US Foreign Policy
Commentary

Iran’s Calculations and the New Round of Diplomacy

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The new round of diplomacy initiated by Condoleezza Rice’s cautious diplomatic overture offers welcome if limited hope for a durable solution to Iran’s nuclear challenge. This and the new package put forward by the P5 and Germany will likely fail to persuade Tehran to suspend its enrichment activities, but they also compel Tehran to decide whether to build on this small opening and turn it into a real opportunity. The ball is now in Tehran’s hands, and the tone and content of its response will prove key to finding a much-needed resolution to this crisis. 
 
Yet, a visitor to Iran may get the sense that Iran is convinced it can ride this storm at a minimal cost. Indeed, many Iranian officials and experts project confidence and defiance. First among them is Supreme Leader Khamenei, who recently boasted that “There is no consensus against Iran. This is a lie by the US and a few other US supporters.” It is difficult to determine whether this is exclusively for public and international consumption or reflects the genuine sentiment of the Iranian leadership. The question is whether this attitude can be sustained both diplomatically and domestically.
 
Many around the world cheer for President Ahmadinejad’s anti-US and anti-Israel ranting, but they do so mainly because they don’t have to pay the price for any consequence. Iranians however have to weigh in the costs of defiance and confrontation, and are slowly doing so. Karim Sadjadpour, an astute Iranian analyst, jokes that it is delusional to think that “[an] average Iranian waking up in the morning in Yazd or Shiraz says ‘what’s missing from my life is enriched uranium.'” Sadjadpour is probably right to think that the Iranian public will think twice about the course chosen by the country’s radicals if given the full story and faced with hard choices.
 
Indeed, despite Ahmadinejad’s campaign promises, Iran’s economic and social ills have not improved, only worsened since June 2005. Ethnic and religious tensions are on the rise. Tehran’s stock market is down by a third. Fear of sanctions and of a showdown is driving foreign investors away. For a country in dire need of foreign investment, especially in its energy sector, this is particularly bad news. And unemployment is up, as is inflation, driven by high oil prices. Indeed, while the extra oil revenues are contributing to Iran’s current sense of confidence, it is important to remember that barring a solid economic development plan, patience and caution, they will not translate into tangible, long-term benefits for Iran’s population. To the contrary, as happened in the 1970s, the economy is likely to overheat and eventually further dislocate in case of shortsighted, expedient spending.
 
In the short term, however, one of Ahmadinejad’s main achievements is that he made the nuclear issue less abstract to his own people. When he visits small villages and towns, not only does he make popular but unrealistic pledges, he also markets the nuclear issue in a way none of his predecessors or rivals has done or can do. He may not be the key decision-maker of Iran’s nuclear policy, but he has become the prime shaper of the public debate-something he skillfully makes the best out of. Thanks to his capacity to attract international and domestic coverage, a function of being the president, and the support of Supreme Leader Khamenei, he sets redlines, defines public expectations in Iran and constrains what his domestic rivals can say and do.
 
Of course, the complexity of Iranian decision-making means that Ahmadinejad must deal with other centers of power. But the fragmented nature of the leadership creates much confusion and uncertainty about Iranian intentions, and about the behavior and calculations of the key players. A cautionary tale is Khamenei’s own: when he succeeded Khomeini as Supreme Leader, he was seen as pragmatic figure. But to strengthen his own legitimacy and make up for his lack of religious credentials, he veered to the right, espoused radical foreign policy views and concluded deals with Iran’s most extremist figures, including Ayatollah Mesbah-Yazdi, now Ahmadinejad’s spiritual adviser.

Despite this grim picture, there is actually room for hope should common sense prevail. Indeed, US officials and Iranian pragmatists share a key judgment that Iranian radicals reject: that Iran will be in a weaker position tomorrow than it is today, both diplomatically and domestically. For the Iranian pragmatists, this means that the sooner a US-Iran dialogue begins the better because Iran could then translate its hard-line positions into tangible benefits. They hope that Khamenei will realize that Ahmadinejad’s big talk, which has somehow contributed to this relative position of strength, is now likely to precipitate unnecessary hardships and isolation. This might explain the timing and content of the letter that Hassan Rohani, the former secretary of Iran’s Supreme National Security Council and a leading pragmatist, sent to Time a few weeks ago. It also suggests that the pragmatists in the national security establishment will not close the door on the new diplomatic efforts.
 
US officials, and especially the most hawkish among them, subscribed to this notion for years, and concluded that policy should be driven by the assumption that the regime in Tehran will likely collapse in the future. With time on its side, America did not need to talk to Tehran-until now. Even if Rice’s announcement was primarily driven by tactical considerations, it was also the result of the sober recognition that radical, democratic change is not around the corner.
 
For their part, the radicals in Tehran believe that Iran will be in an even better position tomorrow. But their revolutionary fervor is largely self-delusional. The Iranian people proved they were willing to sacrifice enormously in the 1980s during the Iran-Iraq war, but two key ingredients are missing today: a figure as imposing as Khomeini and a threat as unifying as the Iraqi invasion. Ahmadinejad is more divisive than unifying, and America has an opportunity to avoid becoming the rallying point that unites Iranians around their regime.
 
The desire to embolden Iran’s moderates and punish its radicals has led many to think that sanctions could make the trick. However, while the threat of sanctions and diplomatic pressure are good tactics for the short-term, the United States must fundamentally rethink its Iran policy, and, at the risk of repeating a now cliché policy recommendation, should talk to Iran and engage more forcefully Iranian society. This good idea was an even better one a few years ago.

Targeted sanctions would have a marginal effect, and miss the point: Iran’s radicals don’t have bank offshore accounts and don’t send their children to European or American schools. If the regime manages to convince its people that America is responsible for their economic hardships, then sanctions will turn out to be a tool in the hands of the radicals. And combining financial support for civil society organizations with a not-so-secret desire for regime change makes its beneficiaries more vulnerable to charges of collusion with the United States.

America’s coercive options are even more limited: its threat of force, implicit at this time, is ironically more credible with its allies and potential partners than with its enemy. Call it the Bush credibility dilemma. Bush’s understandable desire to keep all options on the table, including military force, resonates too well in European ears because he did it before, albeit with debatable results. Europeans oppose resorting to force, and this, combined with America’s troubles in Iraq and diminished standing around the world, comforts those in Tehran who believe that Bush cannot pull it off again.
 
One should therefore give credit to the Bush administration for its decision to put consideration of Chapter VII aside for the moment and focus on creating a diplomatic consensus. This denies Tehran what it would perceive and portray as yet another diplomatic victory. UN-mandated sanctions are a long shot, and the likely negative outcome of such a diplomatic battle would comfort even more those in Tehran who are convinced that Iran won’t pay a price for its determination. The failure to agree on sanctions after a raucous debate in New York, legitimate questions about the intelligence on which the case against Iran is based and clear distrust of the Bush administration and its intentions will leave the United States in a hard spot. US sanctions, backed by a small coalition of the willing of mainly European nations but not endorsed by the UN, will be just be seen as more evidence of America’s isolation, and, in Iranian eyes, as another confirmation of its own rectitude and goodwill.

It is doubtful that diplomacy alone could fundamentally change Iranian calculations and domestic dynamics. That’s why the international community must capitalize on the recent US opening. The US has made a tentative but meaningful step. Ideally this overture would have come earlier, but it would serve no one’s interests if it became merely another missed opportunity. No one should expect a quick positive response from Iran, but if America is willing to begin reconsidering its assumptions and objectives, so should Iran.

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