Sanctions With Teeth

December 19th, 2011 at 3:31 pm David Frum | 38 Comments |

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In my column for CNN, I discuss Senator Mark Kirk’s plan to impose sanctions on Iran’s central bank:

On the other hand, despite the tightening, the sanctions remain pitifully inadequate to the job. Iran’s most crucial import is gasoline, because this oil-producing nation cannot refine enough gasoline for its automobiles. Gasoline imports to Iran are supposedly sanctioned. Despite sanctions, Iran has increased its imports of gasoline over the past 90 days, according to news reports.

As sanctions fail to bait, the options on halting Iran’s nuclear program get uglier.

Somebody (Israel? Iranian dissidents backed by Saudi Arabia?) is carrying out a campaign of violent sabotage against Iran’s nuclear program. On November 12, a huge explosion leveled an Iranian missile base near Tehran. Iran acknowledged the explosion killed several dozen people, including the head of its missile program. By some reports, the dead included a team of visiting North Korean missile scientists.

Two weeks later, another huge explosion was heard near Isfahan, site of an Iranian uranium enrichment facility. This time, however, the Iranian regime offered no statement or details on the explosion. If any Western government knows anything, that government is not sharing its information.

Over the past few years, there have been numerous reports of the assassination of Iranian nuclear scientists, including one shot deadon a busy street by a motorcyclist in July.

Some foreign policy analysts suggest a policy of “containment” and “deterrence” of Iran’s nuclear weapons. That policy seems incredibly unrealistic, given the Iranian regime’s long history of reckless adventurism, including terrorist operations on the soil of (among others): Argentina, France, Germany, Lebanon, Iraq, Israel, Saudi Arabia, Turkey, the United Kingdom and the United States.

But even if containment and deterrence were realistic options, the situation has moved far past that point. There’s a covert war being waged apparently over the Iranian nuclear program. Iran is waging a brutal irregular campaign of its own: It’s suspected of being behind an assassination attempt against the Saudi ambassador to the United States; it has given aid to Bashar al-Assad’s Syria and to Hezbollah in Lebanon and has aided insurgents in Afghanistan. And Iran’s nuclear ambitions have unleashed a cycle that will not be stable — that is much more likely to end in open conflict than in a standoff.

Yet there is a leader pushing a plan that could end the cycle without war: U.S. Sen. Mark Kirk, R-Illinois.

For a year, the freshman senator has been urging a new approach to sanctions, an approach that truly would force an Iranian rethink. The Kirk plan, co-sponsored by Robert Menendez, D-New Jersey, would impose sanctions on the Iranian central bank, in effect severing Iran from the entire global payments system.

Specifically, the Menendez-Kirk amendment would forbid any U.S. financial institution to deal with the Iranian central bank — or to deal with any financial institution that does so. Every bank would find itself confronted with a stark threat: If you do business with Iran, you will lose access to the largest financial market on earth. These sanctions would collapse the central bank of Iran and shove the Iranian economy onto a barter system for all external transactions.

Click here to read the full column.

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38 Comments so far ↓

  • Oldskool

    If I were the Iranians, I’d be checking Barack Obomber’s schedule to see exactly where he’s been hanging out lately.

  • gmat

    Why would you think that Iran’s sponsoring and/or conducting terrorist operations abroad would necessarily make containment and deterrence of Iran unrealistic?

    In how many countries did the USSR (or, for that matter, the US) sponsor/conduct terrorist operations during the Cold War?

  • TerryF98

    Perhaps they could persuade Haliburton and other US corporations to stop breaking the existing sanctions, that would be a start.

  • zaybu

    Iran produces daily 3.6 million barrels of oil. OPEC and other countries would have a hard time to make up the difference. China, India and other major developing countries are going to continue buying Iranian oil irrespective of any unilateral steps taken by the U.S. In Europe, the countries most dependent on Iranian oil are Greece, Spain and Italy, and we know how fragile their economies are.Just recently, Iran said it has signed a $1 billion oil-field development memorandum of understanding with Russia’s OAO Tatneft, clinching a rare contract with a foreign company amid those mounting sanctions. The Menendez-Kirk amendment might make life a little harder for Iran but it would seem that economic sanctions are not going to work. And Iran has stated that if it cannot export its oil, then no oil will pass through the Strait of Hormuz.

    Is this propaganda for a prelude to war???

    The other side of this issue is that we have lived with a nuclear armed Pakistan for many years. Perhaps Iran will learn like most nuclear countries all about MAD, and will pose no more threat to the world than Russia, China, India, France, the UK, North Korea(???), and yes, Israel.

    EDIT: OOPS, I forgot. The US is the only known country to have used the nuke on another country.

  • valkayec

    How tight are the regulations and enforcement? I can easily see how a bank that truly wanted to deal/trade with Iran could circumvent those regulations, just by going through China or Russia.

  • Carney

    This is good, but more broadly, remove Iran’s even theoretical future ability to build up a budget for terror, missiles, and nukes, by destroying oil’s monopoly as the world’s source of transportation motive power and collapsing the ability of oil regimes to charge artificially high, monopoly prices for oil.

    http://www.openfuelstandard.org/2011/06/what-open-fuel-standard-has-to-do-with.html

  • Baron Siegfried

    Big deal. What this boils down to is that Iran plays the same game as everyone else (please tell me something that Iran has done that Israel has done in spades) plays with considerable gusto. So far, I see roughly the same arguments from the same people being used to justify the belief that Iran is developing nukes that were used with Iraq. I’m sorry, I view the IAEA with the proverbial hairy eyeball, as I think their reports reflect an agenda rather than facts.

    If the article is correct, the matter is well in hand, and should produce an interesting assortment of books and movies in future years. It may be a Brezhnevian irony that if / when Khameni and the rest of the theogerontocracy actually running the country finally succeed in developing a device (or not), they die off and the next generation takes over. People are for some reason ignoring the generational shift that’s building in Iran – the old folks are hanging on to power for (literally) dear life, and the young can just wait ‘em out . . . And they’re not as Allahed up as their elders – they grew up with satellite TV dishes, the global equalizer.

    They’re not a signatory to any of the NNPTs so for all of the rhetoric about ‘illegally’ developing nukes. even if they were doing so, it’s their right . . . just like Pakistan, India, NK, all countries that were going to trigger WWIII because they were so crazy. If Iran developed nukes, OK, they have a few compared to Israel’s (estimated) 200. Not to mention ours. Iran has nothing capable of launching a warhead to the US, though that may change over time. Iran now has the ability to commit national suicide along with the rest of the nuclear powers.

    They’re certainly not going to hand a nuke over to people who might, just might decide to use it on YOU instead . . . or screw up and get it traced back to you. The problem inherent in nuclear strategy is that use of a nuke opens you up to nuclear retaliation yourself, and your enemy may or may not be too pissed off to respond proportionally. MAD . . . it worked with us and the Soviets; the strong desire not to be glowing dust is a great inducement to rationality.

    It’s Israel’s problem, let them deal with it. They have their own nuclear umbrella, and they can have their very own little nuclear standoff, like we and the Russians had for so long. The Iranians are no more suicidal than the Russians for all the bluster intended for domestic consumption. Big deal . . .

    • WaStateUrbanGOPer

      I’m not sure that the Iranian government isn’t “suicidal.” The ruling class in Iran is, after all, a gaggle of religious fanatics who believe in martyrdom.

      And if you really want someone to name something that Iran has done that Israel hasn’t, for one I would point out that Israel has never invited such charming figures as David Duke, Louis Farrakhan and David Irving to a state sponsored “Holocaust Denial” conference, or paid their travel expenses and kept them in lavish accommodations for the purpose.

  • Emma

    I’m guessing Obama authorized the assasinations and sabotage under the theory that sanctions will not alter behavior. To their credit the Republican field of hopefuls are pretending that the U.S. is sitting on the sidelines so as not to blow our cover. They are also dialing back criticism of Obama on this score. Kabuki American style.

    • Baron Siegfried

      Ummm . . . I really don’t think WE’RE doing anything other than providing intel & support. No way you’re going to have an ‘illegal’ operating inside Iran, the downside if he’s taken is much too great. No, these are mostly Israeli operations. You can tell – the right things are getting blown up.

  • armstp

    A simple question: why does Iran not have the right to develop nuclear weapons?

    • Vrag

      good question?

    • jakester

      An even simpler question is do you want Iran to have nuclear weapons? If that concept doesn’t scare you, then you are denser than Plutonium.

      • Baron Siegfried

        Because it’s the ultimate in national bling, and accessorizes with any fashion trend. It’s the status symbol that trumps all other symbols, overshadowing even mass famine. Any statesman can have balls of brass, but only a select few have balls of U-239. Why do people drive Maseratis on roads with a 65 MPH speed limit? Because it’s big and sparkly and impressive, they want one REALLY bad, and it’s not in the Nieman-Marcus catalog. If you have compensation issues, you want a nuke A LOT!!!

        It’s also the ultimate protection against an American invasion, though you’re certainly vulnerable during your development phase. But once you have a nuke, you’re safe, though an evangelical president at some point in the future might decide that a nuclear strike might be just the thing for those sagging polls and the retaliatory strike will just take out those inner city libruls . . .

        Look, if we can live with NK having nukes, next door to two of our REAL friends and major trading partners, being led by a bowl of sociopathic Jell-O, then Iran should be a snap. Iran’s Grand Ayatollah is a model of decorum in comparison to the clown Kim clan. Israel might feel differently, but that’s Israel’s problem – they have their own nuclear deterrent as well as ours, so they’re in no worse a state than we were for oh, 50 years as we faced off with the Soviets. MAD is indeed mad, but it works.

        We didn’t blow each other up, and neither will they. The prospect of ruinous war makes negotiations possible, as the cost of the alternative just went WAY up.

      • gmat

        Do I want Iran to have nuclear weapons?

        No. That’s an easy one.

        Am I willing to do whatever it takes, no matter what the cost, to prevent Iran from acquiring nuclear weapons?

        Also no. How about you?

    • Marquis

      1. Iran would use its nuclear arsenal to threaten its neighbors and gain regional hegemony.

      2. The mere presence of nuclear warheads in your own backyard would be used to achieve socio-political goals, that is, they would be the modus operandi for spreading Iran’s style of revolutionary Islamism.

      3. For the first time in the world, an international terrorist organization would have access to weaponized fissile materials.

      4. It would spark a nuclear arms race in the middle east, of all places.

      5. Iran could possibly be the first nation in the world to launch an unprovoked nuclear attack.

      I could go on….

      • Baron Siegfried

        The same thing was said of both Pakistan and India as well as NK . . . yet we’re all still here. The problem with nukes in a close regional setting is that it’s like having a grenade duel in a bungalow. You might win, but it’s going to be messy.

    • nuser

      Because Israel wouldn’t like it!

  • JohnMcC

    From the Financial Times of 8/06/2011:

    “China to Maintain Trade Projects With Iran

    Beijing Aug 6th: Li Keqiang, Chinese Vice-Premier, told the visiting Iranian oil minister on Friday that Beijing would maintain cooperation with Tehran on existing projects, after the US called on Beijing to observe sanctions.

    “Iran is an important trade partner in western Asia and North Africa and one of the country’s main oil suppliers. Bilateral economic and trade cooperation has achieved fruitful results,” state television paraphrases Mr Li as telling Minister Massoud Mirkazemi…..

    China has already pushed back at US pressure on it’s business and oil trade with Iran….”

    I see from Wikipedia that the People’s Republic of China has roughly $30Billion in oil business annually with Iran. Mr Frum wishes us to withhold trade with the PRC because they see their interests differently than he does.

    “Iran also depends on Russia for it’s energy needs. Lukoil, a Russian company is also a major provider of gasoline to Iran.” (Foreign Policy Association in foreignpolicyblogs of 11Sept2009)

    But Mr Frum wants us to declare economic warfare on all of Iran’s trading partners. What could go wrong?

    • baw1064

      +1 Are we going to stop selling Treasury bonds to the Chinese Central Bank if they do business with Iran? Or stop paying interest on the ones they already own?

  • Dazedandconfused

    Unless the Chinese and Russians go along with it, Iraq too, I suppose, sanctions will probably fail to get Iran to surrender. Drive Iran deeper into the Chinese and Russian sphere of influence for sure though. I think Russia would like that. The Chinese? More ambivalent that anything else, I’m guessing. They are sort of feeling their oats these days, the next generation appears to be a bit nationalistic.

    Stick one to Uncle Sam? No, more a chance to prove that they matter.

  • ottovbvs

    David, ever heard of Morton’s Fork? Ratchet up sanctions. The price of oil goes up. World economy damaged (that includes us!). The Iranians sell less oil. Net revenue and income for Iran unchanged. Compris?

  • Katie Fromage

    From the Apr 25, 1984 (1984!) Los Angeles Times:

    Iran Nuclear Bomb Likely in 2 Years, Jane’s Says

    “The Ayatollah Ruhollah Khomeini’s Iranian regime is in the “final stages” of making a nuclear bomb that is likely to be ready within two years, the authoritative Jane’s Defense Weekly said Tuesday.”

  • SteveThompson

    Iran is sitting on a massive natural resource, the world’s second largest natural gas reserves. Here is an article outlining just how large Iran’s natural gas reserves are compared to the total volume of natural gas in the United States and how China is taking an increasingly large position in developing this resource:

    http://viableopposition.blogspot.com/2011/11/iran-natural-gas-giant.html

    It will be interesting to see how long it takes before a coalition of nations decides to act in the name of regime change with the ultimate goal of accessing Iran’s resources.

    • gmat

      “It will be interesting to see how long it takes before a coalition of nations decides to act in the name of regime change with the ultimate goal of accessing Iran’s resources.”

      I don’t understand. Is the current regime trying to prevent other countries from accessing Iran’s resources? What you said about China would seem to indicate otherwise.

    • Baron Siegfried

      Translation: Invading them and looting their natural resources because we don’t like who they’re selling to.

      Ummm . . . yeah, sure, you go right on ahead with that . . . y’all make sure you let me know how it works out for you, OK? I want to see how you do it . . . (go to store, buy even more popcorn . . .)

  • lilmanny

    Look y’all, debating whether or not Iran has a right to pursue nuclear weapons is mental masturbation and comparing them to other historical situations is what gets people in trouble.
    Let’s consider Pakistan: they have nuclear weapons, a religiously diametric enemy next door, and they are still here and no nuclear war has erupted. However, the US has to maintain an expensive balance in the subcontinent to prevent this war and India is not existentially threatened by a nuclear armed Pakistan. It would definitely harm them, but India would pull through.
    Israel, on the other hand, is existentially threatened by a nuclear armed Iran. Several blasts could decimate the geographically concentrated population and would pollute the affected areas for generations. Further, Iran has literally nothing to lose in being the victim of an Israeli nuclear attack. Millions of martyrs would be evaporated in the Israeli attacks, but the ruling class probably bets they could be in the right place at the wrong time and survive to witness the destruction of Israel by the intl community and to be elevated by the rage resulting from the said Israeli attack.

    We allow the general in Pakistan to rule because we know they have something to lose. We cannot make that same bet with the religious authorities in Tehran and we cannot expect Israel to watch an unpredictable enemy arm itself with weapons that would end it, no matter how much detest the religious fanatics settling the West Bank.

    • gmat

      Assuming, for the moment, that what you say about Iran, “Iran has literally nothing to lose in being the victim of an Israeli nuclear attack,” is factually true, it sounds like you are describing an Israel problem, not a US problem.

      They can handle it.

      • lilmanny

        In my opinion, Bob Mcnamara’s most chilling line is “there is no learning curve for nuclear war”. Whatever assumptions I have or you have about how a nuclear exchange, then a regional nuclear war, would begin or end are going to be wrong. Dismiss if you will millions of Israelis and Iranians, but you cannot predict how a crisis will elevate and at what point it might be you getting incinerated.

        My objection to Iranian nuclear arms is not solely a pro-Israeli objection, but a realization that Iran is not Brazil or Japan or Belgium. It is an Israeli problem until it’s not.

        • gmat

          Sure, but it won’t ever get to a regional nuclear war if Iran doesn’t acquire nukes, and you said Israel won’t tolerate that threat to its existence, so why not let them handle it?

          Now, if you are saying they can’t handle it, can’t protect themselves from their enemies, actually need the US to protect them from their enemies, then I would say such a client state, a protectorate if you will, should show more respect for the wishes of their protector.

          But Netanyahu, before the US Congress, made quite a point of how Israel takes care of itself and doesn’t burden the US with matters of Israeli security.

        • Vrag

          true that!!!!

        • lilmanny

          Why do we need to get involved? Because it’s in our interests. Could Israel launch an attack, conventional or otherwise, on the Islamic republic and survive? Sure. Would that be a good end result for the United States. Hell no.
          Again, even if you don’t give a drip of sweat for Israel, you have to admit that a nuclear arms race in the middle east, or a preemptive attack by one or the other, a regional war that might now involve chemical weapons or worse, is a bad result for the United States. A very bad result. Protecting Israel is not our only concern here. We are subject to that blowback and to watch it occur with0ut taking action is negligent.

        • gmat

          define “get involved”

          (hint: sanctions aren’t going to do it)

          Are you saying that for the US to join Israel in an attack on Iran will produce a better result for the US than Israel alone attacking Iran? If so, how exactly?

          Because if Iran wants to acquire nuclear weapons, the only way to prevent that will be by attacking Iran.

  • driftglass

    I applaud Mr. Frum’s bold call to impose drastic sanctions on the GOP until the dangerous fanatics who run the place are overthrown.

    Oh. Wait.

    Never mind.

  • Danny_K

    Can someone tell me how this is supposed to work? If the Chinese central bank won’t stop doing deals with Iran, are we really going cut it off? What will that do when we can’t finance trade deals with the Chinese and they can’t buy our Treasury Bills? This law will never be implemented.