Given the poor state of Iran’s economy, US sanctions on Iran are probably not necessary. However, they are intended to expedite change in Iran and extinguish any hope the regime had of turning around its economy.
Iran’s religious leaders maintain a devotion to revolutionary ideology, rhetoric and action as a means to justify the regime's continued existence and repression of its people. These revolutionary ideals have prevented Iran from welcoming foreign investors and businesses in the years between sanctions, particularly in the oil and gas sector. As a result, Iran has not been able to improve its struggling energy industry or build other industries in the country. Even before President Donald Trump’s decision in May to reinstate sanctions, the country’s economy was suffering. The new sanctions will ensure that Iran cannot turn around its economy without first improving its behavior in world affairs.
With the reinstated sanctions, Iran’s opportunity to improve its economy has dwindled and a crisis point is being hastened. So far, the US is not granting exemptions to foreign businesses, meaning it is seeking to effectively isolate Iran economically. Few countries and firms are willing to risk antagonizing the US and a seemingly staunch Trump administration, even for cheap Iranian oil. They fear losing the opportunity to do business with the US, which has a much larger market and is the most powerful economic force in the world.
An isolated Iran cannot satisfy its people economically. It is now facing regular and persistent protests against religious laws, poor drinking water, unpopular foreign policy decisions, out-of-control inflation and a failing economy.
However, as the sanctions take effect this month and in November, the key question is: What is America’s goal? In May, Secretary of State Mike Pompeo said he asked Iran to “behave like a normal nation.” Some have said the US’ objective should be regime change in Iran, although Washington would probably be satisfied with less. The goal could be a true end to Iran’s nuclear ambitions and missile capabilities, with stringent assurances that were not present in the Joint Comprehensive Plan of Action agreement.
However, the reference to a “normal nation” could indicate that the US is seeking an end to Iran’s extraterritorial involvement in conflicts and terrorist activity. This would mean that the White House is looking for Iran to halt all support of Hezbollah and Hamas, end Islamic Revolutionary Guard Corps activity in Iraq and Syria, and stop its backing of the Houthis in Yemen. Most likely, the Trump administration is being intentionally vague about its goals in order to give the US room to negotiate.
Iran is now facing regular and persistent protests against religious laws, poor drinking water, unpopular foreign policy decisions, out-of-control inflation and a failing economy
Ellen R. Wald
This also explains why Trump offered to meet with Iranian President Hassan Rouhani even before any sanctions came into effect. The goal is to use the economic pain Iran feels to end the threat that the regime poses to its neighbors and to the US. Given the apparent domestic disenchantment with the Iranian regime and the repeated protests and unrest, it is possible that sanctions might lead to regime change, but that is one of the least likely outcomes. The most realistic goal of the sanctions is behavioral change from Iran, coupled with concrete assurances for the global community.
Last week, right after the first round of sanctions came into effect, Rouhani said Iran would talk to the US “right now.” Some took this as a sign of success, because Iran had rejected talks just a few days earlier. However, soon after, Foreign Minister Mohammed Javad Zarif said “there will be no meeting.” From America’s strategic perspective, it is probably better not to meet with Iran right away. It is too early for a rapprochement and Iran has not yet suffered under the sanctions. Strategically, Trump wants Iran to come to the US from a position of need. His statement should be understood as notifying the Iranians that he is ready to talk when Iran is serious about change.
On the topic of a meeting between Trump and Iranian leaders, some in Washington have said that the president should actually meet with Ayatollah Ali Khamenei because it is he who holds the real power in Iran’s bifurcated political system. It is true that, when it comes to foreign affairs, Khamenei is the ultimate arbiter, but in the Iranian system he would not participate in such talks.
Iran’s political system is carefully defined in its constitution and, within that system, Rouhani and Zarif represent Iran in international affairs. Khamenei sets the course of Iranian foreign policy and military moves, but is specifically insulated from day-to-day negotiations and policy implementation. Khamenei sits at the top of a religious hierarchy and must maintain a certain distance from policy and negotiations to preserve the supreme leader’s religiously mandated power. Even though Rouhani could never engage in talks with the US without his approval, it is key to Iran’s political system that Khamenei not be seen directly engaging with the West. Outwardly legitimizing agreements with Washington would implicitly delegitimize Khamenei’s office. In fact, reports now indicate that Khamenei has banned Iranian officials from engaging in direct talks with the US.
The new US sanctions will likely expedite an Iranian economic crisis. There is some potential that they could force behavioral changes and compel Iran to “behave like a normal nation.” However, Iran is used to isolation and its political leaders will try to use the sanctions to rally support for themselves and the Iranian revolutionary movement. If any change is going to happen, we will probably not know until it is imminent.
- Ellen R. Wald, Ph.D. is a historian and author of “Saudi, Inc.” She is the president of Transversal Consulting and also teaches Middle East history and policy at Jacksonville University. Twitter: @EnergzdEconomy