Tag: Iran

America’s Contradictory Yemen Policies

Reuters has an investigation today of the ways in which the Saudi-led War in Yemen has empowered Al Qaeda in the Arabian Peninsula (AQAP), the group’s local affiliate. While it’s been relatively obvious to observers for some time that AQAP had benefitted from the conflict, the extent of their newfound control and wealth as detailed in the article is fascinating.

Thanks to the seizure of the city of Mukalla, AQAP now controls Yemen’s third largest port, a position that Reuters estimates has allowed them to earn up to $2 million per day in fees and taxes. Extortion of businesses, including around $1.4 million from the state oil company, has also provided an easy revenue source, as has the far less subtle method of simply robbing the city’s banks.

Perhaps of more interest is AQAP’s approach to providing civic services and stability. While it’s untrue that Al Qaeda has never experimented with state-building before, such a strategy has more typically been associated with ISIS. As the Reuters investigation notes,  in Mukalla, Al Qaeda is trying to present themselves as a less cruel and brutal ruler than ISIS, an approach which seems to be working with some Yemeni citizens who fear a return to instability.

So entrenched is the group that it attempted to set up a formal profit-sharing deal with the national government to split oil revenues. It is even managing taxes for the citizens of Mukalla, cancelling payroll taxes and promoting various populist policies. All of this is a remarkable feat for a group which has been the focus of concerted US drone strikes and counterterrorism activities for more than a decade.

Time for a Debate on Sanctions Policy

This morning, I attended an interesting speech by Jack Lew, Secretary of the Treasury, on the future of economic sanctions. The speech was notable in that Lew made not only a defense of the effectiveness of sanctions, but also highlighted their potential costs, a variable that is too often missing from debates over sanctions policy.

Some of the points Lew made – like the argument that multilateral sanctions are better than unilateral ones – were hardly novel. Yet others were more interesting, including the argument that sanctions implementation should be based on cost/benefit analysis and an assessment of whether they are likely to be successful. Though such an approach sounds like common sense, it has not always been the rule.

He also focused on the importance of lifting sanctions once they’ve achieved their ends. This is a rebuke to some, particularly in congress, who have argued for reintroducing the sanctions on Iran lifted by the nuclear deal through some other mechanism. As he pointed out, refusing to lift these sanctions now means that they will be less effective in the future: if states know sanctions will remain in place regardless of their behavior, what incentive do they have to change it?

Perhaps most interestingly, Lew argued for the ‘strategic and judicious’ use of sanctions and against their overuse. This is an interesting argument from an administration for whom sanctions have often been the ‘tool of first resort.’ In doing so, he referenced both growing concerns about the costs of sanctions from the business community, and the broader strategic concern that overuse of sanctions could weaken the U.S. financial system or dollar in the long-run.

I still disagree with the Secretary on several points. While he is correct that nuclear sanctions on Iran have broadly been a success, he dramatically overstates the effectiveness of sanctions in the more recent Russian case. Much of the economic damage in that case was the result of falling oil prices, and sanctions have produced little in the way of coherent policy change inside Russia.

He also overstates the extent to which today’s targeted sanctions avoid broad suffering among the population. In fact, evidence suggests that modern sanctions still suffer some of the same flaws as traditional comprehensive trade sanctions, allowing the powerful to deflect the impact of sanctions onto the population, and reinforcing, not undermining, authoritarian dictators.

Despite this, it is refreshing to hear concerns about the long-term implications of runaway sanctions policy expressed by policymakers. In alluding to these concerns – many of which have been noted for some time now by researchers – the Treasury Secretary may help to spark a broader policy discussion of the benefits and costs of sanctions. If we wish to retain sanctions as an effective tool of foreign policy moving forward, such discussion is vital.

For more on some of the big issues surrounding sanctions policy, you can read some of Cato’s recent work on sanctions policy here and here, or check out the video from our recent event on the promises and pitfalls of economic sanctions

Reckless Frenemy Saudi Arabia Makes World More Dangerous for America

Saudi Arabia and Iran continue to turn their national struggle into a religious conflict. The first is dangerous. The second could be catastrophic.

Yet Riyadh, America’s nominal ally, just demonstrated that it is the more reckless of the two states by executing Shia cleric Nimr al-Nimr.

There is much bad to say about Tehran’s authoritarian and interventionist Islamic regime. But even worse is Saudi Arabia, considered by Washington to be a valued ally.

The Kingdom of Saudi Arabia is essentially a totalitarian state. Last year Human Rights Watch reported that Saudi Arabia continued “to try, convict, and imprison political dissidents and human rights activists solely on account of their peaceful activities.”

Freedom House rated the kingdom at the bottom in terms of both civil liberties and political rights. Purported “antiterrorism” legislation allowed the “authorities to press terrorism charges against anyone who demands reform, exposes corruption or otherwise engages in dissent.”

Eagle Claw and Honey Badger

“As health concerns for former President Carter mount,” Caleb Brown noted recently in this space, “it’s nice to be able to look back on his time in the White House and see something remarkably positive.” Indeed, our 39th president doesn’t remotely merit the bad rap he gets from conservatives and libertarians. As I wrote a few years back, “at its best, the Carter legacy was one of workaday reforms that made significant improvements in American life: cheaper travel and cheaper goods for the middle class.” For loosening controls on oiltruckingrailroads, and airlines, he should, Daniel Bier suggests, be thought of as “the Great Deregulator.” It’s in no small part thanks to him that conservatives can cry in their microbrews over the sorry state of the 2016 Republican field.  

So the man from Plains has a lot to be proud of. In the coming months, I hope he’ll have the consolation of seeing the record corrected and his historical reputation start to rise. 

Judging by his recent press conference announcing his illness, however, Carter shares a widely held misconception about where his presidency went wrong. Asked about his regrets, he answered: “I wish I’d sent one more helicopter to get the hostages and we would have rescued them and I would have been re-elected.” Carter was referring to “Operation Eagle Claw,” the aborted Iranian hostage rescue attempt in April 1980. If you’re old enough, you probably remember: the operation never got past the initial “Desert One” rendezvous point, due to the mechanical failure of three helicopters, and eight US soldiers were killed during departure when a helicopter collided with a transport plane. 

The botched rescue attempt definitely contributed to Carter’s defeat. But the mission failed during the “easy” part; when you look at what was supposed to come next, it’s hard not to think the whole operation would have been the Bay of Pigs meets Black Hawk Down.

Writing in the Air & Space Power Journal in 2006, war gaming professor Charles Tustin Kamps observed that “the things which did cause the mission to abort were probably merciful compared to the greater catastrophe which might have taken place if the scenario had progressed further than the Desert One rendezvous.” “In the realm of military planning there are plans that might work and plans that won’t work,” Kamps writes, “In the cold light of history it is evident that the plan for Eagle Claw was in the second category.” It would have required “the proverbial seven simultaneous miracles” to succeed. 

North Korea Remembers Libya, So No Iranian-Style Deal

The Obama administration’s success in negotiating a nuclear deal with Iran has led to hope that a similar agreement might be reached with North Korea. Halt your program, dismantle some of your capabilities, and accept intrusive inspections in return for “coming in from the cold.”

Unfortunately, there’s virtually no chance of that happening. As I point out in National Interest online: “The North already has a nuclear capability and views preservation of a nuclear arsenal as critical for domestic politics as well as international policy. Moreover, the West’s ouster of Libya’s Moammar Khadafy is seen in Pyongyang as dispositive proof that only a fool would negotiate away missile and nuclear capabilities.”

In word and action the Democratic People’s Republic of Korea has demonstrated its commitment to being a nuclear state. Moreover, even a good offer for denuclearization looks suspect in light of U.S. and European support for the ouster of Libya’s Khadafy, who negotiated away his nuclear, chemical, and long-range missile programs.

President George W. Bush promised that Libya’s “good faith will be returned.” Khadafy was feted in European capitals. Tripoli was cited as a model for Iran and North Korea to follow.

However, four years ago the U.S. and European governments saw their chance. Under the guise of humanitarianism, Washington and Brussels promoted low-cost (to them) regime change.

Alas, the self-satisfied celebration of Libya as a “good war” quickly dissipated after that nation suffered post-war atrocities, loosed weapons across the region, generated rogue militias, spawned two governments, descended into incipient civil war, and became another battleground for Islamic State forces. 

Now Libya also stands as a stark warning against nonproliferation, at least for any government believing itself to be in Washington’s gunsights. Had Khadafy possessed nukes, chemical weapons, and/or missiles, the allies almost certainly would have kept their planes and drones at home.

The North Koreans took immediate note. The Foreign Ministry observed:  “Libya’s nuclear dismantlement much touted by the U.S. in the past turned out to be a mode of aggression whereby the latter coaxed the former with such sweet words as ‘guarantee of security’ and ‘improvement of relations’ to disarm and then swallowed it up by force.”

Pyongyang has no reason to believe that the allies would not take advantage of a similar opening against the Kim dynasty.

Nevertheless, the Iranian negotiations have revived hopes that the DPRK might be enticed into following suit. Undersecretary of State Wendy Sherman suggested that implementation of the Iran agreement “might give North Korea second thoughts about the very dangerous path that it is pursuing.” Chinese Foreign Minister Wang Yi said that the Iranian deal was an “active model” for the North.

Alas, Kim Jong-un took power only a couple months after Khadafy was killed in rather gruesome fashion. That event likely was imprinted upon his consciousness. Kim isn’t likely to give up his most important weapon to deter outside intervention.

After announcement of the Iranian agreement, the North Korean foreign ministry issued a statement explaining that the situation of the North was “quite different” from that of Iran and that Pyongyang was “not interested at all in the dialogue to discuss the issue of making it freeze or dismantle its nukes unilaterally first.”

After all, the DPRK was a nuclear state and faced ongoing threats from the U.S. Thus, its nuclear deterrent was not “a plaything to be put on the negotiating table.”

This should surprise no one. Author Mark Fitzpatrick contended that the Iranian deal showed that the U.S. “treated the Iranians as equal negotiating partners, according them respect and collegiality.” But Washington treated Libyans that way too. Which didn’t stop the U.S. and its allies from ousting the same government a few years later.

It never was likely that the DPRK would yield up its nuclear weapons. But the Obama administration’s Libyan misadventure makes that prospect even less likely. Washington may rue this precedent for years to come.

Survey: 58% of Americans Favor Iran Nuclear Agreement, but Worry about Its Efficacy

A new Cato Institute/YouGov poll finds a solid majority—58%—of Americans supports the main components of the Iran nuclear deal, in which the United States and other countries would ease oil and economic sanctions on Iran for 10-15 years in return for Iran agreeing to stop its nuclear program over that period. Forty percent (40%) oppose such a deal.

Americans also prefer Congress to allow such a deal to go forward (53%) rather than block the agreement (46%). Support declines slightly when the deal is described as an agreement between the “Obama administration and Iran.”

Full poll results found here

Despite support for the deal, Americans remain skeptical it will stop Iran’s nuclear program. Fifty-two percent (52%) of Americans say the agreement is “unlikely” to “stop Iran from developing nuclear weapons,” including 32% who say it’s “extremely unlikely.” Conversely, 46% believe the deal is likely to achieve its primary goal.

However, Americans are more optimistic the deal will delay Iran from developing nuclear weapons. The poll found 51% of Americans think the deal will likely “delay” Iran’s nuclear development while 47% disagree.

The survey also offered Americans an opportunity to select which one of several policy options would be “most effective” in reducing the likelihood Iran develops nuclear weapons. Doing so found a plurality –40%— think the Iran nuclear agreement would be more effective than taking military action against Iran’s nuclear facilities (23%), imposing new economic sanctions against Iran (23%) or continuing existing sanctions against Iran (12%).

Ultimately, 63% of Americans say it would be a “disaster” if Iran developed nuclear capabilities while 32% say the problem could be managed and 5% say it wouldn’t be a problem. Nevertheless, Americans tend to have confidence that the Iran nuclear agreement may be the next best step toward reducing that possibility.

Iran and the Global Oil Glut

Today’s Iran deal is a victory for U.S. nonproliferation efforts, and while it may not be perfect, it goes a long way towards ensuring that Iran cannot develop nuclear weapons, and that the IAEA will regain crucial oversight access to Iran’s nuclear facilities. But though it is fundamentally an arms control agreement, some of the biggest impacts may in fact be felt in global oil and gas markets, as easing sanctions allow Iran’s hydrocarbon sector to reopen to the world.

Much of the text of the deal focuses on the sanctions which will be lifted in exchange for Iranian concessions on nuclear enrichment and processing. These include agreement by both the U.S. and EU to permit the import of oil and gas, as well as lifting asset freezes and bans on the export to Iran of technology and equipment for oil and gas extraction. More importantly, bans on investment, financing and service provision in the industry will be lifted, paving the way for European and American firms to provide technical services and invest in the country.

Oil prices have been volatile since the deal was announced, falling almost two percent before recovering. The initial price drop reflects the expectation that Iran may release some of its approximately thirty million reserve barrels of oil onto the market as soon as it is able. Iran also has the potential to impact oil prices in the long-term, holding the world’s fourth-largest reserves of crude oil, and second-largest gas reserves. Production has been depressed by sanctions, but once they are lifted, it is plausible that Iran could increase production to its pre-sanctions levels (2-3 million barrels a day) within several years.

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