May 7, 2020 | Insight

Two Years On, the Trump Administration’s Iran Policy Continues to Make Sense

May 7, 2020 Insight

Two Years On, the Trump Administration’s Iran Policy Continues to Make Sense

In the two years since the United States left the 2015 Iran nuclear deal, formally known as the Joint Comprehensive Plan of Action (JCPOA), the Trump administration has adopted a policy of “maximum pressure” to address the full range of threats from the Islamic Republic. The administration’s objective is a better agreement that addresses the JCPOA’s fatal flaws. The way to secure such an agreement is to escalate all forms of pressure on the clerical regime until it faces a stark choice between its own survival and the abandonment of its nuclear ambitions, foreign aggression, and grave human rights violations.

From the beginning of his 2016 campaign, President Donald Trump insisted that the JCPOA was a bad deal. Rather than permanently blocking Iran’s pathway to nuclear weapons, the deal opens a patient path; if the JCPOA endures until its key provisions expire (or “sunset”), Tehran would emerge around 2025 with an industrial-scale nuclear program, a short path to a bomb, ballistic missiles to deliver that bomb, a conventional force newly equipped with foreign weapons, and its economy immunized against future sanctions.

The administration also dispensed with the fiction adopted by its predecessor that the nuclear agreement would moderate the mullahs by flooding them with cash and integrating them into the global economy. That theory of “moderation through economic seduction” failed miserably with the Chinese Communist Party and Vladimir Putin. The Islamic Republic has been at war with the United States for decades, murdering Americans and seeking to dominate the Middle East through its terrorist proxies. The JCPOA only super-charged such malign conduct by returning tens of billions of dollars for Tehran to fund its destructive activities. The Islamic Republic no longer had to make painful budgetary choices between guns for the Islamic Revolutionary Guard Corps-Quds Force (IRGC-QF), Lebanese Hezbollah, and pro-Iran militias in Iraq, as opposed to butter for its citizens. Cash did little to transform the Islamic Republic’s leaders into more responsible global citizens or improve their treatment of the Iranian people.

In contrast, the Trump administration has drained hundreds of billions of dollars from the Iranian treasury. U.S. sanctions did not need support from allies to work, as JCPOA defenders had long maintained. Put to the choice between the U.S. market and the U.S. dollar on the one hand and the Iranian market on the other, multinational companies cut their ties with the Islamic Republic. The key economic indicators demonstrate clearly: From GDP to inflation rates, oil exports, accessible foreign exchange reserves, the value of the Iranian rial relative to the U.S. dollar, and more, U.S. unilateral sanctions have inflicted a greater cost – and in less time – than previous multilateral penalties. Market forces, even more than political consensus, can sometimes achieve national security objectives.

The administration also broke taboos long observed by Washington’s foreign policy establishment, including an aversion to designating the IRGC in its entirety as a Foreign Terrorist Organization (FTO), blacklisting Iran’s supreme leader, Ayatollah Ali Khamenei, and sanctioning Mohammad Javad Zarif, Iran’s foreign minister. These were political “firsts” that further boxed in the regime. Trump’s decision to kill IRGC-QF commander Qassem Soleimani intensified the operational and psychological pressure while avoiding the “World War Three” that his critics predicted. In addition, the administration’s successful campaign to get the United Kingdom and Germany to blacklist Hezbollah as a terrorist organization demonstrated that both pressure and diplomacy could work against Tehran’s most deadly Arab proxy.

Despite these successes, the current policy has vulnerabilities. Europe remains committed to defending the JCPOA as it hunkers down in the hope that former Vice President Joe Biden will succeed Trump as president and return America to the JCPOA. A Biden administration might prefer to employ America’s newfound leverage to negotiate a better deal, rather than rushing back to the JCPOA. We hope so. Still, Biden says he will rejoin the deal, so the administration should do more to strengthen its “sanctions wall of deterrence,” whose purpose is to deter market players from returning to business with Iran even if the United States rejoins the JCPOA. The designation of the Central Bank of Iran for funding terrorism, the designation of the IRGC as an FTO, and the re-architecting of many of the sanctions to make them based on terrorism, missile proliferation, or connections to the IRGC will pose significant risks to these companies. Few believe the risks of Tehran’s illicit conduct will diminish even if a Biden administration lifts sanctions.

More lawmakers and prospective 2024 presidential candidates can reinforce these political and market risks by supporting a Senate resolution that “rejects the reapplication of sanctions relief provided for in the JCPOA.” This would underscore how companies will be whipsawed again, as they were between 2015 and 2018, if they return to Iran without bipartisan support for a new agreement.

Washington needs to establish clear red lines to head off further Iranian escalation as the maximum pressure campaign continues. Last summer, Washington did not respond to Iranian regional and nuclear escalation, culminating in a cruise missile and drone strike on Saudi Arabia that knocked offline almost 6 million barrels of daily production. While the killing of Soleimani shocked Tehran after its militias killed an American in Iraq, Washington since has absorbed repeated rocket and mortar attacks from pro-Iran militias, even after two American soldiers and a British solider were killed. The red line against the taking of American lives must be enforced. But even this high bar for the use of force can make allies skeptical about American staying power in the region while incentivizing Iran-backed Shiite militias to continue their attacks.

The administration has adopted the right policy, but it must safeguard gains and add to its wins. First, it should not offer Tehran any premature sanctions relief. Diminishing American leverage led to the fatally flawed JCPOA in the first place and has not worked in the administration’s negotiations with North Korea, in which Trump’s summit diplomacy undermined the pressure campaign. Washington should defend its sanctions wall against a new administration by designating more Iranian entities under multiple sanctions authorities and enhancing audit and due diligence requirements for any firm auditing the books of a company that maintains ties with Tehran. This will deter companies that may not do business with the United States or in the U.S. dollar but do need audited financial statements from accounting firms, which will not be able to meet this enhanced standard. The most immediate sanctions target is to tighten the noose on Iran’s regional and non-oil trade, which is where Tehran is generating revenue while under sanctions.

Washington also needs to step-up its support for the Iranian people, whose disdain for the regime is growing with more frequent and broad-based protests, to which the regime has responded with even greater violence. There are numerous ways the United States can shows its support: more targeted designations for human rights abuses and corruption; platforms to help Iranians circumvent Internet restrictions; humanitarian relief efforts through international non-governmental organizations to bypass the regime; public messaging that supports a peaceful democratic Iran; and respect for human rights as a key condition of any comprehensive agreement. Such a policy of “maximum support” will reinforce maximum pressure.

Mark Dubowitz is the chief executive officer of the Foundation for Defense of Democracies (FDD), where Behnam Ben Taleblu is a senior fellow. They both contribute to FDD’s Iran Program, Center on Economic and Financial Power (CEFP), and Center on Military and Political Power (CMPP). For more analysis from Mark, Behnam, the Iran Program, CEFP, and CMPP, please subscribe HERE. Follow Mark on Twitter @mdubowitz. Follow FDD on Twitter @FDD and @FDD_CEFP and @FDD_CMPP. FDD is a Washington, DC-based, nonpartisan research institute focusing on national security and foreign policy.

Issues:

Hezbollah Iran Iran Global Threat Network Iran Missiles Iran Nuclear Iran Politics and Economy Iran Sanctions Iran-backed Terrorism Military and Political Power Sanctions and Illicit Finance