U.S.-Iran: The Sanctions "Paradox"


Col. (res.) Udi Evental | Spotlight: Israel & The Middle East | November 20, 2020

Tehran bazaar
Photo: David Holt | CC BY-SA 2.0


Of the few foreign affair issues discussed by the U.S. presidential candidates during their campaign, the most prominent was grappling with the challenges posed by Iran in both nuclear and the Middle East.


President Elect Joe Biden announced that he would return to the diplomatic path with Iran, and the working assumption in the international system and among experts is that Iran and the U.S. will probably return to the negotiating table in the second half of 2021, once the Iranian presidential elections will be over in June, and the Biden administration will have sufficiently substantiated itself, having appointed all relevant senior position-holders in the cabinet and offices.


Biden presented his strategy vis à vis Iran, whereby if Iran returns to strict compliance with the JCPOA, the US would rejoin it, implicitly indicating that sanctions would be lifted. Only then would his administration negotiate with Iran over "strengthening and extending the nuclear deal's provisions". At the same time, Biden claims the U.S. will continue to push back against Iran's destabilizing activities, and the threat it poses to the region, while continuing to use targeted sanctions against Iran's human rights violations, its support for terrorism, and ballistic missile program.



Lessons learned from the nuclear deal


The Obama administration and its European allies had high hopes that the JCPOA would lead to the mitigation of Iran's threatening policy in the region and the area of ballistic missiles (issues that were not contained within the agreement). In practice, the opposite has undisputedly occurred.


Following the nuclear deal, sanctions on Iran were lifted, primarily the most effective ones in finances/banking and energy that led to the most effective damage to the Iranian economy.


Once the sanctions had been lifted as part of the deal, and as long as Iran was complying with its provisions, they could not be imposed again in response to its problematic moves in the Middle East without breaching it. Thus, the JCPOA had, in effect, granted a form of immunity to Iran, allowing it to increase its negative activity in the region, as it has indeed done, without paying the price for its harmful policy.


Under those circumstances, the Trump administrations had justly argued that the nuclear deal had, in fact, neutralized its own ability to stop Iran in the region through economic punitive measures. The Trump administration therefore withdrew from the agreement, among other reasons, in order to regain its ability to impose painful sanctions on Iran, thereby exerting pressure on its in areas such as terror, subversion, and missile development.


Following its withdrawal from the JCPOA, the U.S. administration adopted a policy whereby the removal of sanctions imposed on Iran is conditioned upon the latter's compliance with maximal demands across the board – in nuclear, terror, and ballistic missiles (Pompeo's 12 points).


The Trump administration sought to extract U.S. troops from the "never-ending" wars in the Middle East, and avoid direct military friction with Iran, and therefore relied almost exclusively on the sanctions. By doing so, it created a new problem – a sanction "overload" that sabotaged this instrument's ability to force Iran into far-reaching compromises.


In hindsight, the Trump administration sanctions were the most stringent ever imposed on Iran, yet failed to lead it back to the negotiating table, or reduce its scope of negative activity in either its nuclear progress or its military entrenchment in the region. Instead, Tehran began to expand its nuclear program while incrementally and explicitly violating the terms of the agreement. It also adopted a more aggressive, bolder policy from the Gulf through Yemen and Iraq to Syria and Lebanon.


Finally, Israel's and the Gulf States' objection to the nuclear deal, among other reasons because it did not address the regional threats posed by Iran, and Washington's withdrawal from the agreement for this reason, among others, underlies one of the key lessons learned by U.S. experts. They now argue that any agreement with Iran that would focus solely on the nuclear challenge, without incorporating the regional threats into the negotiations, even if it is done as part of a separate or parallel framework, is doomed to fail.



Using the sanctions instrument – available options


The Trump administration has proven that the U.S. is capable of unilaterally building a sanctions regime that is unprecedently effective in harming the Iranian economy. Yet the ability to stop Iran's progress in its nuclear and regional efforts using sanctions alone, stringent though they may be, without establishing a credible military threat, and thwarting its attempts using coercive means on the ground, has not withstood the test of time.


The strategy Biden has outlined to date does not seem promising either, nor is it certain that he will indeed abide by it. The question remains: How does he intend to achieve the goal of improving the nuclear deal once the parties return to the original agreement and sanctions are removed, which, in effect, means losing them as leverage.


In any event, based on the lessons learned from the failed nuclear deal, the Biden administration will have to decide between three basic alternatives regarding the way the sanctions instrument should be incorporated into U.S. policy vis à vis Iran.


Option 1: Removing the sanctions in exchange for a "grand bargain" (Iranian concessions in the region and in the nuclear file). This alternative provides, at least nominally, a solution for all challenges posed by Iran, and does not "shackle" the sanctions to a single area, while giving Iran some freedom to act in other areas.


However, bundling the regional challenges and nuclear problem together is also this option's main disadvantage. Negotiations over regional issues are complex and hard to quantify or measure. They are also expected to take a long time. During them, Iran will be free to gradually expand its nuclear program, using it as a pressure lever during negotiations, as it did in the years that preceded the signing of the JCPOA. Moreover, it is unlikely that the international arena would view Iran's actions with respect to terror as sufficient grounds for annulling a future comprehensive deal that provides a reasonable solution for the nuclear challenge it currently poses.


Option 2: Sanctions focus on nuclear only. The obvious advantage of this alternative is that it focuses on the main threat. Iran's nuclearization is far more significant than the challenge of its attempt to militarily establish itself in the region, and build up the force of its proxies, strategic though this threat may be. Moreover, the U.S. and Israel have fewer means by which to grapple with it effectively and at a tolerable price.


The disadvantage of this option, certainly in the eyes of the U.S., is the need to employ tools other than sanctions for it to work. It means having to cope with Iran's terror attempts, and military entrenchment in the region, using operational means on the ground, thereby potentially implicating and posing a threat to U.S. forces deployed in the region.


Option 3: Splitting the sanctions between nuclear, terror and missiles. As Biden has insinuated, targeted sanctions against Iran as a punitive measure for its attempts in terror, missiles, and human rights will remain valid during the pursuit of a nuclear deal, which will inevitably lead to some concession with regard to the "heavy" sanctions.


The obvious disadvantage of this alternative is the weakening of the sanctions lever, certainly if effective sanctions (energy and finances) will be "split" between the different areas. In the absence of a comprehensive, concentrated effort to achieve a single goal, the ability to force Iran into substantial outcomes in the nuclear realm will be compromised. Another disadvantage is associated with the possibility that Iran would interpret this option as an expression of weakness, as the U.S. will be seen as openly preferring to respond using sanctions as opposed to militarily (in June 2019, for instance, the U.S. responded to Iran's interception of an American UAV by imposing sanctions that froze the assets of Iran's leader, Khamenei).



"Sanctions alone aren’t enough" – Implications & recommendations


Iran poses a combined challenge of terror, subversion, military entrenchment, and proliferation of arms across the Middle East on the one hand, and the setting up of advanced, widespread nuclear infrastructure that could be converted to military uses on the other.


The combined Iranian challenge requires a combined international response that employs diplomatic, financial, and military means. Relying on the sanctions instrument alone, with no willingness to utilize counterforce against Iran's maneuvers in the region, as Israel does in Syria, for instance, conveys weakness, reduces deterrence, and makes it difficult to provide an effective solution to the Iranian challenge.


From the Israeli perspective it seems that the best option is the one that allows the sanction lever to focus on achieving nuclear objectives, and more precisely, on the crucial need to rectify the hazardous flaws in the JCPOA. Simultaneously holding international talks with Iran in an effort to achieve de-escalation and draw "red lines" with regard to its policy in the region could provide greater stability to an improved nuclear deal, should one be agreed upon.


In any event, Israel's dialog with the Biden administration should be conducted quietly, and not through public announcements. It should convey a clear message to Washington whereby "there are no shortcuts" to achieving the goals set vis à vis the Iranian regime. Thus, the only effective strategy to force it to compromise would be to combine military deployment and presence in the region while posing a credible military threat with sanctions, punitive measures, and heavy economic pressure.




Authored by Col. (res.) Udi Evental



If you wish to receive the weekly brief regularly, please follow the link to register.




Back to the newsletter >>