS. YOUNG: Thanks. I would say that I think maybe the way that we’ve framed this question and the way that we do at the U.S. policy communities, Iran versus the U.S., and that’s not really the strategic landscape right now. In the Middle East, there are, you know, a common term, seismic shifts happening of other players – Russia, China importantly involved. And of our allies, especially within the Gulf states taking responsibility for their own security, increasing their interventions in the neighborhood, and really not seeing the U.S. as pivotal or centered in the region. And that was of our choosing, but the region has kind of moved on without us.
And so if our view of the region is that, well, you know, this is our chose and we are confronting Iran, so be it. But we need to take in mind that the way that regional leaders see their neighborhood in much more complex terms. And they’re paying attention to different kinds of allies and relationship building than they did a decade ago.
MR. EISENSTADT: Yeah, if I could just make a kind of broad kind of statement and put things – kind of our discussion here in context. I think if you look at, you know, past Middle Eastern wars, there’s always a kind of action-reaction dynamic in the aftermath of the war that ensures that whatever was – achievements were gotten by war have often been undermined within a few years by the social and political forces set loose by that war. We saw that in ’91 after the U.S. defeat of Iraq in Kuwait, where we were kind of at a high-water mark in the region. Within a few years, there was anti-Americanism and sanctions fatigue vis-à-vis Iraq. And then because of our presence in Saudi Arabia you had the rise of al-Qaida. And then in 2003, again, a great American military victory. But then within a year or two we were mired in insurgency that both Iran and Syria were helping.
Iran is now at its high-water mark. And I would ask – you know, I would argue that we’re seeing elements of this kind of reaction kind of forming. But the Middle East is not self-organizing. And we have to play a role in kind of focusing – if we want there to be a kind of rollback of Iranian influence, which I would – you know, I’m one of those who believe that Iranian – Iran’s enhanced influence in the region in the longer run – is now profoundly destabilizing and in the long run will be profoundly destabilizing. And in order to roll that back, we have to play an organizing role. And we have to play the lead role, just as we played a lead role in rolling back the Soviets in Afghanistan – although, of course, there was blowback there, and there’s going to be blowback here, you know, from whatever we do.
But it seems that we’re intent on disengaging from the region, OK? That’s the general trajectory not just of this administration, but the previous one. So I have great concerns. I think there is a potential to make sure that this is the high-water mark reached by Iran, and then pushed back over a period of years to reduce its influence and to restore kind of an equilibrium. But if we’re not willing to play a lead role in that, I think we can look forward to more instability from the region. And I always say, if you don’t visit the Middle East, it will visit you. So we’re going to have to deal with this, whether we want to or not. I think it’s just better to do it on our own terms and be more proactive in doing it.
MR. MATTAIR: Yes. Norman, you know, the – our Arab partners have concluded that we’re not going to be more involved and they have to take matters into their hands. But would they like us to be more involved? And what would they like us to be doing?
MR. ROULE: Well, I agree. And for my closing comments, building on all of that, I’d like to begin by saying this is a prefect reason why everyone should pay more attention to the Middle East Policy Council. These are all going to be broad issues that are beyond any one country and involve the economies, energy sectors, political and military programs of the region as a whole. The United States must engage, but our engagement doesn’t necessarily have to be with troops on the ground. I’m a strong believer that we need to do everything we can to push – to push Yemen to a political agreement. And we should provide whatever support is needed to protect our Arab allies in achieving this. But that doesn’t necessarily mean boots on the ground. That can mean intelligence support. It can mean fielding assistance, technological assistance, guidance.
The Middle East – and this is subject, perhaps, for entirely separate session, which I’d be delighted to attend because I found this fascinating – is going through – and I was making some notes listening to the very smart comments of David and Karen and Mike – a period of redefinition. Saudi Arabia being the perfect example for this. This brand-new – the modernization program will take it some place very differently if it succeeds, and we all hope it does. A period of reassertion, of pushing back in different ways and defending interests. Hybrid war is how routine in the Middle East. And the Middle East is structured for conventional wars. As I mentioned, the Arab Spring seeds remain throughout the region. The unemployment rate, the youth issues, and throughout the Middle East, it’s pretty common.
We have new alliances forming. We have Bahrain, the Emirates, Saudi Arabia, and Egypt. And you kind of have Qatar, Turkey, and Iran – sort of a loose alliance. And the GCC’s relevance, and it still is relevant to certain things in the future, is less so. We have an ongoing engagement on political Islam in the region, of which the Qatari fracture is a large part. And where that ends up, can you have peace with Izz ad-Din Qassam Brigades in Gaza? Can you have peace with Kata’ib Hezbollah in Iraq? We have shattered economies. The U.S. must play a role. And nation building is a terrible thing to say in Washington, but if you want to prevent ISIS 2.0, to push back on Iranian adventurism, we have to find a way to engage on Yemen, Iraq, Syria, and Libya.
And finally, we have the issue of the impending change of leadership throughout the region. If you were to begin and just say: Name the region’s leaders over the age of 78 or have been reported to be in ill health – Algeria, Tunisia, Oman, Kuwait, Ayatollah Sistani in Iraq, the supreme leader. You probably have – Michel Aoun, King Salman. There is – god lengthen their lives, or at least most of them – you could probably have a change in Iran’s – in the region’s leadership. And we could have a dynamic Mohammad Bin Salman. We could have a bureaucrat who sustains things. But can you say we can – we will not have a Gadhafi or a Saddam Hussein? We need to be careful. That future is in front of us. So I think as you look at the Iran issue, that dynamic surrounds it, and those pressures will shape where Iran goes as well.
MR. MATTAIR: Thank you. I wish we had more time, but we may have already lost CSPAN. Our website is www.mepc.org. You’ll find video of this event within a few hours. And we will publish the transcript in the next issue of Middle East Policy. Thank you very much to all the panelist. (Applause.)
Founder and President, Institute for Science and International Security
Senior Resident Scholar, The Arab Gulf States Institute in Washington
Adjunct faculty member in political science, George Washington University, Johns Hopkins (SAIS)
Director, Military & Security Studies Program, The Washington Institute for Near East Policy
Former Officer, Central Intelligence Agency
Former National Intelligence Manager for Iran (NIM-I), Office of the Director of National Intelligence
Senior Adviser to the Counter Extremism Project and United Against Nuclear Iran
Amb. Richard J. Schmierer
Chairman and President, Middle East Policy Council
Former Ambassador, Sultanate of Oman
Dr. Thomas R. Mattair
Executive Director, Middle East Policy Council