Courting Pakistan: Forging a Strategic Partnership

Courting Pakistan: Forging a Strategic Partnership

The United States and Pakistan is the world’s oddest couple, with an on-again, off-again friendship that has survived since the 1950s. Last week both sides completed a "strategic dialogue" in Washington amid fears that they were headed for another break-up. Those fears can only be countered if both the U.S. and Pakistan keep the larger goal in mind: the development of a stable, secure and prosperous Pakistan.

Last week’s dialogue reiterated common goals on some key issues, including energy, infrastructure, agriculture and trade. But the hard issues — the Afghan Taliban operating inside Pakistani space, the Pakistan-India conflict over Kashmir, and Islamabad’s wish for a civil nuclear deal similar to the one given to India — were politely avoided in public commentary.

Part of the problem is Pakistan’s wariness of U.S. intentions. As the late Pakistani dictator General Zial ul Haq once explained to his ambassador in Washington, Jamsheed Marker, "Being friends with the United States is like living on the banks of a great river. Every four years it changes course, and leaves you either flooded, or high and dry!" The U.S. showers aid and attention on Pakistan when it suits its strategic interests in the region and then leaves. Pakistan meanwhile seeks security against a larger and potentially hostile neighbor to the east: India. Each pretends to meet the other’s needs while papering over differences.

The U.S., on its part, sees a deceptive ally in Pakistan; one which seeks aid to use it for defense against India while pretending to meet U.S. regional aims. The Obama administration is attempting to craft a new, longer-term relationship with Pakistan, and American officials travel frequently to the country and return praising the relationship effusively. But it is hard to distinguish their attempts to proclaim success for their individual missions from the reality on the ground.

The passage of the Kerry-Lugar Bill that promises at least $7 billion of aid to Pakistan over five years should have been a good omen, but Pakistani military and public opposition to the bill has put a crimp in the relationship, adding to the public perception of the U.S. as an intrusive and overbearing friend. The army high command, confident after its recent successes against its internal militancy and buoyed by public approval of its actions, recently revived the dialogue with the U.S. on its terms. Army Chief General Ashfaq Parvez Kayani chose to focus on high visibility, high impact projects that would meet the country’s urgent energy and infrastructure needs, rather than dissipating its effect on a wide range of softer social sector projects with longer gestation periods.

To a large extent, Kayani’s actions appeared to be in accord with some of the targets set by Special Representative for Afghanistan and Pakistan Richard Holbrooke. However, the real test will be in Pakistan’s ability to set up an effective governance framework to implement the projects rapidly and without leakage of benefits to the traditional elites that suck up assistance for their own benefit. If most of the aid begins to reach average Pakistanis, then the U.S. and Pakistan could build on this new structure. If not, then the U.S. Congress likely will call in its auditors and cut off the flow.

One piece of good news has been the rapid provision of aid for key road-building projects in South Waziristan that have been undertaken via the FATA Development Authority by the Pakistan army’s Frontier Works Organization. Secretary of State Hillary Clinton is reported to have helped push this aid through after her exchanges with Kayani, who came up with this idea. If this project model succeeds, much more could be done in the frontier areas by bringing the locals on board to help identify and implement necessary projects.

Kayani is clearly trying to build bridges with the U.S. as a necessary ally. But the officer corps still harbors residual mistrust. To remove it, Pakistan must improve its civil governance by taking ownership of its project plans, setting targets and achieving them. The U.S. must deliver what Pakistan needs rapidly, and without too much intrusive monitoring that many Pakistanis fear is secretly designed to identify the location of Pakistan’s strategic nuclear assets. The U.S. must also give the Pakistan military more usable weapons to fight its militancy. And it must use its influence on India to give Pakistan breathing room, so it can concentrate on the war within rather than stay ready for action on two fronts, one against India and the other on the Afghan border. Opening U.S. markets to Pakistani textiles and other goods will also help in the near term.

In the longer run, Pakistan needs help to move up the economic value chain and into manufacturing goods. With its growing population, it needs GDP growth of 6% or more each year to keep improving the lives of its 175 million inhabitants, half of whom are below 18 years of age. That growth depends on foreign investment, which is critically dependent on security and good governance, both of which have been in short supply in recent years. But Pakistan must also avoid becoming dependent on aid or ceding its sovereignty in the process of acquiring aid. As its first military dictator, Mohammad Ayub Khan, put it bluntly: Pakistan needs "friends not masters." What happens after the strategic dialogue in Washington will help prove the truth of that statement.

Shuja Nawaz is director of the Atlantic Council’s South Asia Center. This essay first appeared in The Wall Street Journal as "Courting Pakistan."  Photo credit: Reuters.

Shuja Nawaz: Congressional Testimony on Islamist Militancy in Pakistan

Shuja Nawaz

Shuja Nawaz, director of the Atlantic Council’s South Asia Center, testified before the House Foreign Relations Committee Subcommittee on the Middle East and South Asia on March 11.

His remarks, “Bad Company: Lashkar e-Tayyiba and the Growing Ambition of Islamist Militancy in Pakistan,” can be found below.


Mr. Chairman, Ranking Member Congressman Burton, Members of the Committee, I am honored to be invited to speak before you today.

I speak as a Pakistani who follows closely developments inside Pakistan and the US-Pakistan Relationship. At the Atlantic Council, we are committed to “Waging Peace” in the region and to finding practicable solutions to the security, economic, political, and social challenges facing greater South Asia and Central Asia. Last year we issued a detailed report on Pakistan, warning of troubles ahead if we did not support that country’s fledgling democracy as it took on a rising insurgency. We are shortly going to issue another report that focuses on the progress made to date but warns of dangers ahead if we ignore systemic issues domestically and in the US-Pakistan relationship.

Today’s topic is at the heart of the dangers that confront Pakistan today. The Lashkar e Tayyiba represents a Frankenstein’s Monster created for the purpose of assisting the Kashmir freedom movement but that ended up becoming a powerful Sunni Punjabi movement with an agenda that appears to have taken on a broader regional role. It was born out of the US-backed Afghan Jihad against the Soviets, and built on the training provided by that war to Punjabi fighters who could then inculcate Kashmiri fighters in their ways. Successive civil and military leaders of Pakistan supported the movement as a strategic asset to counter a powerful India to the East and to force it to negotiate for a settlement of the disputed territory by waging a war of “a thousand cuts”.

Over time, however, the sponsored organization took on a life of its own, finding the socially disadvantaged area of Central and Southern Punjab to be a fertile territory for recruitment of Jihadi warriors. In a country where the median age is estimated to be 18 years and hence half the population of 175 million is below that age, the recruitment pool of unemployed, uneducated, and impressionable youth is huge. The attraction of the militants’ message cannot be countered by military might alone. It has to be addressed at the core by changing the underlying social and economic conditions that foster militancy as a passport to a better life here and in the hereafter.

LeT spread its wings nationwide, using its contacts to raise funds from the public and gradually attained autarkic status. Collection boxes for the Kashmiri jihad in shops, at mosques, and around the festivals of Eid al Fitr and Aid al Adha gave it a steady source of income. It spun off a social welfare organization, the Jamaat ud Dawa, that served to proselytize on behalf of the LeT while providing much needed social services. In doing this, the LeT was playing to the weakness of the corrupt political system of Pakistan that failed to recognize and meet the basic needs of its population at large while catering to the elites. The performance of the Jamaat ud Dawa during the earthquake of 2005 won it more followers in a critical region of the country that straddled the Karakoram Highway linking China to Pakistan.

The Inter Services Intelligence started becoming less controlling as the LeT became more self sufficient. But the realization that the LeT had become autonomous was slow in being understood or accepted in the ISI and in the military leadership of Pakistan under General Pervez Musharraf. His ambivalence about the LeT even in 2002 was evident in his confusion during an interview with Australian Broadcasting Corporation when he challenged the interviewer who stated that the LeT had been banned. Musharraf thought only the Jaish e Mohammed had been banned, referring to another surrogate of the ISI in Kashmir. Today, LeT is banned. But the Jamaat ud Dawa remains a functioning entity.

General Musharraf made an effort to lower the political temperature in Kashmir and began distancing the state from the LeT. However, the process was not handled as well as it could have been. Similar to the disbanding of the Iraqi army after the US invasion when thousands of trained soldiers and officers were let go, the LeT was cut loose without a comprehensive plan to disarm, re-train, and gainfully employ the fighters. A dangerous corollary was the induction into the militancy of some former members of the military who had trained and guided them in their war in Kashmir.

What should we do? I believe that it may not be too late to assist Pakistan in crafting a plan to reach out to the fighters of the LeT and other Punjabi militant organizations and by involving their extended families in the process, provide training and stipends to wean them away from their militant path. The extended family unit could play a role in ensuring against recidivism on the part of the fighters. Simultaneously it is critical to focus on drastically changing the Islamist curriculum of public schools, a vestige of the period of general Zia ul Haq’s rule, and invest in South and Central Punjab to create job opportunities that would lift up the relatively backward population of this area.

Enough evidence exists now to link the Sipah e Sahaba and Jaish e Mohammed with Al Qaeda and the Taliban. The LeT’s emerging role as a trans regional force that has broadened its aim to include India and perhaps even Afghanistan, by linking with the Students Islamic Movement of India or SIMI and the Harkat ul Jihad al Islami or HUJI of Bangladesh. It poses a serious threat to regional stability. Another Mumbai-type attack might bring India and Pakistan close to a conflict, a prospect that should keep us awake at night. In Pakistan, both the civil and the military now appear to recognize the existential threat from home grown militancy. The army appears to have dislocated the Tehreek e Taliban of Pakistan. Yet, it faces a huge threat in the hinterland, in the form of the LeT. My own research into the recruitment of the Pakistan army over 1970 to 2005 indicates that the army is now recruiting heavily in the same area. Unless we change the underlying social and economic conditions, the Islamist militancy that appears to be taking root there will start seeping into the military. Mr. Chairman, I am grateful that this committee is focusing on this issue and thank you for allowing me to share some of my ideas. I shall be glad to provide more details in my replies to queries.

Related Testimony:

Related Publications:

U.S.-Iran Relations Event Transcript

U.S.-Iran Relations Event


  • Damon Wilson, Vice President and Director, International Security Program, Atlantic Council
  • C. Richard Nelson, Project Director, Reversing Relations with Adversaries Program, Atlantic Council
  • Kenneth Katzman, Specialist in Middle East Affairs, Congressional Research Service
  • Flynt Leverett, Senior Research Fellow, New America Foundation
  • George Perkovich, Vice President for Studies and Director, Nuclear Policy Program, Carnegie Endowment for International Peace
  • Judith Yaphe, Professor at the Institute for National Strategic Studies, National Defense University

March 9, 2010

DAMON WILSON:  Good afternoon.  Why don’t we go ahead and get started.  I think we’ll have Flynt joining us in just a few minutes.  But my name is Damon Wilson.  Welcome to the Atlantic Council.  I’m the vice president and director of the International Security Program here at the council.  Today we’re pleased to host this discussion on U.S.-Iran relations, preparing for the best case and the launch of our latest publication and analytic compendium of U.S. policies, laws and regulations.

We’re pleased to host the project’s author, Ken Katzman of the Congressional Research Service, the project director, Dick Nelson of the Atlantic Council and our distinguished panelists who served on the steering committee, George Perkovich, Judith Taphe, Flynt Leverett.  I’ll turn to Dick in just a few minutes to introduce our guests properly in a moment.

Today’s discussion is co-hosted by the council’s program on international security and our South Asia center, led by Shuja Nawaz, who’s with us today.  The project’s made possible by a grant from the U.S. Institute for Peace.  But today’s event is also part of a broader – two broader efforts here at the Atlantic Council.

First, for many years, the council’s managed an ongoing program on reversing relations with adversaries.  As part of this effort, we’ve produced publications on what practical steps would be required by the executive and legislative branches to undo restrictions and normalize relations with countries such as North Korea, Cuba and Libya.

Although controversial at the time of publication, the compendium on Libya served as a major resource document for policymakers during the period of normalizing U.S. ties with Tripoli.  The Atlantic Council also has a long history of work on Iran in particular.  Over the years, the council has published several Iran-related publications, including “Thinking Beyond the Stalemate of U.S.-Iranian Relations,” “Do Economic Sanctions Work?” and “Managing Proliferation Issues with Iran.”

Just last week, the South Asia center hosted a spirited date on engagement or regime change featuring Flynt Leverett and Michael Ledeen, moderated by David Ignatius.  The council is also launching a new project on Iran, which will be chaired by Stu Eizenstat and Chuck Hagel and led by Mark Brezinski on when change comes to Iran.

The objective of this project is to explore contingencies in the event that relations between Iran and the United States improve and assist U.S. policymakers in thinking through how the U.S. government and the private sector can maximize the potential of that improved relationship.

But today we will begin to focus on the implications of the best-case scenario in Iran.  The premise of this work is that adversarial relations are subject to sudden change.  And in cases where this has occurred, adjusting to that change has been more complicated than anticipated. 

After the U.S. defeat of the Taliban, it took a year to lift all sanctions against Afghanistan.  In the case of Libya, it took three years from Libya’s decision to end its WMD program and to compensate the victims of flight Pan Am 103.  U.S. sanctions on Iraq were mostly lifted within about one year after the fall of Saddam Hussein’s regime. 

So although the timing and conditions of a tipping point toward better relations with Iran cannot be foreseen – and although worsening of those relations is also possible, if not likely, it’s nevertheless imperative that policymakers begin to think about how we should proceed in a more positive direction.

So the council’s current publication is a compendium of the laws and regulations that govern the current U.S. relationship with Iran.  If conditions change, these are the same laws and regulations that policymakers must quickly examine and change in order to move forward with a more fruitful relationship.

With us today to discuss the compendium is our principle author, Dr. Kenneth Katzman.  I want to thank you for working on this crucial reference document.  And to moderate this event, we have with us Dick Nelson, the project’s director.  Dick served as the director of the council’s Program on International Security for many years and has a deep background of strategic issues as well as within the U.S. intelligence community.

Dick has been involved in our Reversing Relations with Adversaries program for quite a while, starting with our Cuba project in 1994.  So Dick, over to you to kick off the discussion.  Thank you.

DICK NELSON:  And I’d also like to thank the U.S. Institute of Peace for providing a grant to help make this publication possible.  As Damon said, we titled the event today “Preparing for the Best Case” and it’s not because we necessarily think relations are about to change or change for the better in that fact.

But we do think it’s useful to think about the process of change, if and when the circumstances change.  I think without question, this is the most authoritative reference on U.S.-Iranian relations.  It has the full text of all the relevant policies, laws and regulations.  So if you’re at all interested in at least how the U.S. side of the relationship is – is governed and managed – this is the best reference.

And nobody understands the structure of U.S.-Iranian relations better than Ken Katzman.  He’s been at the Congressional Research Service for a number of years.  He, before that, was a Persian Gulf analyst at the CIA.  His dissertation and book – resulting book – was on Iran’s Revolutionary Guard and he’s published a number of articles, both on Iran and on the Middle East.

And he’s also served on the House international relations committee, so he has a first-hand experience on ILSA and other famous pieces of legislation that has affected this relationship over the years.  So like I said, I don’t think anybody understands the structure of U.S.-Iranian relations from the U.S. perspective better than Ken.

So I’d like to have Ken give us an introduction, an overview of the compendium and then I’ll briefly call on the other steering group members to comment on the context of current relations with Iran and then open it up to questions.  We’ll adjourn promptly by 4:30.  So Ken?

KENNETH KATZMAN:  Thank you very much, Dick and I thank the council and USIP for the support for the project.  Just a standard disclaimer which CRS insists on:  I’m not speaking for CRS or the Congress today or anything.  I’ll be glad to answer questions about congressional initiatives without mentioning any specific member offices.

Before I got here, what’s it, about 3:00 today?  I’ve already had about 15 proposals bounced off me for more sanctions on Iran and it’s only 3:00.  So – (laughter) – you can tell how things are going in Congress, okay?

I’m very pleased with the compendium.  It’s about the fourth or fifth one I’ve done.  I didn’t do the one on Cuba, although since I’m retiring in Miami, I may want to rethink that.  Just to make a few comments on you know, what the compendium does and we’re, you know, obviously, there’ll be future updates, hopefully.  We have important pending legislation in Congress, as I mentioned the centerpiece would sanction. 

There’s a lot of time spent in the compendium on what’s called the Iran Sanctions Act – refer to it – originally, it was called ILSA, the Iran-Libya – Iran and Libya Sanctions Act.  Libya dropped off.  Libya was removed from the terrorism list and there was formal legislation to remove it.  So it only applies to Iran.  It is the Iran Sanctions Act.

MR. NELSON:  They graduated right?

MR. KATZMAN:  They graduated.  And the current legislative proposals that you’re reading about – so Mr. Berman’s bill, Dodd-Shelby bill – I said I wasn’t going to mention – well, these are public documents, but things that have not been introduced yet, I cannot identify who’s working on.

These bills would expend the authority of the Iran Sanctions Act and as you’ll see in the compendium, even today, there’s tremendous confusion about the Iran Sanctions Act versus the U.S. ban on trade with Iran, which was imposed by executive order in May of 1995.  That is a big feature of the compendium.  It’s a centerpiece. 

It is worked by – through trade regulations that are amended every so often by the Office of Foreign Assets Control of the Treasury Department, which administers trade regulations when there is a ban on trade, as there is with Iran.  There have been a few modifications of that ban which are in the compendium. 

At the time, Mohammad Khatami was president of Iran.  President Clinton wanted to reach out to Khatami, try to engage, try to enhance the prospects of moderate forces in Iran so there were a few modifications. 

One was to allow for the exportation of food and medical products on a cash basis, no financing.  And another second modification to allow for luxury imports, carpets, caviar, dried fruits, nuts.  Those loopholes that were allowed remain in force.  Some of the pending legislation in Congress now would seek to reverse those modifications and restore a full trade ban.

The Iran Sanctions Act is a different animal because U.S. firms are already banned from investing in Iran under the trade and investment ban.  So the Iran Sanctions Act really was not meant to apply to U.S. firms because they were already banned under this executive order that I mentioned.

The Iran Sanctions Act was intended to sanction foreign companies that are investing in Iran’s energy sector.  And there have been, you know, billions of dollars – I have in one of my CRS reports, a chart on, you know, investments in Iran’s energy sector and there have been many.  Some were just memoranda of understanding that have not been implemented.  Others have proceeded to full production of oil and gas fields.

So the Iran Sanctions Act was intended to impose a series of penalties on these foreign companies that make the investments in Iran’s energy sector.  There was only one project ever determined to have violated the Iran Sanctions Act.  This was the Total, Petronas and Gazprom deal in 1998.  But that was – penalties were waived.

So one project was determined to have violated but no penalties were imposed.  Since then, no projects have been even determined to have violated it.  And some of these projects are hanging since 1999, these investments were made and still, more than 10 years later, there has been no determination that they violated the Iran Sanctions Act.

So this has stirred up, you know, congressional sentiment.  Let me be diplomatic.  You know, there is some proposals – some of them came across my desk today, you know – ways to demand that the administration determine a project to be sanctionable or not.  There were previous legislation – I have in the compendium the Iran Freedom Support Act of the 109th Congress, which the first version attempted to set a firm deadline that the administration must determine sanctionability within 90 days.

The administration didn’t like that.  It wasn’t flexible enough.  It was modified to a sense of Congress that the administration should determine sanctionability within 180 days.  So not to get too deep into the weeds, but basically, the tone I think you’ll find in the compendium, particularly the last section on winding sanctions – and that’s really what we’re talking about today – were there to be some rapprochement with Iran, some change in relationship.

The bottom line is the administration, despite, you know, we have, here a book’s worth of sanctions laws.  The administration still has a lot of flexibility to unwind these sanctions very quickly, if indeed there was a dramatic change.  A few examples we’ll mention just in the intro, you know, Afghanistan.

Once the Taliban were out, sanctions were unraveled fairly rapidly.  Saddam was overthrown, sanctions on Iraq went away very rapidly.  Libya – Gaddafi decided to give up WMD programs, sanctions did unwind fairly quickly, although a little lower.  See, the compendium has terrorism – sanctions that are imposed by consequence of Iran’s designation as a terrorism state sponsor.

And as you’ll read in the compendium, if Iran were to be removed from the terrorism list, a lot of sanctions would instantly go away because a lot of them are not specific to Iran, they are just sanctions that are imposed on any country that is on the terrorism list.  Therefore, if Iran is taken off, a lot of the sanctions instantly go away.

The ban on foreign assistance goes away, the presumption of denial for exports of dual-use items goes away, the requirement that the United States vote against IMF and World Bank loans goes away.  All these requirements instantly dissipate.  So really, taking a country off the list is a key to unwinding the sanctions.

Now, the law provides – and you’ll see this in the compendium, a president can take a country off the terrorism list almost immediately if there is a change of regime.  If there’s a change of regime, it can be almost instant.  If there’s not a change of regime, there is a 45-day waiting period. 

The president has to certify to the Congress, the regime has not changed.  However, they’ve changed their stripes, da, da, da.  They’ve turned over a new leaf, whatever, whatever.  And I’m taking them off the terrorism list.  That happened with Libya.  Gaddafi is still in power, but Libya was taken off because it had given up the WMD and then there were some other things involving the Pan Am issue.

So it’s harder to take it off if the regime is still in power.  So with Iran, unless you know, the Green movement somehow triumphs, which is certainly possible, although one of the speakers may disagree at some point, but then Iran could conceivably be removed from the terrorism list fairly quickly, if there is a change of regime. 

If we are engaged with the current regime and there were a wholesale change in relations, it would be slower.  Now, in any event, Congress has the ability to pass a joint resolution saying Mr. President, we disagree.  We do not think this country should be removed from the terrorism list.  They can pass a joint resolution.

However, the president can veto that joint resolution and therefore, Congress would have to override the veto.  So in practice – and administration has quite a bit of latitude to take countries off the terrorism list.  The trade ban, as I’ve said, is by executive order.  Any president, theoretically, can decide tomorrow to issue new regulations.

I see no more reason for a ban on trade with country X, it’s not justified anymore and OFAC can issue new regulations unwinding the trade ban.  The Iran Sanctions Act, which I know the diplomatic community is very, you know, obviously animated about and our foreign partners – that is a little bit of a different issue because Congress has really, as I’ve said, focused on the Iran Sanctions Act.

Not only does a country have to be removed from the terrorism – not only does Iran have to be removed from the terrorism list, not only does it have to be certified to not have WMD programs, but to make the Iran Sanctions Act non-applicable, the president has to certify that Iran no longer poses a threat to the United States or its allies.

So it’s a very high threshold to make the Iran Sanctions Act inapplicable.  Just to wind up, as I said, the current legislation pending in Congress now would expand the authorities of the Iran Sanctions Act.  As I said, currently, Iran Sanctions Act sanctions foreign companies that invest in Iran’s energy sector.

It does not sanction trading with Iran.  It does not sanction sales to Iran.  It does not sanction financing to Iran.  It only sanctions investments in Iran’s energy sector, not any other sector.  However, the definition of investment is not just to take an equity stake.  It’s also if a company is responsible for managing a construction project in the energy sector.  That is considered an investment under the Iran Sanctions Act.

That’s why there’s been a lot of you know, newspaper articles about different companies.  Some companies say, we didn’t invest anything.  We didn’t put any money into this.  Well, they’re managing a construction project in the energy sector.  That meets the threshold of investment.  So they are vulnerable to being sanctioned.

So the current legislation would expand the authority to make sanctionable, not only investing in Iran’s energy sector, but selling gasoline to Iran or selling equipment that Iran can use to expand its own refining capacity.  And the pending legislation would set up three new sanctions on such companies that are determined to do that.

The Senate bill is more expansive.  There has to be – to make this law, both chambers have to pass the same bill.  You can’t have two different bills, so they have to reconcile the differences.  And the Senate bill is much more expansive.  As I said, it would re-impose these modifications, so the trade ban – it recommends sanctions on Iran’s central bank and it would apply the trade ban to foreign subsidiaries of U.S. companies.

Right now, the trade ban does not cover foreign subsidiaries of U.S. companies because they are legally considered entities of the companies where they’re incorporated.  So the Senate legislation would say that these foreign subsidiaries are held to the same standard as the parent company.  So it would impose a trade ban, essentially, on foreign subsidiaries of U.S. companies.

So there’s big differences between the two bills.  The issue is, you know, Congress – as I’ve said – as I’ve said, it’s only 3:00 and I’ve had 15 proposals on more sanctions on Iran today.  The Congress is inclined, you know, let me be frank, the Congress is inclined to find every which way to squeeze – Iran is not popular in the U.S. Congress.  I don’t think I’m saying anything that – (chuckles) – that anybody doesn’t know already.

They are looking for every which way to squeeze and you know, I would not be surprised if the more expansive Senate bill, you know, elements of that end up in a final – in a final package.  But you know, I can’t really be any clearer on how the Congress feels about Iran and Ahmadinejad and the supreme leader.

There are other pending – there is other pending legislation that I didn’t get too deep into.  I have some democracy and human rights stuff in here, but a lot of this is pending, you know.  Finding ways to sanction companies that are selling Internet-monitoring gear to Iran, finding ways to have a travel ban on any Iranian official who is committing human rights abuses.  You know, further funding for U.S. broadcasting to Iran to get the U.S. democracy message out.

There is even one bill introduced by Sen. Brownback and Sen. Cornyn basically saying if this law is passed, it shall be the policy of the United States government to overthrow the regime in Iran.  There is very, you know, a lot of congressional ferment right now and luckily, after this, I’m going to go home and not worry about it.  But tomorrow morning, I’ll have to worry about it again.  So I think I’ll end there.  Thank you.

MR. NELSON:  And I encourage you don’t.  Now, I’ll turn to our steering group members.  First, Dr. Judith Yaphe.  She’s a distinguished research fellow at the Institute of National Security Studies at National Defense University.  She has over 20 years experience as a senior analyst at CIA on the Middle East and Persian Gulf.  And as most of you know, she’s widely published on Iran and international security affairs.  Judith?

JUDITH YAPHE:  I just want to – can you hear me?  I’m loud anyway.  I just want to make a few points picking up on one or two things that Ken said.  But first of all, we do owe him a vote of thanks.  He did a tremendous job and he fought me really well because as he well knows, I sometimes get carried away and – little too close to the policy.

But the remarks I want to make now are, in effect, I think an extension and in support of the great job that he did.  And whether you believe there’s going to be change or not, I think you have to look at what sanctions mean and what they – why they are so important, even if they are not always powerful.

Many who like the idea of sanctions think that if we’re going to deprive Iran of American-made goods, technology, of the best the West has to offer, that’s going to be sufficient cause for regimes to fall.  Well, it doesn’t happen that way.  I think in our eyes, or if you’re looking at it through Iran’s eyes, it certainly will – I think sanctions.

And you know, we talk about sanctions.  It’s carrots and sticks.  And we think that’s a nice way to put it.  But imagine if you are Iran or anyone else being described as needing carrots and sticks to modify your behavior, that’s the way you treat a donkey and it is insulting.  But that’s, I guess, the intention.

The point I want to make is Iran will still see us – they think about sanctions – as a 19th-century imperialist power determined on modification of a regime’s behavior and if it won’t modify it, change it.  And sanctions, I think, in this sense here, reflect a mentality which says, those mad mullahs.  They must be crazy, they don’t agree with us.

Not to quote any official in the U.S. government, but Iran has now been taken over by the military, meaning the IRGC, the Islamic Revolutionary Guards.  That Ahmadinejad, he sure is crazy and that supreme leader?  Out of touch.  Well, there may be elements of truth in all of that, but again, I think the point is people think sanctions are an easy and cheap way to punish – to get a government to change its point of view, to do things differently or to see things the way we do.

And it just doesn’t happen that way.  Is Iran ready for a change?  They seem quite worried about what advanced sanctions might mean.  A higher level of sanctions, as the Europeans like to say, but sometimes it sounds like – I don’t know if you remember when you were a child, the story of the – was it Br’er Rabbit?  You know, don’t throw me into the tar patch – the tar baby?

And he doesn’t want it so bad because that’s where he really wants to go.  So if he says he doesn’t want to, I’m sure going to do that.  I’m sure going to put sanctions on you.  One point I want to – sanctions don’t just end that easily.  And I would point out that Iraq is still under sanctions, maybe not American sanctions, most sanctions have been removed.

But Chapter 7 has not been removed from sanctions and we don’t seem to be able to do a whole lot to get them removed.  That is sort of the ultimate in a way because it’s the barrier that keeps Iraq from, what?  Rebuilding its military?  Ken will always correct me on this – you know, for purposes of full disclosure, Dick, we once worked together.  So I just have to tell you – (laughter) – you are surrounded.

But I think the point I want to make is that sanctions are loved by people who think that they can do what we want.  They can really change the regime.  They can modify it.  Just by wishing so doesn’t make it so.  That doesn’t make policy.  We haven’t changed Cuba in how many years?  Is it 50 years of sanctions on Cuba or less?

Iraq was under sanctions for 13 years and still faces some sanctions which have to deal – unless you pay up everything you owe to Kuwait and make full amends, they’re still on.  Iraq, too, will be shopping for weapons.  They already are.  Are there still sanctions on them acquiring whatever they want to not?

What will sanctions mean for Iran?  Again, in the realm of be careful what you ask for, the impact on Iraq was to hit the population at large – the middle class, that which we hoped will bring change and moderation and growth and all those good things.  But in Iraq, it didn’t hit the poor that much and it certainly hurt Saddam because he benefited from it.

So be careful what you – as I say – what you ask for.  I would have one other question to think about and that is, what do you need to remove sanctions?  Now, Ken lays out a lot of the law and of course, he’s right.  But the question in my mind is, just one step further, would regime change be sufficient to get sanctions removed?

Simply because Iran has a new government, whatever it is, would that be enough to get sanctions taken off?  And I just have a feeling – some people are very happy because we tend to personalize that which we fear or hate or want to change.  So the personification of Iranian evil is Ahmadinejad and the weapon is sanctions.

But would regime change be sufficient?  Because what this gets to is the issue of nuclear power and the roll – well, if you believe it’s rollback or whatever – George will talk about that.  But if you look at the opposition such as it is to Ahmadinejad and his nuclear policy, it’s not over nuclear policy.  So I think one has to be careful.

A regime change is one thing, but that may not mean a change in policies that we could live with.  Now, in conclusion, I love cartoons.  And I pulled this one out of a drawer today and it’s a couple years old, but it has three hard-line clerics surrounding each other.  They’re reading over the Iranian election results.

So this is a couple years ago.  And there’s someone who looks like, well, you know, it could be the supreme leader.  It could be an old Ahmadinejad, but the point is he’s saying, agreed, we now call ourselves the reformers with results.  (Laughter.)  I’ll leave it there.  Thank you.

MR. NELSON:  Now, we’ll call on Dr. George Perkovich.  He’s vice president for studies and director of the Nuclear Policy Project at the Carnegie Endowment for International Peace.  As most of you know, he’s an expert on nuclear weapons and nonproliferation and has done a lot of work on Iran.  Prior to joining Carnegie and the nonprofit world, he was a foreign policy advisor to Sen. Joe Biden.

GEORGE PERKOVICH:  Thanks, Dick.  And I want to begin by congratulating the council and Kim for this volume because it really is useful.  It’s not exciting reading; it can be a sedative.  But it is very useful as a reference and as a resource guide to have it all in one place.

And picking up on what Ken and Judith said and how Dick started us off, I mean, it seems to me that the best case with Iran is that the worst case doesn’t happen.  And that’s about as good as we can hope.  And I think focusing then on sanctions makes some sense because that is the policy that I think right now is being pursued because we don’t know what else to do.

The other alternatives actually are a lot worse and you can’t do nothing.  Therefore, let’s do sanctions.  And so just to keep moving – and so that the sanctions are incremental; they’re not enough to really bite.  Everybody knows that.  But you’ve got to do something.  And the military and anybody who looks at it carefully, you know, doesn’t want to do military strikes.

The favored, desirable option would be somehow regime change in Iran.  I’ll leave it to other people who are more expert.  My sense is from the people I talk to that that’s extremely likely for a variety of reasons.  But I would also remind that we don’t – in history, as far as I know – have an example of what it is we would want in terms of regime change.

So the people – a lot of people advocating it now kind of cite the Soviet Union, the fall of the Soviet Union.  Well, yeah, the Soviet regime is gone.  But the KGB is still running the country.  They got renamed but it’s the same guys making the same money controlling the same things.  Different policies in some regard; much more humane, but not necessarily a friend of the United States – certainly not democratic in a meaningful way.  We can go through the list of things that are still problematic.

And so in the case of Iran, when people are talking about regime change, what it seems is missing in the discussion is the theory of how the Revolutionary Guard actually would get displaced in Iran and put out of business, lose power, displace so that you would have a genuine regime change in Iran.  And so I think that there’s a lot of wishful thinking on that, to which I’m sympathetic.  But not clear to me how far that goes.

So that leaves you back with sanctions.  And there I think a couple of points are important.  When I and when others advocate stronger sanctions, which I do, people say, but that’s not going to change their nuclear policy.  It’s not going to change their determination to continue to enrich uranium, not to comply with the IAEA resolutions, all of these things, which legally and otherwise they’re required to do.

And my response to that is actually that’s right.  Ideally, sanctions would change behavior.  But in the case of Iran, they’re not.  But there’s another reason to sanction states, which is to punish them.  And it may not change your behavior; but there is a cost for this action.  And in part, we want to communicate to other states, potential other actors who may be looking at what you’re doing as a model – maybe contemplating acquiring fuel cycle capabilities, hedging their bets, doing other things and looking at Iran and saying, well, you can get away with it.  The price isn’t very high.  The risk is relatively low, so let’s do it.  And for that reason, you could do sanctions to punish, even though you don’t have an expectation that there is going to be regime change.  And I think we need to deconflate those arguments.

Having said that, in general, I would think if Congress were an empirical organization that believed in empiricism, which it’s decidedly not, it would look back at history since 1979 and say, gee, this actually really isn’t very effective.  And you wouldn’t keep doing it.  But as a friend of mine once said, there’s no Iran in our Iran policy.  It isn’t about changing Iran.  It’s about how Congress makes itself feel good or shows resolve without responsibility or a whole bunch of things one could say.

But I think the idea that with all of the challenges that we face domestically and in the world – Ken’s getting 15 proposals a day on sanctioning Iran – tells you it’s not a very serious enterprise in the sense of people really thinking through what  it is they’re doing and what the consequences would be.  It’s a cheap shot.  It’s free.  And so it’s done.

And I think there are people working very seriously on this challenge in the executive branch as there were in the Bush administration.  And this whole kind of push for sanctions and congressional determination of the what the executive does predated Obama.  It was being done in the Bush administration too.  And so, what I would say in the Bush administration, I would say now, which is look, the executive branch isn’t full of Iran lovers.  They’ve got a pretty tough mentality.  Give them some discretion to figure out what is smart and what is not.

And as Ken has documented here, if you do it legislatively, you really take away flexibility that makes it much harder to accomplish your objectives in many ways.  So you know, in an ideal world, I would think Congress would cease and desist.  But that’s not the world we live in.

In which case – last point I would say is that we really need to think long term, because I don’t think there’s a short-term solution to any problem in Iran.  And so, the long term, it seems to me, is mostly to contain the damage of what Iran might be doing.  That’s not just contain Iran, but also to be thinking about steps that we can take or that internationally can be taken to make it harder for other states to follow in Iran’s footsteps.  And those can be both kind of restrictive things on nonproliferation but reassurance measures in terms of security.  There are other steps, I think, but all with the mindset of containing the potential damage if you can’t change Iran’s behavior.

Let me stop there.

MR. NELSON:  Thank you, George.  Your remarks remind me in 1999 we did a related study on Iran.  And the co-chairs were Brent Scowcroft, Jim Schlesinger and Lee Hamilton.  And so we had a draft and talking about this kind of stuff.  And Schlesinger’s comment was, while emotionally satisfying, this isn’t working.  And I think that sort of captures it.  You have to do something.

Now I’ll turn to Flynt.  Dr. Flynt Leverett is a senior research fellow at the New America Foundation.  He was senior director for Middle East affairs at the National Security Council, counterterrorism expert at the State Department’s policy planning staff, and a CIA analyst.  Looks like we have several CIA analysts here.

MR. PERKOVICH:  For the record, I was – (inaudible, laughter).

MR. NELSON:  Flynt?

FLYNT LEVERETT:  Yeah, we’ll believe that, George.  (Laughter.)  Thank you, Dick.  Thanks to all of you for coming.  And I’m sorry I’m joining you a little bit late.

When I was asked to serve on the advisory panel for this effort, you know, this is the kind of thing where if you’re an academic or you’re in the think tank world, this kind of activity falls under the rubric of public service.  You know, you’re essentially acting to help further a project that’s going to contribute to better public debate or public knowledge.  And so that’s called public service.  And I certainly think that the Atlantic Council and Ken Katzman have done a real service by putting this volume together.

But I have to say, in all honesty, I had a real self-interested motive in helping with this project, namely my personal copy of the previous edition of this effort – which Ken also put together in two volumes 10 years ago – my personal copy of that is so thoroughly worn out by the nearly constant reference that I’ve made to it over the last 10 years that I thought it was really time that I get a new copy of one of these.  But that meant we were going to have to do a new edition.

I at least have always thought this was an incredibly valuable reference and research tool that Ken had put together.  And I’m really pleased that there’s now this new, updated edition and that I could contribute in a small way to helping that project along.

I think in terms of my own perspective on sanctions and U.S. policy toward Iran, I mean, I think many of the comments that Judy and George have made about the relative lack of efficacy of our sanctions policy over many years, I would certainly agree with that.  There are observations about how in many respects this is largely motivated by domestic politics here and feeling good that we’re doing something about Iran.  I would certainly agree with all of those statements.

But, I’d like to step back for a minute and hopefully look at an even bigger picture and say I think that our policy toward Iran and the sanctions component of it is a big piece of this.  I think that our sanctions policy, our larger Iran policy, even under the Obama administration, is increasingly detached from reality.  And the main reality that it is detached from is that the United States is in relative terms a declining power.

The United States still possesses utterly unique capabilities to project large amounts of military power, conventional military power, into the Persian Gulf or other critical arenas.  But in virtually every other political or economic sphere, our influence is, in relative terms, declining.  And even at this point, if we want to project large amounts of conventional military power into the Persian Gulf or anywhere else, we’re going to have to do it on borrowed money.  We won’t be paying for it ourselves.  We will be relying on Chinese, Saudis, and other major creditors of the United States to loan us the money to do it.

Our Iran policy, especially the sanctions part of that policy, is designed for some other planet than the one I just described, a planet in which the United States is this uniquely hegemonic power and can, through largely unilateral actions and initiatives, shape the world and shape in a determinative way the strategic choices that other countries make.  That world may indeed have existed for a while in the 1990s.  I would contend it doesn’t exist today.  Our Iran policy is increasingly at odds with the reality of the world we live in today.  And if anything, it’s going to get less effective for that reason not more effective.

Just to illustrate that point, I’d highlight one part of our sanctions policy – and there is a very good section on this in Ken’s volume – dealing with secondary sanctions, namely those sanctions, which the United States threatens to impose on third country entities or individuals that are investing in various types of projects in Iran, particularly upstream energy projects or pipeline projects.  We have legislated secondary sanctions of this sort since 1996.  Congress is currently trying to tighten the application and enforcement of such sanctions.

We, of course, bar U.S. energy companies from doing business in Iran by executive orders.  But by law, we also threaten to impose sanctions on non-U.S. energy companies that would do business in Iran.  I’ll tell you a couple of dirty little secrets about secondary sanctions.

Dirty little secret number one is it’s a house of cards.  It’s a bluff.  Since 1996, when secondary sanctions were first authorized in U.S. law, the United States – not the Clinton administration, not the George W. Bush administration and not this current Obama administration – has ever imposed secondary sanctions on a non-U.S. company investing in Iranian energy projects, not once.  In 1998, the Clinton administration determined that a joint venture investment by Total, Gazprom and Petronas in Iran constituted a sanctionable investment but waived the actual imposition of sanctions.

No administration has wanted to go down this road because the foreign policy consequences of doing so would be quite bad for the United States.  And on top of that, the European Union, including Her Majesty’s government, have made clear that if we ever tried to do that to an EU company, they would haul us into court in Geneva saying that this was a violation of the United States obligations under the WTO.  And while I’m not a trade lawyer, my sense is that most professional trade lawyers who have looked at this think the United States would lose that case in Geneva, that in fact secondary sanctions are a violation of America’s obligations under the WTO.

No administration has wanted to go through that.  And after the Clinton administration had to go through the domestic political blowback of waiving the imposition of such sanctions in 1998, the preferred way of dealing with this has simply been never to conclude an investigation into the energy investments that Total, Statoil, ENI, and a whole bunch of other non-U.S. companies have made in the Iranian upstream over the years.  Just don’t ever conclude an investigation so you don’t ever have to make a determination, that in order to avoid all the foreign policy consequences of imposing sanctions, you’ll just waive it.  But then, you catch hell from Congress.  Okay, the secondary sanctions policy is a joke.

But it is worse than that in that at this point it is really, really seriously detached from reality.  For maybe the first decade we did this sort of stuff, we could kid ourselves and say, well, we keep U.S. companies out of Iran.  And if we can at least limit the enthusiasm for big European companies to go into Iran, maybe we’re accomplishing something in terms of limiting Iran’s capacity to develop its own hydrocarbon reserves.

But guess what?  The United States and the Europeans aren’t the only players on the block anymore.  The biggest new contracts for investments in the Iranian upstream, the development of Iranian hydrocarbons right now, are coming from the Chinese and from other non-Western companies.  And if you want to talk about a policy that is detached from reality, what do you think the odds are that the United States is going to impose secondary sanctions on a Chinese energy company for doing business in Iran right now?

It is a joke.  But it is a joke we are going to continue to play for some time to come.  We will play this joke until we realize that we are no longer a uniquely hegemonic power and that if we are going to accomplish things that we want to accomplish in the world, whether with regard to nonproliferation or conflict management in critical regions like the Middle East, we are going to have to do it by dealing with key countries as they exist, not as we would wish them to be.  And we’re going to have to deal with them in a way that actually accommodates some of their interests.

I don’t think we are there yet.  I’m afraid we’re going to have to have some more rather negative encounters with reality before we really start to think like that about our foreign policy.  I do hope that this very, very well executed, thoroughly assembled and compiled compendium will at least make it easier for people to reflect on what they need to reflect on when they get ready for a serious discussion of how America deals with the Islamic Republic of Iran.

And that, I think, does constitute a real public service.  And again, I will commend both Ken Katzman and the Atlantic Council for putting this out.  Thank you very much.

MR. NELSON:  Thank you.  Before we turn to questions, I’d like to excuse Dr. Yaphe.  She has a previous engagement she has to run to.  And we’ll open it up to questions.  I’d like to start off by asking Ken a question about claims.

It seems in all of the other cases we’ve studied about reversing these adversarial relationships, one of the common themes or claims on both sides – and certainly with regard to the U.S. and Iran, it goes clear back to the hostage crisis and the Algiers tribunal.  It’s a longstanding issue.  There’s a process to some extent dealing with claims.  And then we have the complicated factor of the victims of terrorism legislation where individuals can sue the government of Iran, which of course it does not defend itself in U.S. courts.  But it results in further claims.  And so you have a pretty complicated picture here.

And of course, we still have some assets that are frozen.  I guess Iran under the Shah purchased some U.S. military equipment, which was never delivered.  They paid for it but the funds haven’t been returned.  So there’s some assets there.  But there are a lot of claims.  So it’s a fairly complicated, controversial picture.  How is that managed?  And how might it be handled?

MR. KATZMAN:  Well, you’re quite right.  It is very complicated.  And when he was president, Rafsanjani used to raise repeatedly the issue of frozen assets as an obstacle to better relations.  And to some extent, it’s still raised by the Iranians.

What happened was Iran’s former embassy, which is up here on Massachusetts Avenue – it’s worth about $25 million – that’s frozen.  And then, there’s about $400 million in a Defense Department escrow account.  What happened was the shah purchased military equipment and there was Iranian military equipment here being fixed by DOD, being repaired; $400 million was sitting in DOD accounts to pay for the equipment and the repairs.

The revolution happened.  An arms ban, a trade ban was put on Iran by President Carter.  The arms could not be shipped therefore back to the new Khomeini regime.  And these arms were sold to other buyers and the money was put into this DOD escrow account, which got to about $400 million.

So the legislation allowed successful claimants to be paid and to draw against that escrow account.  So the escrow account is pretty much gone.  The DOD account is pretty much empty.  So the money cannot be returned to Iran as part of the reconciliation because the money has been given out to the terrorism victims already.

So I believe the law – I’ll have to look at it a little more.  This is not sort of a mainstream thing that comes up every day.  But I think the law says, if there is a deal with Iran – there is an improvement; a rapprochement with Iran; relations are restored and there’s an agreement that yes we do owe Iran the $400 million back – then Congress would have to just appropriate money to replenish the account and the money would go back to Iran.  So essentially, the U.S. Treasury would have been paying the claimants of these terrorism judgments.  That’s the net effect.

MR. NELSON:  Questions?  Harlan?

Q:  I’m Harlan Ullman with the Atlantic Council.  Thanks for commenting –

MR. NELSON:  There’s a microphone here.

Q:  Two questions.  First, could you share with us whatever evidence you may have that suggests that the Iranian Revolutionary Guard are indeed seizing greater influence or power or perhaps they are not?  And second, for Flynt, I want to test your proposition about declining U.S. influence.  Is that because of the overall diffusion of power in your judgment?  Is it because of poor statecraft on our part, a broken government, ideology or some other factors?  How do you account for that conclusion?

MR. KATZMAN:  I’ll start off on rev. guards.  I guess I did write a book on the rev. guard.  I’m in a little bit disagreement with the analysis that it’s becoming, you know, the rev. guard has taken over or there’s been some sort of quasi-coup d’état and the guard is, you know – I don’t go that far.  But you know, the guard obviously at the height of the protest has issued statements saying this will not be tolerated.

Khomeini, when he was alive, had a fairly strict policy that the military, including the guard, shall not intervene in politics.  And he was pretty strict about that.  Now, since he’s died – and he’s dead well over a decade now; two decades, ’89, so two decades he’s dead already – that’s been eroded.  And the guard has increasingly sort of stepped up in terms of statements, threats in political affairs.  And I would say certainly the Supreme Leader obviously seeing a challenge has relied more heavily on the Pasdaran, the guard, to keep the regime in power.

But I, as an expert, would not go as far.  I think Gen. Petraeus called it a “thugocracy” yesterday.  I mean, the rhetoric coming out of the administration gets increasingly shrill.  You know, I don’t think I would go that far.  But it has intervened politically to a greater degree than Khomeini allowed when he was alive.

MR. NELSON:  Flynt?

MR. LEVERETT:  Yeah, I would just add to that, the idea that the Revolutionary Guard or entities associated with the guard are assuming a greater role in the Iranian economy, there’s nothing new about that.  That’s a trend that started back, I mean, not all that long after Khomeini died, when Rafsanjani was president.  And it was part and parcel of Rafsanjani’s planning for reconstruction in Iran after the Iran-Iraq war.  So there is this trend of entities affiliated with the guard assuming more of an economic role.  But it’s like a 20-year trend; it’s not something that just started happening.

And in terms of political influence, part of it is a generational thing.  You had an eight-year war with Iraq in the 1980s in which a very, very high percentage of men of a certain age participated in that war.  And these are men who are now of an age where they’re getting to the top of their professions.  They’re the ones who are running for parliament and entering higher levels of political life.  And so sometimes speak ominously about how many members of the parliament have rev. guard backgrounds – I mean, that’s – I don’t really find that all that ominous given the Islamic Republic’s history.

In terms of your question to me, how much of what I see as the decline of the United States relative power – I mean, I think it’s a mix of structural factors, which would be in play whether our policy was smart or not.  But it has certainly been exacerbated by what I think is bad statecraft, bad policy, a fiscal policy that is a joke.  So I think it’s a mix of both structural and contingent or policy choice kinds of factors.

MR. NELSON:  Right here in the – oh, I’m sorry.

Q:  That’s quite all right.  Good afternoon.  I’m Tom Trimble with Science Applications International.  Thank you for a really interesting exchange.  For George or for any member of the panel, late last year, President Sarkozy and Gordon Brown, shoulder to shoulder, spoke with urgency, an urgency almost like that of a national emergency or a declaration of war – just a notch or two down – of the need to impose some pretty strident and immediate sanctions on Iran. 

And certainly, President Obama has at least intimated that in the January timeframe of this year, we would be seeing additional sanctions.  This may be very difficult to do and get through the Security Council.  And there could be a whole variety of reasons it seems to be moving a bit slowly.  But is the administration changing course or setting a new strategy based upon these challenges?  I know activities are going on in Congress.  But the administration must be planning for this delay.

MR. PERKOVICH:  My sense is they’ve been pushing for some time now for the strongest sanctions possible and working very closely with the French and U.K.  And the French are very resolute and very determined on this.  But there is a determination that the most important variable again to maintaining or trying to capture momentum, as it were, on the international community side is for there to be U.N. sanctions, not just Western sanctions.

And so they’re willing to have Russia and in particular China and now others – Brazil and others on the Security Council – work to dilute kind of the sharpness or power of potential sanctions in order to make them U.N. rather than the other way around because that’s – the logic is that that’s both important to the broader international community to show Iran where the momentum is but also in Iranian political discourse to make it the government’s legitimacy further questioned, because it’s not just the West who you expect.

I mean, hell, the U.S. has had sanctions since 1979.  It’s not a new story in Iran when Congress adds another sanction.  But when the U.N. Security Council, when the Chinese go along with it, when others go along with it, then that causes more legitimacy problems in Iran.  And so that’s part of, I think, the strategy.

Now, what plan B is, I assume they’re working on it, because again, if the objective is to get Iran to desist from enriching Iran, which has been the stated objective, there is no indication – or there’s little indication – that Iran is going to choose to do that.  So one of the plans is obviously covert action or other efforts to try to break up that capability.  And then what else is going on, I don’t know.

But in any case, I think it would be much smarter – whatever else is going on – that we not know about it, which is another reason why I think Congress is better off for the republic staying out of these things, because they don’t keep secrets.  And much of what you would want to do to influence the Iranians, you’d want the Iranians to know you’re doing it but privately.  You wouldn’t want it to be public because then it’s like waving a red flag in front of them to charge it.

MR. KATZMAN:  Yeah, I would just add that not only do they want it to be a U.N.-led process, they want it to be unanimous in the U.N. Security Council also, which is complicated.  They’ve moved from crippling sanctions, which was what we heard – what you were referencing – where the proposals were to sort of internationalize the Iran Sanctions Act – in other words, the U.N. would ban all investment in Iran’s energy sector.  That was an idea.  Other ideas, you know, banning all weapons sales to Iran, banning shipping insurance to Iran – these were things that were considered.  Now, I think to get unanimity, to get more consensus, it’s been reduced.  The goals, the proposals, of what’s going to be in a resolution have been reduced, mainly to target the Revolutionary Guard and its commanders and businesses.

Q:  Barry Schweid of AP.  Ken Katzman, would the new sanctions that Congress might adopt be – the squeeze as you put it – would the squeeze be directed on investment or do you think there would be new ways?  And if either way, what would you expect are the two or three most likely, if there are that many, pieces of legislation in the near future, you would expect?

MR. KATZMAN:  Well, the main –

Q:  How does this message get – how does this project a good message to the Iranian people?

MR. KATZMAN:  What’s under serious discussion is to sanction foreign firms that sell refined gasoline to Iran or equipment that Iran can use to expand its own ability to refine oil into gasoline.  So that is the thrust of what is going to be probably reconciled in both chambers.  Both chambers have passed bills that do that.  The Senate bill does more than that and so there has to be a discussion as to getting one bill that both chambers would agree to.

There is separate legislation that would not be part of that process, other legislation going in a different direction to sort of name and shame various Iranian figures who are involved in efforts to suppress the democracy movement.  Yes, sir.

MR. NELSON:  Is there not –

MR. KATZMAN:  Identify?

Q:  (Inaudible.)

MR. KATZMAN:  No, it would work like most U.S. sanctions.  In other words, one section is the president shall prepare to Congress a report on Iranian officials who are suppressing the democracy movement.  Then, part two, the following sanctions shall be imposed on the named officials in that report.  It would be sort of like that.

MR. NELSON:  But isn’t that a current trend where they’re more targeted sanctions.  So you see these long lists of individuals and organizations in Iran where they’re trying to target very specifically and then go after them through financial institutions, banks and stuff like that.  So on the executive side of it –

MR. KATZMAN:  It is a trend.  However, until now, the named designated entities have been only proliferation or technology-related persons or entities.  The new trend is to go after who Iranians who are not necessarily involved in weapons issues, but in human rights abuses and things like that.  I’m sorry?

Q:  Would this process –

MR. KATZMAN:  You mean, would he be named?  Would he be named under this?

(Cross talk.)

MR. KATZMAN:  Oh, would the gas sanctions hurt?  Well, you know, that every economist I talk to has a different opinion on that.

MR. PERKOVICH:  I grew up in LA in the ’70s during the Arab oil embargo.  And LA is a car culture.  And I remember waiting in line for hours with my parents.  And I don’t remember anybody saying as they sat in line, You know what?  Those Arabs are right.  We ought to change our policies.  It was basically, bomb them.  And I don’t know that the Arab oil embargo actually changed U.S. policy towards Israel, the Palestinians or anything.

MR. (?):  (Inaudible) – there wasn’t one bad word said about Israel in that period.

MR. PERKOVICH:  So I’m wondering about if we sanction Iranian – so the lines get longer in Iran that the public is going to say, gee, let’s get rid of our government.  Those Americans are right.  And moreover, for economic reasons, they actually need to raise the price of gasoline because right now the price is so low that it’s inefficient but also encourages smuggling and everything else.  And so this becomes a great pretext for the government to say, well, they’ve got to raise prices on gasoline.

So I’m sure there’s some really good reasons why this is being proposed.  Also, it helps the smugglers when you sanction products like this.  Then the smugglers make more money.  And who are the smugglers – the Revolutionary Guard. But I’m sure it’s a good idea.

MR. NELSON:  This lady right back here.  No, right behind you there.

Q:  Thank you.  Anne Penketh from – excuse me – British American Security Information Council.  Basic question for Ken Katzman:  What is the timeline or a timeframe that you get from the Congress action, which clearly would irritate the allies that you need for the U.N. process?  Is it possible that the Congress may be persuaded to hold off until there’s some U.N. action?  Is there that kind of coordination going on?

MR. KATZMAN:  Usually when my phone starts ringing this way, usually that means it’s about to – there’s action.  So I would say we’re looking not too far in the future.  That’s all I can say about timeframe

But I would say the administration is working hard to exempt – provide an advanced exemption – that the president would not have to grant a waiver.  But the legislation itself would exempt categories of firms belonging to U.S. allies such that to try to avoid this conflict with partner countries.

Now, some in Congress don’t like that idea.  They want to keep the legislation as it is.  Others agree that there needs to be this exemption.  That’s all I’ll say for now.

Q:  Hugh Grindstaff.  I wondered of the panels comment on the New York Times article on Saturday listing 74 companies such as Bayer, Bosch, ABB, Lucent doing business with Iran.

MR. NELSON:  What was your question?  I’m sorry.

Q:  What are your comments, the panels’ comments on those 74 firms who are still doing business with Iran and quite a bit of business.

MR. LEVERETT:  My comment would be so what?  Most of those firms are doing business in sectors that aren’t even covered by American secondary sanctions laws.  So unless the Congress wants to try and criminalize all business in Iran, I mean, so what?  So there are companies that do telecoms in Iran.  There are companies that do medicines or chemicals in Iran. 

U.S. secondary sanctions laws relate to, at the moment, upstream energy and pipelines.  And as Ken said, there may be an effort to extend that to the downstream, to refined products or to investments or transfers of equipment and so forth that help Iran develop its own downstream capability.  You know, the world does not accept American policy preferences regarding Iran in this area.  I mean, there’s nothing new about that.

MR. NELSON:  All right, well, right here.

Q:  Howard LaFranchi with the Christian Science Monitor.  Flynt, I was just wondering if you – do you extend your characterization of the secondary sanctions as a joke to international sanctions – how you view those and the process now for additional sanctions on Iran.

MR. LEVERETT:  Yeah, I would respectfully disagree with George that there are other – I mean, if I understood George correctly, George acknowledged that neither U.S. unilateral sanctions nor multilateral sanctions have had any strategically determinative effect on Iranian decision making and are probably very unlikely to do so in the future.  But George would say, there’s still good reasons to do it in terms of sending a message to others.  Maybe this contributes in some way to bolstering the broader global nonproliferation regime and so forth.

I mean, for myself, I would not be so kind.  I think that this is bad policy on both a national level and a multilateral level.  All it has done is to open up – you know, it’s taken American companies out of Iran.  Over time, it has eroded the willingness and ability of European companies to do business in Iran and has created marvelous new market opportunities for Chinese companies and for companies from other rising economic powers, primarily in Asia.

You know, I was just in Iran two weeks ago.  Notwithstanding the global economic crisis that broke in 2008, Iran since then has never gone into recession.  They still are experiencing growth.  The primary effect of the global financial crisis on the Iranian economy as far as I could tell would be that their inflation rate has come down, which is actually a positive thing for them.  Stores are very well stocked.  You can buy all kinds of foreign products, whether it’s personal computers, any kind of high-end Asian electronics you want, you can find quite readily.

The idea that this is an economy somehow teetering on the verge and if we just put a little more pressure on them, you know, this is really going to push them over, it’s ludicrous.  It’s bad policy.

MR. PERKOVICH:  I don’t anything about economics, but that won’t stop me, because it seems to me that all may be right but then there’s a problem in saying that the U.S. is the declining economic power for all these reasons that one can cite but that somehow Iran with all its structural problems isn’t kind of like suffering or long-term weakening in its economy, due to lack of investment and the problems in the energy sector and so on.  So I’m just wondering kind of long term.  I mean, things are nice now.  But the kind of brittleness or long-term problems that are partly the result of the lack of capital and technology you can only get from the West to develop their energy infrastructure.  Isn’t that a problem?

MR. LEVERETT:  Well, I think you’re right certainly in that Iran faces a number of very serious long-term economic, socioeconomic challenges.  Their authorities would be the first to admit that, I think.  That being said, I’m not really sure that sanctions have all that much of an effect on constraining Iran’s options for trying to deal with those long-term challenges.

Iran has its own politics about these issues.  And you know, they will have to sort out for themselves what their posture is ultimately regarding foreign investment, what their posture is regarding other sorts of economic issues.  I mean, for whatever it’s worth, an executive with a large American oil company – I won’t say the name of the company – but an executive with a large American oil company told me that if a magic wand were waved and his company could go into Iran tomorrow and start concluding business deals, given the terms that are on the table for foreign energy companies right now, he didn’t think his company would be signing deals.

So I mean, the Iranians are going to have to work out for themselves how they want to deal with the outside world on economic issues, what their posture is.  But I don’t think that sanctions really limit their options all that much.

MR. NELSON:  Okay, back here?

Q:  My name is Arshad Mohammed.  I cover the State Department for Reuters.  I had a question for Mr. Katzman.  It was my impression that although the administration has been thinking very hard about the question of sanctions related to refined petroleum products that it wasn’t really all that interested in seeing those.  And it had seemed to me to be almost a sort of kabuki where it’s useful for the Hill to pass legislation.  And they can brandish that and you know, try to scare Iranians – but that they really don’t want to see this see the light of day. 

Am I mistaken in that, because it seemed to me that you were suggesting that although they were trying to weaken it and provide exemptions in advance so there is a waiver authority that there is somehow any more desires of seeing this come to light?

And then secondly, to address the question that George, you know, raised.  I’m sad that I was also alive during the Arab oil embargo and I remember the lines.  But I wonder if perhaps in Iran something may be different now post-June of last year and that there may be more of a divergence between the regime and the people and that therefore additional sanctions might – and I have no idea – but might be viewed by the Iranian people as, you know, they might blame their authorities rather than the author of the sanctions, in this case the United States, if you actually saw this legislation passed and signed into law.

MR. KATZMAN:  On the bills that are under consideration, if we judge just by the numbers, they would appear to have very, very substantial support in the U.S. Congress.  And therefore, the administration has realized that there is this sentiment to pass this legislation.  And perhaps apparently they’ve chosen to try to modify it in some way rather than to sort of try to stop a very heavy train that is moving.

So that may account for – you know, I think many in Congress – the Refined Petroleum Sanctions Act was conceived before the June events.  And so, it’s sort of a carryover from before.  Since the June events, as I’ve said, there is this other trend of legislation to try to prevent companies from selling Internet censorship gear, monitoring gear, this name-and-shame legislation that I discussed.  And the people I talk to in Iran through various media, the view is that that may ultimately be more significant than perhaps the oil sector type sanctions, which were conceived before the June issue.

MR. PERKOVICH:  Arshad, my sense is from talking to Iranians – and I haven’t been to Iran in four years – but people who come out who are from the opposition, the ones I talk to, don’t favor the gas sanction.  They favor other kinds but not those because the argument would be why are you punishing the Iranian people?  Why not the bad guys?  I mean, they’re going to have to wait in line.  And they know that the Revolutionary Guard who are the bad guys are going to get rich on the sanctions.  So it’s like, wait a minute.  Why are you guys doing this?

MR. NELSON:  Right down here in front.

Q:  Steve Hurst with the AP.  Flynt, we heard you discussing last weekend and referencing again today a position of a much deeper and greater outreach to Iran as the sensible larger policy.  And in your last presentation, you referenced again Nixon in China, Nixon, Kissinger in China.  What I am wondering is even if in a United States with declining power, if one agrees with that, an administration – whether this or the next or the following – can do that politically, given the political climate right now that races across all the issues affecting American lives and Congress.

MR. LEVERETT:  It’s certainly extremely challenging.  An administration would have to – a president would have to view it as a very high strategic priority, would need to be prepared to run considerable political risks to pursue it.  If you look at the Nixon to China case as a precedent, one thing that strikes me whenever I go back and look at that case – and you know, the relevant documents are now I think pretty much all declassified.  But one of the things that strikes me is that Nixon was well aware of the domestic political obstacles to what he wanted to do.

In Congress, there was a very powerful Taiwan lobby working in Washington at the time.  He knew what he was up against.  And his way of dealing with that was essentially to work for two years, effectively in secret, to prepare the ground for the opening to China.  He didn’t even do it as a normal sort of interagency process within his own administration because he knew it would leak.  It was literally a half a dozen people working at the White House with Henry Kissinger who prepared the groundwork for the opening to China.

The secretary of state was almost literally informed relatively late in the day that there were going to be some changes in our China policy.  And Nixon, to a large degree, sprung a fait accomplit on the American political system.  And there were enough deliverables there and enough tangible benefits and prospective benefits that people could appreciate, once the opening was unveiled, that the predictable opposition to it was largely marginalized.

I’ve not seen from President Obama that he really sees this as a high strategic priority.  I’ve not seem from him that he’s willing to run real domestic political risks to accomplish it.  He’s put together a national security and foreign policy team that for the most part is ill-equipped to help him do it.  And he is not, it would seem, prepared to do this in a kind of Nixonian way.  I mean, among other things, he’s stuck himself with a secretary of state that I think it would be very hard for him to do with his secretary of state what President Nixon did with William Rogers on China.

I think it is possible.  I think it is strategically imperative for the United States.  But it will take a president who sees it as a priority and is willing to run some risks to do it.

MR. NELSON:  And finally, Damon?  Yes, as a final request, thank you all for coming and joining us in this event.  In the front of the compendium, there is a note asking for your feedback on the compendium.  So I’d ask that you give us your feedback on the compendium.  I’d very much appreciate it.

MR. WILSON:  Thank you, Dick.  Just with a tad of irony that I think we’re having this discussion, that we’re launching this report at a time as folks are saying that the pendulum in Washington, and perhaps the international community, is shifting towards more sanctions, stronger sanctions, and potentially a worsening relations. 

But I think what Flynt just alluded to in his concluding thoughts is that change can happen quickly and unexpectedly.  And I do think the compendium functions.  It provides a useful reference and baseline.  It can be a baseline informing those that might be advocating next steps in the sanctions regime or a baseline informing advocates of unwinding the restrictions on the relationship on Iran.  In many respects, as you started off by saying, it does provide a neutral public service.

So I want to thank Ken, Ken Katzman, for leading this effort, Dick for helping to organize this series of work in this project area, and to George, Flynt, and Judith for serving on the steering committee.  Thank you for the conversations today.  Thank you for the U.S. Institute for Peace for sponsoring the work as well.  And thank all of you for coming today.  (Applause.)

Transcript by Federal News Service, Washington, DC

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Iran Debate Event Transcript

Iran Debate Event


  • Frederick Kempe, President and CEO, Atlantic Council
  • David Ignatius, Columnist, Washington Post
  • Michael Ledeen, Freedom Scholar, Foundation for the Defense of Democracies
  • Flynt Leverett, Senior Research Fellow, New American Foundation

March 3, 2010

FREDERICK KEMPE:  Welcome.  I’m Fred Kempe, president and CEO of the Atlantic Council.  It’s a particular personal pleasure for me to introduce today’s event.  And it’s not only because of the importance of the subject or the brilliance of the speakers or the platform of the relatively new South Asia Center.  In the space of one year, I think that Shuja as director and his staff have turned it into an intellectual center for this kind of conversation and Shuja himself has set himself apart I think as one of this town’s – or perhaps beyond this town’s – leading experts on the region.

For me, however, it’s a particular personal pleasure to introduce the moderator.  You all know David Ignatius is a uniquely talented columnist and novelist.  His children know him as the person who got a movie made from one of his books where they got to meet Leonardo Dicaprio.  You also know that in the noise that is U.S. commentary these days he is consistently wise, well-informed and ahead of the curve.  And as a novelist he is consistently readable.

What you probably don’t know is that, as a friend, he is equally as gifted and as durable.  And so I want to thank him for that as well.

But, with that, let me turn over to David, who has some practice in dealing with people who don’t entirely agree with each other.  (Laughter.)

DAVID IGNATIUS:  Well, I am delighted to be moderating this panel, especially after that wonderful introduction from Fred.  People in Washington always refer to each other as my good friend, my dear friend.  Fred and I actually are good and dear friends; we go back to the early 1980s.  We’ve seen each other through more life crises than you’d imagine.  Anybody who wants some really good stories about Fred Kempe, you can call me, but I won’t tell you.  (Laughter.)

Another Washington is to advertise debates that aren’t really debates.  As we all know, the range of permissible opinion in Washington normally stretches from A to B, maybe to C.  This morning we’re going to give you the whole alphabet.  We have a genuine disagreement about what the United States should do on arguably our most important foreign policy priority. 

And we have two people to argue the opposing points of view who don’t mind controversy, who don’t want to round off the edges of what they have to say so as to fit the conventional Washington structure of the debate.  If anything they’re going to probably push it a little to extremes.  Somebody asked me if I had a flak jacket ready.  I, knowing both of these gentlemen, I know that that’s not necessary but I do think that we’re going to get something that’s unusual for Washington, which is, as I say, a real debate about something that matters.

Let me introduce them briefly.  On my left, Flynt Leverett, as you know, is now with the New America Foundation, a director of one of their initiatives.  He is known to us as somebody who was very active in foreign policy and policy analysis first with the CIA in the 1990s – he served as an analyst in the directorate of intelligence from 1992 to 2001; then went in 2001 to the policy planning staff at the State Department; and then in 2002 went to the National Security Council where he was involved in policy questions for the Near East and South Asia – and in that role observed the possibilities for openings to Iran that he then has discussed in some important articles that I’m sure you’re familiar with and that we’ll talk about today.

He has just returned from a trip to the Middle East which took him, I believe, to Iran.

FLYNT LEVERETT:  It did, yes.

MR. IGNATIUS:  So he is that rare man who can talk about Iran with a real close-up appreciation of what’s going on.

Michael Ledeen I’ve known almost as long as I’ve known Fred Kempe.  Michael and I go back to the 1980s.  I scandalized my friends when I was editing the Outlook section of the Washington Post by extending an invitation to somebody who had been involved in the Iran-Contra process, as you’ll remember, as a point of connection between an Iranian gentleman who thought he could define an opening in Tehran in the U.S. government; this was at a time when he was a consultant to the National Security Council.  It was an excellent article.  My colleagues have never forgiven me for running it.

Michael today is a Freedom Scholar at the Foundation for the Defense of Democracies.  He writes many books.  I have a particular favor and have cribbed from it – which is, as we all know, the highest compliment we can pay in Washington – is steal other people’s ideas.  And that was a book about Machiavelli. 

I should – anybody who knows Michael knows this, but when I asked him what I should mention about him, he instantly answered that he was just national bridge champion.  He is a superb bridge player.  He is a man who I can imagine on the boulevards of his beloved Rome a hundred years ago, 200 years ago – as far back as you want to go, basically – being a raconteur playing the card game of the day and managing to write books on the side.

So those are our two discussants.  Because we have structured this as a debate in which one gentleman will go first; then the other will make his opening statement and then each will respond to the other, I have decided I’m going to flip a coin.  And so I’m going to say that if it’s heads, we’ll ask Flynt Leverett to speak first; if it’s tails, we’ll ask Michael Ledeen to speak first.  Drum roll, please.

Oh, here it is!  I do see it.  And it is tails.  So I’m going to ask Michael Ledeen to take the podium and lead us off.  Just so you know the structure beyond that, we’ll have a period of – their presentations:  10 minutes opening, 10 minutes opening, 10 minutes response, 10 minutes response, I’ll then ask some questions and then we’ll turn it over to you for your questions.  So be thinking of them and then we’ll get out of here by 11:30.  Michael.

MICHAEL LEDEEN:  David, yell at me when we’re at about seven minutes because I don’t –

MR. IGNATIUS:  I will.

MR. LEDEEN:  I don’t have a watch. 

MR. IGNATIUS:  I’ll whisper at you.

MR. LEDEEN:  Well, thank you.  Thanks to the Atlantic Council, thanks to Fred, thanks to Shuja, thanks to David for coming, thanks to Flynt for coming.  In a way the title of this debate is a bit of a hoax because, just as people used to argue “make love, not war” or “make war, not love,” it’s easy to do both. 

We can both engage with Iran and support revolution in Iran at the same time.  We did it with the Soviet Union.  There is no reason on Earth why we can’t do it with Iran.  So I hope I’m not disappointing anybody when I say, you want to talk, talk; you want to engage, by all means engage; see what you can get.  I’m pessimistic.

We’ve engaged for, by my count, 31 years.  Every American president has eventually come to the conclusion that we could make a grand bargain with Iran and has tried to do it.  That includes even George W. Bush who, in 2006, thought that the United States had made a deal with Iran which Nicholas Burns, who tells us about it in copious detail in first person on a three-part BBC documentary, had been negotiating with Ali Larijani and thought that the deal had been struck. 

And it was scheduled to take place – the announcement was scheduled to take place on a wonderful Monday and he, Nicholas Burns, and Condoleezza Rice were going to fly up to New York to the United Nations, wait for the plane to land from Tehran; Larijani would announce that Iran was going to suspend Iranian enrichment; Condoleezza Rice would announce that the United States was going to lift or suspend sanctions. 

And on the Friday before the Monday, the Iranians called up and said, could we have an extra 300 visas?  And the secretary of state, not wanting to give the Iranians an excuse not to come, said, issue the 300 visas, which we did.  And on Monday morning Condoleezza Rice and Nicholas Burns flew to New York, waited for the plane to arrive.  The plane never took off, never came – and so forth. 

There was a similar disappointment during the Clinton administration.  There were all kinds of disappointments in the Reagan administration where extensive negotiations went on and indeed from the minute the revolution took place in February of 1979 the United States was negotiating with the Khomeini people and so forth trying to strike a deal.

So in the past 31 years, so far as I can tell, there has never been a moment when we weren’t trying to make a deal with Iran.  And there has certainly never been a president who didn’t conclude or wish or hope that we could do that.  As we all know, it has not happened.

And one of my favorite books about Iran is the terrific book by Mr. Pollack at the Brookings Institution called “The Persian Puzzle,” in which he recounts in painful detail all of the various efforts that the Clinton administration took, at which time he was Flynt’s equivalent at the National Security Council – interestingly with a similar background:  intelligence analyst and so forth.

And basically what he says is, look, we tried everything.  There wasn’t a carrot we didn’t offer.  There wasn’t a stick we didn’t brandish.  It’s not our fault.  We just couldn’t get a deal.  Okay, so my question to anybody who thinks we can get a deal is, what’s different now?  What has changed?  Why would you think you could get a deal today when you couldn’t get a deal for 31 years?  I mean, surely none of us – even though everybody in Washington is famously egotistical – I doubt that anybody here thinks that he or she is more brilliant, more profound, more talented and so forth than all of the people who, for the past last 31 years, have tried to do this.

So why?  That’s my rhetorical question to the people who only want to engage or negotiate or try to strike a deal.  And, as I say, I’m not opposed to trying to strike a deal.  And if you can get one, god bless you.  I’m pessimistic. 

I think that the best metaphor for talking to the Iranians is that great scene from “Goldfinger.”  And every time I talk about this, fewer and fewer have seen “Goldfinger” because younger people haven’t seen those James Bond movies.  But, anyways, there is that great scene where Bond is splayed out on a sheet of gold.  And Goldfinger is standing up on the balcony looking down, watching this scene.  And the laser beam is slicing through the sheet of gold headed for Bond’s private parts.  And Bond looks up and says, do you expect me to talk?  And Goldfinger looks down and says, no, Mr. Bond, I expect you to die.

And, for me, that’s Iran.  Iran expects us to die.  And Iran wants us to die.  And the other rhetorical question that I like to ask people on this subject is, we’ve all seen these mobs in Tehran and other cities in Iran that have been organized by the regime.  And they’re all standing there chanting, death to America!  Death to America!  What do you think they mean?  What is that all about?  Is that local politics?  Is that some kind of street celebration, an excuse to come out to get free food and drink?  What is it?

I’m an historian.  I spent the first half of my professional career in Nazi and fascist archives.  And I have always been bothered – tortured even – by the fact that the Western world watched all of these things happen – whether it’s Hitler, Mussolini or Stalin and so forth.  The color doesn’t much interest me.  Watch these people come up – telling us what they intended to do.  And people said, well, they don’t mean that – or if you only knew them. 

And all of these people fell in love with Stalin or fell in love with Hitler – lots of people; some of the great journalists of the Western world fell in love with Mussolini, quite literally, in part because of the intellectual conceit; David was nice enough to talk about my work on Machiavelli. 

I mean, almost every intellectual secretly wants to be the consigliore to the prince.  It’s the best job because you don’t have to bother with public opinion and justifying yourself and selling books and all of these things that intellectuals hate.  You have an audience of one; you talk to one person.  So there’s kind of tyrants that intellectuals really love; it’s common that intellectuals are seduced by tyrants and come to admire and like and justify and excuse acts of tyranny and so forth.

So I’m not surprised.  It never surprises me when this sort of thing happens.  But what speaks to me as an historian is that for me, in many ways, Iran is “Groundhog Day.”  Here it is again, a tyranny that told us well in advance what it intended to do.  Khomeini wrote books.  Khomeini delivered sermons.  They were published. 

Some of us, before the overthrow of the shah, wrote articles saying things like, you don’t like the shah, god bless you; there is a plenty not to like about the shah.  But this guy, Khomeini, if you take what he writes seriously, he’s going to be worse, much worse – worse for us, worse for the Iranian people, worse for the region, worse for the Muslim world.

And so I think it’s fair to say it has been.  And Khomeini, just like all of the others, did what he said he was going to do.  And the Islamic Republic today rests on a solid foundation of hatred for the West, religious fanaticism and misogyny, which in many ways is the sort of hard core of this regime.  And what struck me most when I first read Khomeini was his hatred of women and his contempt for women.  And what drove him around the bend was the very idea that female teachers could be teaching Iranian boys.  And he railed against that.  Look at what the shah does?  He permits women to teach our boys.

And when he got in, he took care of all of that.  And today, as you all know, Iranian woman are worth, legally, formally, half a man.  So if, for example, a pregnant woman is killed in an automobile accident and she is pregnant with a male fetus and the family of the other car is held guilty in the accident and has to pay reparations to the family of the victims, they pay one full share for the male fetus and one half share for the pregnant woman because she’s a woman and he’s a man.  And so the division of Iran takes place.

This, by the way, if they emerge as a dominant power in the region, you will see that spreading – not that it has to spread.  Other countries in the region think along similar lines and act along similar lines.  But that’s the kind of society that the Islamic revolution created.

But the basic fact for the United States and for American policy is that Iran is at war with us and has been at war with us for 31 years.  Iran kills Americans whenever and however it can.    It took years before it was possible in polite society here or anywhere else to point out that the IEDs, which were the single-greatest cause of American casualties in both Iraq and Afghanistan, were largely of Iranian origin and that the component parts of those things were actually tracked back to Iranian factories; they had Iranian identification numbers and letters on them. 

And some of them still do today in Afghanistan, although the Iranians got very annoyed at being caught out at this and are now outsourcing more and more of that stuff so we will find less and less of their fingerprints on these weapons, even though their support for every major terrorist organization on Earth is now legendary – and that’s whether they’re Sunni or Shiite or not religious at all – like Jibril, for example, whom they famously support and whom they seem to like a lot, which is one of the little mysteries that we can talk about.

So the Iranian regime – both directly and through proxies – kills Americans whenever they can.  And one of the most shocking things about the debate over Iran in the United States is how rarely people refer to the fact that they are killing our boys and girls and they are blowing them up whenever they can.  And nobody seems to get very excited about that.  That somehow is not a central issue in this debate.  Well, it is for the Ledeen family, who have children on those battlefields and have for many years now.

And so it seems to me that the case of Iran –

MR. IGNATIUS:  We have reached 10 minutes.

MR. LEDEEN:  Good.  So two more sentences – that the case of Iran is one of those rare cases in which moral and strategic obligation intersect and coincide.  And so I think it’s both morally right and strategically sound to support revolution in Iran.  And we’ll get to the details later.  (Applause.)

FLYNT LEVERETT:  Thank you very much.  Let me add my own words of gratitude to the Atlantic Council and to David Ignatius for helping organize and stage this event and to Michael Ledeen for participating.

Michael has put a couple of very important questions on the table and I certainly do want to turn to the matter of the plausibility of strategic engagement with Iran.  But before I do that, I want to spend a few minutes talking about another “why” question:  why America should engage with Iran.  And I am going to make a very simple declarative argument; namely, the United States needs strategic rapprochement with the Islamic Republic of Iran.  This is not a nice-to-have thing.  It is an imperative. 

Under any circumstances, Iran would be a pivotal country for the United States, given its geostrategic location at the heart of the Persian Gulf and at the crossroads of the Middle East in Central and South Asia; because of its demographic and territorial size; its historical identity; and its enormous hydrocarbon resources.

But beyond those structural factors, over the last decade, a variety of factors, including U.S. policy choices such as the invasion of Iraq, have come together to boost the strategic position of the Islamic Republic of Iran in quite dramatic fashion.  And Iran, today, is emerging as a genuine regional power. 

This is preceded to a point where, in my view, the United States cannot achieve any of its high-priority goals in the Middle East, whether with regard to Arab-Israeli peacemaking, post-conflict stabilization in Afghanistan and Iraq, fighting al-Qaida or assuring energy security, without a more productive relationship with Iran.  That’s why I say this has moved from the nice-to-have category to the need-to-have category.

I think you can draw a useful analogy between the Islamic Republic today and the People’s Republic of China in the late 1960s, early 1970s.  At that time, China was an emerging regional power but it was certainly not the global economic power that we know today. 

For 25 years, the United States had worked assiduously to isolate the People’s Republic diplomatically, to starve it economically and to support a Republic of China based in Taiwan as a political alternative to the People’s Republic.

When Richard Nixon was inaugurated president of the United States in January, 1969, the People’s Republic was actively supporting armed Marxist movements in multiple countries, it was providing ordinance, weapons and military equipment to North Vietnam that was being used to kill American soldiers in Vietnam and it had actually tested a nuclear weapon less than five years before Nixon’s inauguration.

But President Nixon had the insight and courage to recognize that a 25-year-old policy of diplomatic isolation, economic embargo and nonrecognition for the People’s Republic had proven dysfunctional for the interests of the United States and its allies.  And with Henry Kissinger, he determined to reorient America’s China policy in a direction that would actually serve U.S. interests.

The result, Nixon’s famous opening to China, was one of the great and historic achievements of American foreign policy in the second half of the 20th century.  We need that sort of achievement vis-à-vis the Islamic Republic of Iran today.
Some will say my analogy doesn’t hold because the opening to China took place in still the midst of the Cold War and that the U.S. and China had a common enemy in the Soviet Union.  The United States and the Islamic Republic, from this perspective, don’t have that easily identifiable common enemy.     

I think that really sells short what the opening to China was about.  It’s not just about triangulation against the Soviet Union.  It’s a recognition that the United States has important national security and foreign policy problems that it could not solve, or at least, could not optimally solve without an opening to China.  The U.S.-China relationship didn’t become less important with the end of the Cold War.  It has become progressively more important since the end of the Cold War. 

And I would argue that the United States today has fundamental national security and foreign policy problems that it cannot solve or cannot optimally solve without strategic rapprochement with the Islamic Republic of Iran.  I think that is also true in reverse for the Islamic Republic.  I will come to that momentarily.

Michael said that every president since the founding of the Islamic Republic has tried to reach a grand bargain.  I would respectfully disagree with that statement.  It is certainly true that every administration has tried in some way to engage the Islamic Republic.  Those attempts at engagement have been narrowly focused, usually on some specific tactical issue. 

In most cases, the Iranians have in fact cooperated with us on the issue in which we sought to engage them.  And in many cases, the Iranians cooperated with us on this narrow tactical issue because they thought by doing so, it might actually prompt us to rethink our willingness to live with the Islamic Republic. 

The historical record is that it is typically the American administration which pulls the plug on the tactical cooperation either because of domestic political blowback in the United States or because of some perceived Iranian provocation in another arena that is not connected to the issue on which the United States and Iran are cooperating.  

That was certainly the pattern with U.S.-Iranian cooperation over Afghanistan after September 11th, when the Iranians reached out, provided substantial cooperation to us in getting rid of the Taliban, standing up the Karzai government.  My wife and frequent co-author, Hillary, was directly involved in negotiations with Iran over Afghanistan for almost two years.  Providing very substantial help, their reward for that was to be labeled part of the axis of evil and eventually to have the United States cut off even tactical cooperation over Afghanistan. 

I don’t believe any American administration has ever proposed a grand bargain with the Islamic Republic in the way that President Nixon proposed and pursued, let’s call it, a grand bargain with the People’s Republic of China.  But that is what is required now.  It is required for American interests and it is required if engaging Iran is going to have any chance of success.

As David said, Hillary and I have just come back from a trip to the region and we were able to spend the better part of a week in Tehran.  And I can tell you from discussions with Iranian officials that the Iranian leadership had a certain amount of hope about President Obama.  And when he changed the rhetorical tone about Iran early in his administration, in his inaugural address, in some interviews, in the Nowruz message last year, this had an effect. 

Two days after the Nowruz message, the supreme leader, Ayatollah Khamenei, came out publicly and said, okay, if you change – you, the United States change – your policies towards us, we will change, too. 

From an Iranian perspective, there has been no change.  There’s no change in the red lines on the nuclear issue, there’s no change in U.S. support for both overt and covert activities which the Iranians see as threatening to their internal stability.  And in that kind of climate, the Iranians will not respond favorably to American overtures. 

But, if the United States put on the table a real author of a grand bargain, a real author aimed at a fundamental realignment of U.S.-Iranian relations, I believe that the Iranian leadership, under successive presidents and throughout Ayatollah Khamenei’s tenure as leader, has wanted that kind of fundamental realignment and that they would respond positively to it.  Thank you.  (Applause.)

MR. IGNATIUS:  So we’ll ask Michael Ledeen to respond.  Let’s try to keep the responses to maybe seven minutes so we’ll have time for questions.

MR. LEDEEN:  Okay, on Afghanistan, my understanding of what happened immediately after 9/11 is that the Iranians conducted what we would call a two-track policy.  On the one hand, they cooperated with us diplomatically, and whatever their various relationships – very complicated relationships – with the Taliban were, they purported to help us in Afghanistan and they were rewarded not just with the axis of evil but they were rewarded with an Islamic Republic of Afghanistan, which they wanted very badly and which they saw as a great success for them.

But at the very same time that these negotiations were going on, Iran was running terrorist teams in Afghanistan with explicit instructions to attack American troops when they went in there.  And this was confirmed by the American Special Forces in Afghanistan who found the groups that were there operating under Iranian guidance and support.  And they were neutralized. 

I mean, I come back to what I said at the beginning point, which is both things are invariably going on at the same time.  They are talking and they are killing us.  And they do those things simultaneously. 

I don’t believe that we will ever get a workable modus vivendi, let’s call it, with Iran so long as this regime is in power.  I just don’t think it’ll happen.  I think they hate us.   I think that the Islamic Republic is based on hatred of America; a desire to destroy or dominate us along with all the other infidels. 

I think they believe these things – they certainly act as if they believe them – and that our best hope for getting a grand bargain with Iran, with which I agree is not best accomplished with the Islamic Republic but is best accomplished by a successor regime, a free Iran, which the Iranian people will choose truly freely and not in these phony elections.  And I think that the regime is right to be nervous about internal opposition. 

I wrote the other day that Iran is conducting a two-front war.  One is international and is largely directed against us and our allies and the other is internal against their own enemies.  They’re not at all worried about the international fronts because they think they’re doing very well there.  They’re very worried about the internal front because they know that the internal opposition is very strong and very determined.  And that’s what they’re worried about, so I think we should support that internal opposition. 

You referred to overt and covert assistance to them.  I don’t see it.  I mean, I don’t know about it.  I’m not particularly well-informed about covert but so far as I know, we’re not doing anything to support the Greens, the political opposition inside Iran.  And on that subject, I’m pretty well-informed since I’ve had ongoing friendships with people who are now called Greens and who, back in the mid-1980s, were officials in the office of the prime minister, who was Mousavi at the time.  So I have 25 years of contacts with them.  And they insist that there is not a government in the Western world that is even talking to them, let alone assisting them.

And they say categorically, no contacts, no help, no assistance, no nothing.  And if anyone has a right to complain about the performance of this administration and the ones that came before it, it is they; it is the people who want a free Iran; the people who want equal rights for women; the people who want an end to the political prisoners; the people who want truly free elections and so forth. 

And if the regime really believes, as it says it believes, that it’s dealing with an angry minority and so forth, they might very well put to a test the proposal that was made in the last few weeks by both Mousavi and Karroubi, which is, okay, if you’re not worried about us, if you’re so confident of your own leadership, then don’t bring out hundreds of thousands of troops to make sure that there are no demonstrations. 

Give us a place, whether it’s an open field near Qom or whether it’s a public square in Tehran, and permit us to freely call for a demonstration and see who shows up.  And then the world will be able to see who is the majority and who is the minority, and who wants what.  And then Iran could have a national referendum where the people would be asked to verify or reject this form of government and the very nature of an Islamic Republic, and if they called for a non-Islamic Republic, then they can go through the common practice of writing a new constitution, improving it and then electing people to staff it out.

I will just say – I mean, it’s probably not necessary because this is a very well-informed audience – I have argued for years against any kind of military action against Iran.  And I am violently opposed to the various calls for bombing, even bombing nuclear facilities and so forth.  I have always supported, both in Iran and elsewhere, nonviolent, democratic revolution, which is what I’m calling for in Iran.  And I believe Iran is right on the verge of it, and I think it’s very easily accomplished. 

And we can argue about data and facts and interpretations and so forth, but when I was in the Reagan administration and came to the conclusion that the Soviet empire was about to fall in the face of all kinds of intelligence analyses and formal documents and so forth which assured us that Gorbachev was firmly in control and that the Soviet economy was growing and that it was stable, or the works of famous professors at Yale University said of the three great world empires – the American, the Japanese and the Soviet – the American was the weakest and would fall the first, it seemed to me and to some of my colleagues at that time that you could smell the rot in the Kremlin.  And I can – I think – can smell the rot today in Tehran.  And I can see it. 

I mean, a regime – just one example because they do have a kind of, how shall I call it, charming wackiness about them.  This regime is now committed to the obliteration of “green.”  Very bad for Kermit the Frog.  And so green is now banned from Iran.  The opposition was writing revolutionary slogans on the money in green ink – that is banned.  You can’t wear green.  I’m wearing green today as a sign of solidarity with them. 

But the funniest is that there are streets in Tehran – as I’m sure you’ve seen – which have green stripes on them to tell you where you can park and where you can’t, and there are now teems of people out spraying black on top of the green because you can’t have green.  That is not a self-confident and stable regime, Flynt. These are people who are scared to death even of a bit of colored paint on a sidewalk.  So I think we should support these people. 

How do you support them?  The revolutionary instrument of the Soviet era was the fax machine.  The revolutionary instrument of today is the satellite phone.  Get them satellite phones so they can communicate with one another.  And above all, let the government of the United States comes out and say, we like these people, we support these people, we think their calls are legitimate; release political prisoners, grant equal rights to women, permit freedom of speech, freedom of press. 

I mean, every major press organization brands Iran the greatest enemy of press freedom in the world right now.  That’s quite an accomplishment.  And they’re so frightened of the opposition that they’ve killed in the last several months 440 people, and executions are going on all the time.  This is the kind of regime it is.  Freedom for Iran – a free Iran, I think, will be a great partner for the United States and indeed for all the people in the region.  (Applause.)

MR. LEVERETT:  For 30 years, American analysts of a certain political persuasion – and let me use the shorthand adjective, neoconservative.  For 30 years, neoconservative analysts have been arguing that the Islamic Republic of Iran is on the verge of fundamental political upheaval.  This argument was made in the early days of the Islamic Republic, it was made in the context of the Iran/Iraq War, it was made after Ayatollah Khomeini died, it was made when the reform movement appeared and started winning elections, it was made when the reform movement effectively collapsed and it was made as an argument for the U.S. invasion of Iraq. 

Yes, I personally heard President George W. Bush talk about how one of the reasons that we should use military force to overthrow Saddam Hussein was that the cultivation of a more participatory political order in Iraq would finally help Iran, which of course was ripe for fundamental political change, to realize its full potential, throw off the yoke of the Islamic Republic and become a secular, liberal democracy.

In all of these cases, the argument that the Islamic Republic is on the verge of fundamental political upheaval has been consistently and uniformly wrong.  The argument is still wrong today.  Many advocates of regime-change in Iran – those who have been uniformly wrong about the Islamic Republic’s internal politics for 30 years – say, okay, maybe we were somewhat ahead of our time, premature in our judgment, but look at the situation today.  There’s never been anything like the Green movement; we have to be right now.

Well, sorry, no, you’re not.  Hillary and I have been arguing since June of last year that there is no hard evidence that the Islamic Republic’s presidential election of June 12, 2009, was stolen.  I say no “hard evidence,” not “must have been,” “had to have been,” “no way Ahmadinejad could have won” stuff, but “hard evidence.”  Even the suggested evidence that some people claim to find in the election results, supposedly more votes cast in some districts than there were registered voters in those districts, how could Ahmadinejad have won in Azeri-majority areas when Mousavi was ethnically Azeri, et cetera?

There are easy explanations for all of those things.  likewise, there is no evidence that the Green movement ever represented anything close to a majority of the Iranian public and I would argue the signs are that its social base is shrinking, not growing, right now.

Now, it seems to me that the burden of proof ought to be on those who would claim that the election was stolen, the Green movement represents most Iranians, and Iran is indeed on the verge of some kind of political upheaval, rather than on someone like me, who asks, simply, what’s your evidence for those claims? 

Okay, but if you want to put the burden on me, what tangible evidence we have regarding Iranian public opinion and attitudes – polls conducted by three Western polling organizations before and after the election, nine polls conducted by the University of Tehran before and after the election, and other quantifiable indicators such as crowd size and the ability of the Green movement to turn people out into the street – every one of those polls supports my analysis. 

And if you don’t like the University of Tehran polls, fine, but then you have to explain why the polls done by Western polling organizations show the same results, in broad terms.  You can laugh at the University of Tehran polls.  I didn’t know laughing was an argument.  But then explain to me the Western polling results. 

Public debate, today, in the United States about Iranian domestic politics is altogether too reminiscent of the debate in our country during the run-up to the invasion of Iraq.  Think back to those days, when the American public and, indeed, publics around the world were exposed to a concerted effort by the U.S. government and its partners to build up public support for coercive regime change in Iraq.  The U.S. and British governments proclaimed, with seemingly absolute certainty, that Saddam Hussein’s regime had stockpiles of chemical and biological weapons.  It had reconstituted its nuclear weapons program, and it had close links to al-Qaida. 

After the Bush administration and its followers in the media and think tank echo chambers pushed those, quote, unquote, “judgments,” people just knew that Saddam had nuclear weapons and supported al-Qaida.  They just knew it.  They were established facts.  They fit very well with our assumptions about Saddam and his regime, but of course those facts were all wrong. 

If you want to build American policy toward Iran on the idea of supporting regime change, you better look very, very carefully at on-the-ground reality – as it is, not as you might want it to be, but as it is.  And I can tell you, just back from Tehran, I don’t know where these stories about green being banned in Iran come from.  Excuse me, green is one of the colors of the Iranian flag.  There is no shortage of green in Tehran or in the Islamic Republic.  We can tell stories; we can take comfort in certain kinds of stories; but look at facts.  Look at on-the-ground reality. 

This is not a place that is on the verge of revolution.  They had a revolution 31 years ago.  They don’t want another one.  We may not like it; we may not understand it; but most Iranians want to live in the Islamic Republic of Iran.  They may want the Islamic Republic to evolve in various ways.  They don’t want that Islamic adjective taken out of the name of the country.  We need to come to terms with that, and we need to drop fantasies that internal political change in Iran is going to solve our foreign policy problems in the Middle East.

We also need to abandon the idea that we are going to be able to, sort of, dictate the terms of Iranian surrender, in the way that we dictated Libya’s terms of surrender in order to rehabilitate the Gadafi regime.  If there’s going to be rapprochement between the United States and Iran, it’s going to be on the China model where it’s going to be based on a balance of interests.  And we are going to have to accommodate some important Iranian interests. 

But given what is at stake for the United States and given the enormous damage to America’s strategic position that, I think, the wrong choices regarding Iran policy will inflict on us, this time around we better think.  We better look at reality and make policy on the basis of reality, not how we’d like the world to be.  Thank you.  (Applause.)

MR. IGNATIUS:  Thanks to both of our speakers for articulately summing up the basis of their positions.  As moderator, I want to begin by saying that what I was looking for from each speaker was a better discussion of how the process would happen – how the process of engagement would go forth, Flynt, and how the process of regime change would take place, Michael.  So let me ask you to respond briefly to a question from me on each. 

Flynt, this administration has been trying, at some political cost since it came into office, to make engagement work.  In the president’s most recent statement, he continued very specifically to keep the door open to Iran, saying that if Iran wants to live by international norms, we welcome that.  That’s really an invitation to dialogue about a grand bargain.  And yet we have seen consistently that this regime is unable, for whatever reasons – and I hope you’ll speak to what those might me – to find a consensus to support a reciprocal response. 

In October, Ahmadinejad seemed to support a breakthrough in the Geneva proposal, publicly endorsed it.  And then after some back and forth back home, in which the proposal was attacked by the opposition, support was withdrawn by the supreme leader and then Ahmadinejad backed away from it.  So it does take two to tango, and it looks to the White House right now as if we ain’t got a partner.  What do you know that they don’t that makes you think that this is still a viable strategy?

MR. LEVERETT:  It is true that Obama has changed the rhetoric and has said he’s open to engagement, but from an Iranian perspective that is not substantively serious.  The Obama administration is taking an approach which, I think, could be described as:  Okay, let’s sit down.  You, the Iranians, can talk about whatever you want to talk about.  We’ll have things we want to talk about.  Let’s see what we can do on that basis.

From an Iranian perspective, given the history where, from their perspective, they have tried tactical engagement, tried tactical cooperation with the United States, and it has never led to anything of strategic consequence for them, at this point they are saying very explicitly – they want, upfront, a comprehensive framework for engagement.  They want to know, if this process works, where is it going to go?  Where is it going to lead?  The Obama administration has declined to put that kind of framework on the table or to engage substantively with the Iranians about the definition of such a framework. 

If the United States doesn’t do that, Iran will not think we are serious about engagement.  In terms of the ability of this government to take decisions, and in particular your reference to the discussions about how to refuel the Tehran research reactor, I mean – if you’ll remember the sequence of events on October 1st of last year, there’s a meeting in Geneva, the P-5-plus-1, Bill Burns heading the American delegation. 

And there’s a one-on-one session between Burns on the American side and Saeed Jalili on the Iranian side.  Coming out of that meeting in Geneva, the American side describes it as an agreement in principle to do a kind of swap deal, to refuel the Tehran research reactor.  Iran would send some part of its current stockpile of low-enriched uranium out of Iran.  Finished fuel would be provided for the Tehran research reactor.  Subsequent discussions to be held in Vienna at the IAEA on all of the technical details. 

By the time the meeting in Vienna is held, there is – I think, the day before the Vienna discussions start – there is a Jundallah attack in Baluchistan that kills more than 30 people, including a senior Revolutionary Guard commander, who was a widely known hero of the Iran-Iraq war.  This makes the Iranians even more suspicious than they were going into the Vienna talks about what is really awaiting them. 

There’s no understanding about bigger issues like uranium enrichment on Iranian soil.  There’s no understanding about broader strategic issues beyond the nuclear question.  And in that context the Iranians say, we are not prepared to accept a proposal in which we would send three-fourths of our current stockpile of low-enriched uranium out of the country, in one batch, and wait for more than a year in the hope that we would get finished fuel in return.

MR. LEDEEN:  A proposal that they had previously accepted.

MR. LEVERETT:  They had not accepted all those details.  I think they had accepted the idea of a swap, in principle.  Details to be negotiated.  And by the time we got to the table in Vienna, the climate was not very good for a discussion of those details.

MR. IGNATIUS:  Let me invite you to make news.  I see cameras here; there are reporters from the wire services present.  Did you hear anything last week during your trip to Tehran that would provide some new basis for considering the possibility or process of U.S.-Iran engagement?

MR. LEVERETT:  Yes.  I heard from Iranian officials that they want to engage with the Obama administration.  But they want to see signs, indications that the United States really does want a fundamentally different kind of relationship with the Islamic Republic.  And that sign, whatever it would be, is going to have to go beyond nice rhetoric.  It will need to be something that is tangible, something that can be interpreted in Iran as a clear indication that the United States wants a fundamentally different relationship. 

Some of the ideas that might fit that bill – if the Obama administration would reaffirm the Algiers accord that ended the hostage standoff in January 1981.  There is an explicit commitment in that document by the United States not to interfere in the internal affairs of the Islamic Republic. 

I’m pretty confident the Obama administration went through an exercise, last year, of whether or not to put groups like Jundallah and PJAK on the list of foreign terrorist organizations.  In the case of Jundallah they decided not to do that for reasons that aren’t entirely clear to me.  But if there could be some clear indication that the United States is not involved with groups that are carrying out what the Iranians see as terrorist campaigns inside their country, I think that would be enormously beneficial. 

There is a parallel here – one of the first things Nixon did when he took office to show the Chinese he was serious was to tell the CIA to knock off covert operations in Tibet.  You know, there are things that the Obama administration could do to show their seriousness.  And the Iranians say that they still want to be able to engage with this administration and find a way to a better relationship.

MR. IGNATIUS:  I’ll turn to Michael Ledeen and ask you, Michael, about the missing connection – at least as I listened – in your discussion of regime change.  How does the United States help this opposition, Green movement in Iran without, at the same time, discrediting it, without giving the regime precisely what it wants, as a way to say, these people are tools of the United States; this is another attempt from outside to write our history as Iranians.  How do you avoid that?

MR. LEDEEN:  They say it every day.  They say it today, when we’re not even talking to them, let alone helping them.  They say it all the time and they’re surprisingly explicit about it.  They say there’s a foreign headquarters and the foreign headquarters manipulates all these groups.  Anybody who’s anti-regime is ipso facto a foreign agent.  And when they torture people in the prisons and drag them in front of television cameras, and make them say, yes, I’m working for the United States, I’m an agent of CIA and so forth – you know, a couple of them were even asked how they received their instructions from me.  Right?  On television. 

For them everything that happens inside the country that they don’t like is the result of a foreign plot.  So you’re not going to change anything by helping them.  I mean, if you’re helping them the regime will continue to say about them what it is saying today.  Except, in that case, finally – praise the Lord – it will be true. 

But you know, all of these arguments – we heard them ad infinitum at the end of the Soviet empire.  I mean, everybody said to us, when Shultz dared to go to meetings with his Soviet counterparts and would always have a list of political prisoners and say, release these people.  Give them freedom of speech.  Permit them to gather; permit them to protest, and so forth.  Everybody said, why are you doing this?  You’re pushing the Russians against the wall.  You’ll just make them angrier.  It will make it more difficult to reach agreements with them and so forth.

But it didn’t.  We reached all manner of agreements with the Soviet Union – all the while, supporting dissidents and supporting solidarity.  And for me that’s the model.  Do the same thing.  I mean, the United States shouldn’t permit itself to be intimidated into refusing to advance our highest ideals and support people who are trying to gain their freedom in one of the most noxious tyrannies on Earth by people who say, well, if you do that, the Iranians would just say:  You see, you see, they’re trying to undermine us. 

You know, it’s paradoxical because it is impossible for the United States, in my opinion, to have a durable long-term relationship with a tyranny.  Sooner or later, it’s going to blow up just because of the nature of the thing.  And it applies to China, too.  I mean, there are going to be all kinds of bumps in the road and so forth.  I don’t think much of the China analogy.  I think it’s a different situation, that it would take us, it seems to me, a bit far afield.  But I repeat:  I’m certainly in favor of a modus vivendi with Iran, if you can accomplish it.  I don’t think you can accomplish it. 

I will just say two things about negotiations and all the blame that Flynt puts on the United States.  Do you also blame the French, the British, the Germans, the Italians, the Russians and so forth – that is, all the others who have been trying to reach some kind of agreement with Iran on a very narrow subject, namely, uranium enrichment?  I mean, don’t they bear some part of responsibility for this terrible state of affairs?  Is it all the satanic Americans who are constantly forcing the poor Iranians to reject the latest agreement for one reason after another? 

It’s the whole Western world, after all, that’s trying to get some kind of working relationship with Iran.  And nobody’s managed to accomplish it.  Why?  I mean, Ken Pollack says – and he tried very hard – and I think you’re being unfair to the Clinton administration when you say that no American administration has really tried to reach a grand bargain.  I think they tried very hard to reach a grand bargain.  And they failed.  That’s what he says.  I wasn’t there.

MR. IGNATIUS:  You said, Michael, that sooner or later this rotten regime will begin to crumble.  Unfortunately, there’s a big difference between sooner and later.

MR. LEDEEN:  Yes, there is.  (Chuckles.)

MR. IGNATIUS:  Especially given the prospect that Iran is moving as rapidly as it can, people believe, toward nuclear-weapons capability.  So given that clock, my question is, you said earlier that you did not favor military action.  What do you think is the possibility that this movement will gain at least a share of power in time to influence the nuclear weapons decisions?  And do you in fact think that this opposition has any different goal for Iran than the current regime? 

Certainly, at the time of the October Geneva deal, the opposition was outspoken in denouncing the idea of making a deal with the United States over nuclear weapons.  I wrote at the time that there’s a Great Satan addiction in Iranian politics.  They’re all afflicted with it.  What about that?  What about the timetable?  You know, can we wait for them to build their movement, or do we have to think about something quicker? 

MR. LEDEEN:  Well, the answer is, nobody knows, really.  Everyone was advised – I thought and wrote that the Soviet empire was doomed and hollow and would fall, but I, like most other people, was surprised when it happened, how it happened, under those circumstances, and so forth.  These things are very hard to predict, especially timing, as the bishop often said to the actress.  And so it’s very hard to try to lay out a timetable for these things, especially because there are all kinds of other factors.  Will anybody help them? 

If somebody helps them, I think it will happen faster.  If nobody helps them, I think it will happen more slowly.  I mean, I think that revolutionary moments sort of come around and keep on coming around.  And I think that, had we supported the opposition earlier, that you would have had a successful revolution earlier, frankly.  I’m not one of those with whom Flynt is upset, who has been predicting the imminent downfall of the Iranian regime ever since 1979, not at all. 

But I do think in recent years, there have been times when it was possible and that we should have supported them, and so forth.  And I was very disappointed in Secretary Powell, and said so, back in 2003, was it, when we ran away from the potential support of people who – and at that time, there had been millions of people in the streets of Tehran and a general strike had been called for, and so forth, and he pulled the plug on that, quite explicitly and publicly.  And I think that was a terrible mistake.

So I don’t know.  I mean, I think it’s revolutionary situation.  I think the Green movement is worthy of our support, both morally and strategically.  What do they want?  I think that, in terms of their attitude toward the regime, their policy was anybody but Ahmadinejad.  So I think whatever the Iranian government had agreed to or had proposed at Geneva or Vienna or wherever the most recent meeting was held, they would have opposed it on the grounds that the Iranian people hadn’t been consulted and that the Iranian people must be consulted.

When we talk about revolutions, we should notice that Iran had at least three, and some historians argue four, revolutions in the 20th century.  It’s a country with a revolutionary tradition.  It’s not unusual for revolutions to happen in Iran.  So there’s plenty of tradition and raw material and so forth.  And as to what lessons they learned from the last revolution and therefore, don’t want another one, I don’t think we know. 

I’ll just make one final point on what we know about what the Iranian people want.  I think their actual behavior on the streets is more reliable than what they say to somebody with a clipboard.  If I were an Iranian citizen and somebody either called me up on the phone or came up to me with a clipboard, wherever he came from, and said, I’d like to ask you a few questions about how you feel about your regime, I would immediately assume that, that was kind of loyalty check.  And I would try to tell him things that would keep me on good terms with the ministry of intelligence and the Basij and the Revolutionary Guards. 

MR. IGNATIUS:  Just to clarify, as a final point, the news item, forgive me, but it would be your view, Michael, that the United States should provide both overt and covert support to the opposition movement in Iran?

MR. LEDEEN:  I’ve always been in favor of overt.  I think covert is not an American policy decision.  It’s their policy decision.  So if they want to covertly, then I think we should try to accommodate them.  But the basic things they need from us, which are explicit political support saying, these people are worthy of support, release the political prisoners, grant equal rights to women, freedom of the press, freedom of assembly, all of that – there’s nothing covert about that.  Those are our values.  That’s the United Nations Charter.  Support those things; endorse them.

Communications devices and so forth – there have been some articles recently where people have written that, paradoxically, certain kinds of export controls are making it more difficult to provide things that Congress has called for and most of our leaders approve – keeping Internet open, keeping access to social networks open.  In particular – I’m not smart enough to know if that’s true, but if it is true, we should remove those impediments.  We want – we should try to support free flow of information in any and all ways we possibly can.

And just from the last years of the Cold War, a point that most people are unaware of, that I was unaware of, until we got into it:  When a regime of this sort tries to control information, the information it’s best at controlling is information inside the society.  And so we found, surprisingly, that people in Leningrad didn’t know what was going on in Moscow, et cetera. 

They were much better informed what was going on in, to take the Iranian case today, Beverly Hills or New York City or London or Paris than they were about what was going on inside their own country.  One of the big things that the United States and other Western countries need to do is to try to keep the Iranian people as informed as possible on what’s going on in the rest of the country.

MR. IGNATIUS:  I want to turn, now, to the audience and to your questions.  I see two hands in the back, two up here.  I want to ask you to introduce yourselves, to keep your questions brief, please, to direct them to one of our speakers if it’s a particular question.  Yes, sir, go ahead.

Q:  Yes, thank you very much.  My name is Shahayar Etmanali (ph).  Mr. Leverett, just a quick comment and then a question.  Sorry, Mr. Ignatius.  The comment, I made to you before.  It is very arrogant to sit here in Washington, or quite frankly, anywhere in the world, and to claim that you know what the Iranian people want when you say that they want the Islamic Republic.  There’s only one way to truly find out what the Iranian people want.  It is to have free elections.  And it is very interesting that the only people against such a referendum are the Islamic Republic and their stooges on the payrolls of Washington. 

Now, my question to you:  We clearly hear you about rapprochement and about having a grand bargain with Iran, and you claim it is better for United States security and our allies if such a grand bargain happened than the status quo.  The question to you is, do you believe that the best-case scenario for the United States and its allies, when it comes to Iran, is actually a free, liberal democracy in Iran?  I mean, would you believe that, that’s best case for the United States?

MR. LEVERETT:  Look, I think the United States needs to deal with Iran as it is, and not as we wish it to be.  You know, I said what I say about, I don’t think the election last year – the presidential election – was stolen.  I certainly am not in a position to vouch for the integrity with which every ballot was handled or counted.  You know, that’s not my argument.  My argument is that the result was perfectly compatible with the indicators we have about Iranian public opinion.  And so I have yet to see, as I said, any hard evidence that the election was stolen.

I agree that Ahmadinejad is an extremely polarizing political figure.  And I think that the Western media, in the way that they’ve covered Iranian politics over the last year, they have basically given the lion’s share of attention to those parts of Iranian society that are extremely polarized in opposition or in criticism of Ahmadinejad.  And I think there’s been an inadequate appreciation of how popular Ahmadinejad actually is in big stretches of Iranian society. 

It is not – you say I’m being arrogant – I think it’s arrogant and I think it’s also just a bad way to approach foreign policy, to sit here in Washington and say, well, we want the – you know, we want Iran to become a liberal democracy and, you know, we’re going to withhold doing serious foreign policy with this extremely important country until they fit, you know, our template of how they should have their internal politics organized.  Thank god we didn’t do that with China, and I think we’d be making a big mistake to do that with regard to Iran.  It is not up to me to determine what kind of political order Iran has.  The Iranian people do that. 

MR. IGNATIUS:  The woman in the scarf just under the TV camera here.

Q:  Thank you.  My name is Manda (sp).  I’m Iranian.  And for the last 20 years, I have been working with Iranian women inside Iran, and I have been supporting them and helping them.  And they are organized and they have been the most – they have been – they have had the brunt of dictatorship and gender apartheid against them during the last 30 years.  They have lost their children in eight years brutal war. 

And now, the Iranian women have showed – after the war ended, that killed half-a-million Iranian children, for no good reason, the women of Iran rose up.  They have been, time and again – they put their hope on Mr. Khatami.  Mr. Khatami proved to be nobody and a member of the same regime.  Iran is a gender apartheid regime.  The international community supported the people in South Africa against the racial apartheid regime.  Why can’t the international community support the women of Iran – all 50 million of them – and the young Iranians who are living in – 50 million under 30 years of age living under total poverty and hopelessness. 

MR. IGNATIUS:  Let me ask you to stop there.  I think that does give us a question –

Q:  I’m sorry, I’m giving a lecture here.  But I have one question – one question for Mr. Leverett.

MR. IGNATIUS:  Let me ask Flynt to answer it.

Q:  Can I ask my question, please?

MR. IGNATIUS:  I thought you just did, sorry.

Q:  No, I just made a statement, and I’m sorry.  I’m getting very emotional about this issue, because I know Iranians.  I’m an Iranian myself.  I don’t sit here and make judgments.  But Mr. Leverett, you are – for the last 30 years, you’ve had negotiations with the regime of Iran from Mr. Reagan with – (inaudible) – and on through Mr. Clinton, eight years, through Warren Christopher and Madeleine Albright and through Ms. Rice and during Bush administration, and now 14 months with Obama administration.

Iranian regime is not going to make any deals because they cannot.  They took over Iran by anti-Western civilization – America being the symbol of it.  And they are not going to give it up.  This is one issue – I am saying this in front of all these gentlemen.

MR. IGNATIUS:  Ma’am, we need a question, please, now.

Q:  The question is, how long do you advocate – is there any deadline for your rapprochement or dialogue or political appeasement?  And when it ends, are we going to bomb the people of Iran? 

MR. LEVERETT:  Let me just address, first of all, the gender apartheid issue.  Look, I think it is – you know, there are undoubtedly restrictions on Iranian women today that I might find – I wouldn’t want my wife or daughter necessarily living with those restrictions.  But I also have to say I think this notion of gender apartheid is just belied by the reality of modern Iranian society. 

Hillary and I were invited to be at the University of Tehran to speak with students in their graduate program in American studies.  The majority of those students were women.  They were incredibly accomplished.  The majority of students in Iranian medical schools today, as is finally the case in the United States as well, the majority of students in Iranian medical schools today are women.  Women function at the top of the most learned professions in – look, this is reality.  You can live in whatever, you know, imagined world you like, but this is the reality that one sees if you go to Tehran today.

In terms of how deadlines – you know, this is not a reward to the Iranians, to negotiate with them.  It is something that the United States needs to do for its own interest.  This is not some reward that we will bestow upon the Iranians when they meet certain conditions.  This is something we need to be doing.  And I’m saying we need to get serious about doing it.  Simply having tactical discussions on a particular issue, wait a few more years, have another round of tactical discussions on another particular issue is not serious, strategic engagement. 

That’s not how we did it with China.  And if we want to do this with Iran, we’re not going to be able to do it in that way, either.  We’re going to have to have a comprehensive agenda and approach this in a strategically grounded way.  We have not done that in 30 years.

MR. IGNATIUS:  I’m going to collect a series of questions here.  I will take them in sequence and then we will come back to the panel for final statements.  This gentleman here and that gentleman standing in the back.  Madame, you had your hand up.  So let’s go in that order, please.

Q:  Marvin Glimo (ph).  You’ve said several times that America has to send a signal to the Iranians on what we’re willing to do.  Not once have you said that the Iranians have to send a signal to the United States on what they have to do.  And certain signals will be full inspection of the nuclear facilities, stopping support of the terrorism, stopping the criticism of the destruction of Israel.  What do the Iranians have to do to let the United States government know they’re serious?  I have my own opinion.

MR. IGNATIUS:  I’m going to ask you to hold off – you, sir.

Q:  Thank you.

Q:  Hi, my name is Matt Duss.  I’m at the Center for American Progress.  I just want to thank the three of you for a very interesting discussion.  Mr. Ledeen, I’m interested in the example you gave of Secretary of State Schultz meeting with his Soviet counterpart.  I think it’s a good one, but I think a point there is that he did, in fact, meet with his Soviet counterpart. 

My question is, is it – it seems that a lot of the debate over Iran has been presenting it as a, kind of, zero-sum question.  Is it possible to continue to attempt to achieve some kind of rapprochement or some kind of accommodation – does that necessarily weaken the opposition or is it possible to continue to meet with Iran while, at the same time, making our support for human rights and democracy clear?

MR. IGNATIUS:  Miss here in the second row.

Q:  Thank you.  Hi, my name is May (sp).  I’m from the U.N. Information Center.  My question is for Mr. Ledeen.  As far as my modest knowledge goes, the Green movement is not entirely about regime change or a secular government; it’s more freer elections and granting of rights.  If we help the Green movement, as you proposed, will there be a stipulation for a secular government?  And how would that unfold, according to you?

MR. IGNATIUS:  And we’ll take a final question from this gentleman here.  My apologies to those that I was not able to call on.

Q:  Hi.  My name is Hans Lunger (ph).  I’m with the Cato Institute.  I have a question for Mr. Leverett.  In terms of Iranian public support for the nuclear program, to what extent is it based on the nationalistic sentiment?  And if there was a regime change, would we see any different attitude in public opinion?  Would people then abandon this nuclear effort?

MR. IGNATIUS:  Would you like to start, and then Michael?

MR. LEVERETT:  Yeah, I’ll take two of the questions.  What does Iran need to do to signal – look, I think that, in itself, reflects a certain mindset that the United States is still the hegemonic power that it was in the 1990s and can basically dictate the terms by which problem states realign with the United States.  You know, that model might have worked with Libya – I was involved to some degree in that process, think that it was a very successful outcome for the United States.  It’s not going to work with Iran. 

The focus should be on American interests.  My argument is that America needs a realignment with Iran.  You may not accept that premise.  But you know, if you accept that premise, then what should follow from that is, what does the United States need to do in order to make that happen, in order to make that work?  In the case of China early on, if you want to call them pre-emptive concessions, there were, in fact, pre-emptive concessions made by the Nixon administration to the Chinese.  Tell the CIA to stand down from covert operations in Tibet.  Tell the U.S. Navy to stop patrolling in the Taiwan Straits. 

Because Nixon had a strategic objective and he needed to show the Chinese he was serious in order to be able to achieve that objective.  That is the way we need to be thinking about Iran – not in this kind of quid pro quo, tit-for-tat kind of way.  I think once we put a comprehensive framework on the table, then yes, there are going to be all kinds of things that we will need to get out of this grand bargain in order for it to be worthwhile for us.  But we need to be in that process where we are working to create, to forge that grand bargain.  And you know, I think the focus should be on what the United States needs to do in order to make this work. 

In terms of public opinion on the nuclear issue, both the Western polls that have been done and just, you know, kind of anecdotal impression would lead me to think that the nuclear program, at least defined in terms of a nuclear energy program with fuel cycle – uranium enrichment activity going on in Iran – this has broad support across the Iranian political spectrum.  It has broad support across Iranian society. 

The polls, which show that the public is perfectly supportive of trading off aspects of the nuclear program that might be purely weapons-related in return for better relations with the United States, but they do not see uranium enrichment fuel cycle activities in that light.  That is seen as something that Iran has a right to do.  It is part of Iran becoming a technically modern and advanced society.  And I don’t think there is any political appetite or support in Iran, at this point, for giving up uranium enrichment. 

The regime continues to say, the government continues to say to its own people that this is a peaceful nuclear program.  Iran does not have nuclear weapons, does not want nuclear weapons, and that Shia Islam forbids the acquisition of nuclear weapons.  But I think that there is very, very broad popular support for the nuclear program, including fuel cycle activities.

MR. IGNATIUS:  Michael?

MR. LEDEEN:  Well, as to the question, can we talk to them and support revolution at the same time, it reminds me of one of my favorite jokes, of the person who asks another guy, do you believe in baptism?  And he says, believe in it?  Hell, I’ve seen it done!  So yes, I mean, we do it all the time.  We’ve been talking to the Iranians all the time.  It’s not as if talking to them would be some kind of breakthrough.  We’ve been talking to them for 31 years. 

And what we haven’t done is supported the opposition or even spoken to the opposition.  So sure – of course, obviously.  The question, what’s the nature of the Green movement?  What would the Green movement do if it was suddenly swept into power tomorrow?  Nobody really knows because they are compelled, constantly, to speak in code.  And so the messages that they deliver and the speeches that they give are always very careful because there are certain things that they must not say in order to permit the regime to arrest or kill them.

And there were many top officials in the regime who constantly call for arresting and executing them, after all.  So I think the easy answer is that the Green movement is a big umbrella organization.  Now, there’s all kinds of people in there.  There’s people who want a secular republic; there’s people who want an Islamic republic; there’s people who want, you know, with greater rights, with greater freedoms and things like that.  What they all seem to want is better relations with the West, and I would stress the West, not just the United States.

Iranians see themselves as part of the Western world.  Nothing so much will set an Iranian’s teeth on edge as being lumped in with the Arabs.  They don’t want that.  They don’t think of themselves that way, at all.  And they want to be part of the Western world.  So I think what it is reasonable to expect from a successful Green movement – but anyway, you would see it because the thing would unfold over time and the nature of the regime and a referendum on the nature of a new free government in Iran would take time.  And everybody would debate and you would hear all those different points of view. 

And who would win it and who would emerge as the head of a new, freely elected government in Iran?  I wouldn’t begin to predict.  I don’t think anybody can predict.  I just want to say one thing about, you know, what do the Iranians want from us – what kind of gestures do they want from us to be more forthcoming?  Well, they tell us all the time what they want from us.  They want us out.  They want us out of the Middle East.  They want us out of Iraq, out of Lebanon, out of Afghanistan, abandon support for Israel – get out of the region.  That’s what they keep asking for.

Now, that’s the kind of gesture that we could make that would undoubtedly facilitate arriving at, you know, kumbaya or some such thing.  I don’t think we’re going to do it, but that’s what they say.  And they keep saying it.  And they say it every time.  And then, again, I’d like to thank you and I’d like to thank Flynt.  I think it’s productive.  I think it’s informative.  I think it’s the kind of thing that should happen more often.  And I’m really pleased to have been part of it and I think the Atlantic Council should be commended for doing it.

MR. IGNATIUS:  Hear, hear.  I apologize.  I see hands that are still raised.  I am going to call on the head of the South Asia program at the Atlantic Council, who is really a resource for all of us who follow this region in Washington, Shuja Nawaz, to say just a few words in conclusion.  Shuja?

SHUJA NAWAZ:  Thank you, David.  I just wanted to announce that next Tuesday, March 9th, at 3:00 p.m., we’ll be hosting an event, also on Iran, where we’re building up on the work that we did in 2001, when we published a compendium of sanctions and rules and regulations, and then an analysis of the sanctions.  So we are carrying that work forward.  Dr. Kenneth Catspin (ph) has produced a compendium of the latest rules and regulations and sanctions-related work, and we will have another discussion where all the questions that weren’t’ asked or answered today, I hope, will be answered.

Also, to let you know that the Atlantic Council takes Iran extremely seriously and we are in the process of launching a major Iranian project, which I’m delighted to see Mark Brzezinsky here, who will be leading the project.  And we have a stellar cast, which I will not announce today, but that will be part of the steering group and international group that will help that effort, over the next two to three years.

Also, finally, I want to thank, on behalf of Fred Kempe, who unfortunately had to leave, and he wanted to thank not only Flynt and Michael and David for this superb discussion, but all of you, for having come and having made it such a useful exchange.  And finally, a special thanks to my two colleagues, Ainab Rahman, standing near the camera, and Shikha Bhatnagar, who is hiding at the back, the associate director of the South Asia program, because they worked really hard to pull this together.  And thank you all again.  (Applause.)

Transcript by Federal News Service, Washington, DC.

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