[Senate Hearing 109-763]
[From the U.S. Government Printing Office]
S. Hrg. 109-763
IRAN'S POLITICAL/NUCLEAR AMBITIONS AND U.S. POLICY OPTIONS
COMMITTEE ON FOREIGN RELATIONS
UNITED STATES SENATE
ONE HUNDRED NINTH CONGRESS
MAY 17 AND 18, 2006
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COMMITTEE ON FOREIGN RELATIONS
RICHARD G. LUGAR, Indiana, Chairman
CHUCK HAGEL, Nebraska JOSEPH R. BIDEN, Jr., Delaware
LINCOLN CHAFEE, Rhode Island PAUL S. SARBANES, Maryland
GEORGE ALLEN, Virginia CHRISTOPHER J. DODD, Connecticut
NORM COLEMAN, Minnesota JOHN F. KERRY, Massachusetts
GEORGE V. VOINOVICH, Ohio RUSSELL D. FEINGOLD, Wisconsin
LAMAR ALEXANDER, Tennessee BARBARA BOXER, California
JOHN E. SUNUNU, New Hampshire BILL NELSON, Florida
LISA MURKOWSKI, Alaska BARACK OBAMA, Illinois
MEL MARTINEZ, Florida
Kenneth A. Myers, Jr., Staff Director
Antony J. Blinken, Democratic Staff Director
C O N T E N T S
Wednesday, May 17, 2006
Albright, David, president and founder, Institute for Science and
International Security (ISIS), Washington, DC.................. 15
Prepared statement........................................... 18
Biden, Hon. Joseph R., Jr., U.S. Senator from Delaware, opening
Prepared statement........................................... 6
Clawson, Dr. Patrick, deputy director for Research, the
Washington Institute for Near East Policy, Washington, DC...... 58
Prepared statement........................................... 60
Dodd, Hon. Christopher J., U.S. Senator from Connecticut......... 31
Prepared statement........................................... 32
Einhorn, Hon. Robert J., senior adviser, Center for Strategic and
International Studies, Washington, DC.......................... 8
Prepared statement........................................... 10
Kemp, Dr. Geoffrey, director of Regional Strategic Programs, the
Nixon Center, Washington, DC................................... 65
Prepared statement........................................... 67
Lugar, Hon. Richard G., U.S. Senator from Indiana, opening
Pollack, Dr. Kenneth M., senior fellow and director of Research,
the Saban Center for Middle East Policy at the Brookings
Institute, Washington, DC...................................... 41
Prepared statement........................................... 47
Sadjadpour, Karim, Iran analyst, International Crisis Group,
Washington, DC................................................. 51
Prepared statement........................................... 54
Thursday, May 18, 2006
Biden, Hon. Joseph R., Jr., U.S. Senator from Delaware, opening
Prepared statement........................................... 83
Coleman, Hon. Norm, U.S. Senator from Minnesota.................. 84
Lugar, Hon. Richard G., U.S. Senator from Indiana, opening
Nanay, Julia, senior director, PFC Energy, Washington, DC........ 98
Prepared statement........................................... 99
Nasr, Dr. Vali R., professor of National Security Affairs, Naval
Postgraduate School, Monterey, CA.............................. 91
Prepared statement........................................... 93
Phillips, James A., research fellow for Middle Eastern Affairs in
the Douglas and Sarah Allison Center for Foreign Policy
Studies, the Heritage Foundation, Washington, DC............... 102
Prepared statement........................................... 104
Wisner, Hon. Frank G., vice chairman for External Affairs,
American International Group, Inc., New York, NY............... 84
Prepared statement........................................... 87
IRAN'S POLITICAL/NUCLEAR AMBITIONS AND U.S. POLICY OPTIONS
WEDNESDAY, MAY 17, 2006
Committee on Foreign Relations,
The committee met, pursuant to notice, at 9:35 a.m., in
room SD-419, Dirksen Senate Office Building, Hon. Richard G.
Lugar (chairman of the committee) presiding.
Present: Senators Lugar, Martinez, Biden, Dodd, Nelson, and
OPENING STATEMENT OF HON. RICHARD G. LUGAR, U.S. SENATOR FROM
The Chairman. This meeting of the Senate Foreign Relations
Committee is called to order.
The committee meets today to examine the situation in Iran
and options for U.S. policy. We will have a second hearing on
this topic tomorrow. As the American people and policymakers
debate our course in Iran, I am hopeful that this committee can
contribute by being a bipartisan forum for clarifying the
diplomatic situation and evaluating policy options. Our intent
is to inform policymakers, as well as to help stimulate
constructive public debate.
President Bush has announced that the United States remains
committed to exhausting all diplomatic options with respect to
Iran. The United States and its allies at the United Nations
have been pressing for multilateral diplomatic and economic
sanctions under chapter 7. There is widespread agreement that
Iran has sought to deceive the international community about
its nuclear intentions. Tehran's decision to move ahead with
uranium enrichment was condemned by the international
community, but efforts to attain Security Council consensus on
a firm response to Iran's actions have not been successful.
American policy in the near term will be defined by efforts
to convince the international community of our commitment to
diplomacy and to build a broad multilateral and international
coalition against Iran's nuclear ambitions. I believe that this
is the strategy that Iran fears most. Last minute negotiations,
letters to President Bush, and a feigned interest in
compromises are just a few of the transparent efforts Tehran
has undertaken to split the international community. We must
overcome Iran's efforts with patient diplomatic spadework.
We have stated that no option is off the table. Although
direct talks with Iran come with difficulties and risks, we
cannot rule out their utility, particularly as they relate to
our primary effort to build an international coalition.
Secretary Baker's talks with Iraqi leaders in 1991 were
distasteful, but proved to be a gesture that displayed
America's hope for a peaceful settlement and built
international equity for all steps in our response. The United
States has the diplomatic prowess to attain a strong
multilateral response and win the international debate. We must
be prepared to commit the time, energy, and resources necessary
to win this diplomatic battle.
Retaining all communication tools is also important because
they may be necessary to avoid a tragic miscalculation by the
Iranians. Analysts in our intelligence agencies and State
Department do not regard the Tehran regime as irrational, but
the framework for their decisionmaking is very different from
our own. We must understand that they are interpreting our
actions in ways that we do not always discern. If one overlays
these perceptual differences with demagogic rhetoric, historic
suspicion, and high political stakes, the possibility for
miscalculation increases exponentially. Our policies and our
communications must be clear, precise, and confident, without
becoming inflexible. In some situations, this delicate
diplomatic balance can best be achieved through direct
Some have expressed frustration with the administration's
coalition-building approach and have advocated quick, punitive,
and unilateral sanctions focused on international companies
doing business in Iran. Secretary Rice has stated that such a
policy ``. . . would complicate our ability to work
successfully with our allies to counter the threat posed by
Iran. It would narrow in important ways the President's
flexibility in the implementation of Iran sanctions, create
tensions with countries whose help we need in dealing with
Iran, and shift focus away from Iran's actions and spotlight
differences between us and our allies. This could play into
Iran's hands as it attempts to divide the United States from
the international community as well as to sow division between
the EU3, China, and Russia.''
Unilateral sanctions targeting European and Asian
corporations do not appear to be an effective way to secure
long-term commitments from their host governments on a
multilateral approach to the threat posed by Iran. As such,
they are likely to be counterproductive, as the Bush
administration has asserted.
As part of our diplomatic efforts, the administration
should consider how the NATO alliance might be utilized to
strengthen our position. NATO is the principal defense and
security organization of the trans-Atlantic community. NATO has
become the preeminent strategic forum for broader security
cooperation with Japan, Australia, and members of the
Partnership for Peace in the Caucasus and Central Asia. It is
also facilitating closer ties with North African countries
through the Mediterranean Dialogue. NATO is the only entity
that has successfully developed and implemented a strategy of
deterrence and containment against a nuclear armed enemy. The
Alliance provides us with an effective and experienced
infrastructure capable of supplementing our activities at the
United Nations and implementing an international coalition's
strategy toward Iran.
I would underscore a final point as the Congress and the
administration move forward with decisions pertaining to Iran.
Even as we work quickly, we must calibrate our response with
the long term in mind. The issues related to Iran's pursuit of
nuclear weapons, its role in the Persian Gulf region, and its
impact on world energy markets will not be addressed with a
single act or policy, be it miliary, economic, or diplomatic.
The American people must know that whatever policy options are
chosen will likely require years, if not decades, of intense
vigilance and diplomatic followup.
To assist us in our deliberations today, we welcome two
distinguished panels of experts. The first panel will discuss
the status of Iran's nuclear program. We are joined by Dr.
Robert Einhorn, a senior adviser at the Center for Strategic
and International Studies, and Dr. David Albright, president of
the Institute for Science and International Security. Our
second panel will discuss Iran's motivations and strategies.
Joining us will be Dr. Ken Pollack, the director of the Saban
Center for Middle East Policy at the Brookings Institution; Mr.
Karim Sadjadpour, an Iran expert with the International Crisis
Group; Dr. Patrick Clawson, deputy director of the Washington
Institute for Near East Policy; and Dr. Geoffrey Kemp, director
of Regional Strategic Programs at the Nixon Center.
We appreciate our witnesses being with us today, and in a
moment I will call upon our first panel, but first it's my
privilege to call upon the distinguished ranking member,
Senator Biden, for his opening statement.
STATEMENT OF HON. JOSEPH R. BIDEN, JR., U.S. SENATOR FROM
Senator Biden. Thank you very much, Mr. Chairman. It will
not surprise the panel to hear that my statement tracks yours
in many ways. As we say in this business, I associate myself
with your remarks.
Mr. Chairman, I commend you for calling this hearing, and I
welcome a genuinely impressive group of witnesses we have
Unfortunately, in my view, Mr. Chairman, this
administration has chosen not to send a senior official to be
part of these hearings, and I think that's a mistake. I think
they should have. I know you tried. If the administration wants
to avoid the repeat of the fiasco leading up to the war in
Iraq, I think it has to begin to do what it failed to do at
that time, and that is level with the American people, straight
up, level with them as to what's at stake, and what the
strategy is. Platitudes like ``all options are on the table''
and ``we're pursuing diplomacy,'' in my view, are not good
enough. Dodging congressional hearings is not a good start to
what promises to be one of the most challenging problems facing
our country over the next several years, if not decades, as you
Let me state what I think the problem is: A nuclear-armed
Iran. That would put a bomb in the hands of a radical theocracy
swimming in a sea of high-priced oil, whose President has
denied the Holocaust and threatened to wipe Israel off the map.
Now, in my view, I don't believe Iran would use a weapon
against us or Israel or give its technology to terrorists, but
I believe it would feel emboldened to make more mischief in the
region. And if Iran gets the bomb, that could well fuel an arms
race with Sunni Arab countries like Egypt and Saudi Arabia,
making an already volatile region even more dangerous than it
But I believe we have time. Most published reports conclude
Iran is likely--and I'm quoting from published reports, I'm not
quoting from any direct information that I have. Published
reports conclude Iran is unlikely to develop a weapon for
another 5 to 10 years. The critical question is: How do we use
that time to persuade Iran to forgo nuclear weapons?
For now, the administration seems to have settled on a
diplomatic course, and I think that's the right course, but it
seems to be pursuing it with one hand tied behind its back,
without providing the answers to critical questions that we
need to shape a smart policy. For example, our allies in Europe
are working on a package of incentives that are meant to be a
final offer to Iran. What is our role in developing those
incentives? How seriously can Iran take an offer from Europe,
say, in matters relating to security guarantees if the United
States is no part of that deal? Why are we in a posture of, in
effect, negotiating with the negotiators who are going to
negotiate with Iran? I find that strange, as I know you--as I
suspect you do. Just as I find the same situation strange as it
relates to North Korea. We're negotiating with the negotiators
who are going to negotiate with Iran, and yet we are the
lynchpin of any negotiation. Wouldn't it save some trouble and
confusion to be in the room, along with our allies, as well as
possibly Russia and China?
The press reports that if the Iranians spurn the European
offer, the United States and its allies will move for sanctions
of Iran, even through the U.N. Security Council, or failing
that, through a coalition of like-minded nations. What cost
will these sanctions entail for Iran, for us, for the key
countries we need on our side? How vulnerable is Iran to a ban
on imports of gasoline or exports of crude? What would be the
impact on oil markets and at the local gas pump if Iranian
crude were removed from the market? Why isn't the
administration doing more to prepare the public for the
sacrifices sanction would entail if we go that route, as, by
the way, I might note, the Iranian leadership is preparing
More broadly, what are the chances Europe, Russia, and
China will agree to sanctions if they believe the United States
has not explored every diplomatic avenue, including direct
negotiation with Tehran?
Is the administration committed to regime change in Iran?
Would it be prepared to abandon it as part of the package of
security guarantees in a negotiated settlement on a nuclear
issue that was verifiable? I asked that question to Secretary
of State Rice, I believe it was during her confirmation hearing
or the next visit she had. They're so seldom I should remember
them. And she said we'd have to talk about many other things.
I find it interesting that the recognition of the Qaddafi
regime and placing an embassy in Tripoli and suggesting that
the same kind of rationale in dealing--it wasn't too long ago,
Mr. Lugar, that this administration, as was not totally
inappropriate, talked about two madmen, the madman in Baghdad
and the madman in Libya. And we're putting an embassy in the
madman's country because we actually negotiated. We actually
got something that we wanted that was consequential. And I'm
not criticizing that judgement, but we negotiated.
Is the administration's funding of democracy activities
inside Iran the best way to promote internal reform, or is it
literally the kiss of death for Iranian democrats? How do you
tap into the deep desire for change, particularly among the
majority of the Iranian population, which was born after the
Islamic Revolution? Why, after more than 5 years in office, has
the American administration not lifted sanctions on American
NGOs so they can support democratic activities within Iran?
I wish we had someone here today from the administration to
answer these questions. It's time for a full public airing on
the choices that are before us. Let me state my recommendation,
my recommended policy, up front, and it's not fundamentally
different from yours, Mr. Chairman. Last week the Iranian
President sent a letter to President Bush. The letter won't be
nominated for the Nobel Prize for Literature, or for Peace for
that matter. But the content and style of the letter is not the
point, nor is the identity of the sender. I have not been alone
in suggesting that we should respond not to the letter we
received, but with our own ideas on how to move forward. I
would go a step further: We shouldn't respond to the President;
President Bush should respond to the man who has the final say
in Iran. That is Ayatollah Khamenei. It would make--I would
make the letter public. I would include a call for direct talks
anywhere, anytime, with everything on the table. We should be
willing to talk about all the issues that divide us: The
nuclear program, terrorism, Iraq, Afghanistan, Israeli-
Palestinian peace, sanctions, and security. We should, in my
view, lay out for Iran's leaders and especially for its people
what the future would look like if Iran renounces its nuclear
ambitions and its support for terrorism, and what the future
will look like if it does not.
Will Iran respond favorably? I have no idea. I don't know.
But in recent months Iran has indicated a readiness to engage.
Indeed, an Iranian outline for their own bargain was
communicated to the Bush administration 3 years ago. While the
Government in Tehran has changed since then, Iran's fundamental
position likely has not. If anything, the regime is now even
more comfortable with reformists purged from the Majlis and the
Three years ago when I was chairman of this committee, I
called publicly for a dialog between Members of Congress and
the Iranian Majlis. Senator Hagel joined me in that effort.
That call from two Senators sparked an intense debate in Iran
which lasted for several weeks in every major publication in
the country. The reformist press embraced it; the hard-liners
condemned it. The Supreme Leader finally weighed in and
rejected any direct discussion or meeting.
If two Senators can spark that kind of debate within a
country, imagine what the President could do. I believe that an
offer of direct dialog would place enormous pressure on the
Iranian leadership from their own people, from the
international community. Iranian leaders would face a stark
choice: Reject the overture and risk complete isolation and an
angry public or accept it and start down a path that would
require Iran to alter its nuclear ambitions or be exposed for
not having any intention of doing that.
Talking to Iran would not reward bad behavior or legitimize
the regime. Talking is something we have done virtually with
every other country on Earth, including the former Soviet Union
during the cold war, which possessed, in fact, an existential
threat to us, and the unsavory regimes like the ones in North
Korea and in Libya. And demonstrating that we made a serious
attempt at diplomacy is also the best way to keep others on
board--the point of your statement, one of the points in your
statement for tougher actions if Iran fails to respond.
It seems to me that we have been outsmarted by not very
smart people in their ham-handed use of diplomacy, by us
refusing to engage in imaginative diplomacy. There's more than
one purpose to a meeting, one of which is to keep the rest of
the world on our side. I think it would be a wise course of
action for any administration, but for the Bush administration,
with it's blemished record on Iraq, it is not simply a wise
choice; I think it's a requirement. The threshold of trust is
much, much, much, much higher for this administration at this
point with regard to Iran. If the administration wants to
convince our allies and others to place serious pressure on
Iran over the long haul, it seems to me it makes sense for us
to walk the extra diplomatic mile. I hope we can proceed with
the wisdom that the matter requires. How the Iranian crisis is
handled will help determine international security for a
generation, if not longer.
I look forward to the testimony and the insights of our
witnesses, and I thank you, Mr. Chairman, for once again
staying focused on what is one of the gravest concerns we have
right now in terms of a long-term interests. And I thank the
Chair for the time.
[The prepared statement of Senator Biden follows:]
Prepared Statement of Hon. Joseph R. Biden, Jr., U.S. Senator From
Mr. Chairman, I commend you for calling this hearing. And I welcome
an impressive group of experts. It will not be a surprise that I am
very much in agreement with the chairman's statement.
Unfortunately, the administration has chosen not to send a senior
official to be a part of these hearings. That is a mistake.
If the administration wants to avoid a repeat of the Iraq fiasco,
it must begin to do what it initially failed to do in that arena: Level
with the American people about what is at stake and what its strategy
is. Platitudes like ``all options are on the table'' and ``we're
pursuing diplomacy'' aren't good enough.
Dodging congressional hearings is not a good start to what promises
to be one of the most challenging problems facing our country over the
next several years.
Let me state what the potential problem is: A nuclear-armed Iran.
That would put the bomb in the hands of a radical theocracy, swimming
on a sea of high-priced oil, whose President has denied the Holocaust,
threatened to wipe Israel off the map and to attack us.
In my view, Iran probably would not use a weapon against us or
Israel or give the technology to terrorists. But it would feel
emboldened to make even more mischief in the region. And if Iran gets
the bomb, that could well fuel an arms race with Sunni Arab countries
like Egypt and Saudi Arabia, making an already volatile region even
But I believe we have time: Most published reports conclude Iran is
unlikely to develop a weapon for at least another 5 years. The critical
question is: How do we use that time to persuade Iran to forgo nuclear
For now, the administration seems to have settled on a diplomatic
course. That's the right course--but it seems to be pursuing it with
one hand tied behind its back, and without providing the answers to
critical questions that we need to shape a smart policy.
For example, our allies in Europe are working on a package of
incentives that are meant to be a final offer to Iran. What is our role
in developing these incentives? How seriously can Iran take any offer
from Europe--say on matters related to security guarantees--if the
United States is not part of the deal?
Why are we in a posture of--in effect--negotiating with the
negotiators? Wouldn't it save some trouble and confusion to be in the
room along with our allies as well as Russia and China?
The press reports that if the Iranians spurn the European offer,
the United States and its allies will move to sanction Iran either
through the United Nations Security Council or, failing that, through a
coalition of like-minded nations.
What costs will these sanctions entail for Iran, for us, and for
key countries we need on our side? How vulnerable is Iran to a ban on
imports of gasoline or exports of crude? What would be the impact on
oil markets and at the local gas pump if Iranian crude were removed
from the market? Why isn't the administration doing more to prepare the
public for the sacrifice sanctions would entail as the Iranian
leadership is preparing their public?
More broadly, what are the chances that Europe, Russia, and China
will agree to sanctions if they believe the United States has not
explored every diplomatic avenue, including direct talks with Tehran?
Is the administration committed to regime change in Iran? Would it
be prepared to abandon it as part of a package of security guarantees
in a negotiated settlement of the nuclear issue?
Is the administration's funding of democracy activities inside Iran
the best way to promote internal reform, or is that literally the
``kiss of death'' for Iranian democrats? How do we tap into the deep
desire for change, particularly among the majority of the Iranian
population which was born after the Islamic Revolution?
I wish we had someone here today from the administration to answer
these questions. It is time for a full public airing of the choices
Let me state my recommended policy up front.
Last week, the Iranian President sent a letter to President Bush.
The letter won't be nominated for the Nobel Prize for Literature--or
for Peace. But the content or style of the letter is not the point, nor
is the identity of the sender. I have not been alone in suggesting that
we should respond--not to the letter we received, but with our own
ideas on how to move forward.
I would go a step further. We shouldn't respond to President
Ahmedinejad. President Bush should write to the man who has the final
say in Iran--Ayatollah Khomenei.
I would make the letter public and I would include a call for
direct talks with Iran--anywhere, anytime, with everything on the
We should be willing to talk about all the issues that divide us:
The nuclear program, terrorism, Iraq, Afghanistan, Israeli-Palestinian
peace, sanctions, and security.
We should lay out for Iran's leader--and especially for its people
``what the future could look like if Iran renounces its nuclear
ambitions and support for terrorism--and what the future could look
like if it does not.
Would Iran respond favorably? I don't know, but in recent months,
Iran has indicated a readiness to engage.
Indeed, an Iranian outline for a grand bargain was communicated to
the Bush administration 3 years ago. While the government in Tehran has
changed since then, Iran's fundamental positions likely have not. If
anything the regime is now more comfortable with the reformists purged
from the Majlis and the Presidency.
Four years ago, when I was chairman of this committee, I called
publicly for a dialog between Members of Congress and the Iranian
Majlis. Senator Hagel joined me in that effort. That call--from two
Senators--sparked an intense debate in Iran that lasted several weeks.
The reformist press embraced it. The hard-liners condemned it. The
government couldn't figure out how to respond.
If two Senators can spark that kind of debate, imagine what the
President could do.
I believe that an offer of direct dialog would place enormous
pressure on the Iranian leadership--from their own people and from the
international community. Iranian leaders would face a stark choice--
reject the overture and risk complete isolation and an angry public, or
accept it and start down a path that would require Iran to alter its
Talking to Tehran would not reward bad behavior or legitimize the
regime. Talking is something we have done with virtually every other
country on earth, including the former Soviet Union--which posed an
existential threat to us--and unsavory regimes like the ones in North
Korea and Libya.
Demonstrating that we made a serious attempt at diplomacy is also
the best way to keep others on board for tougher actions if Iran fails
It would be a wise course of action for any administration. But for
this administration, with its blemished record in Iraq, it is not
simply a wise choice--it is a requirement. The threshold of trust is
much higher. If the administration wants to convince our allies and
others to place serious pressure on Iran, it must walk the extra
I hope that we can proceed with the wisdom that this moment
requires. How the Iran crisis is handled will help determine
international security for a generation, if not longer.
I look forward to the testimony.
The Chairman. Thank you very much, Senator Biden.
We now turn to our witnesses. I'll ask you to testify in
the order that I introduced you. That will be, first of all,
Mr. Einhorn and Dr. Albright. Your full statements will be made
a part of the record, and you may summarize or proceed as you
wish. We're looking forward to your testimony, and then to our
opportunity to ask questions of you. We have been advised that
our colloquy may be punctuated by a rollcall vote or two, as
the case may be, and at that point, the Chair will recess the
committee so that all the Senators may vote and return and all
of us will hear the same questions and answers and testimony.
Now, we're delighted to have you, and would you please
proceed, Mr. Einhorn.
STATEMENT OF HON. ROBERT J. EINHORN, SENIOR ADVISER, CENTER FOR
STRATEGIC AND INTERNATIONAL STUDIES, WASHINGTON, DC
Mr. Einhorn. Mr. Chairman, Senator Biden, I thank you very
much for the opportunity to appear here this morning.
In the brief time I have, I would like to make five points.
First, I believe that Iran's claim that it's already mastered
centrifuge enrichment technology is premature. It's true that
the Iranians have assembled a 164-machine centrifuge cascade
and produced enrichments of up to 5 percent. And that's
significant. But they cut many corners in their R&D efforts.
For example, instead of running the cascades with gaseous
uranium for 6 months or more, which would have been standard
practice for gaining the necessary confidence, they ran it for
less than 2 weeks.
Iran's recent R&D efforts have been driven by political
rather than technical considerations. Their highest priority
has been to be able to announce a publicly impressive level of
enrichment so that they can claim that they've already achieved
their goal and that it's too late to stop them. They want the
international community to conclude that it has little choice
but to accommodate to the reality of an Iranian enrichment
capability. But they're not there yet, at least not with any
degree of confidence. They'll now have to go back and do the
thorough developmental and testing work they would normally
have done earlier. It will probably take several months to a
year before Iran will have mastered the technology and be able
to replicate it, and scale it up with confidence.
Second point. While Iran has indeed reached some key
milestones recently, its basic timeline for achieving a nuclear
weapons capability has not significantly changed. I think David
Albright has done the best analysis of this, and I agree with
his conclusion that whether Iran enriches uranium in a small,
clandestine enrichment plant, or breaks out of the NPT and uses
the first module of its industrial scale facility at Natanz,
the earliest it could have enough highly enriched uranium for a
bomb would be about 3 years from now, or 2009.
I would emphasize, as David does, that this is a worst-case
assessment. Unless Iran is both very lucky and very good, it
will probably take significantly longer. For comparison,
Director of National Intelligence, John Negroponte, told the
Senate Intelligence Committee in February that Iran will likely
have the capability to produce a nuclear weapon within the next
decade. And according to a news report, a National Intelligence
estimate last year judged that Iran could have a nuclear weapon
in 5 to 10 years. I think that was the report you were
referring to, Senator Biden.
Senator Biden. It was, Bob.
Mr. Einhorn. Of course, large margins of uncertainty
surround such estimates. The biggest wildcard is whether, and
to what extent, Iran has a clandestine nuclear program parallel
to its overt program. If it has successfully hidden both a
uranium conversion plant and an enrichment facility, then
clearly all bets are off. Although I believe Iran is pursuing
some activities covertly, I doubt that they include both
conversion and enrichment.
Third point. The presence of the International Atomic
Energy Agency on the ground in Iran is crucial in helping us
track--helping us keep track of Iran's progress toward a
fissile material production capability. But without stronger
verification authorities, the IAEA will not be able to
determine whether Iran is pursuing a covert nuclear weapons
program. The IAEA can measure accurately how much uranium
feedstock is produced at Isfahan and how much low-enriched
uranium is produced at Natanz. It can also tell us that no
bomb-grade highly enriched uranium is being produced at Natanz.
But while the IAEA is good at monitoring declared nuclear
facilities, its ability to detect undeclared facilities and
activities is limited, especially after Iran's decision no
longer to act as if bound by the IAEA's Additional Protocol.
The IAEA admitted as much in its April 28 report which said
that given Iran's failure to cooperate and be transparent, it
is ``unable to make progress in its efforts to provide
assurances about the absence of undeclared nuclear material and
activities in Iran.''
The U.N. Security Council should act soon to give the IAEA
stronger verification authorities, including monitoring and
inspection rights that go well beyond those contained in the
Fourth point. Unless there is a major change in Iran's
current perception of the benefits and risks of pursuing its
own enrichment program, Iranian leaders will stay on course.
The United States and the other major powers should act boldly
and quickly to alter Iran's calculus. With military strikes
unlikely, and Russia and China resolutely opposing sanctions,
Tehran now sees little cost in proceeding with enrichment. And
with the United States seemingly intent on regime change
whatever happens on the nuclear issue, it sees little benefit
in negotiating away its enrichment program with the Europeans.
If the international community is to have any chance of
persuading Iran to give up its enrichment capability, and
that's an increasingly big if, it must confront Iran with
stronger sticks and more attractive carrots. Russia and China
must join the United States and Europeans in posing a credible
threat of increasingly severe penalties. At the same time, the
major powers must offer significant incentives going beyond
what the Europeans proposed last July.
A critical incentive for Iran would be the prospect of a
less threatening, more normal relationship with the United
States, and, specifically, a recognition in Washington that
regime change in Tehran should be the prerogative of the
Iranian people, and not the policy of the United States.
Fifth and final point. Within a multilateral framework that
also includes Germany and the other P5 countries, the United
States should be prepared to have bilateral, face-to-face
contacts with Iran. The agenda for United States-Iranian
contact should not be confined to the nuclear issue. It should
cover the full range of issues that divide the two countries,
including United States concerns about Iran's support for
Middle East terrorist groups, its alleged harboring of al-Qaeda
operatives, its role in Iraq, its policies toward Israel, and
its treatment of its own people. And, of course, the Iranians
undoubtedly will have their own list of issues.
The purpose of the talks would be to explore whether U.S.
concerns can be met and whether the interests of the two
countries can be reconciled. Only by addressing the broad range
of issues can prospects for normalization be assessed. And only
the prospect of normalized, bilateral relations can provide the
context in which Iran is likely to consider suspending its
enrichment program and giving up its aspiration for nuclear
Thank you, Mr. Chairman.
[The prepared statement of Hon. Einhorn follows:]
Prepared Statement of Hon. Robert J. Einhorn, Senior Adviser, Center
for Strategic and International Studies, Washington, DC
THE IRAN NUCLEAR ISSUE
Mr. Chairman, thank you for giving me the opportunity to appear
before the committee this morning.
Developments over the last 10 months--including Iran's abrogation
in July of its agreement with the EU3 (Britain, France, and Germany),
its resumption in August of uranium conversion at Isfahan, the end of
its voluntary implementation of the IAEA Additional Protocol, the weak
U.N. Security Council presidential statement issued at the end of
March, Iran's production of enriched uranium at Natanz, and the
inability so far of the five Security Council Permanent Members to
agree on a chapter 7 resolution--have created a widespread impression
that Iran's quest for a fissile material production capability is
progressing more rapidly than expected and is essentially unstoppable.
Fostering that impression--and the belief that the international
community has little choice but to accommodate to the reality of an
Iranian enrichment program--is very much part of Iran's game plan. But
despite the significant progress Iran has made, Iran's claims that it
has mastered centrifuge enrichment are premature; it still has far to
go before it can produce either highly enriched uranium (HEU) or
nuclear weapons; and its willingness to negotiate an end to its
enrichment and reprocessing programs has yet to be put to a serious
Evaluating recent Iranian progress
As documented by the International Atomic Energy Agency (IAEA) in
its report of April 28, 2006, Iran has indeed passed some important
milestones in recent months. Since September 2005, it has produced over
110 tonnes of uranium hexafluoride (UF6) at the Isfahan
uranium conversion facility, enough gaseous uranium feedstock for over
20 nuclear weapons. After ending its suspension of enrichment
activities in January, it fed UF6 into a single P1
centrifuge machine, then into 10-machine and 20-machine cascades, and
then moved quickly to a 164-machine cascade (a key building block in a
centrifuge enrichment facility) where it successfully enriched uranium
to around 3.6 percent. Meanwhile, Iran has been assembling two
additional 164-machine cascades at its Pilot Fuel Enrichment Plant
(PFEP), one which is about to begin enrichment operations and the other
which should be ready by June. In addition, the Iranians announced that
they would begin installing the first 3,000-machine module of their
industrial-scale enrichment facility in the fourth quarter of 2006.
On the basis of these developments, Iran's leaders are claiming
that they have now mastered centrifuge enrichment technology and that
it is too late to stop them. They go so far as to say that, even if
existing nuclear facilities were destroyed, they have reached a stage
where they could regenerate their program quickly and confidently, with
little loss of time. But such claims are premature.
The Iranians have cut corners in their research and development
effort in order to register the accomplishments listed in the IAEA's
report. Standard practice would have required them to run the 164-
machine cascade with UF6 on an uninterrupted basis for up to
6 months or more before gaining confidence in its operation. Instead of
proceeding in parallel to assemble and operate additional cascades, the
efficient operation of the initial cascade would first have been
demonstrated. To verify the ability to manufacture centrifuges
indigenously, the experimental cascade would have relied on machines
made in Iran rather than imported, and it would have been heavily
instrumented to measure performance. And before introducing
UF6 into the cascades, any impurities in the uranium gas
that could damage the centrifuges would have been addressed and
But the Iranians deviated from standard practice. Apparently intent
mainly on demonstrating publicly the ability to reach a significant
enrichment level, they ran the cascade with UF6 for less
than 2 weeks. A significant portion of the experimental cascade may
have consisted of centrifuges imported from the A.Q. Khan network
rather than produced indigenously. Moreover, little of the equipment
normally used to measure performance seems to have been used during the
short experimental run. And instead of taking the time to fix the
problems in the Isfahan conversion process that have produced
impurities in the UF6, the Iranians seem to have chosen to
use the impure UF6 and accept the risk of having to replace
any centrifuges damaged as a result.
Iran's research and development efforts to date seem to have been
driven by political rather than technical considerations. By giving
highest priority to achieving and announcing the ability to produce
uranium enriched to 3.6 percent, the Iranians wanted to present the
world with a fait accompli--to demonstrate that they already have an
enrichment capability and that continued efforts to stop them would be
futile. Moreover, fearing (despite their determined show of self-
confidence) that they may eventually be forced to accept another freeze
on their program, they wanted to establish the highest possible
baseline for such a freeze--thus, accelerating the operation of the
second and third cascades at the PFEP and starting installation of the
3,000-machine module this year at the industrial-scale facility. And
not least, Iran's leaders saw the early announcement of the enrichment
breakthrough as a way of boosting national pride and building domestic
support for the regime, especially in anticipation of international
pressures and possible hardships to follow.
Having taken a series of shortcuts largely for political reasons,
Iran presumably will now have to do the thorough developmental and
testing activities it would normally have done earlier. That will take
considerable time, and is probably one reason why the Iranians are
saying they would be prepared to negotiate a deferral of industrial-
scale enrichment if the Europeans and others will agree to accept
continued R&D activities on a pilot scale.
So recent reports regarding progress in Iran's nuclear program,
especially boastful accounts coming from Tehran, have created the
somewhat misleading picture that Iran's efforts have accelerated to an
alarming degree. While Iran has indeed reached some key milestones of
late, the basic timelines for Iran achieving a nuclear weapons
capability--in particular, the capability to produce enough HEU for a
single nuclear weapon--have not significantly changed.
Timeline for producing HEU
One of the best recent analyses in the open literature of Iran's
timeline for producing HEU was done by David Albright.\1\ Since he's a
witness at today's hearing and available to explain his analysis, I'll
just cite his conclusion--that whether Iran builds a clandestine
enrichment plant with 1,500 P1 centrifuges or breaks out of the NPT and
uses its first module of 3,000 P1 centrifuges at its industrial-scale
facility, the earliest it could produce enough HEU for a single nuclear
weapon would probably be 3 years from now, or 2009. Albright emphasizes
that this is a worst-case assessment and that Iran is likely to take
longer if, for example, it needs additional time to manufacture and
install the necessary number of centrifuges and overcome the normal
technical difficulties that arise in seeking to operate a number of
cascades in a single production unit.
\1\ David Albright and Corey Hinderstein, ``The Clock is Ticking,
But How Fast?'' The Institute for Science and International Security
(ISIS), March 27, 2006.
Director of National Intelligence, John Negroponte, seems to
believe Iran will probably take longer than 3 years. In testimony
before the Senate Intelligence Committee in February 2006, he said that
if Iran continues its present efforts, it ``will likely have the
capability to produce a nuclear weapon within the next decade.'' A
National Intelligence Estimate on Iran produced last year reportedly
judged that Iran could have a nuclear weapon in from 5 to 10 years.
Large margins of uncertainty inevitably surround judgments of when
Iran will or could have nuclear weapons or the fissile materials to
build them. Some of the biggest unknowns relate to Iran's intentions--
whether it is determined to produce HEU and acquire nuclear weapons as
soon as possible; whether--and for how long--it is willing to stop at
an LEU production capability while deferring decisions on HEU
production and weaponization; or whether it is prepared to forgo,
temporarily or indefinitely, the capability to produce even LEU in
order to avoid penalties or gain rewards.
Other uncertainties about the pace of Iran's nuclear program relate
more to capabilities. If Iran cannot readily overcome the technical
problems that typically accompany startup enrichment operations, the
timeframe will lengthen. If, however, Iran can soon learn to master the
much more efficient P2 centrifuge design and build P2 enrichment units,
the timeframe will shorten. Iran's ability to procure materials,
equipment, and technology from abroad will also affect the pace of its
nuclear program, although imports will be much more important in the
case of Iran's industrial-scale enrichment facility, which still
requires large quantities of specialized materials and equipment, than
in the case of a pilot-scale facility. Indeed, even if it were possible
to cut off its access to foreign supplies, Iran probably already
possesses within its territory all the materials and equipment it needs
to set up a 1,500- or 3,000-machine centrifuge facility and produce
enough HEU for a small nuclear weapons stockpile.
A key variable affecting the pace of Iran's nuclear program is
whether--and the extent to which--Iran has a clandestine nuclear
program parallel to its overt program. Obviously, a successfully hidden
conversion plant and enrichment facility would invalidate current
estimates and eventually confront the United States and its allies with
a sudden, major security threat. But even undetected activities of less
importance (e.g., manufacture of centrifuge components or assembly of
centrifuges) could have a substantial impact on timeframes for
producing HEU or nuclear weapons.
Monitoring Iran's program--the role of the IAEA
The IAEA plays a critical role in narrowing our uncertainties about
Iran's nuclear program. But IAEA monitoring of Iran's program has
serious limitations, especially given Tehran's decision in February to
cease implementation of the Additional Protocol and its overall failure
to meet the IAEA's requirements for transparency and cooperation.
The Agency's presence in Iran, even with the less intrusive
verification rights contained in the IAEA-Iran Comprehensive Safeguards
Agreement (as compared to the Additional Protocol), provides a strong
basis for monitoring declared nuclear facilities and activities in
Iran. Agency inspectors can measure accurately how much UF6
is produced at Isfahan and verify that it is not being diverted to a
covert enrichment plant. They know how much enriched uranium is being
produced at Natanz and can be confident that no HEU is being produced
there and that no Natanz-produced LEU is being sent to a covert
enrichment facility to be further enriched to weapons grade. Frequent
IAEA visits also enable us to keep track of progress in assembling and
operating cascades at the PFEP, in constructing and operating the heavy
water production plant and heavy-water research reactor at Arak, and in
building the industrial-scale enrichment plant at Natanz. This
information is crucial in understanding the nature and pace of Iran's
acquisition of a fissile material production capability.
While the IAEA can effectively monitor declared nuclear facilities
and activities as long as the Agency has access to them, monitoring
confidence drops off rapidly at undeclared locations or if inspectors
are no longer given access to declared sites. In the latter case, such
as in the event of NPT withdrawal and termination of IAEA verification,
Iran could proceed without international scrutiny to use previously
monitored facilities to produce fissile material, either by starting
from natural uranium or boosting previously safeguarded LEU to HEU.
Even if Iran remains in the NPT, monitoring undeclared locations is
a formidable challenge, especially given Iran's 20-year track record of
what the IAEA calls its ``many failures and breaches of its obligations
to comply'' with its NPT safeguards agreement and given its February
decision no longer to act as if bound by the Additional Protocol. In
its April 28 report, the IAEA cites numerous ``gaps in the Agency's
knowledge'' that have sustained or even heightened ``concern'' that
Iran may be pursuing nuclear weapons. Among the IAEA's concerns are
that Iran is not being honest about the extent of its work on P2
centrifuges, that Iran took fuller advantage of a 1987 offer by A.Q.
Khan's network than it is admitting, that procurement of dual-use
equipment (e.g., mass spectrometers) was related to a weapons program,
that Iran's military is heavily involved in the nuclear program, that
experiments with plutonium, polonium, and uranium metal point to a
weapons program, and that Iran may be engaged in nuclear-related high
explosives testing and missile re-entry vehicle design.
These concerns, and the IAEA's judgment that Iran is not providing
the Agency ``full transparency and active cooperation,'' have brought
the IAEA to the sobering admission that it ``is unable to make progress
in its efforts to provide assurances about the absence of undeclared
nuclear material and activities in Iran.'' The April 28 report goes on
to say that ``additional transparency measures, including access to
documentation, dual use equipment, and relevant individuals''--all of
which have been specifically requested by the IAEA Board of Governors
but denied by Iran--will be required if the Agency is to be able to do
Iran's decision to stop implementing the Additional Protocol (AP)
has hampered the IAEA's work. But implementation of the AP is not
enough. The AP has its own limitations. Unlike what many observers
believe, it does not provide for ``anywhere, anytime'' inspections. It
does not, for example, authorize investigation of suspected
weaponization activities or allow access to military facilities where
no nuclear materials are believed to be present. That is why the IAEA
Board has several times requested, unsuccessfully, that Iran accept
verification procedures going beyond what is required by the AP.
The IAEA must be given stronger tools to perform its verification
mission in Iran, and that will require action by the United Nations
Security Council. The IAEA Director General should be asked to
determine what additional verification authorities the Agency would
need to carry out its mandate in Iran. If required, those authorities
should go well beyond what is contained in the existing Comprehensive
Safeguards Agreement or even the Additional Protocol. The Security
Council should then take a decision to grant the IAEA those additional
Enhanced verification tools would not be a panacea. Even if Iran
complied with a Security Council directive to cooperate with them, more
intrusive methods would not necessarily be capable of uncovering all
undeclared nuclear activities. For example, a relatively small
clandestine centrifuge enrichment plant (e.g., 1,500 centrifuges) might
still be difficult to detect. But stronger verification tools would
give the international community significantly more confidence than it
currently has in the ability to detect and deter violations.
Persuading Iran to forgo its enrichment program
The absence so far of a clear-cut IAEA determination that Iran is
seeking nuclear weapons has made it very difficult to build strong
international support for a strategy capable of persuading Iran to give
up its enrichment capability. Indeed, under present circumstances, the
prospects for heading off an Iranian fissile material production
capability by means short of the use of military force do not look very
Iran's leaders have done an effective job convincing the Iranian
public that an indigenous enrichment capability is an Iranian right
that is essential to national dignity, technological advancement, and
energy independence and must never be given up. While influential
Iranians occasionally express concern about the potential consequences
of pursuing an enrichment program in defiance of the international
community, the regime can be expected to remain on course barring a
major shift in the currently perceived balance of benefits and risks.
The risks, at this stage at least, appear manageable. Tehran
probably believes the likelihood of military strikes has increased in
recent months but remains remote given Washington's preoccupation with
Iraq and its appreciation of Iran's many options to retaliate. The
Russians and Chinese have so far remained stalwart in their opposition
to sanctions and a chapter 7 resolution. Even if resistance in Moscow
and Beijing eroded, the Iranians may calculate that any sanctions
adopted would be weak and easily weathered and that tougher measures
(such as those affecting oil and gas markets) would be avoided on the
assumption--actively promoted by Tehran--that they would hurt the West
more than Iran.
Not only do the risks of continuing enrichment seem limited, but
the benefits of giving up the enrichment program also currently appear
small (especially when compared to the perceived security,
geopolitical, and prestige benefits of acquiring a nuclear weapons
option). The economic, technological, and political incentives offered
by the Europeans last July apparently didn't impress the Iranians, who
probably recognize that, without U.S. support, those benefits may not
fully materialize. More fundamentally, Iran's leaders may see little
sense in giving up their trump card in a deal with the Europeans if
they believe they'd still face a U.S. Government intent on pursuing a
policy of regime change.
If the international community is to have any chance of persuading
Iran to give up its enrichment capability (and its nuclear weapons
option), it must radically alter Tehran's current calculus of benefit
Part of the equation is stronger sticks. Iran must face the
credible threat of increasingly severe penalties--ranging from travel
bans, asset freezes, and political gestures to investment and trade
restrictions to even the use of military force. Russia and China, in
particular, must be persuaded that such threats are necessary and not
counterproductive. But they will be prepared to join in threatening
such penalties only if Iran is also offered incentives that they
believe could get Iran to accept the deal and, therefore, avoid the
need to implement the penalties.
And so the other part of the equation is more attractive carrots.
Possible incentives for Iran have been widely discussed, including the
kinds of commercial and technological cooperation offered by the
Europeans last July, membership in the World Trade Organization,
lifting of existing U.S. economic sanctions, military confidence-
building arrangements in the gulf region, and so forth. But the carrot
likely to be most influential in Tehran would be the prospect of a less
threatening and more normal relationship with the United States--and
specifically a recognition in Washington that regime change in Tehran
should be the prerogative of the Iranian people and not the policy of
the United States.
Direct engagement between the United States and Iran
The most effective way to offer the incentive of a more normal,
less threatening relationship with the United States--and indeed the
only way it would be credible--is through direct, face-to-face
discussions involving American and Iranian representatives. Bilateral
United States-Iranian contacts could take place within the framework of
a multilateral process that also included Britain, France, Germany,
Russia, and China--analogous to the six-party talks that have provided
an acceptable context for bilateral meetings between the United States
and North Korea during the last year or so.
The agenda for United States-Iranian discussions should not be
confined to the nuclear issue. It should instead cover the full range
of issues that divide the two countries, including U.S. concerns about
Iran's support for Middle East terrorist groups, its role in Iraq, its
alleged harboring of al-Qaeda operatives, its policies toward Israel,
and its treatment of its own people. Iran undoubtedly will have its own
list of issues and demands. The purpose of the talks would be to
explore whether U.S. concerns can be met and whether the interests of
the two countries can be reconciled. Only by addressing the broad range
of issues can prospects for normalization be assessed. And only the
prospect of normalized bilateral relations can provide the context in
which Iran is likely to consider suspending its enrichment program and
giving up its aspiration for nuclear weapons.
At various times during the past decade, the United States and Iran
have both been interested in bilateral engagement, but never at the
same time. In recent weeks and months, the Iranians have been sending
signals--however mixed and confusing--that they might be ready. But it
is the U.S. administration that is now resisting.
Asked recently whether the Bush administration is willing to engage
directly with Iran, Secretary Rice replied: ``What is to be gained if
Iran is not prepared to show that it is ready to accede to the demands
of the international community?'' But do we really expect Iran to meet
our demands even before sitting down to talk with us--before knowing
what it might receive in return? Do we realistically think our current
bargaining position is so strong?
There seems to be a strong conviction within the administration
that talking to the current regime in Tehran will give it legitimacy
and sustain it in power, whereas pressuring and isolating it will
divide the leaders from the people and perhaps even result in regime
change and more acceptable policies on the nuclear issue and other
issues. But most experts on Iran tend to believe just the opposite--
that external pressures will unite the Iranian public behind the regime
and its nuclear policies, while engagement will magnify the fissures
that have begun to appear within the Iranian leadership and perhaps
produce significant changes in policy, including on the nuclear issue.
In London this Friday, the P5 countries plus Germany are scheduled
to meet to consider a European-drafted package proposal for Iran. It is
an opportunity to make the major changes in Iran's calculation of
benefits and risks that will be necessary to induce Tehran to give up
its enrichment capability. To have that effect, the Russians and
Chinese should agree that the package will require stiff penalties if
Iran does not accept a reasonable offer. The Europeans should provide
incentives more attractive than those contained in their July proposal.
And the United States should be prepared to engage in direct talks with
the Iranians within a multilateral framework.
Such a package would be the first real test of whether Iran is
willing to give up its quest for a nuclear weapons capability. If the
Iranians are determined to proceed with their nuclear plans come what
may, they will fail the test. But that will at least put the United
States and the Europeans in a stronger position to rally the
international community behind a longer term strategy to demonstrate to
Iran that it has much to lose and little to gain by staying on its
Despite recent progress in Iran's enrichment program, Iran is still
years away from being able to produce a nuclear weapon. But it will not
be long--perhaps several months to a year--before Iran is confident in
its ability to enrich uranium efficiently in overt or clandestine
production units large enough to produce bomb quantities of HEU in less
than a year. It is, therefore, important that the United States and the
other key states move quickly to construct and present a package that
gives Iran a stark choice--it can be a pariah with nuclear weapons or a
well-integrated, respected member of the international community, with
normal relations with the United States, without them.
The Chairman. Thank you very much, Mr. Einhorn. We will at
this point recess the committee. We're in the midst of a
rollcall vote. Senator Biden and I will vote and return. I look
forward to Mr. Albright's testimony. For the moment, we are
The Chairman. The committee is called to order again. And
we're privileged now to hear from Mr. David Albright.
STATEMENT OF DAVID ALBRIGHT, PRESIDENT AND FOUNDER, INSTITUTE
FOR SCIENCE AND INTERNATIONAL SECURITY (ISIS), WASHINGTON, DC
Mr. Albright. Thank you, Mr. Chairman and Senator Biden for
inviting me to testify at this hearing.
Now that Iran has resumed enrichment activities in Natanz,
one of the key questions facing us is how soon could Iran have
nuclear weapons. A critical factor in developing reliable,
credible information needed to answer that question has been
intensive or intrusive IAEA inspections and monitoring of
Iran's enrichment related activities. Such inspections are now
sharply reduced in scope and intensity. Iran has halted its
adherence to the Additional Protocol, and it has ended the
monitored suspension of its enrichment activities.
IAEA inspections, as Bob has pointed out, can now provide
only a partial picture of Iran's progress in operating gas
centrifuge cascades, which are a collection of centrifuges
connected by pipes. And Iran's mastery of these centrifuge
cascades remains its last significant technical hurdle before
it can actually build gas centrifuge plants.
With the clock now ticking, our ability to learn critical
information about Iran's gas centrifuge activities has greatly
diminished, making revisions of estimates--and I'd emphasize
revisions of estimates--of the time to the bomb more uncertain.
Such a condition carries special risks as diplomacy picks up
over the next several months. The risk of Iran can be
understated, leading to a false sense of security. On the other
hand, the risk of hyping up or exaggerating Iran's progress
toward the bomb can propel us toward unnecessary confrontation
and military action against Iran.
As a result, Congress needs to conduct thorough oversight
and review of intelligence community assessments, and become
familiar with these assessments themselves. Therefore, I
applaud this committee's actions on this subject to try to get
a handle and an expertise over what Iran is up to. And it
reminds me of this committee's actions in 2002, when they tried
to get a handle on the aluminum tubes issue, to bring in
dissenters from the intelligence community, and to try to get
to the bottom of that story. I think we've learned a lot from
that time, and I think that that kind of expertise in this
committee is extremely valuable.
I think Bob has outlined the current situation with regard
to Iran's nuclear program, and I'll just skip over that
quickly. As you know, Iran has enriched uranium in its 164-
machine cascade. It has operated the cascade for a relatively
short period of time, and it's going to need to operate it much
longer. It's now building a second and third cascade. The pilot
plant can hold up to six of these cascades, and they can work
individually or together. And the working of these machines in
these cascades in parallel is going to be a critical goal for
Iran to achieve. The gas centrifuges, based on Iranian
statements, don't seem to be working as well as they could, and
I would wholely endorse what Bob said, that Iran has a lot to
learn. The demonstration phase for these cascades is likely to
last for many more months.
With regard to the fuel enrichment plant, the underground
site at Natanz, from talking to officials in Vienna, not much
has been happening. Iran earlier this year moved fairly quickly
to bring some equipment in there, but it does not appear that
Iran is aggressively moving to outfit the fuel enrichment
plant. And some of the things it has to do, from what I
understand from officials in Vienna, is lay electrical cable,
and finish installing auxiliary equipment that would go along
with the centrifuges. As you all know, Iran has announced that
it plans to start installing the centrifuges in the underground
halls during the fourth quarter of this year.
To understand the timeline to the bomb, I've developed
several worst-case scenarios, two of which I put in my written
statement, and Bob summarized them better than I could. The
first is a clandestine plant that Iran would build. The other
is a breakout using the fuel enrichment plant and the first
module of 3,000 centrifuges. And in my estimate, I felt that
they could not do that any sooner, or let's say, do all that
and then produce enough material for a bomb before 2009. And
the information I've seen since I originally did these
estimates has not shifted my timeline. And as Bob said, these
are worst-case assessments and should in no way be viewed as
projections of when Iran could have the bomb, but more in
answer to the question of how much time do we have or what's
the least amount of time that we have.
In 3 years, I think there is enough time for diplomatic
action, but I would emphasize that it's not too much time, and
I would say that complacency should not set in. It's also very
important that we get more information through the inspection
process. I know everyone is waiting for the inspectors to
report, and many people in many countries are contacting them
to learn about what the recent inspection missions have
detected, because I think, in this case, as it was true in
Iraq, the best information will come from the inspectors. Our
own intelligence means will continue to provide only limited
information about what's actually going on.
One of the issues--or one of the aspects of the Iranian
program that has emerged during the inspection process is how
dependent Iran has been on outside assistance. I would say that
it continues to be dependent on outside assistance. It's not
for big-ticket items, necessarily, major, dual-use equipment,
but it still is out there shopping for enrichment-related
items. And it's very important that countries maintain their
guard. I think the Western suppliers do a very good job at
trying to stop Iran from getting items from European companies
and United States companies, and that work needs to continue.
But I think Iran is now targeting more countries. We hear
reports that Iran is targeting or planning to target India as a
source of certain types of equipment that it just cannot make
itself and it needs to build its centrifuge plants.
I would emphasize that one of the uncertainties is, does
Iran have everything it needs to build this 3,000-centrifuge
module model, and there is still debate about that. The IAEA
doesn't know, from what I understand. They don't know
everything Iran has in hand and what it still needs. Certainly,
if Iran wants to go beyond this module, it's going to need more
items from overseas. And so I think it's very important that
the United States work with a broader set of nations to try to
stop Iran's elicit procurement.
And the final point I'd like to make is that it's very
important for the United States to stick to its goal. I
personally believe, and have for many years, that the goal in
Iran has to be no enrichment or enrichment-related activities
and no reprocessing. I think that Iran's nuclear power program
can proceed, and I would actively support Iran acquiring power
But I do think that a little bit of enrichment is a bad
thing, and that what we should maintain as our goal is no
enrichment activities. I think we need that to satisfy broader
security goals, and we also need it for effective verification.
Gas centrifuge plants are very hard to detect. I've worked on
many studies, some with the IAEA, trying to detect clandestine
enrichment plants, particularly gas centrifuge plants. We've
had years of experience studying secret gas centrifuge plants
in many countries, and they remain one of the most challenging
aspects of verification. I think that it's much easier to
assure or provide assurance of no enrichment activity if
there's no enrichment plant in operation in the country.
I think it's appealing now to try to reduce our goal or
compromise our goal, but I think we have to maintain a very
strict position. And in that sense, I do applaud the Bush
administration for being willing to maintain that central goal.
Thank you, Mr. Chairman.
[The prepared statement of Mr. Albright follows:]
Prepared Statement of David Albright, President and Founder, Institute
for Science and International Security (ISIS), Washington, DC
Iran is now on the verge of mastering a critical step in building
and operating a gas centrifuge plant that would be able to produce
significant quantities of enriched uranium for either peaceful or
military purposes. However, Iran can be expected to face serious
technical hurdles before it can produce significant quantities of
In testimony before the Senate Intelligence Committee on February
2, 2006, John Negroponte, Director of National Intelligence, stated
that Iran is judged as probably having neither a nuclear weapon nor the
necessary fissile material for a weapon. He added that if Iran
continues on its current path, it ``will likely have the capability to
produce a nuclear weapon within the next decade.'' The basis for this
estimate remains classified, although press reports state that Iran's
lack of knowledge and experience in building and running large numbers
of centrifuges is an important consideration. Many interpret
Negroponte's remark to mean that Iran will need 5-10 years before it
possesses nuclear weapons.
Estimates of the amount of time Iran needs to get its first nuclear
weapon are subject to a great deal of uncertainty. Many questions about
Iran's technical nuclear capabilities and its plans to build nuclear
weapons remain unanswered. In addition, the International Atomic Energy
Agency (IAEA) is unable to verify that Iran has fully declared its
nuclear activities. It still cannot state conclusively that Iran does
not conduct secret uranium enrichment activities. Nonetheless, because
of over 3 years of inspections, the IAEA has developed considerable
knowledge about Iran's nuclear program and identified the main
uncertainties in its knowledge about that program. The remaining
uncertainties appear to exclude the existence of undeclared nuclear
facilities large enough to significantly shift projections of the
amount of time Iran would need to produce nuclear weapons. However,
these uncertainties also suggest that Iran intends to develop a nuclear
weapons capability, enabling it to build deliverable nuclear weapons
once the regime's leaders make to a decision to do so.
To understand the assumptions, key information, calculations, and
uncertainties driving estimates of the timelines, I present two
``worst-case'' estimates of the time Iran would need to build its first
nuclear weapon. In both of these estimates, which involve the
production of highly enriched uranium (HEU) and cover the more likely
scenarios, Iran appears to need at least 3 years, or until 2009, before
it could have enough HEU to make a nuclear weapon. Given the technical
difficulty of the task, it could take Iran longer.
Before discussing these estimates, I will provide background
information on Iran's nuclear program and discuss recent developments
in Iran's gas centrifuge program. In particular, I will discuss several
of Iran's recent progress and problems in its centrifuge program that
affect these estimates.
Iran's nuclear program
Iran has invested heavily in nuclear industries in the last 20
years. It has sought a wide range of items overseas, including nuclear
reactors, uranium conversion facilities, heavy water production plants,
fuel fabrication plants, and uranium enrichment facilities. Many of its
overseas purchases were thwarted, such as multiple efforts to buy
research reactors and an attempt to purchase a turn-key gas centrifuge
plant from Russia in 1995. However, in general, Iran found suppliers to
provide the wherewithal to build nuclear facilities. A.Q. Khan and
business associates in Europe and the Middle East provided Iran the
ability to build and operate gas centrifuges. Without their assistance,
Iran would have likely been unable to develop a gas centrifuge program.
Iran's current nuclear infrastructure is impressive. Although many
key facilities are not finished, Iran is close to operating a large
power reactor at Bushehr and has started or is close to operating
several relatively large fuel cycle facilities. Following the end of
the suspension embodied in its November 2004 agreement with the
European Union, Iran resumed operating its uranium enrichment
facilities at Natanz. Table 1 summarizes the main nuclear facilities in
Most of Iran's foreign procurement for its fuel cycle facilities
occurred in secret, and several of the associated nuclear materials and
facilities were not declared to the IAEA, as Iran was required to do
under the Nuclear Non-Proliferation Treaty. Appendix 1 lists Iran's
many violations of its safeguards agreement and important incidences of
its lack of cooperation with the IAEA.
If Iran finishes its declared nuclear facilities, it would have a
capability to produce HEU and plutonium for nuclear weapons. At that
point, Iran could decide to change the purpose of its safeguarded
nuclear facilities and rapidly dedicate them to nuclear weapons
Under current and expected developments, Iran's gas centrifuge
program provides the quickest route to the indigenous production of
nuclear explosive materials. As a result, the gas centrifuge program is
the main focus of my testimony.
However, Iran is also progressing on developing an indigenous
method to produce plutonium. It continues to build a heavy water
reactor at Arak, despite repeated international requests that Iran
discontinue this project. Iranian officials have stated that the
reactor is scheduled to be completed in 2009, although this schedule
may not be met due to problems in building and starting up such a
reactor. When fully operational, the reactor is estimated to be able to
produce about 9 kilograms of weapon-grade plutonium per year, enough
for two nuclear weapons per year. Iran has told the IAEA that it does
not intend to build reprocessing facilities to separate plutonium from
this reactor. It did state that it was planning to build hot cells to
separate ``long-lived radioisotopes,'' but said that it was having
problems obtaining the necessary manipulators and lead glass windows.
IAEA investigations into Iran's past reprocessing activities continue.
Iran breaks the suspension on enrichment activities
Iran ended the suspension on enrichment and enrichment-related
activities in January 2006. Its actions appear aimed at finishing the
Pilot Fuel Enrichment Plant (PFEP) at Natanz this year and, soon
afterward, starting to install centrifuges in the Fuel Enrichment Plant
(FEP), the main underground enrichment facility at Natanz slated to
hold eventually about 50,000 centrifuges.
In early January 2006, Iran removed 52 seals applied by the IAEA
that verified the suspension of Iran's P1 centrifuge uranium enrichment
program. The seals were located at the Natanz, Pars Trash, and Farayand
Technique sites, Iran's main centrifuge facilities. On February 11,
Iran started to enrich uranium in a small number of centrifuges at
Natanz, bringing to a halt Iran's suspension of uranium enrichment that
had lasted since October 2003. A few days earlier, Iran moved to end
its implementation of the Additional Protocol, an advanced safeguards
agreement created in the 1990s to fix traditional safeguards' inability
to provide adequate assurance that a country does not have undeclared
nuclear facilities or materials.
After removing seals, Iran started to substantially renovate key
portions of the PFEP. Iran began construction on the PFEP in secret in
2001, and it installed up to 200 centrifuges in 2002 and 2003. The PFEP
is designed to hold up to six 164-machine cascades, groups of
centrifuges connected together by pipes, in addition to smaller test
cascades, for a total of about 1,000 centrifuges.
At Natanz and Farayand Technique, Iran quickly restarted testing
centrifuge rotors and checking centrifuge components to determine if
they are manufactured precisely enough to use in a centrifuge. By early
March, Iran had restarted enriching uranium at the pilot plant in 10-
and 20-centrifuge cascades.
On April 13, 2006, Iran announced that it had produced low enriched
uranium in its 164-machine cascade, finished in the fall of 2003 but
never operated with uranium hexafluoride prior to the suspension of
enrichment that started in October 2003 as a result of an agreement
between the European Union and Iran reached in Tehran. Soon afterward,
it announced that it had enriched uranium up to a level of almost 5
Restarting the 164-machine cascade took several months. Iran had to
repair damaged centrifuges. According to IAEA reports, many centrifuges
crashed or broke when the cascade was shut down at the start of the
suspension in 2003. Before introducing uranium hexafluoride, it had to
reconnect all the pipes, establish a vacuum inside the cascade, and
prepare the cascade for operation with uranium hexafluoride.
The initial performance of the P1 centrifuges in this cascade has
been less than expected. Based on statements on state-run television on
April 12, 2006, by the Gholam-Reza Aqazadeh, head of the Atomic Energy
Organization of Iran, the average annualized output of the centrifuges
in this cascade is relatively low.\1\ In the same interview, he implied
that he expects that the average output of each P1 centrifuge will
almost double in the main plant.
\1\ The annualized average output of each centrifuge was about 1.4
separative work units per machine per year, based on Aqazadeh's
statement of a maximum feed rate of 70 grams per hour and the
production of 7 grams per hour of 3.5 percent enriched uranium. The
feed and product rate imply a tails assay of 0.4 percent. This
relatively low output could mean that the aluminum centrifuge rotors
are spinning at a lower speed than possible. For the main plant, he
said that 48,000 centrifuges would produce 30 tonnes of low-enriched
uranium per year. Assuming a tails assay of 0.4 percent and a product
of 3.5 percent enriched uranium, the estimated average output of each
machine would be about 2.3 swu/yr. With an assumed tails assay of 0.3
percent, the estimated output rises to 2.7 swu/yr, high for a Pakistani
P1 design, but theoretically possible if the centrifuge is further
In addition, the Iranians have not yet run this cascade
continuously to produce enriched uranium. One report stated that the
cascade operated with uranium hexafluoride only about half of its first
month of operation, although it continued to operate under vacuum the
rest of the time. The Iranian centrifuge operators do not yet have
sufficient understanding of cascade operation and must conduct a series
of longer tests to develop a deeper understanding of the cascade.
The IAEA reported in April that Iran was building the second and
third cascades at the PFEP. A senior diplomat in Vienna said, in a
recent interview, that the second cascade could start in May and the
third one could start in June. This schedule would allow Iran to test
multiple cascades running in parallel, a necessary step prior to
building a centrifuge plant composed of such cascades. The diplomat
speculated that Iran could continue with this pattern, installing the
fourth and fifth in July and August, respectively. He stated that the
slot for the sixth cascade is currently being occupied by the 10- and
Iran would likely want to run its cascades individually and in
parallel for several months to ensure that no significant problems
develop and to gain confidence that it can reliably enrich uranium in
the cascades. Problems could include excessive vibration of the
centrifuges, motor or power failures, pressure and temperature
instabilities, or breakdown of the vacuum. Iran may also want to test
any emergency systems designed to shut down the cascade without losing
many centrifuges in the event of a major failure. Absent major
problems, Iran is expected to need roughly 6 months or more to
demonstrate successful operation of its cascades and their associated
emergency and control systems.
Once Iran overcomes the technical hurdle of operating its
demonstration cascades, it can duplicate them and create larger
cascades. Iran would then be ready to build a centrifuge plant able to
produce significant amounts of enriched uranium either for peaceful
purposes or for nuclear weapons. However, Iran may encounter additional
problems when it tries to build and operate a centrifuge plant.
As of late April, according to the IAEA, Iran was not moving
aggressively to finish the FEP in preparation for installing the first
module. Earlier, it moved process tanks and an autoclave, used to heat
uranium hexafluoride into a gas prior to insertion into centrifuge
cascades, into the FEP at Natanz. Iran told the IAEA that it intends to
start the installation of the first 3,000 P1 centrifuges, called the
first module, in the underground cascade halls at the FEP in the fourth
quarter of 2006. Iran still needs to finish the basic infrastructure,
including installing electrical cables. A key question is whether Iran
has procured or manufactured all the equipment it needs to finish the
first module. In addition, questions remain about the number of
centrifuges Iran has in-hand and the quantity it would still need to
manufacture indigenously to exacting specifications, a task that many
countries have found challenging.
The Uranium Conversion Facility (UCF) at Isfahan has continued to
operate since its restart in August 2005, following the breakdown in
the suspension mandated by the November 2004 agreement between Iran and
the European Union. By late February 2006, Iran had produced about 85
tonnes of uranium hexafluoride, where the quantity refers to uranium
mass. This amount had increased to about 110 tonnes in April. With
roughly 5 tonnes needed to make enough HEU for a nuclear weapon, this
stock represents enough natural uranium hexafluoride for roughly 20
nuclear weapons. Although Iran's uranium hexafluoride reportedly
contains impurities that can interfere with the operation of
centrifuges and reduce their output, IAEA experts believe that Iran can
overcome this problem. Iran is known to be working to improve the
purity of the uranium hexafluoride produced at the UCF. Nonetheless, if
necessary, Iran could use its existing stock of impure material, if it
had no other material. It could take additional steps to purify this
uranium hexafluoride, or it could use the material in its own
centrifuges and experience reduced output and a higher centrifuge
Developing an answer to how soon Iran could produce enough HEU for
a nuclear weapon is complicated and fraught with uncertainty. Beyond
the technical uncertainties, several other important factors are
unknown. Will Iran develop a nuclear weapons capability but produce
only low-enriched uranium for nuclear power reactors and not any highly
enriched uranium? Will Iran withdraw from the NPT, expel inspectors,
and concentrate on building secret nuclear facilities? How does Iran
perceive the risks of particular actions, such as producing HEU in the
pilot plant? What resources will Iran apply to finishing its uranium
enrichment facilities? Will there be military strikes against Iranian
Before developing a timeline, it is necessary to estimate how much
HEU Iran would need to make a nuclear weapon. Many assessments cite 25
kilograms of weapon-grade uranium (HEU containing more than 90 percent
uranium 235) as the minimum amount necessary for a crude, implosion-
type fission weapon of the type Iran is expected to build. However, the
experience of similar proliferant states such as Iraq leads to lower
quantities. In 1990, Iraq initially planned to use 15 kilograms of
weapon-grade uranium in its implosion design. An unclassified design
using almost 20 kilograms was calculated in a study coauthored by
Theodore Taylor and Albright in about 1990. Thus, an Iranian nuclear
weapon could be expected to need about 15-20 kilograms of weapon-grade
uranium. A larger quantity of HEU is needed than the exact amount
placed into the weapon because of inevitable losses during processing,
but such losses can be kept to less than 20 percent with care and the
recovered material recycled into successive weapons. Thus, for the
estimates presented here, a crude fission weapon is estimated to
require 15-20 kilograms of weapon-grade uranium.
Scenario I--Clandestine centrifuge plant
Iran's most direct path to obtaining HEU for nuclear weapons is
building a relatively small gas centrifuge plant that can make weapon-
grade uranium directly from natural uranium.\2\ If Iran built such a
plant openly, it would be an acknowledgement that it seeks nuclear
weapons. As a result, Iran is likely to pursue such a path in utmost
secrecy, without declaring to the IAEA the facility and any associated
uranium hexafluoride production facilities.
\2\ Alternatively, Iran could secretly build a ``topping plant'' of
about 500 centrifuges and use a stock of low-enriched uranium produced
in the pilot plant as feed to produce HEU. However, the estimated
timeline for this alternative route is not significantly different from
the one outlined in this scenario and is not considered further.
Without the Additional Protocol in effect, however, the IAEA faces
a difficult challenge discovering such a clandestine facility, even as
Iran installs centrifuges at Natanz to produce low-enriched uranium.
The IAEA has already reported that it can no longer monitor effectively
centrifuge components, unless they are at Natanz and within areas
subject to IAEA containment and surveillance. When Iran halted its
adherence to the Additional Protocol, the IAEA lost access to
centrifuge production and storage facilities. Alternatively, Iran may
feel less assured about successfully deceiving the inspectors and
proceed with such a plant only after withdrawing from the NPT and
asking inspectors to leave. In either case, United States, Israeli, and
European intelligence agencies would be unlikely to locate precisely
The key to predicting a timeline is understanding the pace and
scope of Iran's gas centrifuge program, for example the schedule for
establishing a centrifuge plant large enough to make enough HEU for one
nuclear weapon per year. Such a clandestine facility would require
about 1,500-1,800 P1 centrifuges with an average capacity of about 2.5-
3 swus per year. These values for separative work are at the high end
of the possible output of Iran's P1 centrifuge; actual values may be
A capacity of 4,500 swus per year is sufficient to produce about 28
kilograms of weapon-grade uranium per year, assuming continuous
operation and a tails assay of 0.5 percent, where tails assay is the
fraction of uranium 235 in the waste stream. This is a relatively high
tails assay, but such a tails assay is common in initial nuclear
weapons programs. As a program matures and grows, it typically reduces
the tails assay to about 0.4 percent and perhaps later to 0.3 percent
to conserve uranium supplies.
Iran has enough components for up to 5,000 centrifuges, according
to senior diplomats in Vienna. However, other senior diplomats said
that Iran may not have 5,000 of all components, and many components are
not expected to pass quality control. In total, Iran is estimated to
have in-hand enough good components for at least an additional 1,000 to
2,000 centrifuges, beyond the roughly 800 centrifuges already slated
for the pilot plant at Natanz. Iran could also build new centrifuge
components, and in fact may have already started to do so.
If Iran had decided to build a clandestine plant in early 2006, it
could assemble enough additional usable centrifuges for this plant of
1,500-1,800 centrifuges in about 15-18 months, or by about mid-2007. It
would need to assemble at the upper limit of its past rate of about 70-
100 centrifuges per month to accomplish this goal. If necessary, Iran
could also increase the centrifuge assembly rate, for example, by
increasing the number of shifts from one to two per day, according to
diplomats in Vienna.
In the meantime, Iran would need to identify a new facility where
it could install centrifuge cascades, since it is unlikely to choose
Natanz as the location of a secret plant. It would also need to install
electrical, cooling, control and emergency equipment, feed and
withdrawal systems, and other peripheral equipment. It would then need
to integrate all these systems, test them, and commission the plant.
Iran could start immediately to accomplish these steps, even before the
final testing of the 164-machine cascades at Natanz, but final
completion of the clandestine plant is highly unlikely before the end
Given another year to make enough HEU for a nuclear weapon, where
some inefficiency in the plant is expected, and a few more months to
convert the uranium into weapon components, Iran could have its first
nuclear weapon in 2009. By this time, Iran is assessed to have had
sufficient time to prepare the other components of a nuclear weapon,
although the weapon may not be small enough to be deliverable by a
This result reflects a worst-case assessment, and Iran can be
expected to take longer. Iran is likely to encounter technical
difficulties that would delay bringing a centrifuge plant into
operation. The output of its centrifuges may not achieve the higher
value used in this assessment. Other factors causing delay include Iran
having trouble in the manufacturing and installation of so many
centrifuges and cascades in such a short time period, or Iran taking
longer than expected to overcome difficulties in operating the cascades
as a single production unit or in commissioning the secret centrifuge
Scenario II--Break out using FEP
Iran has stated its intention to start installing centrifuges in
late 2006 in its first module of 3,000 centrifuges in the underground
halls of FEP at Natanz. This module would give Iran another way to
produce HEU for nuclear weapons, even though the module is being
designed to produce low-enriched uranium. Once Iran has an adequate
stock of LEU, the time to produce enough HEU for a nuclear weapon in
this facility could be dramatically shortened.
At above rates of centrifuge assembly, and assuming that Iran has
or can produce enough new P1 centrifuge components and associated
equipment, Iran could finish producing 3,000 centrifuges for this
module sometime in 2008. Although cascades would be expected to be
built before all the centrifuges are assembled, Iran will probably need
at least another year to finish this module, placing the completion
date in 2009 or 2010. Unexpected complications could delay the
commissioning date. On the other hand, Iran could accelerate the pace
by manufacturing, assembling, and installing centrifuges more quickly.
Given all the difficult tasks that must be accomplished, however, Iran
is unlikely to commission this module much before the start of 2009.
If Iran decided to make HEU in this module, it would have several
alternatives. Because of the small throughput and great operational
flexibility of centrifuges, HEU for nuclear weapons could be produced
by reconfiguring the cascades in the module or batch recycling where
the cascade product is used as feed for subsequent cycles of enrichment
in the same cascade.
Reconfiguration could be as straightforward as connecting separate
cascades in series and selecting carefully the places where new pipes
interconnect the cascades. The Iranian module is slated to be composed
of 164-centrifuge cascades operating together under one control system.
In such a case, reconfiguration would not require the disassembly of
the individual cascades, and it could be accomplished within days. In
this case, the loss of enrichment output can be less than 10 percent,
although the final enrichment level of the HEU may reach only 80
percent, sufficient for use in an existing implosion design albeit with
a lower explosive yield. With a reconfigured plant, and starting with
natural uranium, 20 kilograms of HEU uranium could be produced within 4
to 6 months. If Iran waited until it had produced a stock of LEU and
used this stock as the initial feedstock, it could produce 20 kilograms
in about 1 to 2 months.
Batch recycling would entail putting the cascade product back
through the cascade several times, without the need to change the basic
setup of the cascade. Cascades of the type expected at Natanz could
produce weapon-grade uranium after roughly four or five recycles,
starting with natural uranium. Twenty kilograms of weapon-grade uranium
could be produced in about 6 to 12 months. If the batch operation
started with an existing stock of LEU, the time to produce 20 kilograms
of weapon-grade uranium would drop to about 1 to 2 months.
Whether using batch recycling or reconfiguration, Iran could
produce in 3,000 centrifuges at Natanz enough HEU for its first nuclear
weapon in less than a year. Iran could do so in considerably less than
a year, if it used an existing stock of LEU as the initial feed. It is
likely that Iran would operate the module to make LEU so that any
production of HEU would be expected to happen quickly.
Using either break-out approach, Iran is not likely to have enough
HEU for a nuclear weapon until 2009. This timeline is similar to that
outlined in the clandestine plant scenario. In addition, technical
obstacles may further delay the operation of the module in the FEP.
The international community needs to be committed to a diplomatic
solution that results in an agreement whereby Iran voluntarily
forswears having any deployed enrichment capability. Looking at a
timeline of at least 3 years before Iran could have a nuclear weapons
capability means that there is still time to pursue aggressive
diplomatic options, and time for measures such as sanctions to have an
effect, if they become necessary.
In the short term, it is imperative for the international community
to intensify its efforts to disrupt or slow Iran's overseas acquisition
of dual-use items for its centrifuge program and other nuclear
programs. Iran continues to seek centrifuge-related items aboard, but
it has encountered greater difficulty acquiring these items because of
the increased scrutiny by key supplier states. As Iran seeks these
items in a larger number of countries, greater efforts will be required
to thwart Iran from succeeding.
It is vital to understand what Iran has accomplished, what it still
has to learn, and when it will reach a point when a plan to pursue
nuclear weapons covertly or openly could succeed more quickly than the
international community could react. Although these estimates include
significant uncertainties, they reinforce the view that Iran must
foreswear any deployed enrichment capability and accept adequate
inspections. Otherwise, we risk a seismic shift in the balance of power
in the region.
TABLE 1--IRAN'S MAIN DECLARED NUCLEAR SITES
Uranium Mining and Milling............. Saghand Mine and Mill.
Gchine Mine and Mill.
Nuclear Research & Development......... Jabr Ibn Havan Multipurpose
Radiochemistry Laboratories of
Tehran Research Reactor (TRR).
Uranium Chemistry Laboratory
Research reactors at Esfahan.
Molybdenum, Iodine and Xenon
Facility (MIX Facility).
Uranium Conversion..................... Uranium Conversion Facility
Centrifuge Research & Development and Kalaye Electric Company.
Manufacturing. Farayand Technique.
Other centrifuge manufacturing
Centrifuge Uranium Enrichment.......... Pilot Fuel Enrichment Plant at
Fuel Enrichment Plant at
Laser Uranium Enrichment............... Lashkar Ab'ad.
Karaj Agricultural and Medical
Fuel Fabrication....................... Fuel Fabrication Laboratory
Zirconium Production Plant
Fuel Manufacturing Plant.
Heavy-Water-Related Facilities......... Heavy Water Production Plant.
IR-40 Heavy-Water Reactor.
Nuclear Power Generation............... Bushehr Nuclear Power Plant
Waste Disposal......................... Anarak.
Suspect Sites.......................... Parchin, Lavisan-Shian.
Appendix 1--Iran's Safeguards Violations
The International Atomic Energy Agency (IAEA) has found that Iran
violated the Nuclear Non-Proliferation Treaty (NPT) and its related
safeguards agreement for many years. Iran's violations and eventual--
though still incomplete--cooperation with the IAEA can be divided into
four eras or stages.
First Stage: Up to mid-2002
In the first stage, beginning in the mid-1980s to early 1990s and
continuing until mid-2002, Iran violated its safeguards agreement by
pursuing undeclared fuel cycle activities with little scrutiny by the
IAEA or member states. Although the IAEA and member states were
collecting information about Iranian violations, they were reluctant to
Second Stage: 2002-2003
The second stage began in August 2002 when the National Council of
Resistance of Iran (NCRI) made the first of many public revelations
about secret Iranian nuclear facilities, revealing the Natanz and Arak
nuclear sites and ended in late 2003. After pressure from the IAEA and
further public revelations about the Natanz site by ISIS, Iran finally
allowed the IAEA to visit Natanz in February 2003, and that month Iran
began to reveal some of its violations. However, the Atomic Energy
Organization of Iran denied many of the accusations, and blocked access
by the IAEA to suspect sites. During this time, Iran's leadership
seemed to be torn between acting cooperative and protecting their
nuclear secrets at all costs. Despite many efforts by Iran to hide its
past and current activities, however, the IAEA, with assistance from
member states, NCRI, and ISIS, revealed several more secret nuclear
activities and facilities.
In his November 2004 safeguards report to the IAEA Board of
Governors, the Director General detailed Iran's failures to implement
its safeguards agreement that had been uncovered through this period.
The violations include Iran's failure to report activities related to
nuclear material, the failure to declare the existence of relevant
nuclear facilities, the failure to provide design data for a number of
facilities, and the ``failure on many occasions to cooperate to
facilitate the implementation of safeguards, as evidenced by extensive
concealment activities.'' \1\
\1\ International Atomic Energy Agency, ``Implementation of the NPT
Safeguards Agreement in the Islamic Republic of Iran,'' GOV/2004/83, 15
According to the IAEA, Iran failed to declare six major activities
related to nuclear material:
Iran failed to report that it had imported natural uranium
(1,000 kg of UF6, 400 kg of UF4, and 400
kg of UO2) from China in 1991 and its transfer for
processing. Iran acknowledged the import in February 2003.
It failed to report that it had used the imported uranium to
test parts of its uranium conversion process, such as uranium
dissolution, purification using pulse columns, and the
production of uranium metal, and the associated production and
loss of nuclear material. Iran acknowledged this failure in
Iran failed to report that it had used 1.9 kg of the
imported UF6 to test P1 centrifuges at the Kalaye
Electric Company centrifuge workshop in 1999 and 2002. In its
October 2003 declaration, Iran said it first fed UF6
into a centrifuge in 1999 and in 2002 fed UF6 into
as many as 19 centrifuges. Iran also failed to declare the
associated production of enriched and depleted uranium.
It failed to report that in 1993 it had imported 50 kg of
natural uranium metal, and that it used 8 kg of this for atomic
vapor laser isotope separation (AVLIS) experiments at Tehran
Nuclear Research Center from 1999 to 2000 and 22 kg for AVLIS
experiments at Lashkar Ab'ad from 2002 to 2003.\2\ Iran
acknowledged these activities in its October 2003 declaration.
\2\ International Atomic Energy Agency, ``Implementation of the NPT
Safeguards Agreement in the Islamic Republic of Iran,'' GOV/2003/75, 10
November 2003, Annex 1, p. 2.
Iran failed to report that it had used imported depleted
UO2, depleted U308, and natural
U308 to produce UO2, UO3,
UF4, UF6, and ammonium uranyl carbonate
(AUC) at the Esfahan Nuclear Technology Center and the Tehran
Nuclear Research Center.
It failed to report that it had produced UO2
targets, irradiated them in the Tehran Research Reactor, and
then separated the plutonium from the irradiated targets. Iran
also failed to report the production and transfer of waste
associated with these activities and that it had stored
unprocessed irradiated targets at the Tehran Nuclear Research
Center. In meetings with the IAEA following its October 2003
declaration, Iran said that it conducted the plutonium
separation experiments between 1988 and 1993 using shielded
glove boxes at the Tehran Nuclear Research Center.
According to the IAEA, Iran failed to declare the existence of key
nuclear facilities and failed to provide design information, or updated
design information, for a number of facilities. Iran failed to declare
the existence of the pilot enrichment facility at the Kalaye Electric
Company workshop, the laser enrichment facility at Tehran Nuclear
Research Center, and the pilot laser enrichment plant at Lashkar Ab'ad.
Iran failed to provide design information for the facilities where
the uranium imported in 1991 was received, stored, and processed,
including at Jabr Ibn Hayan Multipurpose Laboratories, Tehran Research
Reactor, Esfahan Nuclear Technology Center, and the waste storage
facilities at Esfahan and Anarak. Iran also failed to provide design
information for the facilities at the Esfahan Nuclear Technology Center
and the Tehran Nuclear Research Center where Iran produced
UO2, UO3, UF4, UF6 and AUC
using imported depleted UO2, depleted U308, and
natural U308. Iran failed to provide design information for
the waste storage facilities at Esfahan and Anarak in a timely manner.
It failed to provide design information for locations where wastes
resulting from undeclared activities were processed and stored,
including the waste storage facility at Karaj. And it failed to provide
design information for the Tehran Research Reactor, in relation to the
irradiation of uranium targets, the facility at the Tehran Nuclear
Research Center where Iran separated plutonium, and the center's waste
Third Stage: End of 2003-2005
The third stage, from October 2003 to the end of 2005, could be
called the ``Rowhani era,'' because Hassan Rowhani, then head of Iran's
National Security Council, took the lead from the Atomic Energy
Organization of Iran in the fall of 2003 and attempted to convince the
international community that Iran would now be transparent and
cooperate fully with the IAEA. Facing a deadline set by the IAEA Board
of Governors, on October 21, 2003 Iran made an extensive written
declaration to the IAEA of its past nuclear activities, which revealed
a number of additional safeguards violations, and Iran agreed to sign
the Additional Protocol.
According to the IAEA Director General's November 15, 2004, report
to the Board of Governors, ``Since October 2003, Iran's cooperation has
improved appreciably, although information has continued in some cases
to be slow in coming and provided in reaction to Agency requests. Since
December 2003, Iran has facilitated in a timely manner Agency access
under its Safeguards Agreement and Additional Protocol to nuclear
materials and facilities, as well as other locations in the country,
and has permitted the Agency to take environmental samples as requested
by the Agency.''
However, despite better cooperation, a number of new questions have
been raised. For example, Iran's work on developing P2 centrifuges,
which Iran had failed to declare in its declaration in October 2003, is
not fully understood by the Agency. In addition, Iran has not allowed
the IAEA sufficient visits to suspect sites at Parchin that are
involved in research and development of high explosives. In proceeding
with construction of tunnels at the Esfahan Nuclear Technology Centre
before it had told the IAEA, Iran failed to honor its commitment to
tell the IAEA about plans to construct new facilities.
Iran has not permitted the IAEA adequate information about and
access to dual-use equipment and materials procured by the Physics
Research Center for its Lavisan-Shian site that could be used in a gas
centrifuge program. Except in one case, Iran has also refused repeated
IAEA requests to interview individuals involved in the acquisition of
these items. In the one case where the IAEA recently interviewed a
former head of the Physics Research Center and took environmental
samples of some of the equipment he presented to the inspectors, it
detected traces of HEU on some vacuum equipment. This result links this
equipment to the gas centrifuge program and contradicts Iranian denials
about its relationship to the centrifuge program.
In addition, the IAEA has questions about a range of studies and
documents that could have a military nuclear dimension. The documents
include a 15-page document that describes the production of uranium
metal from uranium hexafluoride and the casting of enriched and
depleted uranium into hemispheres, activities typically associated with
a nuclear weapons program. Iran declared that it received the document
unsolicited from agents of the Khan network and that it has never used
the document. Because this document was part of a package of detailed
documents available from the Khan network related to the production of
nuclear weapon components made from depleted uranium and HEU, the IAEA
remains concerned that Iran may have received more documents in the
package and conducted undeclared activities associated with these
Another set of documents were located on a laptop computer that was
brought out of Iran and provided to the United States, which in turn
shared part of the information with the IAEA. The studies relate to a
``Green Salt Project,'' high explosives testing, and the design of a
missile re-entry vehicle that appears able to carry a nuclear warhead.
Although this information is not a smoking gun, it suggests the
existence of a military-run nuclear weapons program. Iran has refused
to answer questions about the last two areas and offered inadequate
answers about the Green Salt Project.
A number of questions from before October 2003 also remain
unanswered, pending new information or further analysis, such as the
source of low-enriched uranium and some HEU contamination on Iran's P1
centrifuges and the timeline of Iran's plutonium separation activities.
Fourth Stage: 2006-present
In the fourth stage, starting in early 2006 and continuing until
today, Iran has broken the suspension and halted its adherence to the
Additional Protocol. The IAEA is making minimal progress in answering
its outstanding questions and concerns or in confirming the absence of
undeclared nuclear material and activities. It has also lost access to
key centrifuge production and storage facilities, which would enable
inspectors to determine the rate and status of Iran's production of
centrifuges. This knowledge is especially relevant to concerns of a
possible covert enrichment program.
The Chairman. Thank you very much, Mr. Albright. In terms
of management of the hearing, we will have a round of
questions. I'm going to suggest 8 minutes, although the Chair
will be liberal in case there's some runover in terms of
questions and answers there. We have a good representation
present, and we have another distinguished panel of four
witnesses still to come. So we'll have one round of questions,
and I'm sure we'll not exhaust all the things we would like to
ask you. We hope that you might be available for further
questions and deliberation by mail, if not in person.
Let me start the questioning by asking both of you:
Yesterday EU officials stated that Iran should be offered,
``the best and most sophisticated'' nuclear technology in
exchange for coming back into compliance with its
nonproliferation obligations and commitments. Now let me ask
you for a discussion by both of you. What do you understand
this technology to be, and what are the conditions under which
it could be given to Iran? How can that technology be reliably
safeguarded in a country such as Iran? And something to frame
the issue more: What technology should not be given to Iran as
far as its noncompliance to current obligations? And finally,
if enrichment of fresh fuel and reprocessing of spent fuel for
Iran were carried out in Russia as a part of this plan, would
that prevent Iran from building a nuclear weapon?
Will both of you discuss this current development and the
Mr. Einhorn. Thank you, Mr. Chairman. I think what the
Europeans have in mind are a couple of things. One is to
provide a light-water research reactor to Iran so that it can
do, you know, legitimate research. It could produce medical,
agricultural, industrial isotopes, these kinds of peaceful
Right now Iran is constructing a 40-megawatt heavy-water
moderated research reactor at a town called Arak. Now, that
reactor is exactly the same kind of reactor that several
countries have used in the past for nuclear weapons programs.
It's a very efficient producer of weapons-grade plutonium. I
think that's why Iran is constructing that reactor. It wants to
be able to reprocess the spent fuel and have plutonium for
So the Iranians are trying to wean them away from that kind
of a reactor and give them a more proliferation-resistant
light-water research reactor, which has to be fueled with
enriched fuel rather than natural uranium fuel. So that's
better, and I think it's a very good idea to provide Iran that,
and to show the Iranian public that the West is not seeking to
deny them the benefits of nuclear energy.
Also, the Europeans may be talking about providing fuel
assurances. The Iranians say they've got to make their own
enriched fuel because they've been so disappointed in the past
about being the victim of embargoes from the United States and
others. They've been a member of the EURODIF enrichment
consortium, but have been cut out of that. So what they're
saying is they have to have their own enrichment capability.
The Europeans are saying we'll give you guarantees that if you
are cut off, your fuel supply is cut off for reasons having
nothing to do with your performance on nonproliferation, we'll
assure you that you can get alternative sources of supply. It's
a way of encouraging them to give up this indigenous
capability, and I think that makes good sense.
On your third question, about the Russian joint venture, I
think that's just a good idea. The Bush administration endorses
doing--having a joint venture, but on Russian territory,
without Iran having access to the enrichment technology that
will be used in Russia. I think that's fine, but of course it's
no guarantee that the Iranians are not going to try
clandestinely to have their own enrichment facility even if
they formally sign up to forgoing that capability indigenously,
and that's why it's very, very important to have the IAEA given
strengthened verification authorities by the U.N. Security
The Chairman. Mr. Albright, do you have a comment?
Mr. Albright. He said it very well. Why don't I just leave
it at that.
The Chairman. All right. Fine. Let me try out for size
then, we've talked about Russia, but let me ask how are the
Russians and/or the Chinese likely to get interested in the
European proposals or in our desires in this situation? We have
talked about the diplomatic track, and clearly it includes
those two countries, members of the Security Council. Almost
anything having to do with resolutions, large or small,
involves them. You've already touched on the plans the
Europeans have to involve the Russians with regard to the spent
Why would they become interested in this, given their
protestations that they already have energy deals with Iran?
They have a very sizeable strategic interest in dealing with
Mr. Albright. Let me just respond to one of the sets of
statements by China and Russia, which is they mistrust what the
United States is up to, that they often see this as Iraq No. 2,
and so they pull back. Particularly, Russian officials have
I think it would help if, as Senator Biden pointed out, if
the United States would change its policies and be willing to
negotiate with the Iranians. I would tend to support efforts
that are somewhat like the six-party talks, build from the
European-Iranian discussions, and then after the United States
is involved try to draw in Russia and China.
I also think it would be helpful if the administration
would not remove the military option from the table, but stop
banging that drum, because I think it's hurting this effort.
[Disruption in the audience.]
Mr. Albright. I think they think they're sending a signal
to Iran, and Iran will somehow listen. In our monitoring of the
Iranians and the press, it's having the opposite effect. And so
it would be useful if the administration would, as Britain has
done, just back away from that for now.
Mr. Einhorn. Could I just add to that, Mr. Chairman? I've
been, in the last 3 weeks, both in Moscow and in Beijing and
spoken to senior officials involved in the Iran issue. Iraq
looms very large in their thinking. They don't want to--I'll
use the words of one of my interlocutors--they don't want to
get on the first rung of the escalatory ladder. They think that
adopting a chapter 7 resolution will get the world on that
first rung, and then we will--if I can shift metaphors--slide
down the slippery slope to a military confrontation, and that's
their principal reason not wanting to get tougher in the
I've also spoken to German, British, and French officials,
and all of them, as well as the Russians and Chinese, say that
it would be very, very important for the United States
administration to be prepared to engage directly with Iran. Now
the Russians and Chinese are doubtful that the United States is
prepared to take yes for an answer on the nuclear issue. I
think they would be much more willing to pose the prospect of
penalties to Iran if the Bush administration were prepared to
say, you know, we're prepared to negotiate and if Iran is
prepared to change its behavior on the nuclear issue, and on
other issues, then we're prepared to move eventually toward
normalization. I think the Russians and Chinese would see that
as a very different kind of situation, and it would, I think,
increase the likelihood that they would buy into a package of
both sticks and carrots.
The Chairman. Thank you.
Senator Biden. I've not had the same talks you've had, Bob,
but I've had talks with European counterparts. And I'm going to
say something. Maybe I agree with both your judgements that if
we stopped rattling the saber--I mean, it's kind of interesting
that 6 years ago the other metaphor was used by the President--
of Teddy Roosevelt; walking softly and carrying a big stick. I
think he used that actual metaphor. I'm not positive of that,
but that's my recollection. And now we sort of rattle the cage,
and actions have consequences. The very thing that a number of
us, sitting on this dais, warned that would flow from Iraq in
terms of impacting our ability to get the rest of the world to
listen to us and join us in other things, I think we're seeing
it now, because I can't imagine why Russia or China would not
think it in their interest to stop Iran from having a nuclear
weapon, particularly Russia.
But one of the things--and I'm not asking you to respond.
One of the things that I hear back, and I had not intended on
saying this, but it is that as long as Mr. Rumsfield and Mr.
Cheney are perceived to be the drivers of policy, I'm not sure
whatever the administration says, absent what they do, will
make a lot of difference. As I suggested, we should be talking.
We should flat out say that regime change can be taken off the
table if behavior changes. But I must tell you I'm not sure,
absent actually engaging in such discussions, it's going to
matter a whole lot, because I find the rest of the world
I note that, the end of March, the Brits floated a proposal
not unlike what you suggested, that Russia and the United
States, the EU3, get involved in direct talks. And the White
House wasn't very happy about that, and maybe it's
coincidental, but I notice the Brits backed off that proposal.
So I think we've got a long way to go, but that doesn't mean we
shouldn't be pushing it.
I'd like to speak to this issue--ask you to speak to the
issue of this notion of a full range of issues. When I say to
people--and it's not unique to me; I know the chairman has been
saying it for sometime; I think, I may be mistaken, Senator
Dodd has said it; I know Senator Hagel has--that we should be
directly engaging the Iranians, and that it not just be limited
to the issue relating to nuclear questions. As a matter of
fact, I've suggested that with regard to Iraq, we engage them,
just on Iraq engage them. I get the following response from
skeptics, and there's a reason to be skeptical, and that is
that Iraq has no interest whatsoever, there's no common ground
that we could arrive at with regard to Iraq, no common ground
we could arrive at with regard to the nuclear issue, no common
ground we could arrive at on any of the issues that would come
up in a discussion. And my response is, and I'd like you to
respond to it--my response is that unless you assume the
leadership of Iran to be totally irrational; not
miscalculating, but irrational--it's not in their interest, for
example, to have an all-out civil war in Iraq. It threatens
their security, their stability, that is, the clerics. It's not
in their interest to see the world united in attempting to
isolate them and sanction them in various ways. And so they
would be inclined to, if there were enough carrots and sticks
to make it credible, talk about a lot of these things. Respond
to that for me, the criticism that, no, there's no common
interest here; why would the Iranians be willing to talk to us
about anything constructively.
Mr. Einhorn. I think it was clear a few years ago, after
the Afghanistan campaign, when there were meetings in Bonn
about the future Afghanistan, that it was possible for American
and Iranian diplomats to speak together about the future of
Afghanistan in a very constructive way. I know the Americans
who participated in those discussions, and they found the
Iranians very forthcoming, very practical, because we did have
common interests in stabilizing the situation in Afghanistan.
I think clearly our interests are not identical in Iraq,
but you've cited a number of the areas where they do converge.
I can't imagine that Iran wants to see chaos.
Senator Biden. I can't imagine Iran wants to see 17 million
Arab Shiites honing the art of war, when 65 of their 71 million
people don't like them, and the border is relatively porous. I
don't understand, but that's me.
Mr. Einhorn. But we have to explore. We don't know how much
commonality of interest there might be on Afghanistan, on Iraq,
or any other subject. That's why we have to sit down and
explore. The administration has authorized Ambassador Khalizhad
to sit down and talk about Iraq, but nothing else. My hope is
that if those----
Senator Biden. Even that, by the way, took about a year and
a half for him to get that kind of authority, and even there,
I'm not sure what the breadth of that----
Mr. Einhorn. Well, it would be good if broader
authorization were provided, but if not, if it turns out that
these Iraq-specific talks look productive, then eventually
there will be authorization to broaden them. I think that's the
best hope. I think we do have to address the full range of
issues that divide us. As much as I think the nuclear issue
deserves high priority, it's hard to imagine, domestically, for
us to cut a deal on the nuclear issue when we still--when
Ahmadinejad is still making these outrageous comments about
Israel, if we believe that al-Qaeda operatives are being
harbored in Iran, if we believe that Iran is still providing
arms to Middle East terrorist groups. So I think we have to
explore the possibility of reaching a broad modus vivendi with
Iran. It may not be possible, but it will take a long time to
address all these issues, and I would hope that as we engage in
this broad dialog, we can at least put the nuclear issue on
hold by gaining Iran's agreement to fully suspend its
Senator Biden. Doctor, my time is almost up, but let me ask
you, you raised the point that's been raised by others that
there appears to be a continued requirement on the part of the
Iranians in order to move forward in a robust way with their
gas centrifuge system. They're searching the world. What could
or should we be doing? What other things can be done to make it
harder for Iran to be able to access what material or
technology that they may need to----
Mr. Albright. To go forward?
Senator Biden [continuing]. Move forward more rapidly?
Mr. Albright. Yeah. Let me just mention two. One is a
simple one--making Iran the center of international attention.
Whether it's companies or governments, the company should find
out what the end user is planning to do, and try to see through
all these trading companies that go out and seek items for
Another, if I can highlight the United States-India deal. I
think one of the problems that I had with that deal is that
India, from what we understand, is going to be a target for
Iranian procurement. We don't know exactly what form. We sort
of know the items they're looking for. We see India having
inadequate export controls. Their heart is in the right place,
but its system inadequate. I don't think this administration is
putting enough pressure on India to come up with adequate
controls. We all know what they are but Indians may not. I
don't know if they really understand they need to interact and
cooperate on this issue with us and others. But I think that
India remains a ripe place for Iran to go and try to seek
items, either directly from Indian companies or through
contacting, let's say, European companies who are setting up
shop there now, and to try to then move the material to Iran
under false pretenses.
Senator Biden. Thank you very much.
Mr. Chairman, for the record, because I'm out of time now,
I think it would be useful for the public at large and our
colleagues, if you would each respond to a question for the
record that makes a distinction between--which confuses people
as I speak to them--uranium enrichment and plutonium. Why, when
one is more available, is the seeking of the other more
consequential? In other words, why the dual track that they're
on? If you would, for the record.
Mr. Albright. Is this for Iran or just in general?
Senator Biden. For Iran. Yes, I'm sorry. Iran,
Mr. Albright. I think that Iran is seeking both pathways to
the bomb. It has agreed to not pursue reprocessing; that's been
accomplished. But as Bob pointed out, it's building this heavy-
water reactor, which will probably make weapon-grade plutonium,
normally, and it could create a reprocessing plant fairly
quickly. And so I think that path needs to be made a part of
these deals, that Iran would stop the heavy-water reactor.
Another part of these deals put forth by the Europeans and
the Russians is that spent fuel produced in power reactors
would leave Iran, that Iran wouldn't have an endless supply of
plutonium in spent fuel.
The uranium enrichment route is traditionally much harder
for developing countries, no doubt about it, and without the
assistance of A.Q. Khan, I don't think we'd be talking very
much about Iranian gas centrifuges. And so that's been the big
disappointment of the international community, that these
technologies have gotten out and spread. Once you have a gas
centrifuge program, from a proliferation point, or from a
proliferation point of view, it's much more valuable than the
plutonium pathways, which involve reactors that are easier to
spot. And if you can go the gas centrifuge route, if you master
that, then you could build these things in what are just light
industrial buildings. They don't emit much radiation. You can
isolate them from the rest of your nuclear establishment so
people aren't moving back and forth, and successfully hide them
from even some of the best IAEA inspections.
Senator Biden. Thank you very much.
The Chairman. Mr. Dodd.
STATEMENT OF HON. CHRISTOPHER J. DODD, U.S. SENATOR FROM
Senator Dodd. Thank you, Mr. Chairman, and thank you again
for hosting and holding this hearing. And I gather Senator
Biden raised the point earlier, but it deserves being
underscored again: I'm terribly disappointed that we didn't get
administration officials to come and share their thoughts with
us on this issue. If I had to prioritize issues involving this
Nation's national security, obviously Iraq would probably come
in No. 1 because of the proximity and immediacy of all of that,
but a very close second, in my view, would be this issue. And
the fact the administration is unwilling to participate in a
discussion about where we ought to be going here is troubling,
to put it mildly. I'm very grateful to both of these witnesses,
but my hope is that in other hearings we have, they will be
forthcoming and share with us their thoughts because this is
I spent a week or so in the Middle East 2 weeks ago. Unless
I brought up the issue of Iraq, it didn't come up; Iran came up
everywhere. Everyone wanted to talk about Iran and what we were
going to do, what likely would happen. So I appreciate the
witnesses' testimony; it's very helpful, by the way, and I
thank you for it.
I'd like to underscore the point again--I think, again, I
heard Senator Biden raise it, it may have been raised by the
chairman as well--and that is the notion somehow that the
administration and others are marketing that diplomacy is a
gift to Iran rather than recognizing it as a vital national
security tool. And we're allowing this word diplomacy and
negotiation to slip into the category of as a favor to our
adversaries or opponents in the world, rather than utilizing it
as a tool by which we minimize the very threats we're facing,
and you've pointed out some serious ones here. And no less a
figure than Henry Kissinger in yesterday's--I think it was
yesterday's piece he wrote for, I think, the Washington Post as
well as Richard Haas and others, have argued that we ought to
begin more seriously looking at the diplomacy route here as a
way to try and explore that route without giving up, obviously,
as we all say, the option of utilizing force, but with the
clear understanding--I think, Mr. Albright, you made it very
clear as well--we need to be downplaying that at this time, it
seems to me, and more aggressively pursuing the diplomatic
And, Mr. Chairman, I had some opening comments here that I
just ask consent to be included as part of the record.
[The prepared statement of Senator Dodd follows:]
Prepared Statement of Hon. Christopher J. Dodd, U.S. Senator From
Mr. Chairman, I commend you for holding this critical hearing on
Iran's political and nuclear ambitions, and for following it up with
another hearing on Thursday. Iran's pursuit of nuclear technology is
perhaps the most urgent international crisis that we face today, and
Congress needs to be discussing this issue in a thorough and
deliberative manner. I am confident that our distinguished witnesses
here today will help us to do just that and I welcome them here.
Mr. Chairman, all of us here in this room probably agree that Iran
would like to acquire nuclear weapons. And I think that there is a
universal desire to prevent such a development. But the
administration's policy of diplomatic disengagement is only hastening
Indeed, I can't help but feel a sense of deja vu. It was just a few
years ago that we encountered a similar situation on the Korean
Peninsula. The agreed framework was faltering but North Korea had not
yet produced nuclear weapons. Then the Bush administration came into
power and refused to deal with the North Koreans. This decision had an
immediate, simple, and severe repercussion--the North Koreans started
producing bombs. And they've kept producing them.
Today, we're facing a nation that is similarly hostile--but that is
at the same time willing to talk--Iran. The leaders of that country
just sent two letters to President Bush, in at least a rhetorical
effort, to engage the United States. But instead of responding to frame
the conflict on our terms, the administration is letting Iran define
this issue to the world.
And instead of engaging to shape an outcome that we want, the Bush
administration has outsourced U.S. national security to our European
allies--France, Britain, and Germany. With all due respect to our
allies, at the end of the day it's only with U.S. engagement and
cooperation that there can be any hope of a real solution.
This means that the administration needs to sit down with our
European allies--and also with Russia and China. Together, we need to
figure out exactly what our shared objectives are with respect to Iran.
And then we need to engage in multilateral talks on the issue. The
United States must be directly involved in these negotiations. And we
must be willing to offer some real incentives. Henry Kissinger stated
nearly as much in an op-ed published yesterday in the Washington Post,
and I couldn't agree more.
Until today, this administration has treated any hint of diplomacy
with Iran as a gift. This needs to change. Because diplomacy isn't a
gift. It's a vital national security tool.
If you don't want to take my word for it, then ask two highly
respected former officials who served under Republican
administrations--Richard Haass and Henry Kissinger.
Or consult the writings of the famed Prussian soldier and
strategist, Carl von Clausewitz, who wrote almost 200 years ago that
``war is a continuation of politics by other means.'' In other words,
waging diplomacy is different than war only in the blood and treasure
that is expended.
That's not to say that we should take the military option off of
the table. The threat of war is a vital component of effective
diplomacy. But by eschewing diplomacy we're liable to leave ourselves
with very few options for resolving this crisis.
It's high time that the Bush administration comes to the table with
our allies and Iran. Because with each passing day, we're losing ground
and the Iranians are coming closer to acquiring a nuclear weapon. The
U.S. strategy of diplomatic disengagement is simply not working--it is
failing to protect the security of the American people.
I would note, finally, my deep regrets that the President didn't
send Secretary Rice or Undersecretary Burns here today to testify.
There has never been a more crucial time for open and constructive
dialog on an issue as the one we are here today to discuss.
Thank you again, Mr. Chairman, for holding this hearing. I look
forward to asking some questions of our witnesses at the appropriate
The Chairman. It will be included in the record in full.
Senator Dodd. And I want to underscore that point. I think
it's--I've looked back over the years and had that view of
treating diplomacy as a gift been predominant, I shudder to
think what the 1950s, 1960s, 1970s, and 1980s might have looked
like as we worked through a containment philosophy with the
former Soviet Union and others. We had sound diplomats who
utilized diplomacy to minimize those threats, and to treat it
today as somehow a favor to someone I think is a major step
backward, and I hope we reverse that trend.
Let me explore the issue of the military option with you,
though, because I think it needs to be thought out. I want you,
if you can, both of you or however you want to do it, draw the
comparisons between the Israeli attack in the 1980s on the
reactor in Iraq and what would be involved today if we were to
successfully--or an ally or someone else were to try and
successfully take out the Iranian nuclear capability. What is
involved? Compare the two actions for us, based on the
information you have today, and the likelihood of succeeding
with such an option. What period of time would it take? What
sort of forces would be necessary?
Mr. Albright. Well, the purpose of the 1981 attack by
Israel was to take out a reactor that they believed would
produce plutonium for nuclear weapons and was also, by the way,
fueled by highly enriched uranium. I would say that attack was
successful at taking out the reactor, but unfortunately had the
effect of greatly accelerating the Iraqi nuclear weapons
program and left them with the highly enriched uranium that was
going to be used by them in their crash program in 1990 and
1991 to try to build their first nuclear weapon. So I think the
one lesson of the 1981 strike is that you're unlikely to take
out all the program, and you may reinforce the country's view
that their only solution to their security problem is to build
I think Iran has certainly learned from that example, and
from the very beginning it's been building things underground;
it's been dispersing sites. I think even during the suspension,
it's been focused on trying to build up stockpiles of certain
items, like uranium hexaflouride, so that if the uranium
conversion facility at Isfahan was bombed, it would have enough
for a bomb program. The civilian program would be stopped dead
by a bombing, but because of these actions of Iran, their bomb
program would have enough uranium hexaflouride.
So I think what military planners are confronted with is a
dispersed program, an adversary that is thinking actively of
how to maintain its capabilities after a military campaign. And
I think that what we would be faced with is essentially a
massive bombing campaign that would really be aimed at other
things in Iran, that we probably couldn't have much confidence
that its nuclear weapons program was set back.
As I said before, their civil nuclear program would be
devastated and probably never recover, but their nuclear
weapons program may not be affected very much at all,
particularly if the bombing isn't even contemplated for a
while. In a certain sense, the best time to have bombed Iran
was probably last January/February. The IAEA knew where
everything was. Now as this crisis builds, we can expect that
we will know less and less about Iran's key assets that would
be oriented toward their nuclear weapons program.
Senator Dodd. What time would be sort of involved? Does it
involve more than a day? A single strike? Multiple strikes over
a period of time?
Mr. Albright. Oh, I think it would be many strikes.
Senator Dodd. A major military operation?
Mr. Albright. Yes, I think it would be. At the time of a
military strike that is being discussed, Natanz may very well
have centrifuges underground, and so you'd want to knock out
that site. From our understanding, the roof is about 8 meters
underground, and so it's vulnerable to conventional strikes,
but I don't think you can take it out with one bomb.
Senator Dodd. No.
Mr. Albright. I think you're going to be doing multiple
strikes against those kinds of facilities. There's tunnels
everywhere in Iran. It is a legacy of the Iran-Iraq war.
[Disturbance in the audience.]
The Chairman. The committee will be in order. The committee
will be in order.
Mr. Albright. So I think the bottom line is you're looking
at a major military campaign against Iran that would go over a
significant period of time. And it would just start a war. It's
not going to be 1981 again where Israel bombs Iraq and then
there's a diplomatic crisis.
Senator Dodd. I'd like you to also comment on how far along
is this heavy-water reactor in construction. To the extent that
you might be able to convince the Iranians with the European
proposal to back up on that proposal, to go to a smaller
facility, how far down does this add on to this question?
Mr. Einhorn. On that, Senator Dodd, they're at the very
early stage of constructing this 40-megawatt heavy-water
reactor, so they have years and years to go. And I think
they've been more successful in their enrichment program.
That's why I think they're probably prepared to bargain away
their plutonium program. But just on the other question, I
think the main difference between Osirak in 1981 and Iran today
is the ease and speed of regenerating the capability. There are
probably lots of facilities in Iran we cannot locate; they're
just hidden. But my guess is we know where the critical
facilities are, and I think it's Natanz, their enrichment
plant, their two plants--their pilot plant and their
industrial-scale facility that's not yet really under
construction; their conversion facility in Isfahan, and this
reactor in Arak. We know where they are. I think we could
destroy those facilities. The problem is that it might not take
a long time to regenerate facilities capable of fissile
It would take a long time to regenerate facilities able to
generate nuclear power, you know, a large-scale enrichment
plant. But a small, clandestine enrichment facility with 1,500
or 3,000 centrifuge machines, I think that could be done
relatively quickly, whereas in the Israeli raid against Osirak
in 1981, you had to rebuild the whole reactor. That's a major
project. It's out there in the open; you can see it. In the
case of Iran, you're not going to see what they're able to do
in terms of, you know, building clandestine and relatively
Senator Dodd. Thank you. Thank you, Mr. Chairman.
The Chairman. Thank you, Senator Dodd.
Senator Martinez. Chairman, thank you very much for holding
this important and timely hearing on this very important issue.
I want to just ask the panel--and whichever one of you cares to
answer would be perfectly OK--on the issue of Iran's internal
situation and their own perception of this nuclear program as
to--at times I've had the idea that perhaps this has been a
very popular thing within the country and that politically it
has helped the Iranian Government to solidify support within
the country. What is your insight into that, and how do you
think whatever steps we take would not help to enhance further
strengthening of the hand of the current government?
Mr. Einhorn. Senator Martinez, I suggest--I'll give you an
answer, but the second panel is really going to be much more
informative on this question. My take on it is that so far
there's been unanimity in the Iranian public about this
enrichment program, about the nuclear program, but there's been
unanimity because they haven't--no one's had to pay a price.
The Iranians have felt that they can have their cake and eat it
too. They can have an enrichment capability, advanced nuclear
power, and good relations with the West. But if they're forced
to make a choice, and they can't have their cake and eat it
too, I think there might be divisions within Iranian society.
We've already seen some fissures opening up. A number of senior
Iranians have begun raising questions about the wisdom of going
down this enrichment track in defiance of the international
community because they think there may be costs that could
really hurt Iran. I think it's important that we demonstrate to
them that there will be costs if they continue down this track,
and I think that will open up and expand fissures within Iran
and perhaps over time lead to a change of policy.
Senator Martinez. But that really would require a fairly
united front from the international community?
Mr. Einhorn. Absolutely.
Senator Martinez. And my perception is that we're not quite
there at this point.
Mr. Einhorn. Absolutely. And as long as they get the
impression that the Russians and the Chinese will block any
severe penalties, then they're going to continue on their
Senator Martinez. A lot of focus has been placed lately on
the idea that the United States should play a more preeminent
role in negotiating with Iran. It seems to me that we should be
perhaps focusing on our negotiations with the Soviet--I'm
sorry, with Russia and with Chinese governments in hopes of
instilling their commitment for strong international action.
How do you suggest we might approach that.
Mr. Einhorn. Well, I think the administration has put a lot
of time and effort into persuading Russia and China to join
with the United States and the Europeans in threatening
sanctions in the Security Council, so far to no avail. We'll
see now. Friday in London there's going to be a meeting of the
P5 plus Germany to try to come up with a package of both
incentives and disincentives. Perhaps that will be more
successful. The Russians and Chinese have urged the Europeans
to put more carrots on the table. In exchange, they may be
prepared to support some sticks. We'll see.
Senator Martinez. One other area that I know my colleague
from Florida, Senator Nelson and I, and I know Senator Dodd,
and I don't mean to exclude others, but the area of Latin
America and our neighbors close to the south of Florida.
Increasingly there seems to be a strategic alliance developing
between the Venezuelan Government and the Cuban Government with
Iran, and it particularly seems like they're working in
lockstep internationally, or as, you know, Iran makes
aggressive statements, they seem to have fairly supportive
echoes from both Caracas and Havana. Have you focused on this
potential alliance and this area of support for the Iranian
Government so close to our own backyard?
Mr. Einhorn. It's something that bears close watching. The
Iranians and Ahmadinejad--President Ahmadinejad--recently have
talked about sharing their nuclear technology. You know, this
is very worrisome. I don't know if he was just trying to twist
our tail on that, you know, or what, but I think we need to
watch that very carefully and make sure Iran is not exporting
any of its technology. I think Hugo Chavez has talked about
nuclear technology and perhaps cooperating with Iran. That
bears close watching. Again, don't know if it's just thinking
out loud or a bluff, but I think we have to be very careful
Senator Martinez. Lastly, there was one other--Mr.
Chairman, I guess I'm OK on time.
There was one other area. Recently I've heard the thought
advanced that perhaps one of the great ways in which we can
check Iranians' ambitions is by having pluralistic democracies
at two of their borders, Afghanistan and Iraq, particularly
countries that area Shi'a majorities. Do you share that view
that perhaps this is a positive development for the reason and
that it could influence Iranians, particularly within Iran, in
terms of their own attitudes toward their government?
Mr. Einhorn. I think the demonstration effect of
functioning democracies in Afghanistan and Iraq would be very
powerful as far as Iran is concerned. I think we have a long
way to go, though, before we have truly functioning
democracies. But I think it's a goal that we ought to be
Mr. Albright. I would just add that I don't think that
would stop Iran from seeking uranium enrichment.
Senator Martinez. You mean the fact that they had a
democratic neighbor, but, however, do you think it would
influence people within the country in terms of how they view
their own government?
Mr. Albright. It could possibly affect their security
calculation, for example, the Iraq security issue was settled
in 2003. So I think that the motivations for them to pursue
enrichment--which are both national pride, a desire to have
enriched uranium for power reactors and, I believe, also
nuclear weapons--will remain intact. And so I think that if
Iran transforms and becomes more democratic, it may still seek
uranium enrichment. They may, however, be easier to negotiate
with because they may drop some of these other attributes, like
the support of terrorism.
Senator Martinez. And you're clear that their ambitions are
not purely civilian?
Mr. Albright. I don't believe they're civilian. I mean,
we're all struggling with what's the smoking gun. We can't find
one, at least I don't believe we can. But everything I've seen,
I believe they're seeking nuclear weapons. I don't believe
they've necessarily made a decision and allocated the budget to
build a nuclear arsenal, but I think they've made a decision to
put in place an ability to produce nuclear weapons in the
future, and will only make a concrete decision when they're
Senator Martinez. Thank you, Mr. Chairman.
The Chairman. Thank you very much, Senator Martinez.
Senator Nelson. As we consider the India nuclear deal,
you're suggesting to us that we have as a condition of the
agreement, tightened export controls and guarantees on
cooperation with Iran?
Mr. Albright. Well, what I would suggest is that the
condition be that India has taken steps--measurable steps--to
improve its export control system. And they're well known. I
mean, number of staff devoted to this, number of companies in
India informed. I wouldn't put a condition that relates to Iran
specifically, because it may be other countries that will
target India too. But I do think that a critical condition is
for India to improve its export control system, particularly
its implementation of that system.
Mr. Einhorn. The Indians like to say that their export
controls are impeccable. Well, I agree with David. I think
they're ``peccable.'' And they need further work. Whether you
condition our nuclear cooperation on strengthening their export
control system, I'm not sure what the committee would want to
do, but I think we need to work with the Indians and ensure
that they do strengthen their system, especially if David is
right and the Iranians are going to go shopping in India's
market for enrichment-related technology and equipment.
Mr. Albright. I would add another condition. India goes out
and buys items from Western countries for its own gas
centrifuge program and its other unsafeguarded nuclear
programs. I think we should also ask India to stop that. We see
networks that they create. They're not like Pakistan. I mean,
they're not as hidden, India is not as involved in active
deception of the suppliers on a national level, but we see
India going out and buying things and using very circuitous
routes. It uses trading companies to get items, dual-use items.
I think another condition should be that India would stop
illicit procurement. It's not violating Indian laws, but if
they go to Germany and do this, it can violate German law.
Senator Nelson. Let's talk about Hezbollah. What dollar
value would you put on Iranian support for Hezbollah?
Mr. Einhorn. I'd encourage you to wait for the second
panel. I think the fellows just behind me have that information
off the top of their heads. And if they don't, they have a few
minutes to figure out a good answer. [Laughter.]
Senator Nelson. OK. I'll wait till the second panel.
The Chairman. Thank you very much, Senator Nelson.
Senator Obama. Thank you, Mr. Chairman. Thanks for the
panel. This is very informative, and I appreciate you taking
I wanted to just follow up on Senator Dodd's question with
respect to the military option because I think that there has
been a lot of saber rattling out there, and it strikes me that
any time we start talking about military options, we should
weigh costs and benefits, something that sometimes we haven't
done. And we pay a price for this lack of sober analysis. And
so I just wanted to be clear. My understanding, based on the
testimony, was that a military option is viable only through a
sustained and fairly costly series of air strikes, for example,
which would not only involve major military operations, but
also presumably significant civilian casualties, to slow down a
program but not eliminate a program. Is that an accurate----
Mr. Albright. Yes.
Senator Obama [continuing]. Assessment on both your parts?
If that's the case, and if we agree that it's very
important for us to pursue diplomatic approaches in a vigorous
way, can you tell me where--Where is the space that we would
potentially provide Iran to land in negotiations? The problem
right now is that the nuclear issue in Iran has become a symbol
of national pride. There's been a lot of stoking of the fires
within Iran by domestic politicians. It strikes me in some ways
that they've backed themselves into a corner by placing so much
capital into the nuclear program. So if, in fact, we were to
try to provide some sort of carrots as well as sticks, what
would that look like? What would be a position that the
Iranians can possibly take that would accommodate their
political needs and accommodate our national security
objectives, if there is any? Maybe they're irreconcilable, in
which case diplomacy will flounder, but if that is the
assessment presumably we'd want to start thinking about what an
endgame might be.
Mr. Albright. Let me just say one thing. I think you want
to have it somewhat how Taiwan and South Korea have ended,
where they gave up reprocessing and uranium enrichment. They
were caught seeking nuclear weapons. The United States played
major roles in catching them and turning them around, but they
now both have robust civil nuclear energy programs.
If you look at our country, there's certainly more money in
medical isotopes, radio isotopes, and industrial isotopes and
their applications than on electrical generation by nuclear
power. There's money to be made in enrichment, but it's not
that great of money. And so I think in terms of the benefits
and sort of where the action is, it's on nuclear power and
I think one of the brilliant moves of the Iranian regime is
to turn this all on its head and make it look like some
incredibly uneconomic, wasteful activity like gas-centrifuge
enrichment in Iran for civil purposes is the major goal of
civil nuclear energy. It's not at all. I think if Iran was
truely invested in civil nuclear energy and isotope use, the
enrichment program would just evaporate for economic reasons.
And so I think that where we want Iran to land is with the
most of the rest of the world that's invested in civil nuclear
Senator Obama. Can I just follow up, and then I'd like your
response, Mr. Einhorn. Is it your understanding that the
current--that our administration's posture provides room for
that scenario, or in public statements have we seemed to go
further and expect Iran to completely dismantle all nuclear
Mr. Albright. It's gotten better. They've shifted over the
3 years of this nuclear crisis with Iran. Many administration
officials started out saying that Bushehr was not acceptable.
Some even said that Bushehr was more of a threat than the
enrichment program. So I think they've shifted away from that,
but I don't think they've come out and publicly stated that
it's fine for Iran to have Bushehr Two, Three, Four, and Five.
In fact, this meeting on Friday could be interesting to see how
the United States reacts to this potential European offer to
provide a light-water reactor, if it marks another shift in the
U.S. position toward accepting a robust nuclear energy program
Mr. Einhorn. On that question, Senator Obama, I think that
the administration has come a long way. They're prepared to
concede that Iran can pursue a nuclear power program. It may
not make sense for them given, you know, the amount of oil and
natural gas they have, but if they want to do it, fine, as long
as they don't pursue sensitive fuel cycle capabilities that
would give them the ability to produce nuclear weapon fuel.
But in terms of what incentives should they be given, I
think much of the explanation for their program is a desire for
prestige in the region, in the Islamic world, and so forth. And
I think any incentives would have to address those kinds of
needs. The Europeans have tried to do that. They've talked
about advanced technology cooperation, so that Iran would be
seen as, you know, on the cutting edge of advanced technology.
I think that is important. Also, Iran wants to get into the
World Trade Organization. I think accelerating that process
would be very beneficial to Iran.
There are security objectives, obviously, that contribute
to Iran's desire for a nuclear deterrent. A key one now, is
concern about the intentions of the United States. And I think
that by having direct discussions with them and seeing if we
can reach some kind of modus vivendi, we can alleviate over
time concerns about a threat from the United States. It means,
as I mentioned in my statement, recognizing that regime change
is the prerogative of the Iranian people and not a policy of
the United States. Also, Iran has legitimate security interests
in its own region. It probably wants to dominate its region. It
sees itself as the natural leader. Well, I think we can't
prevent Iran from playing a leading role in its region, but I
think by working through our friends and allies in the region
and having discussions about confidence-building measures and
security arrangements in the region, we can both satisfy the
security needs of our friends and allies, but also demonstrate
to Iran that we are not, you know, opposed to their living in
the region and playing an important part in that region.
Senator Obama. Mr. Chairman, I'm running out of time, but I
wonder if I can ask just one more question. And that is on the
stick side of the equation. There is seemingly a range of
options that experts are advocating--and you voiced some
concerns about what China and Russia would or would not be
willing to go along with. Just in terms of changing the cost-
benefit analysis for the Iranians, what measured steps could be
taken that you think would have a significant effect on the
Iranians but would not be perceived as provocations of the sort
that are overt attempts at regime change or imply that we're
not willing to negotiate in good faith?
Mr. Einhorn. Well, at the low end of the spectrum, the
kinds of measures that have been considered are bans on travel,
you know, for members of the elite leadership. You deny visas
to come into their countries. You don't send your own senior
officials to Tehran. Freezing the assets of Iranians overseas.
Making it difficult for Iranian financial institutions to deal
with Western financial institutions. These kinds of things.
There are also symbolic measures, and some of the people on the
second panel have suggested various devices--deny them the
ability to compete in the World Cup of soccer, for example,
because, you know, Iranians love soccer. There are lots of
things that can be done at the political level, but you
escalate it when you get into the area of trade and investment.
Those are potentially very, very significant, but that sword
cuts both ways, and that's why it's of such great concern.
Senator Obama. Thank you, Mr. Chairman.
The Chairman. Thank you very much, Senator Obama.
We thank both of the witnesses for your outstanding
testimony and your responses to our questions, and we look
forward to visiting with you again.
Mr. Albright. Thank you.
The Chairman. The Chair would like to call now our
distinguished second panel, which includes Dr. Kenneth Pollack,
director of research and senior fellow of the Saban Center for
Middle East Policy, Brookings Institution; Mr. Karim
Sadjadpour, Iran analyst, International Crisis Group; Dr.
Patrick Clawson, deputy director for research at the Washington
Institute for Near East Policy; and Dr. Geoffrey Kemp, director
of Regional Strategic Programs, The Nixon Center.
We welcome you, gentlemen. And I'll ask you to testify in
the order that you were introduced, and that will be Dr.
Pollack first. Let me just say at the outset, your full
statements will be made a part of the record, and we'll ask
that you please summarize those statements. And we'll hear each
of the members of the panel and then have a round of
questioning by Senators.
STATEMENT OF DR. KENNETH M. POLLACK, SENIOR FELLOW AND DIRECTOR
OF RESEARCH, THE SABAN CENTER FOR MIDDLE EAST POLICY AT THE
BROOKINGS INSTITUTE, WASHINGTON, DC
Dr. Pollack. Thank you very much, Mr. Chairman. Thank you,
distinguished Senators. As always it is a great pleasure to be
back here testifying before this committee on this very
You've asked us to consider Iran's motives in seeking a
nuclear enrichment capability wholely with the intent of at
some point acquiring nuclear weapons capability. Like most of
my colleagues, I see three principal sets of motives among
Iranians, and I will say that I think that different Iranians
probably share different mixtures of these motives. The first,
the most obvious, I think, is a security motive. As we are fond
of saying, Iran lives in a tough neighborhood. It is surrounded
by countries that at times have been Iran's adversaries,
oftentimes are antagonistic toward the Islamic regime. The fact
that in many cases the Iranians provoked the antagonism of
these other countries I think is often lost on the Iranians,
but nevertheless, the objective fact remains the case that Iran
does have significant security problems. Farther beyond its
borders there is Israel, and, of course, beyond that is the
United States. And I would say that of all of Iran's security
considerations, I think that the United States is the
overwhelming security threat that Iranians feel, that while
they might talk about Israel and its threats to Iran, that in
truth what they fear is an American military strike, an
American effort at regime change designed to topple their
I would say that the experience of North Korea versus Iraq
is probably not one that is lost on the Iranian leadership. The
North Koreans are believed to possess nuclear weapons, and so
they were not invaded by the United States of America. The
Iraqis did not possess nuclear weapons, were believed to be
trying to do so, and were invaded by the United States of
America. And so just looking at the other members of President
Bush's axis of evil, the Iranians could draw some obvious
conclusions that if you want to keep the United States from
invading your country and trying to overturn your government,
you need to have a nuclear weapon.
I think a second set of motivations for many Iranians is
prestige. We should never forget that Iranians consider
themselves the lineal descendants of a 2,500-year-old
civilization which produced the world's first superpower and
many great powers after it. Iranians, almost to a man or woman,
believe themselves to be part of a nation that ought to be one
of the world's great powers. I think that a lot of Iranians do
believe that acquisition of a nuclear weapons capability would
help boost them to that status that they seek. And here I think
the example of India is probably one that is not lost on Iran,
that India's acquisition of nuclear weapons, and ultimately the
international community's acceptance of India's nuclear weapons
program, were critical in India achieving its long-term
aspiration to become one of the great powers of the world to be
consulted on all of the important matters of the world,
something that Iranians themselves seek. And I think that that
prestige motive is also one that lies behind many Iranians and
their thinking about their nuclear weapons program.
The final motive is one that I would term ideology,
although I would here caution that most of the Iranians who
would subscribe to this position would not consider their
motivation to be ideologically driven, but strategically
driven, that when they were to present it, they would present
it in strategic terms. But I think from our perspective we can
consider it ideological. There are still Iranians who believe
in the export of their revolution, who do still believe in the
mission that Ayatollah Khomenei preached to them during his
time as the leader of Iran, who believe that there is a
fundamental battle between good and evil going on in the world,
in which they perceive Iran to be the champion of good and the
United States to be the champion of evil, and therefore, again,
they must acquire a nuclear weapon or some other deterrent to
keep the United States at bay and help them to wage this
struggle. We've seen Iranian leaders over the last 27 years
engage in a variety of different aggressive behavior around the
region, oftentimes I would say largely because of this
ideological aspiration. Their efforts to subvert friendly
governments in Saudi Arabia, in Kuwait, in Bahrain, to subvert
governments in Iraq, their efforts in Lebanon, elsewhere, are
often driven by these goals. These goals bring them into
conflict with the United States, and, again, I think that for
some Iranians acquisition of nuclear weapons is important to
them because they believe that only by acquiring nuclear
weapons will they be able to successfully wage this cataclysmic
struggle, this apocalyptic struggle that they see between the
United States and the West--or the United States and Iran, or
at a more mundane level, simply be able to expand their own
power, create governments that are friendly to themselves in
the region without fear of American retaliation.
That, I think broadly encompasses most Iranian motives for
acquiring nuclear weapons. But that said, I think that a
discussion of Iran's motives is at best no more than half of
the issue before us. And I think that the other issue, which
the previous panel alluded to, at least briefly, is the
question of priorities. As all of you know better than any of
us on this panel, politics is not so much what you want, but
what you're willing to get or willing to take. Politics is
mostly about making tradeoffs. And I think the critical
question that we need to be asking ourselves is not what do the
Iranians want, but what are their priorities. What is their
highest aspiration, what is secondary, what they would be
willing to give up to hang on to their nuclear program.
A friend of mine, a Swedish diplomat, once said to me in
response to exactly this point that if you asked Swedes on the
street whether they wanted a nuclear weapon, most of them would
probably say yes, too, until you pointed out to them that the
acquisition of those weapons would probably entail costs and
possibly even international sanctions. Once you start
introducing costs into people's calculus, that calculus can
change very rapidly. And here I think what's important is that
there do seem to be very important divisions, both Iranian
leaders and between the Iranian leadership and the Iranian
It is always dangerous to start divvying up the Iranian
leadership and ascribing some leaders to this group and other
leaders to that group, but, of course, there is no alternative
to doing so, not, certainly, in the amount of time that we're
allocated today. And so I will go down that slippery slope and
divide the Iranian leadership into three different groups.
There are pragmatists, typically associated with former
President Hashemi Rafsanjani among others, for whom Iran's
economy is clearly the highest priority. What's more, these
figures seem to recognize that the only salvation for Iran's
economy, which is in very deep trouble, is a better
relationship with the West and the technology and the
investment and the latching with the global economy that would
come from that.
For them, therefore, Iran's nuclear weapons I think are
desirable. I suggest that most Iranian leaders in this group
probably would like to have nuclear weapons if there were no
costs involved, but they have consistently suggested that
Iran's economic health was a higher priority than the nuclear
program, and that Iran might be willing to make accommodations
and even sacrifices where its nuclear program was involved if
it were important for Iran's economic health.
At the other end of the spectrum are the radical hard-
liners, today typically associated with President Ahmadinejad,
although he is not by any means the most important member or
the only member of that camp. The radical hard-liners seem to
believe that nuclear weapons are Iran's highest priority.
That's not because in some cases they don't believe that Iran's
economy isn't important, in many cases they do, but because
they have very different ideas about how to solve Iran's
economic problems. In part it's because they don't know very
much about economics or how to solve Iran's economic problems,
but also because they do, in many cases, ascribe to this
ideological motivation. They do believe in the revolution, and
they do seem to believe that having nuclear weapons is
important for them to ultimately achieve the goals that
Ayatollah Khomenei laid out for the Islamic Revolution.
Caught in between are Iran's mainstream conservatives, and
here the most important figure by far is the Supreme Leader,
Ali Khamenei. I think that the best way I would describe
Khamenei's position, as best any of us can tell given the tea
leaves that we are forced to read because our sources of
information about Iran or Iranian leadership are so limited, is
that they see Iran's economy and its nuclear program as perhaps
being coequal in importance. Or at least that's the best we can
tell given their behavior so far. Khamenei has tried very hard
since about 1990 to simultaneously maintain progress on Iran's
acquisition of nuclear weapons and maintain good enough ties
with the West so that Iran can have enough trade and enough
investment to keep its economy from stumbling along. The
mainstream conservatives, like the pragmatists, seem to
recognize that the greatest problem for the regime is popular
dissatisfaction with the regime and that the greatest source of
that popular dissatisfaction is Iran's poor economic health.
What we've seen from the regime to support this point,
first of all, are very different perspectives on the nuclear
program, to the extent of Mr. Ahmadinejad's Foreign Minister
rejecting out-of-hand offers for negotiations, for example,
from the Russians, only to have several days or weeks later,
Mr. Khamenei's people come in and then accept those very same
offers from the Russians and others, suggesting a very serious
difference within the Iranian regime.
Beyond that, there is the fact that the Iranian regime has
tried scrupulously to maintain that their nuclear program is
all about Iran's economic health, even to the extent of
throwing out the CNN Bureau when an interpreter mistranslated
remarks by President Ahmadinejad where he mentioned nuclear
power, and it was mistranslated as nuclear weapons. And this
demonstrates the extreme sensitivity of the regime.
Again, as the previous panel suggested, the regime is
trying to convince the Iranian people that the reason that they
need this nuclear program is to help Iran's economy, that it is
the solution to Iran's economic problems, not its security
problems. And, again, that speaks to what I think is the fourth
factor in all of this, which is the Iranian people. Which,
again, I will say we have the least--the worst information on
what the Iranian people believe; however, there do seem to be
quite a bit of anecdotal evidence that indicates that for the
Iranian people, ``It's the economy, stupid.'' The economy is by
far the most important priority that they have, and I think
that there is every expectation, especially given the regime's
own rhetoric, that if the Iranian people were ever forced to
choose between their economic health and their nuclear program,
they would grudgingly but readily choose their economic health.
Now, what all of this suggests to me is that convincing
Iran to give up its nuclear weapons program or its nuclear
program will be difficult, but not impossible. Iran clearly
does have powerful incentives for acquiring this capability,
and I don't think that it is going to be easy for someone to
convince them otherwise. By the same token, there is nothing
about their priority structure that suggests that it is going
to be impossible to do so. And, again, for me, history is an
important set of lessons. In the 1960s, especially in the late
1960s, Mr. Chairman, you will remember that it was considered a
foregone conclusion that Egypt would acquire nuclear weapons.
They, too, had compelling strategic reasons, reasons of
prestige, and reasons of ideology for acquiring those weapons.
In fact, I think you could argue that Egypt's reasons were even
more compelling than Iran's reasons today. But Egypt
voluntarily chose to give up its nuclear weapons program, and
it did so because Egypt's leadership recognized that nuclear
weapons were not its highest priority and that its pursuit of
nuclear weapons were undermining its highest priorities.
More recently, Belarus, Ukraine, and Kazakhstan have been
convinced to give up their nuclear weapons even though any
number of academic strategists believed that they were insane
to do so because of their own strategic rationales for keeping
the weapons. But what the Ukrainians, Belarusians, and Kazaks
realized was that again, their relationship with the West and
the health of their economies was far more important to them
than their possession of these nuclear weapons.
And as a final example, there is Libya, one of the worst
rogues of the Middle East over the last 30 years, which also
under the weight of international sanctions was ultimately
convinced that its pursuit of terrorism and nuclear weapons
stood in the way of its ultimate prosperity and stability.
All of that suggests to me that, again, it will be
difficult, but not impossible to convince the Iranians to give
up their nuclear weapons program.
Ultimately, in addition, what it points to, to me, is that
the goal, the strategy that the West should be employing, the
international community should be employing to try to convince
the Iranians to cease its nuclear weapons program is to force
them to make a choice between their highest priority, their
economy, and their nuclear weapons program. And I think that it
has been our failure to do so all along that has left us in the
conundrum that we face today.
Ultimately, I believe that we need to change Iran's
incentive structure, since at the moment they have strategic,
ideological, and prestige incentives for pursuing it and few
economic and other disincentives to cease pursuing it. And here
is a sidebar. I'll point out that this is one reason that I'm
also very leery of a military operation against Iran to try to
eliminate its nuclear capability, because ultimately, no matter
how successful that effort may, or may not, be in the short
run, in the long run it will do nothing to change Iran's
incentive structure, and in fact will most likely simply
Now, my time is running short, and I'm not going to get
into this in greater detail because others have already made
the point and it is available elsewhere, but I do believe that
the key incentive for Iran is ultimately economic incentives,
both positive and negative. As I've said, the one priority that
we can clearly identify among the Iranian people and among
important segments of its leadership is the health of Iran's
economy. And so, therefore, I think that the key for the
international community is to make clear to the Iranians that
if they continue down this path, if they continue to resist the
will of the international community, their economy will suffer
and will suffer very markedly and very quickly.
On the other hand, I also think it is critical that the
international community, including the United States, also
offer a positive set of incentives to the Iranians that the
best way out of their current economic impasse is to give up
the nuclear program, and ideally their support of terrorism,
and that in so doing, they would be rewarded and it would help
them to solve their economic problems.
As I suggested, it is going to be difficult to convince
them to give up this program, and I think that only a
combination of positive and economic--positive and negative
economic inducements is going to do so, and what's more, I
would suggest that these positive and negative economic
inducements are going to have to be very significant. Given the
range of Iranian motivations for possessing these weapons, I
don't think that we should assume that symbolic sanctions or
minor concessions along the lines of what President Bush
offered on March 10, 2005, when he offered admission to the WTO
and spare parts for Boeing aircraft is going to be sufficient
to bring the Iranians around. We're going to have to put some
very significant offers on the table, including the lifting
ultimately of United States economic sanctions against Iran,
and very serious economic sanctions against Iran if they're not
willing to comply. And here I think the best way to focus our
efforts would be in the area of investment rather than trade.
My own experience with our Iraq sanctions during the 1990s has
convinced me that trade sanctions, which can very immediately
affect the people of the targeted country, are not in our best
interests. They are not sustainable----
[Disruption in the audience.]
The Chairman. The hearing will come to order.
Dr. Pollack. They are not the appropriate moral course of
action for the United States of America. Investment is an area
where Iran is vulnerable and, ultimately, an area where the
West can apply significant pressure over the long term in a way
that is unlikely to hurt the Iranian people in the short term.
I would also say that I think that we need to brace
ourselves, because even if we are willing to put a very
significant set of positive inducements on the table, and here
I'd make the point that while I do believe that economic
inducements need to be at the heart of that package, it cannot
be the only thing. Security guarantees, a new security
architecture for the Persian Gulf where the Iranians can
discuss their legitimate security concerns and perhaps even
find a way toward an arms control solution to the various
problems of the Persian Gulf should be another element. I would
also be very willing to allow the Iranians nuclear energy,
access to nuclear technology as the first panel described, and
a range of other incentives. But, again, for me I think it is
the economic incentives that need to be at the heart of it
because that is the one priority that we've identified of the
Iranians that seems to stand above even their pursuit of
I think that we need to recognize that the Iranians also
have a reason to resist even a very compelling package, a
package of big carrots and big sticks, and this is because,
ultimately, it is going to be--while we are the ones required
to put up the big carrots at this point in time, it is our
European allies, and hopefully the Russians and Chinese and
Indians, who will have to put up the big sticks. And quite
frankly, I don't think that the Iranians think that the
Europeans are up to it. All throughout the 1990s they saw the
Europeans threaten economic sanctions and then back off, often
for no reason whatsoever regardless of what Iran's behavior
was. And so I think that Iran's current policy of brinksmanship
is very much designed to force the Europeans to do something
that the Iranians believe that the Europeans just don't have
the stomach for. And for that reason as well, I think that even
if we do apply a package of carrots and sticks, we're going to
have to expect that we're going to have to impose significant
sanctions on Iran probably for some period of time before the
Iranian regime believes that the Europeans really mean
I will conclude with one final thought. I've had a chance
to quickly skim Dr. Clawson's testimony, and I know that he is
going to advocate a different kind of package, one where the
incentives are primarily security related. And I will simply
close by saying, Mr. Chairman, that I think we now have in
front of us the definition of a hard problem, which is when the
security expert on the panel urges an economic solution to the
problem, and the economist on the panel urges a security
solution to the problem.
Thank you very much.
[The prepared statement of Dr. Pollack follows:]
Prepared Statement of Dr. Kenneth M. Pollack, Senior Fellow and
Director of Research, Saban Center for Middle East Policy, the
Brookings Institution, Washington, DC
Mr. Chairman, Senator Biden, other distinguished members of the
committee, it is an honor to appear here today to discuss a matter of
such importance to our Nation.
As with all writing about Iran's political process, it is important
to be humble about what we can know. Our sources of information about
Iranian decisionmaking are miserable and the Iranian governmental
process is labyrinthine and unpredictable even for the most subtle and
knowledgeable observers inside Iran and out. Even Iran's public opinion
is difficult to discern because the regime works hard to control
sources of information, punishes dissent, and hinders the efforts of
disinterested pollsters. Consequently, we are all ``reading tea
leaves'' when it comes to trying to predict Iran's behavior, especially
on an issue as important and heavily debated as this one. All that any
of us can offer is an educated guess as to what the Iranians are
thinking and how they may react.
With that caveat in mind, I believe that Iran's interest in nuclear
weapons is both wide and deep, but it is not adamantine. The issue, as
always in politics, is not whether Iran wants to see its nuclear
program through to completion but what it would be willing to sacrifice
to keep it. On this matter, I believe the Iranians would be willing to
sacrifice a fair amount, but hardly everything. What this suggests then
is that convincing Iran to give up its nuclear program is going to
require very considerable inducements, both positive and negative, but
that it is not impossible to do so.
IRAN'S STRATEGIC PERSPECTIVE
Setting aside the question of whether Iran is determinedly seeking
actual nuclear weapons or simply the capability to produce fissile
material (and thereby be in a position to acquire the weapons
themselves rapidly), there is ample reason to believe that Iranians
would want nuclear weapons.
Deterrence. It has become a cliche in the United States to note
that Iran lives in a tough neighborhood. Iranian leaders in Tehran can
objectively look out beyond Iran's borders and see a wide range of
potential threats, from chaos and civil war in Iraq or Afghanistan, to
a nuclear-armed Pakistan, to Israel over the horizon, to American
forces arrayed all along Iran's borders. What's more, Tehran's
relations are strained or antagonistic with many of its neighbors, and
even those with correct relations with the Islamic Republic tend to
view it with considerable suspicion. Thus, the Iranians can honestly
point to a wide range of threats and serious concerns for their
security, although the fact that their own actions have been
responsible for much of the animosity they face is probably lost on
most of them.
In other words, possession of nuclear weapons makes sense from an
Iranian perspective for purely defensive reasons. While nuclear weapons
cannot solve all of Iran's security problems, they can solve some, and
in so doing might make dealing with the rest much easier. At the most
extreme, Iran is unlikely to be able to deter a determined American
military operation without a nuclear arsenal. This lesson has no doubt
been driven home to the Iranians by the divergent experiences of Iraq
and North Korea, the two other members of President Bush's ``Axis of
Evil.'' North Korea is believed to possess nuclear weapons and so the
United States has not attacked it and is being forced to engage with
Pyongyang. On the other hand, Saddam Hussein's Iraq did not possess
nuclear weapons--but was believed to be trying to acquire them--and so
the United States was willing to invade and overturn the Ba'athist
regime. It is hard to imagine that the leadership in Tehran did not see
this as a very simple set of reinforcing conclusions: If you have
nuclear weapons, the United States will not dare use force against you,
but if you don't, you are vulnerable.
Prestige. We should never forget that the Iranians see themselves
as the lineal descendants of a 2,500-year-old civilization that
bequeathed to the world its first superpower (the Persian Empire of
Cyrus the Great, Darius, and Xerxes), and a long string of great powers
from the Parthians to the Sassanids to the Safavids. Only very
recently, as measured by the full tale of human history, has Persian
power been supplanted in the region by European and eventually American
power. A great many Iranians believe that their country's history,
experience, and natural resources mandate for it a role as one of the
world's great powers and the dominant force in southwest Asia and the
To the legacy of Persia's imperial greatness can be added the pride
of the Islamic Revolution, which since 1978 has reinforced to many
Iranians the sense that their nation has been marked by destiny to play
a leading (perhaps ``the'' leading) role in the region and the Islamic
world. Although many Iranians have soured on the revolution, others
continue to see it as vital to Iran's mission in the world and many
more still see it as another sign that Iran should be the intellectual,
diplomatic, and military hegemon of the region.
Persian pride appears to be another motivation in Iran's pursuit of
nuclear enrichment capability, if not actual nuclear weapons. Acquiring
nuclear weapons would give Iran a status that only a very few other
nations possess. It would immediately catapult Iran into the ``big
leagues'' of world politics. It would likely force other states to pay
more attention to Iran's aspirations and wishes. Here the recent model
that seems to stand out in the minds of many Iranians is India, whose
development of nuclear weapons--and their acceptance by the
international community--has been a critical element of New Delhi's
acceptance as one of the great powers of the world, whose views should
be considered on any matter of importance. Since this is the position
to which many Iranians seem to aspire, matching India in the nuclear
realm also appears to be a self-evident necessity for Iran.
Export of the Revolution. For at least some Iranians, typically
referred to as the ``radical hard-liners,'' Ayatollah Khomenei's dream
of exporting Iran's Islamic Revolution to the rest of the Muslim world
(and possibly even beyond) is yet another motive. Throughout the 1980s
and, to a lesser extent during the early 1990s, Iran attempted to
realize this dream by attempting to subvert reactionary Middle Eastern
governments and assist would-be revolutionaries in those same
countries. Iranian efforts in Iraq, Saudi Arabia, Kuwait, Bahrain, and
even Lebanon were all motivated in part or in whole by this goal. But
Iran's efforts in these countries triggered the animosity of the United
States and in at least one case (Iraq during the Iran-Iraq war)
prompted limited but direct American military intervention against
Iran. In Lebanon, Iranian actions were part of what inspired American
intervention there, and in Saudi Arabia, Iranian activities sparked
other aggressive American responses as well as prompting debate in
Washington over whether to mount retaliatory military actions against
the Islamic Republic.
For still other Iranians, another motivation to acquire nuclear
weapons appears to be the related goal of waging war against the United
States. This is an offensive version of the deterrence argument above
that is also closely related to export of the revolution. Proponents of
this motivation continue to see the world as Khomenei described it--as
a battle between the forces of good, represented by Iran, and the
forces of evil, represented by the United States. In this worldview,
Iran will not just face endless attack by the United States but it will
also face constant opposition to its efforts to export the revolution
from the United States. Therefore, Iran must have the power to drive
out American influence from the region and prevent the United States
from keeping Iran from achieving its destiny.
For Iranians holding either or both of these more offensive
rationales, acquisition of nuclear weapons would also appear to be
vital because it would be the only sure way to limit or preclude an
American military response for Iranian asymmetric warfare, terrorism,
and subversion against the United States and its conservative allies in
MOTIVATIONS VS. PRIORITIES
The Iranians clearly have a range of powerful motivations,
strategic, ideological, and psychological, for desiring an arsenal of
nuclear weapons--or at least the capability to manufacture such weapons
in short order. Nevertheless, it would be a mistake to confuse
motivations with a universal and indomitable determination to do so.
The history of the past 60 years demonstrates that other states with
equal or greater strategic need, ideological justification, and/or
psychological desire for nuclear weapons ultimately chose either not to
pursue them at all or to give up their pursuit midstream:
In the 1960s it was considered a foregone conclusion that
Egypt would develop a nuclear weapon as its strategic and
psychological incentives were even more compelling than Iran's
are today. Egypt was locked in a conflict with a nuclear-armed
Israel which resulted in four mostly disastrous wars (for
Egypt) in 25 years, and Cairo aspired to be the ``leader of the
Arab world.'' Yet Egypt shut down its nuclear weapons program
entirely of its own volition because the Egyptian leadership
concluded that it had higher priorities which the pursuit of
nuclear weapons were undermining.
Leaders in Italy, Australia, Sweden, Japan, and South Korea
considered developing nuclear weapons at various points, and
the Italians and Australians actually made some considerable
progress toward that goal. However, all of them decided that
nuclear weapons would be counterproductive to other, higher
priorities, and that they could find ways to deal with their
security problems (including even South Korea) through other
Belarus, Ukraine, and Kazakhstan went even further in the
early 1990s, voluntarily surrendering the nuclear arsenals that
they had inherited from the Soviet Union. Although many Western
academic strategists believed that they were insane to do so,
all three recognized that the security benefits from possessing
nuclear weapons were outweighed by the diplomatic and economic
benefits of giving them up and strong economies and good
relations with the rest of the world were of far greater
importance to them.
Finally, there is the example of Libya, long one of the
Middle East's worst rogue states, which agreed to give up its
nuclear program in December 2003 after 10 years of U.N.
sanctions convinced Muammar Qaddafi that his pursuit of the
bomb was not worth the devastation of Libya's economy and
What these examples demonstrate is that it is entirely possible for
the international community to dissuade states from trying to acquire
nuclear weapons and even persuade them to give them up, even when those
states have compelling strategic rationales for possessing the weapons.
In every case, the key has been to create a powerful set of positive
incentives and negative disincentives geared to the priorities of the
state in question.
Iran's political leadership is divided over its nuclear program in
important ways. While the available evidence suggests that most Iranian
leaders would like at least a nuclear weapons capability (if not the
weapons themselves), it also indicates that they differ widely in the
priority they ascribe to this goal. For instance, in an interview in
2002, then Minister of Defense, Ali Shamkhani, warned that the
``existence of nuclear weapons will turn us into a threat to others
that could be exploited in a dangerous way to harm our relations with
the countries of the region.'' More important still, former President
Ali Akbar Hashemi Rafsanjani has warned that ``If there [are] domestic
and foreign conflicts, foreign capital will not flow into the country.
In fact, such conflicts will lead to the flight of capital from this
country.'' Statements like these demonstrate that important Iranian
leaders do not regard possession of nuclear weapons either as an
unvarnished blessing or Iran's highest priority.
The same appears to hold true for the Iranian populace, as best we
can discern it. When Iranians took to the polls in the spring of 2005
to elect a new President, they did not vote for Mr. Ahmedinejad because
he was determined to acquire nuclear weapons. Instead, they voted for
him because he promised to reform Iran's economy and curb the rampant
corruption that is the principal blight on the economy. Anecdotal
evidence has repeatedly confirmed that for the Iranian people, ``it's
the economy, stupid.'' Of course, many average Iranians continue to
voice their support for Iran's nuclear program and even for acquisition
for nuclear weapons, but stated in a vacuum (i.e., without regard for
potential tradeoffs) such sentiments are meaningless. As a friend of
mine, a Swedish diplomat, put it to me, ``If you were to ask Swedes
whether Sweden should have a nuclear weapon, most of them would
probably say yes, too, until you told them that it would come at the
cost of isolation or even sanctions.''
What's more, the regime appears to be well aware of this. Supreme
Leader Ali Khamenei and his allies have tried hard to steer clear of
policy paths that would cause Iran's European and Japanese trading
partners to impose economic sanctions on Tehran, even being willing to
agree to suspend Iran's nuclear program in 2003 to avoid such a fate.
It is noteworthy that while President Ahmedinejad and his hard-line
colleagues in Iran's Foreign Ministry regularly reject foreign
overtures to deal with Iran's nuclear program, Khamenei's people have
just as frequently contradicted the hard-liners by announcing a
willingness to negotiate. Thus it was Ahmedinejad's Foreign Ministry
that rejected the 2005 Russian proposal to allow Iran to enrich uranium
at Russian facilities, but days later National Security Adviser (and
Khamenei protege) Ali Larijani accepted the Russian offer to start a
dialog on this proposal, almost certainly in an effort to drag out
negotiations, postpone U.N. Security Council action, and possibly
harden Russia's support for Tehran's position.
It is also important to note that the regime itself has
scrupulously maintained that the nuclear program is about securing
Iran's energy needs (so that it can export more oil and gas) and
developing a high-tech industry. While there are a number of logical
and evidentiary problems with these claims, what is critical is that
they are designed to portray Iran's nuclear program as necessary to
Iran's economy, not its security. Indeed, Tehran is so paranoid about
this that it temporarily evicted CNN's bureau from Iran when a CNN
interpreter mistranslated ``nuclear power'' as ``nuclear weapons'' in a
speech of Ahmedinejad's. This too makes clear that the regime shares
the belief that if the Iranian people were ever forced to choose
between the nuclear program and economic health, they would choose the
SQUARING THE CIRCLE
This discussion suggests that convincing Iran to give up its
nuclear program is going to be tough. The Iranians are not going to do
so willingly. But it also tells me that doing so should not be
impossible, because there are Iranians--both the bulk of the people and
important members of the regime--for whom nuclear weapons are
desirable, perhaps even important, but neither essential nor even their
Another comparison is useful to illustrate this point. North
Korea's calculus regarding nuclear weapons was clearly different from
Iran's. For Pyongyang, its nuclear weapons program was its highest
priority and it was willing to tolerate hardships that few other
countries (including even Iran) would be willing to. Ultimately, North
Korea accepted the devastation of its economy, the impoverishment of
its citizenry, and having 3 million of its people starve to death to
hold onto its nuclear weapons program. If the same could be said about
Iran then it probably would be impossible to convince Iran to give up
its nuclear program; however, there is no Iranian or Iran expert who
believes that this is the case. There is absolutely no evidence that
Tehran would be willing to tolerate the extremes of sacrifice that
North Korea did. Instead, the evidence suggests exactly the opposite,
that Iran would be more like Libya: Difficult, but hardly impossible to
The key then is for the United States and its allies to compel the
Iranians to choose between their nuclear program and their highest
priority--their economic well-being. The way of doing so is now well-
explicated, including in my own work. Briefly, it would involve a
multilateral sanctions regime that would gradually shut down Western
(ideally the OECD, but initially perhaps just the G-7) investment in
Iran, particularly its gas and oil sectors, in response to continued
Iranian recalcitrance. Even with oil prices above $60 per barrel, Iran
is desperate for Western investment capital because corruption is
sucking the oil revenues right out of the system and thus having little
impact on the overall economy. Despite the claims of some that Russia
and China could make up for any loss capital from Europe and Japan, the
fact is that their economies are still roughly a decade away from being
in a position to do so. Simultaneously, as we did with the Libyans, in
return for Iran agreeing to abandon its nuclear program and do so in
verifiable fashion, the West (or the U.N. Security Council) would offer
Tehran a package of incentives to include admission to the WTO and
integration into the global economy, a lifting of U.S. economic
sanctions (assuming that, like Libya, Iran renounced terrorism as well)
and a universal settlement of all outstanding claims, investment
guarantees to make investing in Iran more attractive for Western
companies, provision of properly safeguarded light-water reactors,
terms for giving Tehran access to enrichment technology (without the
feedstock materials, the equipment, or the spent fuel), security
guarantees, and ideally a new security architecture in the Persian Gulf
similar to the Organization of Security and Cooperation in Europe that
would allow Iran to address its legitimate security concerns through a
peaceful process of dialog and, eventually, arms control.
Presenting such a package would make clear to the Iranian people
and their leadership that their country really did have just two
choices. They could retain their nuclear program (and their support for
terrorism) and they would become an international outcast and have
their economy slowly crippled by sanctions. Or they could give up these
two things and enjoy all of the benefits of the international community
that they ever dreamed of.
Two additional caveats suggested by the discussion of Iranian
motives and priorities are also in order here. First, the package would
have to make very clear that all Iran has to give up is its pursuit of
nuclear weapons--not nuclear energy or nuclear technology--to get all
of the benefits promised. Any ambiguity here would allow Iran's hard-
liners to continue to proffer the canard that Iran's nuclear program is
about its economy, thus engaging Iran's highest priority and making it
less likely that the Iranian people would favor it.
Second, both the carrots and the sticks employed by the
international community are going to have to be very big. Iran has
major strategic, ideological, and psychological equities attached to
its nuclear program and it will not budge easily. Small carrots, like
those offered by President Bush on March 10, 2005 (admission to the WTO
and sale of spare parts for Boeing passenger aircraft), or simply deals
for nuclear reactors and technology, are probably not going to be
adequate. The Iranian people will have to believe that there is a huge
pot of gold at the end of the rainbow, especially if they are going to
be able to help Iran's more pragmatic leaders defeat Tehran's hard-
liners in what is likely to be a knock-down, drag-out internal
political battle. Similarly, no one should be under the misimpression
that Iran will accept such a deal without the threat of very serious
economic sanctions. Indeed, it seems likely that the international
community, or merely the West acting outside the United Nations in
multilateral fashion, will have to impose strong sanctions on Iran and
keep them in place for some time before Tehran accedes. As noted above,
it took 10 years for Libya to come to terms, although the Libya
sanctions were relatively light as far as sanctions go.
Moreover, throughout the 1990s the European countries threatened
Iran with sanctions for its bad behavior but never, ever followed
through on their threats no matter how outrageous Iran's behavior.
Consequently, it appears that Iran does not believe that the Europeans
will be willing to impose such sanctions, let alone maintain them for
very long. This is the root of Tehran's current strategy of
brinksmanship: The Iranians seem certain that, in the end, the
Europeans will balk and when that happens, the crisis will be over and
they can go back to both pursuing nuclear weapons and enjoying trade
and investment from Europe. Thus their strategy is to give on nothing
and force the Europeans either to make good on their threats or, as
Tehran seems to believe, admit that they are bluffing. For this reason,
the Iranians are probably going to have see the Europeans actually
impose meaningful sanctions and be willing to hold them in place for
some time before Tehran actually believes the Europeans mean business.
None of this should be terribly heartening, but neither should it
cause us to lose heart. We always knew that convincing states like Iran
that have a range of important rationales for pursuing a nuclear
capability to give it up is difficult. But few things in the worlds of
politics and diplomacy are impossible, and there is good reason to
believe that Iran can be dissuaded from its current course if the
United States and its allies in Europe and Asia can forge a common
position and make clear to Iran that pursuit of a nuclear weapon will
cost it what most Iranians value the most.
The Chairman. Well, thank you very much, Dr. Pollack, for
your very comprehensive testimony.
I appreciate that our guests today are enthusiastic about
our panel members, but please, if you can, resist too many of
these impulses as it would be helpful in terms of the order of
the hearing to proceed.
Now, Mr. Sadjadpour, would you please testify.
STATEMENT OF KARIM SADJADPOUR, IRAN ANALYST, INTERNATIONAL
CRISIS GROUP, WASHINGTON, DC
Mr. Sadjadpour. Well, thank you very much, Mr. Chairman.
It's a great privilege to be here before you on behalf of the
International Crisis Group. It's a great privilege to be a
member of such a distinguished panel as well. I thought I would
focus primarily on domestic political happenings in Iran, given
that my colleagues have not been granted a visa to go to Iran
by the Iranian Government.
I think that we are on a collision course here between the
United States and Iran with decidedly potentially devastating
consequences for the future of nonproliferation, for the future
of Middle East peace and security, and for the future of Iran's
evolution toward democracy.
These negotiations were once called a game of chess. I
believe they've now evolved into a game of chicken. We
essentially have a situation where we have two cars moving at
each other with increasing velocity, and neither side, meaning
neither the United States, nor Iran, believes that it behooves
them to either slow down or to get out of the way.
From Washington's perspective there's great suspicion about
Iran's intentions to acquire this nuclear capability. There's a
sense in Washington that we should not reward bad Iranian
behavior and we should not talk to it by talking to Iran would
conferring legitimacy on the regime.
From Tehran's perspective there's also great suspicion
about United States intention. Tehran believes that this
nuclear issue is simply a pretext for a regime-change approach,
and their mentality is that if we succumb to pressure on this
nuclear issue, it's not going to get us out of trouble, it's
simply going to invite further pressure, and, again, nothing
short of a regime change is going to appease the United States.
I thought I would focus on four observations and their
implications for U.S. policy. And the first observation--this
is in my capacity as an analyst with the International Crisis
Group based in Tehran and interviewing Iranian, European, and
United States officials frequently. I believe there's very
little hope of reaching any binding resolution absent some type
of direct U.S. involvement. In 3 years of interviewing the
European negotiating team and senior European officials, I've
always come away with the notion that there's very little
confidence that a binding resolution can be reached absent some
type of direct United States role because it is not political
security and economic dividends that Iran is seeking from the
Europeans, but from the United States.
Iran analysts commonly invoke a paradigm to talk about the
situation: Two ticking clocks. There's the regime change clock
and the nuclear clock. I believe the dilemma is that when you
try to speed up the regime change clock, you simultaneously
expedite Iran's ambitions for a nuclear deterrent. I think when
it comes to United States policy we should be very clear to the
Iranians that a belligerent foreign policy is not going to reap
rewards, but at the same time we should make it clear that a
more conciliatory and compromising Iranian stance would trigger
reciprocal steps from the United States.
The second observation I wanted to address is that we
should disabuse ourselves of this notion that dialog is
tantamount to appeasement or indifference to human rights
abuses, that talking to Iran would be selling out the will of
the Iranian people. Empirical studies and anecdotal evidence
suggests overwhelmingly that the Iranian people, despite great
discontent with their leadership, overwhelmingly want to have
relations with the United States. Empirical studies suggest
upward of 80 percent of Iranians would support having dialog
and relations with the United States. The vast majority of
Iranian democratic activists I've come across agree that they
believe a United States-Iran diplomatic accommodation would
actually be helpful to their cause, not hurtful of their cause.
I'm talking about Nobel Laureate, Shirin Ebadi, and brave
activists like Akbar Ghangi.
One thing that's been dismaying for me personally is that
human rights, the issues of human rights and democracy have
been absent from these EU-Iran nuclear accords that have taken
place these last few years, and I do believe that the United
States is the only country which, if they were to join the
negotiations, would be able to ensure that these issues, human
rights and democracy, have a role at the table.
Now, I wanted to nuance some of the comments of the
previous panel about Iranian popular sentiment vis-a-vis the
nuclear issue. Having been based in Iran intermittently since
2003, this is an issue in which I would engage the vast
majority of Iranians I would come across traveling around the
country. And I found that this popular sentiment which has been
written about in the Western media and, of course, the Iranian
media, has been very much exaggerated. It is true that for some
Iranians this is an issue of national pride. Iran is an old
country, old civilization, and they look around and they say,
well, India, Pakistan, Israel can have these projects, why the
double standard? But I would argue that at the same time this
is a society which experienced a devastating 8-year war with
Iraq, which not really one family was left unscathed by this
war. And no one romanticizes about the prospect of conflict,
about the prospect of militarization, so when they see this
nuclear project, there's a lot of concern about the direction
in which the country is headed. And quite frankly this is a
very technical project, actively enriching uranium indigenously
as opposed to importing enriched uranium abroad. So despite the
claims of the Iranian Government, I can tell you that the
Iranian people don't wake up thinking in the morning what's
missing from our lives is enriched uranium.
I would argue that if you were to pose two options to the
Iranian people as a referendum: (a) Pursue this nuclear program
unequivocally come what may, sanctions, further isolation,
potential military confrontation, or (b) make certain nuclear
compromises and reintegrate into the international community,
this young Iranian population, two-thirds of whom are under 30,
would overwhelmingly choose the later option.
Now, lastly, I believe that we need to disabuse ourselves
of the notion that a sudden upheaval in Iran or some type of
abrupt political change would necessarily be for the better. I
would argue that the vast majority of Iranians are in favor of
a democratic system, a more tolerant system, a more open
society. But unfortunately these peaceful and democracy-loving
Iranians are not the ones who are currently organized, and
they're not the ones currently with arms. To quote the great
United States diplomat and Iran scholar, John Limbert, who was
actually a hostage in Iran for 444 days, to paraphrase him, in
fact, revolutions are not won by those who can write incisive
op-ed pieces. At that time it was won by those who were willing
to throw acid in other people's faces. These days it's won by
those willing to conduct suicide operations, et cetera. So I
think we should be very careful about romanticizing about the
prospect of sudden, abrupt change in Iran.
Lastly, I wanted to present two visions for Iran, two
possibilities which I believe are equally plausible. The first
is of a country isolated from the world, isolated from the
international community, but with enough oil wealth to continue
to fund its paramilitary groups, 2 million Bassij, 150,000
revolutionary guards, to repress popular will and popular
demand for change. And unfortunately I can see this
sustainable. I can see an Islamic Cuba with a bomb 10, 15, 20
years from now.
The second vision is of a country reintegrated into the
international community, having relations with the United
States, having a United States Embassy in Tehran, having
increased foreign investment, a strengthened middle class,
tourists going back and forth, the Iranian diaspora going back
and forth. I believe this is a much more fertile ground for
democratic change and would certainly expedite Iran's path
toward democracy rather than the contrary.
[The prepared statement of Mr. Sadjadpour follows:]
Prepared Statement of Karim Sadjadpour, Iran Analyst, International
Crisis Group, Washington, DC
Mr. Chairman and Senator Biden, thank you for allowing me, on
behalf of the International Crisis Group, the privilege to discuss
before you the fate and relationship of the two countries which I care
most deeply about, the United States and Iran.
Mr. Chairman and Senator Biden, I fear we are on a collision course
with decidedly devastating consequences for the future of the U.S.'s
international standing, nuclear nonproliferation, Middle East peace and
security, and Iran's evolution toward a society which respects the
human rights and civil liberties of its citizens. What was once
described as a game of chess has evolved into a game of chicken: The
United States and Iran are like two cars moving head on with increasing
velocity. Most concerning is that neither side believes that it serves
its interests to slow down or get out of the way.
The policy stances of both sides have the merit of being clear:
Washington sincerely doubts that Tehran's intentions are peaceful, and
refuses to ``reward bad behavior'' or ``confer legitimacy'' on the
Iranian regime by talking to it. Tehran, meanwhile, believes that the
nuclear issue is simply a pretext used by the United States to cover
its regime change ambitions, and that agreeing to compromise on its
``legal NPT rights'' would not allay U.S. pressure, but on the contrary
be perceived by Washington as a sign of weakness that would only invite
further pressure. Operating under this premise, Iran's leadership
believes it must not relent from its position, especially when oil
prices soar, its hand in Iraq is strong, and there is still no
indication that a more conciliatory Iranian approach would beget a more
conciliatory U.S. response.
I do not believe that a nuclear-armed Iran is inevitable. Nor do I
believe that a firm decision has been made in Tehran to pursue the
acquisition of a nuclear weapon. Despite current ominous trends I
remain hopeful that the Iranian people's aspirations to live in a more
open society at peace with the outside world is a worthy goal which
will one day be realized. But I believe the probability of achieving
either of these two salient goals--preventing a nuclear-armed Iran and
forwarding the cause of Iranian democracy--is highly unlikely in the
context of current U.S. policy toward Iran.
Over three decades of U.S. attempts to change Iranian behavior by
isolating it politically and economically have borne little fruit: 27
years after the 1979 revolution, Iran continues to sit atop the State
Department's list of the world's state sponsors of terror, continues to
play an unconstructive role in the Israeli-Palestinian conflict,
continues to expand its military arsenal, and continues to repress its
own population. If U.S. policy toward Iran were a business model, it
would have been scrapped long ago for failing to achieve its bottom
I. TEHRAN'S CALCULATIONS: THE INTERNAL NUCLEAR DEBATE
Iran's senior leadership has always attempted to project a unified
mindset regarding the nuclear issue, but in reality the country's
ruling elites are divided into three broad categories: Those who favor
pursuit of the nuclear project at all costs; those who wish to pursue
it without sacrificing diplomatic interests; and those who argue for a
suspension of activities to build trust and allow for a full fuel cycle
down the road. Understanding and exploiting these differences should be
a key component of any diplomatic approach.
The first group, sympathizers of President Mahmoud Ahmadinejad,
comprises ideologues and confrontationists who romanticize the defiance
of the revolution's early days. They believe that former President
Mohammed Khatami's ``detente'' foreign policy projected an image of
weakness while achieving little for Tehran other than membership in the
``Axis of Evil.'' In contrast, they favor an uncompromising approach,
in some cases going as far as to advocate that Iran withdraw from the
NPT, unequivocally pursue its nuclear ambitions, and dare the
international community to react. This group advocates measures such as
withholding oil exports and cutting diplomatic ties with countries that
side against Iran, confident that ``the West needs Iran more than we
need them.'' While 2 to 3 years ago such views were on the fringe, with
the recent elections they have gained increased relevance and
Like the confrontationists, the second group is highly cynical of
Western (particularly U.S.) intentions, and argues that Iran is ``bound
by national duty'' to pursue its ``inalienable'' right to enrich
uranium. Unlike them, however, they favor working within an
international framework. Iran's lead nuclear negotiator Ali Larijani is
perhaps the best representative of this group, arguing simultaneously,
perhaps inconsistently, that Iran must neither succumb to ``Western
double standards'' nor abandon diplomacy. ``The West wants two classes
of nations,'' Larijani frequently says. ``Those that have nuclear
technology and can be advanced, and nations that must be restricted to
produce only tomato juice and air conditioners . . . [But] a country's
survival depends on its political and diplomatic ties. You can't live
The third, more conciliatory group, arguably most representative of
popular sentiment, is currently the least influential. After months of
silence, however, they are increasingly beginning to make their voices
heard. Former President Khatami and former lead nuclear negotiator,
Hassan Rowhani, have criticized their successor's disregard for
diplomacy, and the country's largest reform party recently urged the
government to voluntarily suspend all nuclear fuel cycle work.
Believing the costs of nuclear intransigence to be greater than its
benefits, they argue that Iran should freeze its enrichment activities
in order to build confidence and assuage international concerns. This
group welcomes diplomacy and has consistently backed direct talks with
the United States, convinced that the Europeans are incapable of
providing the political, economic, and security dividends Iran seeks.
Signing off on all major decision in Iran is Supreme Leader
Ayatollah Ali Khamenei, whose 17-year track record suggests a leader
who wants neither confrontation nor accommodation with the West. Yet
decisions in Iran are made by consensus rather than decree, and at the
moment Ayatollah Khamenei appears more influenced by advisors who
argue--with some plausibility--that nothing short of regime change will
satisfy the United States, and that retreating on the nuclear question
will only display weakness. If there is to be clash with the United
States, Tehran's hard-liners want it to occur on their terms, when oil
prices are high and the United States is bogged down in Iraq.
II. AHMADINEJAD AND THE STRUGGLE FOR POWER
If Mahmoud Ahmadinejad's election proved anything, it is that the
Iranian regime is far from monolithic and Iranian politics are far from
predictable. While his triumph last June was widely viewed as a
consolidation of power by the nation's conservatives, differences among
conservatives have never been greater than today. And though it was
widely assumed that he would focus on domestic economic affairs and
have minimal influence over Iran's foreign policy, in the 9 months
since his inauguration, Ahmadinejad's impact on Iran's foreign
relations has been nothing short of monumental.
Ahmadinejad's assertiveness and outspokenness has surprised many.
During his election campaign he criticized Iran's previous nuclear
negotiating team for being ``frightened,'' and as President he
disbanded it in favor of his own. He is said to have personally
authored the provocative speech he delivered at the U.N. Security
Council last September, and to have penned his recent 18-page letter to
President Bush. Ahmadinejad also has repeatedly issued provocative,
bellicose statements on Israel that go beyond what the Supreme Leader
or others in the leadership have pronounced.
By most accounts, the President's style has irked the country's
entrenched political elite. Senior officials have complained that he
``doesn't play by the rules,'' and displays a surprising lack of
respect for the Islamic Republic's protocols and hierarchy. Rather than
defer to the elders of the revolution on matters as significant as the
nuclear issue or United States-Iran relations, he has tried to present
himself as a force that cannot be bypassed. Indeed, political rivalries
once kept under wraps are now playing out in the open. Last month, for
example, Ahmadinejad's eagerly anticipated announcement that Iran had
successfully operated a centrifuge cascade was preemptively leaked by
Rafsanjani to the Kuwaiti press. More recently, when news came out that
he had written an unprecedented letter to President Bush, former lead
nuclear negotiator, Hassan Rowhani, quickly countered by releasing a
concise, two-page compromise proposal to Time Magazine--seemingly
sending a message to the West that he is an alternative messenger with
an alternative message.
Ahmadinejad's behavior can be explained on two counts. To some
extent, it is a function of his ambiguous relationship with Ayatollah
Khamenei. The two men have decidedly different post-revolution
experiences and responsibilities: Ahmadinejad and his peers' most
salient experience was fighting in the battlefields during the Iran-
Iraq war whereas Ayatollah Khamenei was serving as President, and faced
with the day-to-day dilemmas of governing a country embroiled in a
full-blown war and facing near total political, economic, and
diplomatic isolation. Wary of repeating this experience, the Supreme
Leader has more than once publicly downplayed Ahmadinejad's fiery
pronouncements. Yet, at the same time, there is evidence that Khamenei
appreciates Ahmadinejad's anticorruption campaign and his commitment to
revolutionary ideals, and finds comfort in working with a junior
president who is seemingly loyal to him and at the same time makes him
look like a moderate. Moreover, Khamenei judges various government
officials by their results: In this case, he may well consider that
during his relatively short tenure Ahmadinejad has accomplished more
progress on the nuclear file than in the previous 2\1/2\ years of
negotiations with Europe.
While Ahmadinejad's behavior has caused disquiet among the
political elite, his standing on the Iranian street is more difficult
to assess. On one hand he has failed to deliver on his core electoral
promise, namely that he would ``put the oil money on people's dinner
tables''; since his inauguration last August the country has
experienced massive capital flight, foreign investment has dropped
precipitously, and Tehran's stock exchange has lost nearly a third of
its value. Most noticeably for the Iranian people, inflation has
increased dramatically, and unemployment has also risen.
Still, Ahmadinejad continues to enjoy some backing, a result of his
populist rhetoric, pious ways, humble lifestyle, and fiery nationalism.
Aware that he lacks support among the urban middle and upper classes,
he instead has courted economically disenfranchised Iranians in smaller
towns and far-off provinces, promising loans and debt-relief. Realizing
that he lacks favor among the country's top elite--technocrats,
business mangers, journalists, academics, and even senior clerics--he
curries favor with the country's paramilitary groups, such as the
Bassij; has attempted to co-opt the country's military forces by
providing numerous projects in the construction and development sector
to Revolutionary Guard commanders; and has formed close alliances with
powerful hard-line clerics in Qom, such as Ayatollah Mesbah Yazdi. All
in all, he has managed through his nationalist rhetoric and postures to
set the tone for Iranian foreign policy in a way that few had
III. IRAN'S DOMESTIC EVOLUTION
Despite concerns about Ahmadinejad and his team's desires to return
to the early days of the revolution, societal reform in Iran is a train
that has left the tracks. While it may be slowed down at times, and
will certainly face delays and obstacles, it is process that will be
near impossible to reverse, for sheer demographic reasons: Two-thirds
of Iranians are under 33 years old; they increasingly are connected to
the outside world via satellite television and the Internet; and they
have no special affinity for a revolution they did not experience and a
revolutionary government which has not been able to meet their economic
Indeed, for the vast majority of Iranians the priority is economic
rather than political deliverance. This is not to say that democracy
and human rights are not important concerns, but that for a majority of
Iranians they come second. As a Tehran laborer once explained to me,
``When your stomach is empty you don't cry for democracy, you cry for
While throughout the country Iranians' sense of alienation vis-a-
vis their leaders is palpable, despite these socio-economic discontents
people have become increasingly disillusioned with politics. In 1997,
2000, and 2001 they went to the polls in overwhelming numbers, twice to
elect President Khatami and once to elect a reform-minded Parliament,
yet saw insufficient returns on their civic investments. As a Tehran-
based intellectual once told me, ``People's political frustration is to
be expected. It's like exercising every day for 6 years and not seeing
any results. Soon you are going to stop going to the gym.''
What's more, without a clear alternative model or alternative
leadership, the deep-seated desire for economic, political, and social
reform among many Iranians is tempered by a strong aversion to unrest,
uncertainty, and insecurity. Having already experienced one tumultuous
revolution (or in the case of Iran's youth, the aftermath of one
tumultuous revolution) and a brutal 8-year war with Iraq, Iranians have
few concrete ideas as to how change should take place other than it
ought to occur bedun-e khoonrizi--``without bloodshed.''
The post-war turbulence and insecurity in next-door neighbor Iraq
has made Iranians even wearier about the prospects of a sudden
political upheaval or a quick-fix solution. As opposed to the aftermath
of the U.S. removal of the Taliban in Afghanistan, when some Iranians
could be heard naively romanticizing about the prospects of a swift
U.S. intervention in Tehran, today it is rare to find any Iranians who
see Iraq as a model for change, or look to their Western neighbor with
envy. In the widely echoed words of one middle-class, middle-aged
Tehran resident, ``When we look at what's going on in Iraq, it seems
that the real choice is not one between democracy or authoritarianism,
but between stability or unrest. People may not be happy in Iran, but
no one wants unrest.''
IMPLICATIONS FOR U.S. POLICY
1. To effectively counter Tehran's confrontationists, the United States
must simultaneously strengthen its pragmatists
While the United States should make clear that a bellicose Iranian
policy will not reap rewards, it should also clarify that a
conciliatory and compromising Iranian stance would trigger reciprocal
steps. A broader diplomatic accommodation--Iran forsaking domestic
uranium enrichment and modifying its objectionable domestic and
regional behavior in exchange for improved bilateral relations,
security assurances, and a lifting of sanctions--is the preferred
option. But given the depth of mutual mistrust and ill will, it may not
be possible to achieve this at the moment.
A smaller bargain proposed by the International Crisis Group would
be to offer Iran a ``delayed, limited enrichment scheme,''
acknowledging its eventual right, after several years of a total
freeze, to operate a small-scale uranium enrichment facility under an
intrusive inspections regime, making clear that a military program
would not be tolerated.
In both instances the logic is similar: To strengthen the hand of
Iranians who are pressing for a more accommodating foreign and nuclear
policy, they need to have a realistic and appealing alternative to
2. Dialog does not equal appeasement and certainly not indifference to
human rights abuses
It is important that we disabuse ourselves of the notion that
dialog is tantamount to appeasement, or would be ``selling out'' the
Iranian people's aspirations for a more representative government.
Quite the contrary: Opinion polls suggest that upward of 75 percent of
Iranians want their government to have relations with the United
States. Iranian democratic activists like female former MP Fatemeh
Haghighatjou--currently a fellow at MIT--have long argued that a United
States-Iran diplomatic accommodation is crucial for domestic change to
take place in Iran. Embarking on a comprehensive dialog with Iran would
provide the United States with the opportunity to match its rhetorical
commitment to Iranian democracy and human rights with action, instead
of ineffectively, and at times counterproductively, trying to promote
it from afar.
Greater economic and cultural contacts with the outside world,
combined with continued international insistence on political reform
and respect for human rights, would strengthen Iran's burgeoning civil
society; not weaken it, and dilute the conservatives' hold on power
rather than fortify it.
3. A sudden upheaval or abrupt political change in Iran is unlikely to
be for the better
John Limbert, the erudite Iran scholar and talented former U.S.
diplomat (taken hostage in Iran for 444 days) once reflected on the
1979 Iranian revolution that his liberal-minded Iranian friends ``who
could write penetrating analyses and biting editorials'' lacked the
stomach to ``throw acid, break up meetings, beat up opponents, trash
opposition newspapers, and organize street gangs . . . and engage in
the brutality that wins revolutions.''
Today we should be similarly sober about the realities of a short-
term upheaval in Iran. There currently exists no credible, organized
alternative to the status quo whether within Iran or in the diaspora.
And despite the fact that a majority of Iranians favor a more tolerant,
democratic system, there is little evidence to believe that in the
event of a sudden uprising it would be Iranian democrats who come to
power, especially in a country with nearly 150,000 revolutionary
guardsmen and 2 million members of the Bassij, whose livelihood, in
many cases, depends on the continuation of the status quo.
4. The United States should make it clear that it has no intention of
undermining Iran's territorial integrity
While a diversity of opinion exists among Iranians regarding the
country's nuclear ambitions, the maintenance of the country's
territorial integrity is an issue which unites the vast majority of
countrymen of all ethnic, religious, and political persuasions. Amid
widespread concern and rumors in Iran that the United States is
flirting with a strategy of supporting ethnic Iranian separatists
groups, Washington should do its utmost to reassure the Iranian people
that such concerns are unfounded.
Mr. Chairman and Senator Biden, I believe there are two equally
plausible visions for Iran's future. One is a hostile, backward-looking
nation increasingly isolated from the international community, but with
enough oil wealth to fund military and paramilitary groups which
repress popular demand for change. Despite popular discontent, such a
situation could be sustainable in Iran for years if not decades; an
Islamic Cuba, with potentially a nuclear weapon.
The second scenario is of a country which has made amends with the
United States, is reintegrated into the international community,
experiences large flows of foreign investment, a strengthened middle
class, a burgeoning private sector, and a free flow of tourists and
members of the Iranian diaspora visiting freely. It is this scenario
which will provide fertile ground for Iran's transition to a more
tolerant and democratic system at peace with the international
The Chairman. Well, thank you very much, Mr. Sadjadpour.
STATEMENT OF DR. PATRICK CLAWSON, DEPUTY DIRECTOR FOR RESEARCH,
THE WASHINGTON INSTITUTE FOR NEAR EAST POLICY, WASHINGTON, DC
Dr. Clawson. Thank you. I'd like to pick up on some of the
things that Dr. Pollack referred to about Iran's economic
situation and how that could influence its thinking about its
Iran has very serious economic problems of its own making.
The country has a growing unemployment which the World Bank
warned could, ``threaten its economic, social, and political
situation.'' And Iran's per capita income today is 30 percent
below that of the prerevolutionary period. At a time when the
rest of the world incomes have doubled, Iran's income has
fallen. And these serious economic problems create a lot of
vulnerability to foreign pressure. Much of the discussion about
foreign pressure is about multilateral sanctions imposed by the
U.N. Security Council. And, in fact, I would suggest that going
that route is a good way of giving Ahmadinejad a rallying point
around which to say to his people that the rest of the world is
ganging up on us and to feed this populist nationalism that he
has been such a master at manipulating. So I'm not convinced by
any means that U.N. sanctions route is the best route.
Something below the horizon which can impact Iranian business
may be a better way to go. In that regard, the de facto
sanctions which the governments in Europe and also this
government have been talking about may be a good way to
persuade businesses to pull out of Iran and to have the impact
on the business and economic elite that Dr. Pollack referred to
without having to give the red flag that Ahmadinejad can wave
The U.S. Government has been quite creative at pushing
other governments about how are they going to be implementing
the two relevant U.N. Security Council resolutions: 1373, which
calls on governments to take action against the financing of
terrorism and support for terrorism; and 1540, which calls on
governments to take action to prevent the proliferation of
weapons of mass destruction and the financing of this. We've
also been quite effective at reminding banks around the world,
and industrial companies around the world, that they really do
have to go through the U.S. banking system if they want to
carry out their economic activities, and do they really want to
be doing business with these bad guys? It's going to cause them
a lot of problems in their public relations and a lot of
problems with the U.S. Government.
We've already seen quite a bit of success about this. That
is to say, the three largest European--excuse me, three large
European banks--two large Swiss banks and the largest British
bank have stopped doing new business in Iran. And recently a
state-owned Iranian bank said, and I quote from this report
from the Karafarin Bank, ``The fear of imposition of sanctions
by the United Nations against Iran in connection with the
nuclear enrichment issue has reduced the reliability of Iranian
banks as international trading partners. . . . This may prove
to be for the banks and the country as a whole, one of the most
important obstacles to hurdle in the months to come.''
So I would argue that going this route of pursuing de facto
sanctions fits in well with also European traditions about
providing informal guidance to companies about what to do, and
that it is something that we can do with a coalition of like-
minded countries rather than relying on the Security Council,
where there can be grandstanding and, of course, there's always
the veto issue. Plus, as the Russians and Chinese remind us,
that every time we talk about sanctions at the United Nations,
we are also talking about the authority to use military force
at the same time; whereas, if we do this, discourage business
in Iran through these de facto sanctions, we don't run into
these kinds of problems.
Some will counter that putting economic pressure on Iran
right now is pretty tough given the state of world oil prices.
And it's certainly true that the Iranians are feeling very
self-confident at the moment. But, in fact, times in Iran are
not so good despite the high oil income. Last year the stock
market fell by 26 percent. And, again, quoting from the
Karafarin Bank's report, it said that, ``The [Tehran] stock
market has shown to be hypersensitive to political issues (such
as the course of the nuclear enrichment negotiations), as well
as domestic economic policy uncertainties.''
So I would suggest there is much that we can do even while
oil prices remain high, and furthermore, the last couple times
around when oil prices were high, that only lasted for 3 or 4
years, and then they came crashing back down again. And so I
wouldn't get to be so confident as the Iranians. In 1981 prices
went up; they came way back down again in 1985 because of
increased production and conservation.
Some will say that economic pressure is not going to
dissuade hard-line Iranian leaders, and I would agree with Dr.
Pollack that someone like Ahmadinejad doesn't seem to factor
economics that much into his calculations. But Ahmadinejad was
elected not because of his stance on the nuclear program, but
because of his economic populism and all these promises he's
been making as he runs around the country offering to build a
hospital there and a school there. When he can't deliver on
those promises, he's going to have a problem. Now his two
predecessors, both Mr. Rafsanjani and Mr. Khatami, came into
office with grand plans for how to remake Iran, and they each
got about 2 years into their terms before their plans turned to
dust. They ran into a lot of resistance against a system which
is really pretty hard to move, and they found themselves
undercut by the Supreme Leader, who forced them to throttle way
back on their plans. And if I had to guess, I'm going to give
Ahmadinejad about the same period, about 2 years where he goes
ahead with his plans to rekindle revolutionary fervor before he
is going to find that his plans turn to dust, and he gets
yanked back by the Supreme Leader once again.
Lastly, as Dr. Pollack mentioned, I'm skeptical about using
economic inducements as well as pressure on Iran, and one
important reason is that it's a lot easier to pull on a rope
than it is to push on it. And if we offer Iran economic
inducements, that's not going to have much impact on the
Iranian economy so long as they're following the inappropriate
and ineffective, and, frankly, stupid policies that were there
even before Ahmadinejad came in, and he's only made them worse.
So all of our economic inducements aren't going to do very much
to the Iranian economic state, and the Iranians will realize
that pretty soon and then say, well, what do we get for all
this, and the answer is not very much. On top of all this,
economic inducements can look like bribes, which just encourage
So I am a fan of security inducements, and several of the
previous speakers have noted that some of the security
inducements that we could offer would be mutually advantageous.
Things like confidence and stability building measures would be
in the interests of both sides. If we had an agreement about
how to prevent incidents at sea, or if we had an exchange of
military observers and exercises, both sides would benefit.
There's a lot of talk about one security inducement which
concerns me, and that is about a security guarantee for the
regime. We don't guarantee the survival of any regime, anywhere
in the world. Whether or not a regime survives is up to its own
people. But what we can do is provide a conditional security
insurance, which is a fancy way of saying if you don't attack
us, we won't attack you. And that, really, is what we ought to
be talking about, which is, if you give up your nukes then we
agree that if you don't attack us, we won't attack you. That,
rather than guaranteeing the regime, is a security approach
that we could have taken in other situations and could take in
this case without compromising our stand in favor of democratic
change inside Iran.
[The prepared statement of Dr. Clawson follows:]
Prepared Statement of Dr. Patrick Clawson, Deputy Director for
Research, the Washington Institute for Near East Policy, Washington, DC
If Iran saw its nuclear program as essential to defending the
country's very existence--the way Israel and Pakistan view their
nuclear programs--then economic considerations would make little
difference to Iran's calculations. But defense is not the principal
factor behind the Iranian nuclear program. Rather, Iran's principal
motives for its nuclear program are the pursuit of prestige and
influence. Iranian leaders consistently present the nuclear program as
an accomplishment of Iranian science and as evidence that Iran is an
advanced modern industrial power. They also argue that Western
opposition to Iran's nuclear ambitions are an effort to keep Iran down,
to prevent the country from assuming its rightful place as a leader in
the region and the broader Muslim world. They play to Iranians'
national pride, to their sense that Iran is naturally a great power--
not to any sense that Iran is so threatened that it must take desperate
steps to defend itself.
The challenge for the West is to persuade Iran's powerholders that
the nuclear program will not advance Iran's prestige and influence.
Economic instruments can play a role in this regard, though they are
most unlikely to be sufficient by themselves.
Unfortunately, the West's ability to press Iran has eroded in
recent years. Iran's leaders are now remarkably self-assured, given the
conjunction of favorable circumstances, including the end to threats to
Iran from Iraq and Afghanistan; the United States being tied down in
Iraq; and victories by pro-Iranian forces in Iraqi and Palestinian
elections. Economic factors play no small part in this self-assurance,
as documented by the recent International Monetary Fund report (the
source of all the economic figures I cite, unless otherwise noted). Oil
and gas exports have shot up from $23 billion in 2002/03 to $55 billion
this year, driven entirely by higher prices (Iran got $23 per barrel in
2002/03 and will get $55 this year). The oil exports have swelled
government coffers allowing an explosion of off-budget spending that
has sent economic growth shooting up to an average of 6.2 percent a
year (discounting for inflation) from 2002/03 to this year. Foreign
exchange reserves have shot up to $47 billion, more than twice the size
of all foreign debt, and are expected to rise further to $62 billion by
the end of this year.
In light of the favorable strategic situation, many in the Iranian
leadership are no longer convinced that it must maintain strong ties
with Russia and Europe, nor do they think that these relationships have
brought Iran any benefits to date. To the extent that this self-reliant
attitude prevails, it will be harder to persuade Iran to cooperate with
the international community. However, if the great powers can remind
Iran about the true danger of isolation, the terms of the nuclear
debate in Iran will change. Conceding will be difficult for Iran, but
the Islamic Republic has in the past made difficult compromises with
its revolutionary principles, such as ending the Iran-Iraq war.
Complicating the situation is that Iranian President Mahmoud
Ahmadinejad seems to welcome the prospect of an attack on Iran as a
means to rekindle the lost fervor of the early revolutionary days.
While he represents a dangerous and growing element in the Iranian
elite, the real power holder has been the Supreme Leader (who is
exactly what the title suggests), Ayatollah Ali Khamenei. For the last
18 years, Khamenei has preferred low-level confrontation with the
West--just enough to keep the revolutionary spirit alive, but not
enough to risk open hostilities. For now, Khamenei seems to think that
the West, despite its tough rhetoric, will do nothing to stop
Ahmadinejad, so why not let him push ahead.
Having pegged his reputation on his ability to help the ordinary
man, Ahmadinejad faces serious problems: The economy is a mess, his
policies are disastrous, and Iranians' expectations are sky-high. The
World Bank's 2003 report about Iran noted, ``Despite the growth in the
1990s, GDP per capita in 2000 is still 30 percent below what it was in
the mid-1970s, compared with a near doubling for the rest of the
world.'' Iranians are galled to find that their country has slipped
badly behind the Arabs on the south side of the Persian Gulf, whom they
traditionally have regarded as their social inferiors. Thanks to the
tens of thousands of Iranians living in Dubai, Iranians know full well
that Dubai is booming because it has embraced globalization, while
their country falls ever farther behind, trapped by its suspicion of
Ahmadinejad's policy is based on producing everything at home and
creating barriers to trade--he has no use for globalization. His
government has been discouraging foreign investors, for instance,
refusing to allow Renault to use the billion-dollar facility it built
in Iran to build an inexpensive car for the Asian market. The recent
Iranian boom has been based almost entirely on profligate government
spending which cannot last forever. Despite the flood of oil money,
government policies are such that the IMF warns the budget will fall
back into deficit again within 2 years even if oil prices remain sky-
The recent massive government spending has led to several years of
solid growth, yet it has barely dented the country's long-term economic
problems. While reported unemployment fell to an 8-year low of 10.3
percent last year, job creation remains insufficient to absorb the
700,000 young people entering the job market each year. The IMF
forecasts that even if oil prices remain at their present high level,
unemployment will steadily increase in years to come. In its 2003
report, the usually sober and understated World Bank summed up the
``daunting unemployment challenge'' with strong words: ``Unless the
country moves quickly to a faster path of growth with employment,
discontent and disenchantment could threaten its economic, social, and
Economic and political frustration is feeding social problems. One
is chronic drug problem, with the Iranian Government acknowledging that
2 million people use narcotics, mainly opium; other estimates are
higher. Divorce is on the rise; one study found that 30 percent of
newlyweds got divorced within 3 years. Another is increasing
prostitution; the official estimate is 300,000 prostitutes. There have
been a number of corruption scandals involving judges and government
social workers involved in prostituting young girls. Instead of making
reforms that would allow entrepreneurs to create jobs, the political
elite is more comfortable with the ``solution'' of rising emigration
rates, especially among the well educated. In sum, many of Iran's best
and brightest are leaving the country, and a growing number of those
remaining are at risk of becoming an underclass.
BUSINESS CONFIDENCE: THE ACHILLES' HEEL
Given that inappropriate government policies are already making the
Iranian business community nervous, international pressure on the
economy could have a major impact on business confidence. ``The [Tehran
stock market has shown to be hypersensitive to political issues (such
as the course of the nuclear enrichment negotiations), as well as
domestic economic policy uncertainties,'' writes the state-owned
Karafarin Bank in its Survey of the Iranian Economy for October-
December 20. In 2005, the stock market index fell 26 percent. At the
same time, the banking system was hit by a crisis from dishonored
promissory notes, primarily by big firms unable to pay their debts.
With even Iranian fans nervous about business conditions, there are
excellent opportunities to press foreign firms to reduce their presence
in Iran. There have already been some notable successes in this regard.
Strict U.S. Treasury application of existing rules about fund
transfers--such as those to prevent transfer of funds to terrorists and
weapons of mass destruction proliferators--led the two largest Swiss
banks (UBS and Credit Swiss) and a large British bank (HSBC) to decide
recently that Iran was not an attractive place to do business, so they
stopped taking new business. The impact that this is having was well
described by the state-owned Karafarin Bank in its Survey of the
Iranian Economy for October-December 2005:
Most probably, the fear of imposition of sanctions by the
United Nations against Iran, in connection with the nuclear
enrichment issue, has reduced the reliability of Iranian banks
as international trading partners. In other words, despite [an]
important balance of payments surplus, Iranian banks have been
facing difficulties dealing with their otherwise cooperative
correspondents. This may prove to be for the banks and the
country as a whole, [sic] one of the most important obstacles
to hurdle in the months to came.
There is much scope for working with U.S. allies to more vigorously
apply restrictions an financial transactions and trade with Iran. U.N.
Security Council Resolutions 1373 and 1540 call on countries to adopt
and enforce effective controls on funds and services that would
contribute to terrorism and WMD proliferation respectively. The United
States and its allies can approach countries to ask what are they doing
to implement these resolutions regarding Iran, especially in light of
the International Atomic Energy Agency (IAEA) decisions finding Iran
has violated its safeguards agreements with the IAEA. Industrial firms
can be warned about the many items which could be diverted from their
declared peaceful intentions to be used instead in the nuclear program.
Banks can be cautioned about the negative publicity as well as
regulatory complications if they were found to be facillitating shady
businesses. European governments excel at using such quiet warnings,
which can be very effective at persuading firms that the Iran market is
not worth the risks; indeed, a number of European governments seem
already to be passing such warnings. The U.S. Treasury has a well-oiled
machinery for implementing restrictions, and its warnings to banks can
be particularly effective since few banks in the world are willing to
risk being cut off from dealings with the U.S. financial system. That
same machinery could be extended to press firms considering investments
in the Iranian oil and gas industry.
Tighter restrictions are ``de facto sanctions'' which have many
advantages over formal sanctions imposed by the U.N. Security Council.
Russia and China have no veto over tightening restrictions. In the best
of cases, obtaining Security Council consensus for action takes a long
time, whereas tightening restrictions can be done much more quickly.
Action by the Security Council provides Ahmadinejad with a banner
around which he can rally nationalist reaction, claiming that the
country is under attack. By contrast, tighter restrictions operate
under the public's radar screen, while their impact is fully felt by
the business community--which in Iran means first and foremost the
revolutionary elite which behind the scenes controls the economy as
fully as it does the political system.
OIL'S MIXED ROLE
Given that Iran's goal is to use its nuclear program to achieve
influence and prestige, fewer instruments would seem better suited to
that task than its oil exports. It has been suggested that were Iran to
make good on threats to cut off its oil exports of 2.5 million barrels/
day, this action would hurt the West so much it might have to back off
on its pressure against Iran's nuclear program.
Perhaps--but perhaps not. The present tight world oil market will
not last forever. Production outside of OPEC is increasing, not least
under the stimulus of high prices, and the return of Katrina-damaged
facilities will only add to the higher output. Despite the red-hot
Chinese and Indian economies, world demand is growing more slowly as
price influences consumption. It is not beyond the realm of possibility
that within the next few years, oil markets could become much more
slack. After all, that was the experience after both the 1973-74 and
1980-81 price increases: Within 4 years, the oil market got soft. In
short, the more time that passes, the less may be Iran's strategic
leverage regarding oil.
Indeed, the world oil situation is already changing, though that
fact is obscured by the fears of consumers and speculation of traders.
In April 2006, world oil production was 1 million barrels/day higher
than demand, according to the prestigious Petroleum Intelligence
Weekly. Plus OPEC countries--principally Saudi Arabia--had excess
production capacity of about 1.5 million barrels/day, and the world
refinery situation is changing such that the heavier Saudi crude oils
could be more readily absorbed (last year when Saudi Arabia wanted to
sell additional oil to offset post-Katrina price spikes, refineries
were unable to take advantage of the exceptionally low prices offered).
Those two factors alone could have made up for a cutoff in Iranian oil
exports, even without the use of the West's approximately 1.4 billion
barrels in strategic reserves, which are the equivalent of 560 days of
Iranian exports (figures from the International Energy Agency).
Were Iran to cut off its oil exports, the impact on the Iranian
economy would be considerable. To be sure, Iran's ample foreign
exchange reserves would cushion the impact, but those reserves would
only be sufficient to pay for a year's imports (or, if Iran cut back
imports to the bone, for 2 year's imports at that low level). And the
Iranian Government relies on oil revenue to fund 75 percent of its
expenditures, according to Karafarin Bank (the IMF reports are not much
help on this issue, because the government has taken to conducting so
many of its operations outside the budget through various shady
Perhaps the most immediate Iranian vulnerability regarding oil is
its dependence on imported gasoline, which provide about 40 percent of
the 350,000 barrels of gasoline sold daily. However, this vulnerability
is less than meets the eye. The price of gasoline at the pump is 800
rials per liter, or about 35 cents a gallon. Such a ridiculously cheap
price encourages rampant smuggling of gasoline to neighboring
countries, such as Turkey and Pakistan, where gasoline prices are more
than 10 times higher than in Iran. Plus the low pump price leads to
excessive gasoline consumption that gives Tehran some of the world's
most polluted air; schools frequently have to close because it would be
unhealthy for children to go outside. And the low gasoline price
results in a massive loss of government revenue; just the cost of
distributing the fuel after it leaves the refinery gate is more than
what the customer pays. The IMF and World Bank have spent years
documenting in great detail the pernicious economic and health impact
of the excessive gasoline consumption. In short, there are few steps
which would help the Iranian economy more than forcing a reduction in
gasoline consumption. And the Iranian Government is well along with
plans to ration gasoline from September 2006--plans which would allow a
quick response in the event of a gasoline import cutoff.
A final word about the role of oil in thinking about Iran's nuclear
program. It is tempting to assume that Iran can use its oil riches to
influence the decisions of other governments. However, there is
remarkably little evidence that Iran has successfully used oil to
induce other countries to turn a blind eye to its nuclear violations.
Consider for instance that the great power most reluctant to press Iran
has been Russia, which is a fellow oil exporter and could, therefore,
benefit if Iranian oil were kept off the market. Indeed, there is
little reason to think that Moscow's approach has been affected by any
economic consideration, which is not surprising given the remarkably
favorable economic circumstances Russia finds itself in, with the main
dilemma facing the government being how much of the vast budget surplus
to spend and how much to save. As for Iranian efforts to use oil
projects to influence China, Japan, or India, they seem to have had
little impact, in part perhaps because Iran has been unwilling to offer
particularly attractive terms to foreign investors. The eye-poppingly
large deals announced with great fanfare have all run into serious
difficulties over the terms and conditions.
THE LIMITATIONS OF ECONOMIC INSTRUMENTS
Economic instruments alone are unlikely to be sufficient to
persuade Iran to freeze its nuclear program. The principal levers of
power in Iran are in the hands of revolutionaries who are not motivated
primarily by economic concerns, while those who care about the state of
the economy do not have sufficient influence on their own to persuade
the real powerholders to change policies. Success at influencing
Iranian policy is much more likely if action on the economic front is
combined with action on other fronts. In particular, the security
apparatus--especially the Revolutionary Guards--are a vital power
center in Iran. They need to be convinced that the current nuclear
policies are threatening Iran's security, because Iran's neighbors and
the great powers will react in ways that will hurt Iran. If Iran makes
the gulf a more dangerous place, then the United States and other
powers will need to deploy more powerful military assets to the region,
if for no other reason to protect shipping from Iranian threats to
close the Strait of Hormuz. And Iran's nuclear program could start an
arms race, which the gulf Arab monarchies and Turkey would win, since
compared to Iran they are both richer and have better ties with the
world's principal arms suppliers.
Much as pressure should be applied on several fronts rather than
just on the economy, so inducements offered Iran should take multiple
forms rather than only being trade and investment incentives. Indeed,
economic inducements look suspiciously like bribes paid for bad
behavior. Besides being odious, such bribes give the impression that
bad behavior is more profitable than good behavior. Pro-Western
reformers were unable to secure a trade agreement with Europe or
substantial U.S. relaxation of its economic sanctions despite their
obvious interest in improving relations, but now it appears that anti-
Western hard-liners may achieve those objectives--which suggests that
Iran would be well advised to be obnoxious rather than cooperative. No
matter how creatively one designs or packages economic inducements,
they will inevitably look like reward for bad behavior.
A much more appropriate form of inducement would be security
inducements. Such security inducements should be designed to counter
the argument that Iran needs nuclear weapons for its defense. There are
many confidence- and security-building measures and arms control
measures that would provide gains for both Iran and the West, similar
to the way such steps reduced tensions between the old Warsaw Pact and
NATO during the cold war. One example would be an agreement to reduce
the risk of incidents at sea between the United States and Iranian
A further security inducement which the United States could offer
would be to address the reported concern that the Bush administration's
real goal is regime change in Iran and that the Bush administration
will use force to that end. Such complaints sound peculiar coming from
an Iranian Government whose President lectures President Bush on why
the United States should abandon its liberal democracy and who
sponsored a conference last fall on the theme ``The World Without
Zionism and America''--a government which regularly organizes mass
demonstrations filled with the chant ``Death to America.'' Perhaps we
should take as a compliment that Iran's hard-liners expect the United
States to be more restrained than they are; we certainly do not
organize terror attacks to blow up their barracks the way they did at
Khobar Towers in 1996 or in Beirut in 1983.
It would of course be inappropriate for the U.S. Government to
offer any security guarantees to the Iranian or any other government;
what government is in power in another country is up to the people of
that country to decide. But what Washington could offer Tehran would be
a ``conditional security assurance''--jargon for the simple
proposition, ``We will not attack you if you do not attack us.'' To
clarify what that means, the U.S. Government should spell out:
``Just as you criticize us for our liberal democracy, we
will remain free to criticize you for your undemocratic
violations of human rights.
``Just as you spend tens of millions on radio and television
broadcasting to our country to propagate your views, so we will
remain free to support broadcasts to Iran.
``Just as you tightly restrict trade with America, we will
remain free to restrict trade with Iran.''
Such a conditional security assurance might not be all that Iranian
hard-liners want, but at the very least, it would help in the battle to
influence European and Middle Eastern opinion that the United States is
being reasonable and Iran is not. Since Iran's main objective in
pursuing its nuclear program is to gain influence and prestige,
Washington's strategy should be to show that Tehran's obstinate nuclear
stance is undermining Iran's influence.
The Chairman. Thank you very much, Dr. Clawson.
STATEMENT OF DR. GEOFFREY KEMP, DIRECTOR OF REGIONAL STRATEGIC
PROGRAMS, THE NIXON CENTER, WASHINGTON, DC
Dr. Kemp. I'm the last speaker, Mr. Chairman, so how do I
make this interesting? [Laughter.]
I was asked to talk about three issues: Russia and China,
the attitudes of Iran's neighbors, the opportunities for
containing Iran by the neighbors, and a fourth issue that I
think is very important, the necessity for United States-
European cooperation to continue.
On Russia and China, Mr. Chairman, I am convinced that
Russia is a key player, that Russia could have played a much
tougher role in containing Iran's nuclear program, and that if
it had done this, the Chinese would have gone along. They do
not want to be the lone dissenter. But, frankly, in my
judgement, we've not handled the Russian portfolio with great
skill on this particular issue.
Russia sees Iran as a cooperative partner in an unstable
part of the world, straddling the Caucasus and Central Asia. In
contrast, the Russians see American policy toward the near
abroad as provocative. And while the laudatory objectives of
the Bush administration to nurture more freedom in Eurasia and
develop more pipeline routes are sensible, this does not help
the Russians in their decisions on Iran.
And I think that those of us who've talked to Russians, and
many of us have, what you hear, is that if you want us to take
the step of leaning very hard on our partner, Iran, then you
have to offer us some quid pro quos. And the quid pro quos that
you normally hear discussed have to do with our efforts to get
Ukraine into NATO. In my judgement, the Russians and the
Chinese are both playing power politics on the issue of Iran,
and I don't think they see any reason to help us on the
particular nuclear issue unless there is something in it for
them. And, frankly, aside from the broad goals of
nonproliferation, I don't think we are offering them very much.
Now, to change the subject, what about the neighborhood
that Iran finds itself in? What do the neighbors think about
this current regime and its behavior, particularly on the
nuclear front? The neighbors of Iran all have specific problems
with the leadership, but I think they all share a concern about
the nuclear program. The dilemma is, of course, that Iraq's
Shi'a leaders owe a great deal to Iran and have nurtured very
close ties with the mullahs while also making it clear they do
not want to see the establishment of a Shi'a theocracy in Iraq.
Turkey and Iran share common concerns about the evolving
problems in the Kurdish region in northern Iraq, and we've seen
reports of Iranian troop movements in the north and Turkish
troop movements in the north, suggesting that this tranquil
area may not be tranquil forever.
The key Sunni states of the region are very, very fearful
about Iran's hegemonic tendencies, and, as you know, there's
this talk throughout the Arab world about a ``Shi'a Crescent''
emerging from Iran through Iraq into Syria and Lebanon. We can
dispute that, but there's no doubt that is a concern.
The smaller gulf states plus Saudi Arabia worry about the
impact of Iranian hegemony on their own Shi'a populations. The
UAE has longstanding territorial disputes with Iran. Quatar has
become perhaps our most reliable military ally in the region
apart from Kuwait, and, therefore, has certainly taken sides on
this issue. I think Oman is probably the least worried country
in the gulf about what the Iranians are doing.
Now, how do we assess, therefore, the development of an
Iranian nuclear program on gulf security? Here I think there is
a major difference between Saudi Arabia, the large country, and
the smaller countries that are basically going to have to
depend on us for their security no matter what the Iranians do.
In the case of Saudi Arabia, they have the money and the
wherewithal, not the technical wherewithal but the political
wherewithal, to essentially buy themselves some form of
deterrence if the Iranians get the bomb. You will remember in
the 1980s that when we, the United States, refused to upgrade
the Saudi F-15 fleet with conformal fuel tanks because that
would extend their range deep into Israel, they, unknowingly to
us, turned to China for medium-range surface-to-surface
missiles, which they still have in their inventory. How good
they are, we don't know, but they have them there. And there's
no doubt in my judgment that if the circumstances arose where
Iran had a nuclear program, they could do likewise, and there
are countries who I think would be prepared to be very
supportive of them. Pakistan immediately comes to mind.
If the Iranians crossed the threshold and actually produced
some form of nuclear device what would be the major concern? At
this point in time, in the Arab Gulf at least--the concern
would be that there would be a preemptive United States and/or
Israeli strike, which they believe would be highly
destabilizing, not only because of their own internal problems,
which I alluded to, but because of the impact that could have
on the oil market, and, of course, they're all there together
in this highly vulnerable gulf infrastructure.
The problem also is that there's huge suspicion about how
much we really know about the Iranian weapons program. The
failure of the intelligence on Iraq has had an enormous impact
on our credibility.
I go on in my testimony to talk about opportunities for
containing Iran, even if it goes as far as a nuclear weapon.
And indeed there are many things we could do in bolstering the
security of the region, not only with our own forces, but in
providing more capabilities to the local countries to defend
themselves, so that at the end of the day, when the Iranians
look around at their strategic environment if they get the
bomb, they may find themselves even less secure because the
neighbors have responded with upgrading their own military
Let me end, Mr. Chairman, since it's getting late, with my
overview of where we stand today, diplomatically. I think the
Iranian Government, as my colleagues have also been inferring,
feels supremely confident at this point in time that neither
the United Nations, nor the IAEA is going to really do anything
to hurt them. And, therefore, I think what we have to fall back
on is the issue as to whether or not this coalition of the
willing that Dr. Clawson alludes to, mainly the United States
and the Europeans, will be prepared in the last resort to use
strong economic and diplomatic measures against Iran,
irrespective of what the United Nations, Russia, China decide
to do. And here the real pressure is on the Europeans. Don't
forget we've had Iran under sanctions now at full speed since
the mid-1990s. The Europeans keep avoiding the discussion of
imposing sanctions similar to ours, in part because they
haven't yet agreed among themselves about whether they think
this is a wise idea or whether they can get consensus among
themselves. But there's no doubt in my judgement that if the
European Union were to do to Iran what we are currently doing
in the economic arena, it would have a very serious impact on
the Iranian economy for all the reasons that my colleagues have
pointed out. It would not, however, change the Iranian behavior
on the specific issues that we are most concerned about at this
point in time: The nuclear threat, terrorism, and their
treatment or attitude toward the peace process in Israel.
So while I think that European and American and Japanese
economic sanctions against Iran would have a long-term impact
on the regime, and that might in turn bring about much more
discontent with the current leadership, we should not kid
ourselves that this is going to change anything in the short
The Iranians are showing, at this point in time, sort of
almost gleeful defiance, not only at ourselves but at the
international community. Mr. Ahmadinejad's statements about
Israel have actually stimulated a lot of support in certain
Islamic countries, and once he saw this happening, he's then
been repeating it time and time again. But I think, as my
colleagues have pointed out, the Iranians would be unwise to
assume that things will go their way indefinitely. And in this
regard I agree with most of my colleagues that Iran's vital
national interests would be helped by ending the standoff with
the United States. I believe that we should have a dialog. I
think we have far more to gain than to lose if we have a
coherent and pragmatic policy toward the Islamic Republic, and
I think in the long run that will benefit everybody.
[The prepared statement of Dr. Kemp follows:]
Prepared Statement of Dr. Geoffrey Kemp, Director of Regional Strategic
Programs, the Nixon Center, Washington, DC
Mr. Chairman, I am grateful for the opportunity to speak to you and
your colleagues about a matter of grave importance to the United
States, namely Iran's behavior and its nuclear program. The committee
has asked me to comment on three subjects:
Can Russia and China be helpful in pressuring Iran to change
its present course?
What are the attitudes of Iran's neighbors to the current
regime and the course it has chosen to pursue?
Do opportunities exist in the region for those seeking to
I will add a fourth issue:
The need for continued U.S.-EU cooperation
Can Russia and China be helpful in pressuring Iran to change its
There is no doubt, in my opinion, that Russia is the key player on
this matter and that with adroit diplomacy it would have been possible
to obtain the cooperation of the Putin government to put far more
pressure on the Iranian regime to put limits on its nuclear program. In
the event of Russian cooperation it is unlikely that China would be the
lone dissenter to joint pressure against the Islamic Republic.
However we have not handled the Russia portfolio with skill. Russia
sees Iran as a cooperative partner in an unstable part of the world
straddling the Caucuses and Central Asia. In contrast the U.S. policy
toward Russia's ``near abroad'' is seen in Moscow to be provocative.
The laudatory objective of the Bush administration is to nurture more
freedom in Eurasia and to develop multiple pipeline routes in the
context of energy security. However in the specific context of
persuading Russia that it is in its interests to turn on one of its
partners, Iran, it must be asked what it is we are offering the
Russians to make this difficult choice worthwhile? Russians privately
tell you that if the Americans want to deal on Iran then it would
require some quid pro quo, such as not encouraging Ukraine to join NATO
or not deliberately making provocative speeches in the region a few
weeks before the G-8 summit in St. Petersburg. I would have to conclude
that while there are good arguments for being critical of Russia and
being supportive of neighbors such as Ukraine and Georgia, the Baltic
States, and Kazakhstan, such pronouncements are counterproductive in
the context of Iran policy.
Seen from the Russian point of view, not only are we interfering in
their backyard, but if we eventually improve relations with Iran as
part of some ultimate ``grand bargain'' and remove economic sanctions
then Russia stands to lose a great deal of economic leverage in that
country while witnessing the return of the United States and all that
entails for the region.
A similar set of tradeoffs could be made in the context of China.
China is not unhappy to see us struggling in the Middle East, even
though it does not want to see a failure in Iraq. Neither does it want
to see an Iranian nuclear program. Yet China, too, would need some quid
pro quo to put serious pressure on Iran.
What are the attitudes of Iran's neighbors to the current regime?
Iran's neighbors have different specific problems with the current
leadership in Tehran but all are concerned about its nuclear program.
Most of Iraq's Shi'a leaders owe a big debt to Iran and have nurtured
close ties with the mullahs while making it clear that they do not wish
to establish a Shi'a theocracy in Iraq. Turkey and Iran share common
concerns about the evolving Kurdish region in northern Iraq. The Sunni
Arab States are all fearful of Iran's hegemonic tendencies and talk
about a ``Shi'a Crescent'' running from Iran, through Iraq into Syria
and Lebanon. The Gulf States with significant Shi'a populations,
notably Saudi Arabia and Bahrain, worry about domestic pressure. The
UAE has a longstanding territorial dispute with Iran. Qatar has become
a firm military ally of the United States. Oman is probably the least
worried about Iran, though this could change.
How to assess the impact of Iran's nuclear program on gulf
security? There is a major difference between Saudi Arabia and the
smaller GCC countries, because of Saudi Arabia's size, budget,
infrastructure, and regional aspirations. For instance, unilateral
options open to the smaller Gulf States in the event of an Iranian bomb
are very limited. Saudi Arabia, however, has the capacity and the
wealth to consider some form of nuclear deterrent, most likely in
cooperation with another country, such as Pakistan. Saudi Arabia
already has Chinese SS-2 medium range missiles in its current
inventory. It is not unreasonable to assume that Saudi Arabia could
engage in nuclear purchases, either the basic fissile materials to make
a bomb or a finished product. Furthermore, it is not only an Iranian
bomb that could motivate Saudi Arabia to consider such an option. The
propensity of Saudi Arabia to think about a nuclear option is related
to the state of its relationship with the United States, which, until
recently, was always considered the protector of the kingdom in the
Aside from Saudi Arabia's reaction, the most likely initial
response of the gulf countries to the news of an Iranian nuclear
weapons program will be concern about possible United States and
Israeli preemptive military actions. The Bush administration and
Israeli leaders have both made it clear that the Islamic Republic's
possession of the bomb will be an intolerable threat.
However, since the Iraqi war and the unreliability of Western
intelligence concerning Iraq's WMD programs, the case for preemptive
war against supposedly proliferant states has been weakened and,
therefore, the political costs of undertaking such action in the future
have become much higher. If there is uncertainty with intelligence
about an Iranian bomb, the United States and Israel will have problems
garnering support for military action. Even if the evidence is
overwhelming and highly convincing (i.e., Iran either tests a nuclear
device or announces it is building the bomb), there will be reluctance
to endorse United States-Israeli military action for fear of the chaos
this could bring to the gulf and the region.
Do opportunities exist in the region for those seeking to contain Iran?
An Iranian nuclear program means the United States will have strong
reasons to maintain its military presence in the Gulf States. The
nature and purpose of enhanced military cooperation between the United
States and the Arabian Peninsula could take many forms. The most
important component would be a counterdeterrent to indicate to Iran
that any efforts to use nuclear weapons to intimidate or blackmail
would be challenged by the United States. The credibility of this
counterdeterrent would be linked to the vulnerability of U.S. forces
and U.S. targets themselves to Iranian intimidation. And here we are
referring to regional targets. Iran is not expected to deploy an
intercontinental ballistic missile capable of striking the continental
United States for many, many years. It is difficult to see under what
circumstances Iran could use its nuclear weapons in anger, except for
in some suicidal spasm similar to the scenarios that were heard so
frequently with respect to Saddam Hussein and his capacity for a
glorious Gotterdammerung ending to his fiefdom.
Need for continued U.S.-EU cooperation
The Iranian Government feels sufficiently confident of its
diplomatic position on the nuclear program, at both the United Nations
and the IAEA, to run the risk of a major confrontation with the United
States and Europe. The key test will be whether the United States and
Europe can continue to address this issue from the same set of
principles and talking points. Much will depend on whether the
Europeans are now finally prepared to join the United States on
imposing economic sanctions on Iran if pressures from the IAEA at the
Security Council fail. The Iranian nuclear issue will be a test not
only of U.S.-European relations, but of European resolve as well. It is
important to note how far out on a limb the European governments,
particularly Britain, France, and Germany, have gone in proposing this
agreement and what a challenge they face if the Iranians continue their
nuclear enrichment program.
Iran's leaders appear to have calculated that they can withstand
the diplomatic pressure they are likely to face and that even if
sanctions are imposed Iran has the will and financial resources to ride
them out. It remains to be seen what the long-term implications of this
are for both Iran's domestic politics and its actions in Iraq. If the
United States and Europe increase their rhetoric against the Iranians,
and if sanctions begin to hurt Tehran, Iran may use its bargaining
chips in Iraq at a critical moment in its post-Saddam political
evolution. The linkage between the Iran's nuclear issue and its role in
Iraq is becoming clearer.
Despite Iran's gleeful defiance of the international community on
the nuclear issue, it would be unwise for Iran's leaders to take their
current good luck for granted. The Islamic Republic faces significant
social and economic challenges that can only be made more difficult by
alienating the West. The embarrassing and unacceptable statements by
its new President calling for Israel's destruction, while a popular
theme in many Islamic countries, have harmed Iran's international image
and caused further anxiety with his behavior at home. Regionally, Iran
has poor relations with its Arab neighbors, and it cannot be assumed
that Iraq's Shiite community will remain friendly and grateful
indefinitely. Iran's vital national interests could be helped by ending
the standoff with the United States. Likewise, the United States has
more to gain than lose if it adopts a more coherent and pragmatic
policy toward the Islamic Republic.
The Chairman. Thank you very much, Dr. Kemp. We'll have a
round of questions and once again we will have an 8-minute
period for Senators.
Let me commence by asking you, Mr. Sadjadpour, frequently
persons talk about working with elements inside of Iran,
presumably persons, groups that might be helpful in creating a
dialog somewhat different from the official dialog that many
witnesses have suggested today at the highest levels,
conceivably with youth, even I understand that an Iranian
congressional delegation went to London recently and met with
legislators over there. But let me just ask you as a student of
who is in Iran and who might talk and who could make any
difference, Are there other avenues here, or are these sort of
wishful thoughts by many Americans who somehow are still
looking for persons who want peace and who want a different
situation, maybe who resist the mullahs, have any other views?
Are we able to identify those people, and would even contact
with them be dangerous for them, maybe not useful to be
identified as friends with whom we might talk?
Mr. Sadjadpour. Well, that's a great question, Mr.
Chairman. I think in the current context of United States-Iran
relations, not only with the military option not being taken
off the table, but also with $75 million recently earmarked for
supporting change in Iran, what is perceived in Tehran as a
passive or covert regime change approach, I think it's very
difficult to have official interaction with these types of
elements within Iran. The example I will give you right now is
a very dear friend of mine called Ramin Jahan Begloo, a
prominent secular intellectual who was imprisoned 3 weeks ago
and has been in solitary confinement since. He was a fellow at
the National Endowment for Democracy about 4 years ago, and he
has a great track record of being an apolitical, secular
espouser of nonviolence, et cetera. And I see in the current
context one of the wishes from his family, one of the first
wishes from his family, was that the U.S. Government doesn't
release any statements on his behalf, that it would be
counterproductive to his cause when he's currently being tried
on charges of--bogus charges of espionage.
So I think in the current context it's very difficult to
support these actors within Iran, simply because the costs for
them are tremendous, and then the United States has very little
leverage, if at all, to help their cause. But I would argue
that any types of interactions in terms of easing of visa
restrictions for Iranian students, as you said, congressional
delegations, both from the United States and Iran, interacting
with each other, scholars going back and forth, every time I've
seen these interactions take place, I always come away with
both--I see that the Iranian officials and the members of the
political elite who come and spend time in the United States
come away with a far more nuanced and understanding position of
the United States and vice versa. United States scholars and
academics and analysts who go to Iran come away with a much
better understanding of Iran's perspective. So I do believe
that interaction is definitely a plus, something that we should
push for, but in the current context it's very difficult to
support any types of political actors within Iran because by
helping them I think we're doing far more to hurt them.
The Chairman. Let me ask you, Dr. Kemp----
[Disturbance in audience.]
The Chairman. Please. I'm sorry. The committee will come to
We will be in recess until the police have removed the
The Chairman. All right. The committee will come back into
Dr. Kemp, let me ask you, what can the United States say to
China or to Russia that might bring a ray of cooperation with
them? Are there things that we can say to them, offer them? How
do we enhance our dialog with partners that we've all said
might well be around the table, I think. Would one suggest six-
power talks with Iran, maybe comparable to the North Korean
Dr. Kemp. Not easy. I think what we have to do is get our
priorities straight. I mean, if indeed we all agree that the
Iranian crisis is right up there with Iraq as a priority for
the administration and the country, then we have to make
tradeoffs. And it seems to me that in the case of Russia, we
are doing things in diplomacy that are not only unhelpful, but
seem to me to be somewhat provocative. And, therefore perhaps,
the first thing we should do is to lower our own rhetoric at
this point in time about some of the issues on which this
particular Russian Government feels extremely sensitive.
Now, you know, that of course means upsetting those who
want to hear us speak out more loudly for the extension of
democracy and freedom in Russia and in the near abroad and in
Central Asia, but we have to make some hard choices. And my
judgement is that it's not just that we're not offering the
Russians, or for that matter, the Chinese, any real incentive
to help us on Iran; in the case of Russia we seem to be going
almost in the opposite direction.
The Chairman. Let me just ask you, Dr. Clawson, quickly,
you suggest in your written testimony that Iran has had little
success using oil projects to influence China, Japan, and
India. Why is this? One has the impression reading the press
every day that given the sizeable contracts that are signed and
the oil that's to be delivered, that Iran has considerable
leverage over these countries.
Dr. Clawson. Well, a good example is what's happened this
last week. Iran signed a contract with India when President
Ahmadinejad went to India for shipping natural gas to India,
and Iran insisted on a price which was 40 percent higher than
what India is paying for the natural gas that it imports from
Quatar. And this week the Iranians said, well, you know we've
rethought this matter, and we've decided that's not good
enough--we want an extra 57 percent more in the price. So, in
other words, we want to get a price which is more than twice
what you're paying Quatar. And the Indians are saying, wait a
minute here--this deal's no good. We would have to be paying
much more than we could get the gas from other sources.
So the fact is that the Iranians have been insisting that
they're going to get every last penny out of these deals, and
they're not particularly attractive. So the Indians, in fact,
have said if you don't back off, we're going to, in fact, tear
up this deal because it's just not attractive. So, in other
words, while Iran has been prepared to sign big deals, it
hasn't been prepared to put even small bucks on the table to
make those deals attractive, and most of those deals are in
very serious trouble.
The Chairman. That's fascinating testimony because the
general impression is that the price is right, that essentially
there's a cohesion of effort here, but as you're pointing out,
the price isn't right, and apparently there are still
alternatives for the Indians, thank goodness, at least in terms
of their economic security. And I appreciate it. Senator Biden
and I just chatted for a moment when you talked about the stock
market in Iran going down 26 percent. It raises all sorts of
curious issues about the market, what's listed there and what,
in fact, happens in their economy. The fact that that market
might be sensitive to its foreign policy and actually reflect
that and be reported is interesting all by itself.
Well, let me cease for the moment and recognize my
colleague, Senator Biden.
Senator Biden. Well, you've asked some of the questions
that I wanted to raise, particularly with Dr. Kemp about what
we can essentially offer or forgo with regard to Russia and
China. The thing that surprises me the most, Dr. Kemp, is of
the seven administrations that have been here when I've been
here, this is the only one that doesn't seem to connect dots
very well. I mean, everything is bilateral. There doesn't seem
to be any ability to be able to figure out what may be in our
mutual interest if we offer A or B to Country X or Y that they
may change their policy with regard to a priority we have. I
don't get a sense--I mean, we really don't. In 6 years, I've
not gotten a sense there's any of that kind of thinking.
[Disturbance in the hallway.]
Senator Biden. Catchy tune. [Laughter.]
But you've answered that question. Here's what I take away
from your collective testimony--and any one of you jump in
here--that there is, the economy is critically important to the
regime to be able to have a prospect of not preventing a
rebellion, but providing some stability; that you vary in your
sense from Dr. Pollack to you, Dr. Clawson, and others in
between, as to whether or not the oil revenues that are
available now are enough to sort of satiate that or hold over
any kind of, if not eruption, any, you know, genuine discontent
within the country. And this notion that if given choices, as
one of you said, if given choices of sanctions or reintegrate,
they'd choose to reintegrate, but that requires you to have
some credible sanctions. Right now it seems to me the real
choice is they get a nuclear program, there are no sanctions,
and they're not denied from--they don't have total integration.
I think they can see their way through to integration once they
break through this nuclear piece and actually accomplish it or
get the rest of the world to back off. And so the central
question for me is, No. 1, who's really in charge? Who gets to
call the final shots? Is it the radical hard-liners? Is it the
mainstream? You know, Khamenei, is that where it is? What
influence do the Iranian people have on this process?
And the second big question I have--Dr. Clawson, you piqued
my interest in a way I hadn't thought about it, that a
coalition of the willing dealing with sanctions that affect the
banking industry, and/or an ability to encourage their domestic
companies to cease and desist from operations in Iran is fairly
powerful. And so I have two questions.
One, Dr. Pollack, What do you think about Dr. Clawson's
notion that if, in fact, the European Union would engage in the
same kind of sanctions that the United States is engaged in it
would have a material impact on attitudes in Iran?
And to ask all of you, in a sense what difference does it
make if the hard-liners are really calling the shots at the end
of the day, because they do not have any fear of this grand
bargain like was made in China. You let us continue our
despotic oligarchy and maintain the control over foreign policy
and your lives, we'll let you have economic growth. And this
grand bargain is going on where growth is occurring in China. I
think the game is to sort of satiate the desire for what we
call freedom. Is there any such dynamic going on in Iran?
So, first question, and maybe my only question in the 3
minutes I have left here, is, you know, who's in charge, and do
the sanctions that Dr. Clawson--assuming we could get them--do
they--would they matter, Dr. Pollack?
Dr. Pollack. Thank you, Senator. And my response will also
have to be brief. As the chairman is aware, I'm going to have
to leave to make an event at the University of Delaware, which
I know you would not want me to miss. [Laughter.]
Senator Biden. Get going. I'll go right to Clawson.
Dr. Pollack. I will answer quickly. First, with regard to
who rules, who's going to make this decision, the honest answer
that we all have to say is we don't really know. The Iranian
regime is, as Winston Churchill once said about Russia, a
riddle wrapped in a mystery inside an enigma. And even the
Iranians themselves, high-ranking Iranians in the government
often have difficulty predicting what's going to happen. I
think what we would all agree on is also though that the most
important figure in the regime is clearly the Supreme Leader,
Ali Khamenei, who has had the most decisive impact on Iranian
policy over the last 15 years. That said, he has typically, as
best we can tell, exerted that influence by balancing his two
camps off and coming up with very clever compromises that give
each of them half a loaf.
The policy which we are all more or less subscribing to in
one way or shape or form would ultimately be about driving Mr.
Khamenei to make a decision he doesn't want to make, which is
to say to him, you can't give each side half a loaf; one side
gets the whole loaf. Which side is it? And I think what we're
all betting is that, based on his prior behavior and the fact
that the regime, as Karim pointed out, is quite sensitive to
public opinion, we're betting that he ultimately, if faced with
that dilemma--faced with that choice--would say, I don't like
it, but the pragmatists, the economy get the whole loaf.
With regard to Dr. Clawson's idea, as always I think it is
a very clever one. I certainly agree. It is actually consistent
with something I wrote a number of years ago about the
importance of perhaps pursuing these sanctions in a
multilateral forum outside the Security Council because of the
problems we were likely to have in the Security Council. The
one caveat I would attach is, is that I think it is absolutely
critical that there be formal sanctions. As Dr. Clawson pointed
out, all of this kind of informal sanctioning that is going on,
this capital flight, the fear of doing business in Iran, is all
predicated on the expectation of sanctions, and if it, at some
point in time, it were clear that those sanctions were never
going to occur, I think all this informal pressure would go
away. So I think it is important, but I think it is entirely
possible to do it in a multilateral framework.
Senator Biden. Is that your--is that the context as you see
it, Dr. Clawson, that the threat of sanctions is the mover
behind the actions taken by various banks and others of not
investing or withholding or withdrawing? Are they connected? I
mean, tell me what you think about that.
Dr. Clawson. We've got a powerful helper in this process,
and his name is Ahmadinejad. With his stupid economic policies
and his discouraging foreign investment, and his imposing price
controls here, there, and everywhere, and announcing that the
way he's going to help the automobile companies is freeze the
prices that cars are sold at in a country with 20 percent per
year inflation, I mean, his stupid economic policies are making
the place a bad place to do business, and he's helping us a
lot, therefore, on this front.
Senator Biden. Well, let me ask you another way. The threat
of sanctions out of the Security Council or wherever, formal
sanctions, how much of a factor is that in the broader point
you made about sanctions that are less formal but coherent?
Dr. Clawson. For the key actors involved in the Iranian
economy at the moment, not very. So for instance, you've got
Renault and Total, two companies which have historically been
owned by the French Government. The French Government can
provide some pretty impressive informal guidance through the
social networks that link together the business elite with the
government elite in France, and Total and Renault can get the
point and scale back their activities.
So this sort of informal guidance fits in with how France
does business usually, and let's build on it. And, if I may say
so, it was a French Government official who told me about their
interest in these de facto sanctions.
So I'm optimistic that right now Ahmadinejad is living on a
cloud because he's done the easy part, he's promised everybody
things. And now he's got to deliver, and I don't think he's
going to be able to. When, in fact, people discover that he's
not delivering, there's going to be a real drop in his
popularity. And right now the Supreme Leader, who's letting
Ahmadinejad run free, is going to yank his chain back and this
guy's not going to get what he wants. That's what happened to
the last two Presidents. We shouldn't go around assuming that
this President is somehow Superman. We thought that about
Khatami with his talk about dialog of civilizations. We thought
that 16 years ago about Rafsanjani with his talk of economic
reform. And they both came crashing down to earth pretty fast.
So it's a question of how can we postpone this nuclear issue
long enough until Ahmadinejad crashes and burns.
Senator Biden. Thank you very much.
The Chairman. Senator Dodd.
Senator Dodd. Thank you, Mr. Chairman, and thank all of
you. You've really given terrific testimony and most
informative. I appreciate it immensely. And, again, thank you,
Mr. Chairman, for doing this. It's tremendously helpful.
A couple of quick questions. I presume the previous two
panelists when I raised the issue to lay out a scenario of
exercising nuclear--or rather the military option. And there
was, I think, general consensus that this would be a very
complicated process, to put it mildly, that there would be a
significant--it would make it difficult to have any kind of
permanent solution here on the nuclear weapons capability of
Iran, even if you were successful with a military option, and
the collateral fallout of it would be pretty significant. I
wondered if any of you disagreed with anything that was said
there. I don't want to dwell on it. Would you add anything to
that question I raised, or would you disagree with anything
that was said by the two previous witnesses?
Dr. Clawson. I would say that we should certainly operate
on the assumption that that's what's going to happen, because
it's a cautious assumption and we should plan for very bad
cases. But I would just point out that the last time the United
States and the Iranians really mixed it up was back at the end
of the Iran-Iraq war in 1988. And at that time, after some
initial belligerence by the Iranians, the fact is that when
they decided that the United States was entering this conflict
on the side of Iraq, they had no choice but to back down. And
Ayatollah Khomenei, in fact, had to give up what had been for
him one of the most precious aspects of the revolution, the war
with Iraq. And he described it as like worse than drinking a
cup of poison, but he did that.
It would be a bad idea for us to plan that that's going to
happen, but there is that possibility that it could happen. But
we certainly, certainly should not assume that that is the
Dr. Kemp. I don't disagree with that, but I do think that
we have to be very specific about the circumstances under which
we would contemplate any military action. I mean, there are
things the Iranian Government could do to provoke not just
ourselves but the rest of the world that would make it much
more legitimate to consider the use of force. But absent
getting a much broader agreement and a consensus on the use of
force than we have today, I think the most immediate
consequence would be in the energy sector at a very critical
time, and I think that is something that I think any
administration would have to pay attention to. And it's not
just the fact that the oil prices would spike significantly,
but that there could be serious damage to the infrastructure,
not just of Iran's oil facilities, but those of the neighbors,
including Saudi Arabia.
Senator Dodd. Mr. Sadjadpour.
Mr. Sadjadpour. I know Senator McCain has spoken on this
before, saying that the only thing worse than military strikes
on Iran would be Iran acquiring a nuclear weapon. I would
slightly disagree with that, and I would put it into three
different contexts. First, there's a domestic context. I would
still make the argument that the Iranian people are the most
pro-American people in the Middle East. But I can tell you that
the United States has lost considerable political capital on
the Iranian streets in the aftermath of the Iraq war. Daily
broadcasts of the chaos, tumult, and insecurity in Iraq I think
have taken their toll on the Iranians, and there is increasing
skepticism about what the United States has planned for the
region. So I think the fallout in terms of soiling this oasis
of goodwill which currently exists vis-a-vis the United States
would take place. I think that people like the
confrontationists like Ahmadinejad would actually perhaps
welcome some type of military encounter. It would give them
further pretext to clamp down on popular will.
From the regional perspective, I would argue that it's
going to be very difficult to confront Iran while
simultaneously trying to tranquilize and democratize Iraq. I
would argue that the most plausible Iranian reaction will be in
Iraq, but it won't be, I would argue, what Iran was doing in
Lebanon in the 1980s, which is conducting suicide operations
and killing United States troops. I would argue perhaps a more
plausible Iranian response would be to mobilize and incite
their Shiite friends in Iraq to, say, mobilize a 2-million-man
march against the United States occupation. When you have
Iraq's newly elected leadership telling the United States to
leave, it's going to be very difficult to stay, and I would
argue that that's going to be a much greater blow to United
States interests in the region rather than the killing of more
United States troops.
Lastly, from a proliferation perspective, I believe the
fallout would be tremendous and it would actually be
counterproductive. I once played out this military option with
a Navy captain, a retired Navy captain, who said to me, well,
let's assume that we bomb Iran's facilities, and admittedly we
don't have very good intelligence on where these facilities
are, some of them are buried underground, Iran's likely
reaction is going to be, well, you've now proven to us that we
need a nuclear deterrent, so in fact we are pursuing the
nuclear option and tells the IA inspectors to get out.
International public opinion I think will sympathize with
Iran's stance, and at that point, if they are pursuing a
nuclear weapons program clandestinely, and there's no
inspectors present, and the intelligence is very small, you're
going to have to send in ground troops to go and prevent this
production of nuclear weapons, and where are ground troops
going to come from when we have 140,000 troops in Iraq and
we're quite spent.
So I think the fallout from a military encounter would be
tremendous, and would actually be in my opinion the greater of
the two evils of Iran acquiring a weapon or bombing it.
Senator Dodd. Very good. Thanks. Let me jump. I'm curious
as to how you would--what you think the U.S. response--official
response--ought to be to the letter, which I've read several
times, and my reaction is forget about the content--it was a
letter, and you react to the letter. The fact that it was sent
has more value to me, in many ways, than what was in the
letter. And, in fact, if you read the letter and sort of
disregard each of the major paragraphs about Christianity and
the like, there are certain sentences in there that certainly
sympathizing, expressing a sense of condolence and solidarity
with the United States regarding the 9/11 attacks and how any
nation has a right to respond when its security is jeopardized.
So I wonder what you think we ought to be doing about that, if
anything at all.
Mr. Sadjadpour. I'm certain we all have views on that.
Dr. Clawson. That letter was not for President Bush; that
letter was to the Iranian people and to make an argument for
Ahmadinejad to the Iranian people. And I think we should
respond in kind with a letter to the Iranian people, which I
would address to Ayatollah Khamenei, who is the Supreme Leader,
who really holds power. But my aim would be to influence
Iranian opinion and world opinion and to heck with the Iranian
Government. I mean, that letter was not designed to persuade
President Bush to do anything; it was designed to be part of
the battle of ideas. And we should take advantage of this to
wage the battle of ideas. I frankly think our diplomacy is
going pretty well with regard to Iran, but I think that our
public diplomacy, our waging the battle of ideas, is not going
particularly well, and we're not spending a lot of time and
effort on it. And so I thought it was unfortunate that we
looked at this and said, well, this is silly if it's diplomacy,
which diplomats around the world will recognize that's the
case. That's not the purpose of this. This was a propaganda
ploy vis-a-vis his own people, and we should respond in kind.
Senator Dodd. Dr. Kemp.
Dr. Kemp. I think we should have responded to it. I think
we should respond to it. I would be open to suggestions to who
the addressees are. We can make it to both the President and to
the Supreme Leader and to the Iranian people, but I think there
are things that we could say in a letter that would put us on
the high ground. There are many issues that he raised about
liberty and justice that I think we could certainly ask about
the situation in Iran. I think the letter was quite
deferential, actually, to religion, particularly to
Christianity and that there's no reason why we should ignore or
snub the letter. We just have to craft a wise and careful
Mr. Sadjadpour. I think President Ahmadinejad was trying to
take a page out of the play book of his idol, Ayatollah
Khomenei, who wrote a letter to Gorbachev in, I believe, 1989,
was it? And he wrote to Gorbachev that he should embrace Islam
or risk the downfall of the Soviet Union. And many Iranian
radicals to this day believe that Khomenei was very prescient
in his analysis, and I think Ahmadinejad was trying to take--in
fact, yeah, he caused the downfall of the Soviet Union. So he
was trying to take a page out of his idol's play book. But I
would also agree with Professor Kemp and Dr. Clawson that we
should respond to this letter. We could have a debate about who
the letter would be addressed to: The Iranian people, to the
Supreme Leader, et cetera. But there were particular lines from
the letter which I found quite astounding and really lacking of
any type of self-awareness when Ahmadinejad criticizes human
rights abuses in the United States or unfair detentions in
Guantanamo Bay, lack of representation, lack of legal progress.
As I said, when I have a very close friend of mine who's
detained right now in an Iranian prison in solitary confinement
for 3 weeks without any legal representation and without any
contact with his family, I think the United States would be
wise to call Ahmadinejad on this type of rhetoric.
Senator Dodd. Let me jump to another letter, though, that's
a bit more substantive, and that is, of course, this piece that
appeared in the May 9 edition of Time, and it's ``Iran's
Nuclear Program: The Way Out,'' written by Hassan Rhohani, who
is one of the chief negotiators for Iran and its nuclear
programs, but also very close as an advisor to the Supreme
Leader. And this was a far more substantive piece. I don't know
if you've seen this. Have you seen this? Well, it lays out some
suggestions as to how Iran might be willing to respond to this
nuclear question. Could you address this, and, by the way, just
in the context of it, and I think you answered it with Senator
Biden's question, but I didn't really see this as a debate
between an economic approach or a security approach, but rather
probably having some mix of the two would make the best sense
in a way here, taking your suggestions.
But I wonder if you might comment on these suggestions.
They're far more, obviously, substantive than the letter that
was sent to President Bush.
Dr. Clawson. To quote a senior State Department official,
there's a reason he only sent that letter after he got fired.
If Iran's really interested in exploring these things, there
are quiet channels through which these things can be passed. A
former official publishing in the pages of Time is again more
aimed at showing the American public and the European public
that Iran is reasonable than it is at actually trying to
resolve things, because I don't think there's a bat's chance in
hell that the current Iranian Government would agree to those
proposals at the present.
Dr. Kemp. I think that what the letter demonstrates is
that, you know--and Rhohani is not the only one who could write
that sort of letter--there are some extremely sophisticated ex-
Iranian officials, some of them may still be in the government,
who are quite capable of negotiating a reasonable deal under
the right circumstances, but they've been shoved aside by the
rhetoric of the current President, and that we should,
therefore, try to find a way to nurture relations with these
former officials, one way or the other, because at some point,
if the pendulum swings the way some of my colleagues think it
will, back to the Supreme Leader, then it is people like Mr.
Rhohani who ultimately, I think, we are capable of talking to.
Senator Dodd. I find your answers, Dr. Clawson, rather
cavalier. I mean, I don't disagree it's a publication, but it
seems to me that this is something that ought to be pursued. I
mean, I don't disagree there's a way of channeling these ideas
in a more sophisticated way, but possibly the reaction has been
so negative that this is one opportunity.
Dr. Clawson. I would pursue it by indeed trying to write in
various places a similar offer which looks very very attractive
to the Iranian people and looks very moderate. And I would also
pass back channel the kind of message that Professor Kemp was
suggesting, saying, look, if you're back in charge here, then
we can work out a deal on this one. But let's be honest that
this is unlikely to be a breakthrough at the moment.
Senator Dodd. Oh, no. This is a game of--I understand
what's going on.
Dr. Clawson. It's a battle of ideas.
Senator Dodd. But this is vastly different than what
happened with North Korea, for instance.
Dr. Clawson. The negotiating style is vastly different,
which is to say the Iranians have a divided government that
makes our system of check and balances look modest by
comparison. And they have a style of doing politics which makes
our partisanship look modest by comparison as well. And at some
point, as Professor Kemp was saying, and we could be dealing
with a different group again.
Senator Dodd. I don't want to leave you with any
misimpressions. I certainly have said over and over again I
don't think you ought to take a force option off the table at
all, and I don't necessarily believe this is necessarily going
to work, but it seems to me that it ought to be pursued. Any
comment on this?
Mr. Sadjadpour. Yeah. You know, Dr. Clawson's comment about
Rhohani being an ex-official, I think he would agree that in
Iran personalities are more important than positions, so Hassan
Rhohani is definitely a very relevant official. He's very close
to both former President Rafsanjani and the current Supreme
Leader, Ayatollah Khamenei, and I think this letter from
Rhohani is indicative of these deep splinters taking place
among Iran's leadership.
When Ahmadinejad won the Presidency in 2005, it was widely
assumed that the conservatives had now consolidated power. As
we see now, they've never been more divided. And the timing of
this letter was very interesting. As soon as there was word out
that Ahmadinejad had written an 18-page letter to President
Bush, Rhohani quickly released this letter. And it was, in my
opinion, he was presenting both an alternative message and an
alternative messenger to the Americans, that don't think you
just have to deal with this crazy President of ours, and I'm
sure he would agree with that statement, but there's other more
pragmatic minds. But I would argue that in the very broad sense
we should make it clear to you all that a belligerent foreign
policy is absolutely not going to reap rewards, and if you want
to take this bellicose, uncompromising belligerent approach,
you're just going to reach a brick wall. But at the same time,
I think we should make it clear that there is an alternative
path, that a more conciliatory approach, a more compromising
approach, will trigger reciprocal steps from the United States.
I think to quote President Bush, Sr., good will begets good
Senator Dodd. That's terrific. Mr. Chairman, I can't thank
you enough. We could go on, I'm sure, another couple of hours.
We hardly touched on this, and the subject is very important. I
think it's right there at the top. It should be at the very top
of our foreign policy agenda. And I deeply appreciate your
thoughts and observations. Very, very helpful.
Thank you, Mr. Chairman.
The Chairman. Well, I join my colleague, Senator Dodd, in
thanking you for your wisdom, and likewise for your stamina. We
appreciate the hearing, and the hearing is adjourned.
[Whereupon, at 12:50 p.m., the hearing was adjourned.]
IRAN'S POLITICAL/NUCLEAR AMBITIONS AND U.S. POLICY OPTIONS
THURSDAY, MAY 18, 2006
Foreign Relations Committee,
The committee met, pursuant to notice, at 9:30 a.m., in
room SD-419, Dirksen Senate Office Building, Hon. Richard G.
Lugar (chairman of the committee) presiding.
Present: Senators Lugar, Coleman, Biden, Nelson, and Obama.
OPENING STATEMENT OF HON. RICHARD G. LUGAR, U.S. SENATOR FROM
The Chairman. This hearing of the Senate Foreign Relations
Committee is called to order. The committee meets today to
continue our examination of the United States policy toward
Iran. This is the second hearing of our two-part series.
Yesterday, we focused our attention on the status of Iran's
nuclear program and on analysis of Iran's motivations and
strategies. Today, we will evaluate the options available to
deal with these challenges.
The Bush administration has been attempting to build a
cohesive international coalition capable of applying economic
and diplomatic pressure on Iran that would have the potential
to dissuade it from continuing its drive toward a nuclear
weapons program. Though efforts to attain a Security Council
consensus on a firm response to Iran's actions have not been
successful--primarily because of resistance from Russia and
China--diplomacy backed by multilateral sanctions remains the
focus of United States policy.
Our witnesses yesterday judged that Iranian acquisition of
nuclear weapons is not inevitable, though they underscored that
a nuclear weapons capability is an extremely important Iranian
goal that would be given up only grudgingly. They noted that
the Iranian leadership is pursuing nuclear weapons for a number
of reasons, including self-defense, Iranian national pride, and
regional influence. But as several of our witnesses asserted,
the Iranian leadership is faced with economic problems that
could be exacerbated by multilateral sanctions and
international isolation. In contrast, a verifiable resolution
of the nuclear problem could result in long-term economic
benefits flowing to Iran, including much-needed Western
investment in the energy sector. Our witnesses also emphasized
that Iran's Government is far from monolithic. Factions and
personalities in Tehran have varying priorities that could lead
to diplomatic opportunities.
The witnesses generally shared the view that no diplomatic
options, including direct talks, should be taken off the table.
Direct talks may in some circumstances be useful in
demonstrating to our allies our commitment to diplomacy,
dispelling anti-American rumors among the Iranian people,
preventing Iranian misinterpretation of our goals, or reducing
the risk of accidental escalation. Our policies and our
communications must be clear, precise, and confident, without
I noted a comment by Dr. Henry Kissinger in an op-ed on
Iran that appeared in Tuesday's Washington Post. Dr. Kissinger
wrote: ``The diplomacy appropriate to denuclearization is
comparable to the containment policy that helped win the cold
war: i.e., no preemptive challenge to the external security of
the adversary, but firm resistance to attempts to project its
power abroad and reliance on domestic forces to bring about
internal change. It was precisely such a nuanced policy that
caused President Ronald Reagan to invite Soviet leader Leonid
Brezhnev to a dialog within weeks of labeling the Soviet Union
the `evil empire.' ''
Dr. Kissinger's analogy, as well as the testimony that we
heard yesterday, reinforce the point that Iran poses a
sophisticated policy challenge that will require the nuanced
use of a range of diplomatic and economic tools.
To discuss how such tools might be applied, we are joined
by four distinguished experts. We welcome Mr. Frank Wisner,
former Ambassador to India and currently vice chairman for
External Affairs at the American International Group; Dr. Vali
Nasr, a professor of National Security Affairs at the U.S.
Naval Postgraduate School in Monterey, CA; Ms. Julia Nanay, a
senior director at PFC Energy in Washington; and Mr. James
Phillips, a research fellow in Middle Eastern Affairs at the
We thank our witnesses for joining us today, and we look
forward to their insights on the policy options open to the
Before calling upon our witnesses, I'd like to call upon
our distinguished ranking member, Senator Biden, for his
OPENING STATEMENT OF HON. JOSEPH R. BIDEN, JR., U.S. SENATOR
Senator Biden. Mr. Chairman, in the interest of saving time
and not being redundant--because much of my statement reflects
what you've already said--I ask unanimous consent that my
statement be placed in the record.
The Chairman. It will be placed in the record in full.
Senator Biden. I just want one brief addendum, one comment.
The headline in the New York Times today in the David Sanger
piece about a new approach, I think it's 3 years too late, but
a new approach of this administration to North Korea, is one
that I hope permeates through the tundra, the frost down there,
and makes it clear that what Dr. Kissinger referenced, the
article you referenced what experience has demonstrated, and
the abject failure of the policy thus far of once identifying
the ``axis of evil'' judged by their own measure, we are worse
off in every circumstance of every nation that we identified as
part of that access.
I hope this causes a stirring of at least some intellectual
debate in the administration about how to proceed. I hope they
conclude that it is equally reasonable to follow some version
of the recommendations of you, of Dr. Kissinger, me and others,
all slight variations. And I'm anxious to hear from the
witnesses. Yesterday we heard about the nature of the threat,
the imminency of the threat, and about motivation on the part
of the Iranians. Today I hope our very distinguished panel
speaks to options available that they would discuss
forthrightly, whether or not what you have suggested or I have
suggested or as recently as, I guess, yesterday or whatever day
it was, Dr. Kissinger's op-ed piece--I'd be very interested to
know what their views on that specific proposal are, that
course recommendation is.
So, I thank you, Mr. Chairman, and I look forward to
hearing the testimony of our witnesses.
[The prepared statement of Senator Biden follows:]
Prepared Statement of Hon. Joseph R. Biden, Jr., U.S. Senator From
Thank you, Mr. Chairman. I welcome our witnesses.
Yesterday, we heard from several well-informed witnesses on Iran's
nuclear program. We also heard about Iran's motivations, the attitude
of its population, and its vulnerability to economic sanctions. Today,
I look forward to hearing about the options before us.
This hearing is timely. Our European allies are crafting a package
of incentives and, if they fail, sanctions that will be presented to
Their first objective is to secure Chinese and Russian support for
the entire package, so that Iran will understand that it faces U.N.
Security Council mandated sanctions if it rejects the offer.
If Russia and China balk at supporting the package, there is talk
of the United States and Europe forming our own sanctions coalition. We
heard yesterday that Iran is already feeling some pressure as investors
and banks pull back from Iran in anticipation of sanctions.
But achieving broad-based agreement on sanctions cannot be the sum
total of a diplomatic strategy for Iran. Sanctions are at best one tool
to achieve our broader objectives, including ending Iran's uranium
We need greater clarity on our precise goals--clarity the Bush
administration has, thus far, failed to provide.
If our goal is regime change, then that argues for an aggressive
set of policies that will likely alienate most of our friends,
particularly in the wake of Iraq.
If our goal is to see Iran's threatening behavior end in the short
term--while working for long-term change--then that argues for a policy
that many could likely support.
Yesterday, I recommended that President Bush respond to the recent
letter sent by the Iranian President, but he should write to the man
who has the final say in Iran--Ayatollah Khamenei.
I would make the letter public and I would include a call for
direct talks with Iran--anywhere, anytime, with everything on the
We should be willing to talk about all the issues that divide us:
The nuclear program, terrorism, Iraq, Afghanistan, Israeli-Palestinian
peace, sanctions, and security.
We should lay out for Iran's leader--and especially for its
people--what the future could look like if Iran renounces its nuclear
ambitions and support for terrorism--and what the future could look
like if it does not.
As I said yesterday, I don't know for certain how Iran would
respond, but I believe that an offer of direct dialog would place
enormous pressure on the Iranian leadership--from their own people and
from the international community.
Iranian leaders would face a stark choice--reject the overture and
risk complete isolation and an angry public, or accept it and start
down a path that would require Iran to alter its nuclear ambitions.
Talking to Tehran would not reward bad behavior or legitimize the
regime. Talking is something we have done with virtually every other
country on earth, including unsavory regimes like the ones in North
Korea and Libya.
Demonstrating that we made a serious attempt at diplomacy is also
the best way to keep others on board for tougher actions if Iran fails
If the administration wants to convince our allies and others to
place serious pressure on Iran, it must walk the extra diplomatic mile.
I look forward to the testimony.
The Chairman. Thank you, Senator Biden.
Senator Coleman, do you have any opening comments?
STATEMENT OF HON. NORM COLEMAN, U.S. SENATOR FROM MINNESOTA
Senator Coleman. Very briefly, Mr. Chairman. First, thank
you for this hearing, for this focus, I think it's critically
important. Just three observations.
One, it is clear that Iran cannot be allowed to develop
nuclear weapons, that is, that's the bottom line. How to ensure
that, is the great challenge; this is perplexing.
Two, regime changes in the best interest of this country.
This is a regime in which you've got a President openly talking
about the destruction of Israel. Hitler in ``Mein Kampf'' told
us what he was going to do and we didn't listen. Ahmadinejad
says what he's going to do, and throughout I would just urge
that, I would--and I've read Dr. Kissinger's piece, and I think
we have to look at it carefully. He is talking about new
diplomatic initiatives, he's not talking about engagement, he's
not talking about fully working with this regime, and lines of
communication, if they can be done in a way that doesn't
provide support for this regime I think would make sense, and
the last comment is just, you know, today's Washington Post,
and quoting Ahmadinejad, they say they talk about the Europeans
trying to work something out with them, and as a response, they
say that they want to offer us incentives, Ahmadinejad says
we'll tell them, ``Keep the incentives as a gift for yourself,
we have no hope of anything good from you.'' This is a
perplexing issue. And I think this forum is very, very helpful,
so thank you.
The Chairman. Thank you, Senator Coleman.
Let me indicate to the witnesses that your full statements
will be made a part of the record, and we will ask you to
either recite from those or to summarize. So that it will not
be disconcerting to you or to those who are following the
hearing, I would note that we anticipate a rollcall vote at or
about 10 o'clock. We will have an interruption and recess the
committee so the Senators can vote, and then return so that
none of us will miss anything. We always regret that there will
be a break in the action, but that is the nature of our debate
on the floor today. We may have one or more votes during the
I want to call upon you now in the order that I introduced
you in my opening statement. That would be first of all, Dr.
Wisner. If you would proceed.
STATEMENT OF HON. FRANK G. WISNER, VICE CHAIRMAN FOR EXTERNAL
AFFAIRS, AMERICAN INTERNATIONAL GROUP, INC., NEW YORK, NY
Ambassador Wisner. Senator Coleman, it's a privilege to be
able to return to the committee, and to discuss a topic of such
moment, Iran and the nuclear enrichment crisis that we face.
I have submitted, as you suggested, my written testimony
for the record and therefore I won't read it.
I come today before you with some modest background in the
subject we're discussing. I've been part of a ``track two''
dialog with Iran since 2002 with thoughtful Iranians meeting
under the auspices of the United Nations Association of the
United States of America, generally in Sweden occasionally, and
I represented the United States in 1997 in discussions in
Moscow over the illegal transfer of missile technology--from
Russia to Iran. But I guess, principally, I come today
reflecting on 37 years of experience in this Nation's
For openers, let me make four points. These points reflect,
substantially, the starting point that Senator Lugar mentioned
in his opening remarks.
My first point is, to me it is not clear that Iran has
decided to develop a nuclear weapon. I believe its house is
divided, and its program is not at a stage where the choice
between a nuclear weapon and another option needs to be made. I
recognize, saying that, that the enrichment program, which
leaves Iran capable of developing a nuclear weapon, is
extraordinarily dangerous for the United States. But I rest my
argument on the fact that there is ambiguity in Iranian
intentions, and, therefore, space for the United States to
My second contention is that we have time. Time to think
through our choices. There are a variety of estimates of when
an enrichment program will reach term, and those estimates vary
sharply. We are not in an immediate decision.
Third, I would argue that when speaking about Iran, it is
wrong to conclude that there is a united Iranian point of view.
There isn't on most national decisions. There are even sharp
disagreements with the way that Mahmoud Ahmadinejad has
conducted himself as President.
That said, he is a key figure, and we're going to have to
take him into account. And his skill in manipulating Iranian
politics has not run course.
My fourth contention is that the United States does not
stand alone. Our European allies are dead opposed to Iranian
nuclear enrichment. Russia and China are on record as well. Not
only on the nuclear issue, but on other issues related to Iran.
The history of the use of terror; issues related to Israel and
Palestine provide common ground.
At heart, however, our allies want us to engage with the
Iranians politically--to explore with Iran leadership, a basis
of restraint. So then, Senator Lugar, as you Senator Biden,
suggested--what are the choices before the United States?
Many have talked about military action, I find it one
without particular promise. I believe that military action
would tip Iran over the edge, and we would have a nuclear
weapon in Iran's arsenal. I also believe there would be direct
retaliation against American interests, including our exposed
position in Iraq. There would be a violent eruption in the
Muslim world--there would be a most severe impact on oil
markets--and most of all I can't believe that military action,
as I've heard it described, is decisive, that it would deliver
a knock-out blow.
Similarly, sanctions don't offer a decisive outcome. They
can be costly, they can be disruptive--they will produce a
political reaction from Iran, that's to be anticipated. But the
most effective sanctions, and we've used many of them up in
deploying our policies toward Iran, are those that are short-
lived, that are multilateral and targeted.
Now, I therefore argue that both military options and
sanctions are arrows in our quiver--they are the backdrop to
effective diplomacy. But our real leverage over Iran is Iran's
isolation. For now, decades, the country has stood on the
margins of international life, its people and its policies
without allies, a young population demanding economic progress
that cannot be achieved until Iran is accepted into the
mainstream of the global economy, and has access to capital and
technology. That leverage is our greatest point of salience in
dealing with Iran.
I conclude, Senator Lugar, Senator Biden, Senator Coleman,
that the time is right to engage Iran--not just on the nuclear
issue, but much more broadly--on the issues of terror, Iraq,
Afghanistan, the Palestine-Israel equation, on Iran's security,
and fundamentally, on her place in the international community.
But I argue most carefully that trying only to engage Iran
on one issue is bound to fail. There is a record of American
diplomacy with Iran where we have directed ourselves at one
question, only to find that unlinked to other questions, and
complicated by the political dynamics in our respective
societies those initiatives have achieved a short-term benefit
in some cases, but have always ended in not producing a
spreading agreement to others.
I would argue, furthermore, that Iran may be ready to talk.
There is a new circumstance in Iran, the clerics are more
closely behind Ahmadinejad then was the case with his
predecessor Khatami. They also see Iran on a more equal footing
with the United States. The letter that Ahmadinejad sent to the
President was bizarre in its formulations, but a sense of
Iranian confidence that they can engage the United States, and
in that there is moment to pause and consider.
The United States doesn't have to apologize for a political
dialog, diplomacy, or engagement--we've used those devices in
the past. We engaged the Soviet Union over many, many years as
Senator Lugar in referring to Secretary Kissinger's statement
pointed out; we did with China in the context of the Shanghai
Declaration--both examples of engagement where we have profound
differences of ideology, of national interests, and of
But, I would argue, engagement has to begin at the top. It
must begin, if it is to work, right at the top on this side,
with the President. It cannot begin with a lower level
administration initiative, unless it's identified on both sides
with the most senior figures in the regimes, it won't work.
I also believe it's important to think of an engagement
setting aside the rhetoric of ``axis of evil'' and even of
legislative considerations aimed at funding regime change in
Senator Coleman, you'll forgive me if I disagree with you.
I believe the essential national interest of the United States
is to contain Iran's national security threats, and the
external threat the country poses. Iran's domestic order is a
matter that--while important to us as a matter of principle--is
not a threat to the United States. And therefore, as Iran has
proved countless times over its history, it changes regimes.
And I'd like even to argue that we've seen other cases in the
past where less pressure on an international crisis produces
space within which politics take root and changes--political
changes--within a society occur even more rapidly.
Now, therefore, what do I recommend? I don't say that I
have, Senator Lugar, a neat formula to resolve the nuclear
crisis--I doubt Iran will renounce enrichment--but we would
enter into cooperative, international-based arrangements for
the production and supervised production of enriched fuel. Is
it possible to find common ground? Is it possible to find
common ground with Iran over Iraq and Afghanistan, where I know
Iranian interests have been served by the elimination of Saddam
Hussein and the Taliban? I believe so. Especially if we make it
clear that the United States does not intend to be a permanent
fixture in Iraq and Afghanistan, and we will not use our
position in either country to threaten Iran.
Can the concerns of our friends in the Sunni Arab world be
addressed? I contend there is room for a regional conference,
to elaborate security guarantees. Can Iran address the dangers
posed by Hezbollah and Hamas, and can Iran be brought to be a
more responsible player in the Israeli-Palestinian equation.
Perhaps, but it will be difficult.
But it is reasonable to conclude that Iran sees in Hamas
victory in the Palestinian elections, its own vindication. And
because Hamas is now in power, a two-state solution may be
Are there any guarantees? No. But then, diplomacy is not
only the art of the possible, diplomacy is about exploring what
might be possible. To repeat, therefore, I argue for the option
of engagement--not taking any of our other options off the
table--engagement starting at the top. For anything less, I
believe, that fails to be broad will end in failure and
dangerous frustration for the United States.
[The prepared statement of Ambassador Wisner follows:]
Prepared Statement of Hon. Frank G. Wisner, Vice Chairman for External
Affairs, American International Group, Inc., New York, NY
The United States, the international community and Iran are in
crisis. The crisis broke out last year in the wake of Iran's decision
to proceed with its nuclear enrichment program and limit its
cooperation with the International Atomic Energy Agency. But the crisis
runs deeper. It is rooted in broad international concern over Iran's
clandestine efforts to develop an enrichment program, which have put
into question the spirit of Iran's compliance with the Non-
In fact, the origins of the crisis are longstanding. For over a
quarter of a century and as a result of the overthrow of the Shah's
regime, Iran's clerically dominated government has been at odds with
the United States and frequently with its neighbors. The regime's
aggressive assertion of its religious identity has frightened Sunni
Muslim nations in the gulf, the Middle East and elsewhere in the
region. Iran's espousal of Hezbollah and Hamas has put the country on
the front lines of the war against terror. The Iranian leadership's
unwillingness to accept the existence of the State of Israel has
further undermined the ability of the United States to find common
ground with it.
In response to the Iranian Government's policies and the principles
it espouses, the United States, during the Bush administration, has
identified Iran as an opponent of the United States and a candidate for
``regime change.'' The Congress' involvement in legislation to fund
activities which would undermine clerical rule in Iran has sent the
strong signal of aggressive American intent. To a nation historically
under siege and more recently at odds with the United States, these
threats have hit hard and have stirred broad Iranian insecurities.
I come to this meeting over the future of American policy toward
Iran, having read Iran's history closely and having followed
attentively its recent actions and our relationship. I bring to this
session my 37 years of experience in our Nation's diplomatic service as
well as a 4-year association with ``track two'' discussions with
knowledgeable Iranians. These discussions have been organized under the
auspices of the United Nations Association of the United States (UNA-
USA). The results have been regularly shared with officials of the U.S.
In addition, I represented the United States Government in 1997 in
discussions with Russia's authorities over the transfer of missile
technology from the Russian Federation to Iran. This said, I have no
access to official intelligence on Iran, its nuclear program nor the
workings of Iranian domestic politics.
In presenting my conclusions today, I do not speak for the American
International Group, where I serve as vice chairman, external affairs.
My views are entirely my own.
I intend, in the course of my testimony, to answer four questions:
(1) Will Iran develop a nuclear weapon? (2) Is that outcome imminent?
(3) Is Iran's leadership united behind the development of a nuclear
weapon? and (4) What is the way ahead for the United States?
Will Iran develop a nuclear weapon?
The answer to that question is not obvious. It is clear Iran
believes it has the right to enrich uranium and fuel a nuclear power
system. Iran further argues that this right is part of its commitment
to the NPT. It is also true that Iran has pursued a nuclear ambition
since the days of the Shah. Finally, it is obvious that Iran has
developed its fuel enrichment system clandestinely and in violation of
its international obligations.
It is my view that Iran has not made a nuclear weapons decision and
that its house is divided on the subject. There are Iranians who
believe Iran would be better off with a nuclear weapon; there are
others who argue that a weapon will increase the dangers which Iran
faces. Virtually all Iranians, including those who live outside the
country, share the opinion that their country needs nuclear power and
that an enrichment program is a legitimate assertion of the nation's
right. Moreover, the nuclear program has become in Iranian eyes a
question of national honor and prestige.
It is possible that Iran will proceed down the path of enrichment,
stopping just short of a nuclear weapon, leaving open the option to
acquire such a capacity. Given Iran's dangerous record on other fronts
and the lack of confidence in its government's behavior, that outcome
is unacceptable to the United States and our friends in Europe. In a
word, we must deal with the nuclear issue and seek to contain it.
Is a weapon imminent?
Again, I advise caution in concluding that the United States faces
an immediate, threat. Estimates of the time it would take Iran to
assemble adequate amounts of fissionable material vary sharply. Like
you, I have seen figures that range from 3 to 10 years, depending on
the urgency with which Iran pursues the goal, the technology and
resources available to it and the international environment. The design
and weaponization of a nuclear device is another matter but not one for
``tomorrow morning.'' I argue, therefore, that we have time to
consider, carefully, our strategy for dealing with the very real threat
which Iran's enrichment program poses. There need be no rush to
judgment; and we have time to explore and exercise the option of
Let me make this point in a different way.
Is Iran's leadership united behind the development of a nuclear weapon?
Once again my experience leads me to be careful about concluding
Iran's leadership and political class are united. Those, who state with
confidence that they know Iran's intentions, have been consistently
wrong. Our insights into the politics of the clerical regime are
limited; our estrangement from Iran has impeded serious analysis of
political trends and developments. This state of affairs is regrettable
and I suggest it is in the interests of the United States to increase
the attention we pay to Iran, its politics, economics, and social
trends--within government and in academic and research communities.
It is my view that Iran's leadership, broadly defined, is not
united on a wide range of issues of national importance, including
nuclear weaponization. Power is divided. The Supreme Leader retains
control over Iran's Revolutionary Guards, its intelligence services and
the nuclear program. Mahmoud Ahmadinejad--the President and author of
deeply offensive and inflammatory statements about Israel, the region,
Iran's nuclear intentions, and the United States--does not directly
control these institutions and programs. But he won the election to the
Presidency with a solid majority and with clerical sympathy. Today he
is playing Iranian politics with consummate skill. Ahmadinejad will be
a significant factor in Iranian politics for years to come. He has
developed a strong base among young Iranians and he appeals effectively
to the street's instincts. Moreover he enjoys substantial standing with
the Supreme Leader and the Guardians. In the election campaign and his
brief time in office, Ahmadinejad has eclipsed the reformers; his
leverage in Iranian politics is rising. This said, so are his opponents
who are questioning the President's assertions about national security
policy and his profligate interventions in the economy.
Finally, it has been my experience that the exercise of power has
the potential of educating its holders in the realities of
international and domestic life. This has been Iran's recent
experience. The country's original revolutionary fervor has run thin.
We are in Ahmadinejad's early days. There is more to come, but the
present situation of crisis strengthens the Iranian President's hand.
There is reason, therefore, to lessen, if we can, the intensity of the
What are the United States choices?
I suggest that the nuclear standoff with Iran will play out over a
period of time--months if not years. There are no quick fixes and we
need the time to examine, select, and pursue our options. The U.N.
Security Council is divided. Our European friends, deeply opposed to
Iran's nuclear program, seek a diplomatic resolution.
Is there a military solution to enrichment? There is no obvious way
to deal with Iran's intention to proceed with nuclear enrichment. It is
my view that military action can only disrupt Iranian facilities. Worse
yet, the consequences of an American attack on Iranian intentions will
be severe. If Iran's leaders have not crossed the nuclear threshold,
they would in the wake of American military action. We would have to
anticipate direct Iranian retaliation against our forces in Iraq and
other American targets in the gulf and the Middle East--if not beyond.
I have not seen any evidence that our intelligence is adequate to
pinpoint Iran's nuclear enrichment system and make it vulnerable to a
decisive military strike.
The political consequences of an American attack would be even more
devastating. I can assure you that there will be an eruption of protest
across the Muslim world; public opinion in allied nations would be
hostile and our standing in international fora would be undermined. We
must also calculate the economic consequences. I have no way to predict
where the price of oil will go in the wake of military action against
Iran or countermoves which impeded the Strait of Hormuz.
Military action should always be the last choice--and never
excluded. But I do not believe that we have reached the end of the road
and can, therefore, justify or appropriately use military force to stop
Iran's enrichment program.
Will economic sanctions deter Iran?
The United States has committed the majority of its sanctions
arsenal against Iran in the past and has few decisive instruments left.
While the possibility of greater allied cooperation in the face of a
nuclear threat is somewhat better, our allies have been hard to bring
along in the past. Ordinary trade sanctions will be very difficult to
enforce, given Iran's long borders and proximity to trading entrepots,
like Dubai. Financial sanctions come at the cost of disruption of our
complicated, international financial system. Sanctions against the
movement of Iranian officials are hardly significant. Sanctions
generally work when they are targeted, short term and multilateral. It
is hard to imagine the Iranian nuclear crisis being either of short
duration or subject to resolution only through the imposition of
The case for engagement
The first choice in conflict resolution should be diplomacy. There
are diplomatic options available to the United States.
Does this mean that military means or sanctions have no place in
addressing the crisis we face with Iran? Of course not. They are and
must remain arrows in our quiver. Diplomacy, without strength and the
ability to deliver pressure, is rarely successful. For the moment,
military force and additional sanctions are more effective as threats
which its leaders must contemplate.
Our leverage lies elsewhere. Iran is an isolated nation. Apart from
a few states, like Syria, whose association with Iran is based on
tactical considerations, Iran has few friends and no allies. If the
international community, notably Russia and China, are divided from us
about how to deal with Iran, there are no divisions over the issue of
Iran's nuclear pretensions nor her historic sponsorship of violence in
her region. Cut off from acceptance within the international community,
Iran is also isolated in the mainstream of world economics. She sells
oil but she receives virtually no investment. Existing sanctions,
especially those put in place by the United States, limit foreign
capital flows. And these sanctions can be deepened. Iran receives
little to no technology and will not as long as she continues to stand
outside the norms of acceptable international behavior.
Iran's isolation, born of her policies of confrontation, aggravates
her perception of threat and preoccupies her leaders and
intelligentsia. At heart, they know that Iran cannot force her way into
respectability, partnership, and security. Sooner or later, Iran must
meet all of us ``half way'' or she will remain threatened and denied
the capital flows, investment partnerships, and technology her lagging
economy and highly dissatisfied and deprived population requires. In a
word, Iran's understanding of her isolation and our capacity to sustain
and intensify it are powerful weapons in addressing the nuclear crisis
we face and the other threats Iran poses to our interests. Equally, our
willingness to offer a path away from isolation is a powerful tool.
Then how do we deal with Iran?
Our ability to respond militarily is ``on the table'' and it should
remain there. Sanctions are in place and selectively, for example, a
multilateral agreement aimed at the denial of official credits, can be
added over time. We have drawn our ``lines in the sand'' and the time
is right to move on and engage Iran politically.
The time is right, moreover, to signal that the United States not
only seeks agreement which will contain the nuclear crisis but that we
are prepared to consider normalizing relations, provided, of course,
that Iran is similarly disposed and acts accordingly. Engagement,
through diplomatic dialog, means addressing the broad array of issues
that divide Iran from us and the international community--the issues
that leave her marginalized and insecure--in other words, the issues
that undergird distrust of Iran.
The questions, which we and Iran must address, are obvious and they
deal with subjects of vital importance to the United States--Iran's
nuclear pretensions; the future of Iraq and Afghanistan; the security
of the gulf; the prevalence of terror in the Middle East; political
instability in the Arab East; and peace between Israel and Palestine.
The United States plays a very special role in Iran's thinking. The
questions she wishes to address with us are her isolation; the
sanctions' regimes she faces; her search for acceptance in the
international community and her insecurity in a deeply troubled region.
In particular, Iran needs access to the international economy if she is
to provide employment for her young.
Our record of engagement with Islamic Iran is a poor one. Past
attempts, born of initiatives to address a single issue, have failed.
They will fail again if we and Iran do not address the totality of our
relationship and if we and Iran are not prepared to set, as an ultimate
objective, the normalization of our relationship. And that means,
simply stated, a reciprocal readiness to live in peace and mutual
respect, no matter how sharply divided we are over our view of each
others' political systems.
History is replete with examples of the United States finding a
working basis for our relationships with those from whom we were
sharply divided over ideology, national ambition, and questions of
vital national security concern. I have in mind our ability to find
common ground, through detente, with the erstwhile Soviet Union and
through the Shanghai Communique, with the People's Republic of China.
Engagement begins with a commitment at the top of our political
system. On our side, it starts with an undertaking by the President to
a normalized relationship. It means a willingness to set aside the
rhetoric of ``axis of evil'' and measures legislatively mandated to
undermine Iran's regime. Our concerns are legitimately with Iran's
external ambitions and absent any confidence in those ambitions, its
nuclear intentions. Its domestic orientation is another question.
Iranians have changed their regimes in the past and they will do so
again. In a situation of greater peace and security, that day may even
come sooner. Our objective must be the stability of the region and our
interests there--not Iran's domestic order. We have our principles; the
clerics have theirs. Let's see on whose side history sits.
I believe there is an opportunity today to pursue engagement with
Iran. Based on my assessment of Iran's policies, I conclude that Iran's
clerical leaders are more comfortable with the country's elected
government and are willing to give it the freedom to maneuver
internationally, including with us. This was not the case in Khatami's
time. In addition Iran's leaders are less intimidated by our ability to
deliver on the threats they feel we have articulated. They know we are
bogged down in Iraq. Therefore they feel they can approach us on a more
equal footing. Our European allies want us to enter the dialog; Russia
and China clearly share that view. I suspect they would welcome a
signal the United States is ready to seek normalized relations with
Iran and to live in peace.
Ahmadinejad's recent letter, as bizarre and objectionable as its
contents are, is based on a sense of self confidence. It deserves an
answer--not rejection. We are under no obligation to reply to the terms
which the letter offers. We are free to state our case and spell out
our objectives for a dialog.
I do not have a neat formula to resolve the nuclear crisis. I doubt
Iran will renounce enrichment but will it enter into cooperative,
internationally based arrangements for the production and supervision
of enriched fuel. Is it possible to find common ground over Iraq and
Afghanistan where Iranian interests have been served by the elimination
of Saddam and the Taliban? I believe so, especially if we make it clear
the United States does not intend to be a permanent fixture in Iraq or
Afghanistan and that we will not use our position in either country to
threaten Iran. Can the concerns of Sunni Arabs be addressed? I contend
there is room for a regional conference to elaborate security
guarantees. Can Iran address the dangers posed by Hezbollah and Hamas
and can Iran be brought to be a more responsible player in the Israeli-
Palestinian equation? Perhaps, but it will be difficult. But it is
reasonable to conclude Iran sees in Hamas' victory in the Palestinian
elections a vindication and because Hamas is now in power, a two-state
solution can be pursued.
This said, I return to my core contention: The starting point in
negotiations with Iran is our willingness to seek normalization.
The United States must deal with the nuclear crisis. We have time,
leverage, and the authority to do so. But to repeat, our approach
should be a broad one; aimed at a full exploration of the several
issues of concern to us and with the objective of a normalized
relationship. The history of America's dealings with Iran should make
it clear that anything less will lead to frustration.
The Chairman. Well, thank you very, very much, Ambassador
Wisner, for that comprehensive statement.
We appreciate having you, Dr. Nasr, with us today, and ask
that you proceed.
STATEMENT OF DR. VALI R. NASR, PROFESSOR OF NATIONAL SECURITY
AFFAIRS, NAVAL POSTGRADUATE SCHOOL, MONTEREY, CA
Dr. Nasr. Good morning, Senator Lugar. Senator Lugar,
Senator Biden, Senator Coleman it's a privilege being here and
contributing to these proceedings.
I would limit my comments to discussing the role that
democracy promotion as a policy fits into the context of
dealing with Iran's nuclear threat. It is safe to say that
between 2001 and 2005, the United States has looked to regime
change and democratization as a way of solving the outstanding
issues between the United States and Iran, and particularly the
nuclear issue at some point. It was hoped that the example of
Iraq would undermine the bureaucratic regime in Iran, and some
expected that the Presidential elections that happened in June
2005 would exacerbate tensions within Iran, and would provide
for a Ukrainian moment.
However, the elections defied expectations, and the United
States now faces a much more aggressive and overconfident
regime in Iran. Despite significant change in the direction of
Iranian politics, United States policy still continues to look
at democracy and regime change as a solution to the immediate
problems that Iran poses. There are a number of inherent
problems in this approach.
One is that the scope of intensification of Iran's nuclear
program over the past year, and the escalation of the rhetoric
around it, requires a much more direct and focused policy to
address the specific threats in areas of concern that the
United States has. Democracy and democratization does not
amount to such a policy--it's a blunt instrument.
It's also increasingly doubtful--at least to me, who has
observed these things for awhile--that there is actually a
credible democracy movement in Iran right now. It is unlikely
to have an impact on the regime behavior or its decisionmaking
in the small window of opportunity that exists to correct
Iran's path on the nuclear issue. It is also likely that the
policy of conflating democracy promotion with the nuclear issue
is not likely to be compatible together, and is likely to
interfere with one another. First of all, it confuses the
United States message, as it debases democracy as a means to
deal with a nuclear issue--and this has impact, not only on
Iran, but actually on the broader region, and its perception of
the meaning of the United States promotion of democracy.
And it also makes it less likely that Iran will abandon its
nuclear program if it believes that it's the cover for regime
change. As a number of Iranian senior leaders have expressed,
this is a veiled effort to change a regime, and, therefore, why
There is no doubt that Iran has many of the ingredients of
democracy--it has a young population, viable civil society--we
all have seen the positive statistics. But these social factors
have not produced democracy in Iran.
The Iranian society, to many of us, may look like Eastern
Europe in the 1980s, but the Iranian Government does not look
like the Eastern European governments of the 1980s. The
conservative leadership in Iran today--unlike Eastern European
governments of the 1980s--is confident, it's in control, and
it's not completely alienated from its society--it is confident
in the fact that it won the 2005 elections, at least in its own
estimation, relatively comfortably.
The rise in the price of oil has allowed it to combine
nationalism with radicalism, with anti-Americanism, and with
populism in a manner that's also evident in Hugo Chavez's
Venezuela or even Morales' Bolivia.
Now, since the 2005 election the prodemocracy voices in
Iran have been demoralized and marginalized. They have lost
their access to power by losing the Presidency in Iran, they
don't have political parties, they are saddled with infighting
and they don't have a program. There is no issue around it with
which they can galvanize, and there are no election dates on
the horizon in the next 5 years that they can rally around. An
escalation of tensions between Iran and the United States, and
especially the prospects of sanctions and military action
against Iran has created a ``rally to the flag'' phenomenon in
Iran. War and nationalist favor does not favor democracy. A
strong demand for democracy in Iran should not be confused with
a strong democratic movement in Iran.
It is fair to conclude, in fact, that democracy in the
short run is not the solution to the pressing problems in
United States-Iran relations. There is no credible democratic
partner to work with, there is no clear opening, there is no
clear elections to rally around.
At the same time it is possible that contending with the
pressing issues facing United States-Iran relations, as
Ambassador Wisner has mentioned, may require engaging Iran
directly. And that engagement inevitably will lead to the
Iranian Government demanding security guarantees which would
involve that regime change should be off the table.
United States policymakers must realize that
democratization is a long, long process in Iran. It is not a
solution to short-run problems. At a time of escalating
tensions between the United States and Iran, overt support for
democracy in Iran will be counterproductive. It will cast
democracy advocates as ``unpatriotic'' and is likely to be
futile. In a time of war and nationalism, democracy will surely
lose to nationalism.
The imperative of solving the short-run crisis in Iran-
United States relations requires that democracy be specifically
decoupled from the long--the short-run policies and the
requirements of dealing with the nuclear issue be specifically
decoupled from the long-run goal of democracy promotion.
Democracy promotion should remain the U.S. objective, and
the United States should continue to lend its moral authority
to advocating its cause. However, it should not be a substitute
for, or interfere with, directly dealing with the problems at
hand, including the question of engaging Iran. In the case of
the Soviet Union, we ought to remember that the overt policy of
pushing for democracy followed the diplomatic engagement phase,
and did not substitute it. Thank you very much.
[The prepared statement of Dr. Nasr follows:]
Prepared Statement of Dr. Vali Nasr, Professor of National Security
Affairs, Naval Postgraduate School, Monterey, CA
Iran, today, presents a serious foreign policy challenge to the
United States. The growing prominence of security concerns: Escalation
of tensions over Iran's continued development of a nuclear capability,
the country's role in Iraq and Afghanistan and support for Hamas and
Hezbollah have preoccupied United States foreign policy. The election
of a hard-line President in Iran in 2005, who has adopted a belligerent
rhetoric, has added urgency to contending with these challenges.
The U.S. policy between 2001 and 2005 was focused on promotion of
democracy in Iran with the hope that such a transition would result in
a breakthrough in United States-Iran relations, and that in turn would
solve the above-mentioned challenges. It was hoped that the example of
democracy in Iraq would undermine theocracy. Many observers looked to
the Presidential elections of 2005 in Iran as an opening: Expecting
that it would exacerbate internal tensions in Iran and produce a
The election results defied expectations. The reformist lost, and
the most radical conservative forces won. The turnout was higher than
expetced, and despite electoral irregularities there were no wide-
spread protests and a new militant and hard-line President assumed
power, and quickly escalated tensions with the West. The United States
now confronted a more aggressive Iran at a time when the Iraq war was
taxing America's military capability, constricting its ability to deter
Iran in particular intensified its campaign to acquire nuclear
capability, and after the breakdown of negotiations with the EU3 became
less cooperative with IAEA and less willing to compromise. It, in fact,
adopted a policy of deliberately escalating tensions, believing that it
had ample room to push for maximum gains.
It became clear that the priority for U.S. policy in its relations
with Iran would have to be first and foremost, containment of its
nuclear program; and in addition, contending with Iran's regional
role--in particular in Iraq and Palestinian territories.
United States policy has, since 2005, continued to look to
democracy as a solution to the Iranian challenge. There are inherent
problems in this approach:
1. The scope of intensification of Iran's nuclear program requires
a more direct and focused policy to address specific threats and
concerns. Democratization does not amount to such a policy.
2. It is increasingly doubtful that there is, in fact, a credible
democracy movement in Iran, and if it is likely to have an impact on
regime behavior or decisionmaking in the small policymaking window that
is available to the United States to deal with the nuclear issue.
3. It is also likely that democracy promotion and contending with
security concerns regarding Iran may not be compatible with each other,
and, in fact, may interfere with one another.
PROSPECTS FOR DEMOCRACY IN IRAN
Iran, today, has many ingredients of democracy. It has an educated
youth (some 70 percent of the population), who are receptive to Western
ideas, thousands of activist NGOs, more women in universities than men,
and the level of cultural dynamism that is unique in the Middle East.
Persian is today, after English and Mandarin Chinese, the third most
popular language on the Internet, and there are over 80,000 Iranian
blogs. There are hundreds of widely read newspapers, magazines, and
periodicals, and there is relatively easy access to outside sources of
information. One third of Iranians listen to BBC Radio, and BBC's
Persian Web site, at one point, received 450,000 hits a day. Iranians
watch everything from CNN to Al-Jazeera on satellite TV. Although
unelected authorities screen election candidates, and there are deep
flaws in electoral politics, still Iranians are more familiar with the
rudiments of elections than their neighbors. Iranians take the
campaigning and voting seriously. The voting age is 15. An entire
generation has now grown up with ballots and electioneering, promises
from politicians, and the ideals of democracy as well as its mechanics.
These social factors, however, have not produced democracy.
Conversely, over the past 5 years Iran has witnessed growing power of
conservative forces that since the 2005 elections are consolidating
their hold on power. The conservative leadership comprise of clerics
and Revolutionary Guards commanders, and their allies in the
bureaucracy, media, and private sector. They now control all
institutions of power--the executive, legislature, and judiciary--and
are in command of key decisionmaking bodies. Their political ethos
combines loyalty to the ideals of the revolution with an ascendant
nationalism that sees Iran as a regional power. Although Iranian
society may look like Eastern Europe of 1980s the Iranian Government
The conservative leadership in Iran unlike Eastern European
governments of 1980s is not completely alienated from society, and
hence isolated and vulnerable. The ruling regime in Iran is confident
and in control, and has a base of support of around 20 percent (a
steady number in election after election), and far from feeling under
pressure is confident of its own legitimacy and ability to govern. It
sees itself as capable to confronting social opposition. The
conservative leadership has proven itself capable to defending its own
prerogative to power. It combines nationalism with revolutionary
ideology with populism to mobilize the poor in its own support and
marginalize the more affluent middle classes that demand democracy. The
rising price of oil has made such an approach possible. In this regard
the Iranian regime resembles Hugo Chavez's regime in Venezuela or Evo
Morales' in Bolivia.
Since the 2005 elections Iran's prodemocracy forces are demoralized
and marginalized. They have lost their access to power and are excluded
from all state institutions. They are disorganized. They lack political
parties, and infighting has prevented them from forming a united front
before the regime. They do not have a program of action or a platform
that could challenge the current government's foreign policy or
populist economic policies. In addition there is no wedge issue around
which they could mobilize their followers, organize demonstrations, and
build a movement. There is no major election on the calendar for the
next 5 years--nothing to rally around. Escalation of tensions between
United States and Iran--and especially the prospects of sanctions and a
military strike on Iran--has moreover, created a rally to the flag
phenomenon in Iran--war and nationalist fervor do not favor democracy.
As strong as the demand for democracy is in Iran the democracy movement
is weak. It poses no palpable threats to regime stability.
CONTENDING WITH THE CHALLENGE
In the past 5 years the challenges posed by Iran to U.S. policy
have not gone away, they have in fact grown. The prospect for democracy
has in the meantime faded. It is fair to conclude that democracy is not
in the short run a solution to the pressing problems in United States-
Iranian relations. There is no democratic partner organization, no
clear opening, or an election to rally around.
At the same time it is possible that contending with pressing
issues in United States-Iranian relations will require engaging Iran
more directly. Any conversation between the United States and Iran that
yields results will have to contend with security guarantees that will
be sought by Iran. A key element of such a guarantee is likely to be a
removal of a U.S. threat to regime survival in Iran. Such a guarantee
will run counter to the goal of democracy promotion. Hence, not only
will democracy not solve the security challenges facing the United
States, but rather, the solution to those challenges will adversely
impact democracy promotion. Three considerations are important at this
1. U.S. policymaking must realize that democratization is a long-
run process in Iran. It will not address short-run problems.
2. At a time of escalating tensions between the United States and
Iran overt U.S. support for democracy in Iran will be
counterproductive. It will cast democracy advocates as unpatriotic. It
is also likely to be futile as prodemocracy forces are unlikely to
engage the United States at a time when the United States and Iran are
in conflict. Faced with a choice between democracy or nationalism the
Iranian population will likely choose nationalism, and prodemocracy
forces will likely follow the same trend.
3. The imperative of solving short-run crises requires that
policies directed at solving them be decoupled from the long-run goal
of democracy promotion.
Democracy promotion should remain a U.S. objective, and the United
States should continue to lend its moral authority to advocating its
cause. However, the United States should not see this as a short-run
policy or a solution to the nuclear crisis. Democracy promotion should
not be a substitute for diplomacy.
The Chairman. Thank you very much, Dr. Nasr.
Let me suggest at this point--the vote has just commenced--
that we take a recess before beginning with our next testimony
so we may then hear it in full, without apprehension. I
apologize to you.
Senator Biden. This is highly unusual. I'm going to have
to--from 10:15 to about 20 minutes of--not be present. Would it
be appropriate if you allowed me, in the first half of this, to
just ask two questions to the two witnesses who have already
spoken? Because I may not be able to get back, and I'm anxious
to hear the other testimony as well, but if I could just, there
are two thoughts I have and I just want to ask the two
witnesses now, would that be appropriate?
The Chairman. That would be fine.
Senator Biden. I probably won't take more than 7 minutes
and I will recess until you come back, and then I'll try to
come back by quarter of.
The Chairman. Fine, very good. I will vote while you're
raising your questions.
Senator Biden. I appreciate it very much.
The Chairman. And then I'll come back.
Senator Biden. Thank you, thank you very much.
Again, I apologize to the other two witnesses--I hope I get
back in time to be able to follow up with questions to you as
Dr. Nasr, I am very, very impressed with your testimony, as
would not surprise you, since it coincides with my thinking,
but you expressed it in a way that is more, I think, concise
and coherent than anyone I've heard do it.
I'd also point out that I've listened to you a long time; a
year ago you predicted that the Sunni problem in Iraq would be
the problem that we would be having to confront. I think you
were prescient there, unfortunately, and so, I want to ask you
about the democracy movement and then, Mr. Ambassador, if you
could chime in, I'd appreciate it as well, because they don't
seem to be at odds, they seem to be convergent here.
More than a few witnesses pointed out that--I try to figure
out what's going on and what the thinking of the administration
is as it deals with a whole range of foreign policy problems. I
try because we only have one President at a time, we have one
foreign policy at a time, and the success of that foreign
policy is critical to the interest of all Americans, so I try
very hard to understand the underpinning of this approach that
the administration is taking with regard to both North Korea
and Iran and they're different.
But you mentioned something that no witness has that I can
recall thus far--and that is that the underlying thesis here
was, and I mean this in a positive way, now this is not a
criticism. The neoconservative intellectuals argued that by the
demonstrable show of force, also the shock and awe of going
into Iraq, and doing it almost in the face of the moral
disapprobation of the world--most of the world, anyway--would
have a salvatory impact upon world regimes which we consider
rogues, and I would argue not incorrectly, North Korea and
Iran. And prior to us going into Iraq, there was in Iran a
vibrant--not pro-Western--but vibrant democratic movement that
the clerics were fearful of crushing in the cold view of the
whole world for the previous 6 or 7 years.
And then along came our effort in Iraq--and my view and I
would like you both to comment on this--my view was it had the
exact opposite impact. Once it was clear that we were occupied
in Iraq and would be for some time, in the clear light of day,
for all the world to see, there was almost a challenge that you
had the clerics in Tehran saying, ``Watch us crush this
movement. Everybody looking? Take a good look at what we're
about to do.'' And they purged the list of those who could run.
They purged the moderates of anybody who appeared to have any
genuine small ``d'', democratic instincts, again, I'm not
confusing democrat with pro-Western. And now this policy of
democratization, to use your phrase, being used as a blunt
instrument--we don't have a whole lot to work with. And, it
seems as though it's read, specifically, as a means by which
you change regimes.
My observation of having gotten deeply involved in trying
to become educated on Persian culture, on Iran--in particular
over the last 30 years, I was a product of Dr. Fatimi and
others--I've observed that there is a pretty wide consensus in
Iran that they live in a dangerous neighborhood, and even those
democrats with a small ``d'' think having nuclear weapons is
not a bad idea. And the only thing I've ever observed that
unites Iranians is a direct assault on, or a perceived threat,
to their national unity, their nationalism.
And so having said all of that--why is it different, why
can the administration make, if it's true, a shift in a policy
on North Korea, if this New York Times article by Sanger is
correct--including beginning negotiations on a peace treaty, a
peace treaty--that's what it says. How can they argue that any
direct discussions--not even negotiations--with Tehran is
antithetical to U.S. interests when North Korea is a nation
that has 400 percent more fissile material than they had just 5
years ago. A nation that has a nuclear capacity, a nation that
has engaged in proliferation, a nation that has, in fact, been
at war with us? How can you square that circle? Talk to me
about the sort of--we're missing something here in terms of the
rationale. The foreign policy imperatives of this
administration. Or do we have two different administrations? Do
we have one group focusing on Korea, and another group focusing
I realize that's a very broad statement as well as
question, but talk to me a little bit about--what are these
Dr. Nasr. Thank you, Senator Biden. Since I haven't been
part of the decisionmaking, I cannot speak for what leads to
the current position. But what I can say is the confusion that
is core of having to achieve what we want within the nuclear
issue and promotion of democracy is actually hampering us. But
I think the point, if I may push further, you mention regarding
where the people of Iran will stand in terms of a response to a
United States position, and I think a critical issue is that we
have to realize that the people of Iran are a strategic asset
in that region for the United States. Because it is the only
population in the region that does not carry, or harbor, deep-
seated ideological anti-Americanism.
Senator Biden. And that's the amazing thing.
Dr. Nasr. That's the amazing thing, absolutely. And we
should think that our policy should not be focused only on what
the regime does, but whether or not we will keep or lose that
Second, I think whether or not the people of Iran will
rally to the flag, support their government or not, depends on
whether they think the policies of the international community
are reasonable, just, and legitimate. And therefore, even if it
were to come to a military action, if they were to assume that
the United States did not exhaust every possible option, it did
not pursue a course that, in their mind, was reasonable, then
they will support that government. And I think to support
Senator Biden. That's an interesting nuance difference.
Dr. Nasr. I do believe to support Ambassador Wisner's
position--one of the wisdoms of at least engaging in Iran is
that it makes our case with the people of Iran much stronger.
Senator Biden. Ambassador, do you have any comment? And by
the way, I'd invite any comment from any--I know you haven't
testified yet, but if you want to--and I really want to
apologize for going out of order like this, but this is such an
important hearing, I'm being selfish here, trying to get
Ambassador Wisner. Senator, thanks. I think I find myself
as constrained as Dr. Vali Nasr in trying to interpret a policy
that at heart I don't agree with. But, I start from the premise
that Dr. Vali Nasr laid out, and that is that there really
isn't a democratic opposition to be worked with, even if you
are an advocate of regime change--it's divided, dispirited, and
the assault on the nuclear issue is an assault on national
honor that has a habit of unifying Iranians.
But when I look at the administration's response, I detect
two quite different courses of thinking. The first is a matter
of principle, and a reading or misreading--I would assert--of
our own history in the cold war. And that is: If one states
American principles, a deep belief in democracy, over time that
by standing firm, the walls will crumble and the regimes hidden
behind them will fail. And that is one reading of what happened
at the end of the cold war. I don't happen to share that view.
But it is deeply viewed as an outgrowth of American principle,
if you stand firm on eternal truths like democracy, eventually
those standing behind the walls will take heart, and we will
have kept the faith with young Iranians for the future.
The second view that I sense inside the administration is
much more tactical. What is the right way to engage Iran today?
Is it by being extremely firm, of showing very little light
until Iran makes categorical statements about its enrichment
program? To stand firm in order to put backbone in the allied
position and to bring Russia and China on board by a strong
view of American intention--it's a tactical view, not an
ideological view, in the expectation that in seeing strength,
Iran will then move toward that strength and try to accommodate
it. Again, I remain to be persuaded this is the effective way--
Senator Biden. I thank you very much, the Chairman is back
and I only have a few minutes to vote. Ms. Nanay and Mr.
Phillips, I read your testimony, I'm anxious to get back and
engage you--I know the views are not uniform here, and I'm
very--I have an open mind about, I'm just perplexed as to
what's--anyway, I thank you. Thank you very much.
The Chairman. We'll now proceed to Ms. Nanay.
STATEMENT OF MS. JULIA NANAY, SENIOR DIRECTOR, PFC ENERGY,
Ms. Nanay. Good morning, again, thank you for letting me
testify before this committee. PFC Energy, the firm that I work
for, is a strategic advisory firm, and we advise the petroleum
industry on the oil markets and various aspects of investment
risk related to the global petroleum environment.
Let me say that I'm coming before the panel as a petroleum
expert and I know the committee has other issues that override
this sector, but I'm not here to address those.
Let me start with the fact--and this is very important--
that Iran is an important oil producer and supplier of oil to
world markets. At a time when oil supplies are tight and prices
are high, Iran is a significant source of oil for world
The timing of today's hearings is important because the
industry is troubled by difficulties in many parts of the world
in oil, including the nationalization trends which we're
watching in Latin America. Lower oil production and exports
being forecasted for Venezuela, production disruptions in
Nigeria, and slowing production in Russia and so on--this is an
extremely volatile period for oil markets and for oil prices.
Now, uncertainty over the ability of the markets to supply
the world's oil requirements, if Iran's oil supplies were
disrupted, has kept the oil markets on edge.
If you see the day-to-day volatility, which is what we
watch closely, it's driven by news about Iran. The more that
Iran is in the news and the more that the United States presses
for sanctions and holds out the threat of military action, the
higher that oil prices stay. Any news about the easing of
tension leads to a price drop. Any news that military action
takes place will drive oil prices up over $90 or $100 a barrel.
In fact, estimates of the Iran premium in today's oil price run
as high as $15 a barrel, and oil prices have been hovering
around $70 a barrel.
Another point is that sanctions work if everyone
participates, but it's difficult to impose sanctions on crude
oil and petroleum products--like gasoline imports to Iran,
because there can be leakages, and not all countries or
companies observe sanctions.
Short of disrupting Iran's oil trade with sanctions on oil
exports, which would drive up oil prices and certainly
negatively impact the United States economy, there's really
limited impact to be gained for the world's community from any
other additional sanctions on Iran's oil and gas industry.
In a market where companies and countries seek to secure
their economic lifelines through access to oil and gas, the
idea that you can create a foolproof sanction system targeted
at any oil and gas producer today is just a nonstarter. There
will always be those who violate the sanctions.
If we talk about cutting off gasoline imports to Iran, we
have to remember that Iran has demonstrated extraordinary
resiliency over the last 25 years when it comes to outside
pressure and sanctions. It would find a way around the gasoline
sanctions. At the very least, the gasoline that is currently
smuggled to neighboring countries--because Iran's domestic
gasoline prices are heavily subsidized and very low--these
smuggled amounts would be eliminated, and they're very
substantial. Energy subsidies in Iran amount to as much as $11
billion a year. The government, of course, would be forced to
address this already controversial subsidy program which
imposes high costs on the country's economy. So, in fact, if we
try to attach sanctions to gasoline imports, you could have
side effects which probably could be useful for Iran.
Unless there are major disruptions caused by some sort of
military intervention or sanctions on Iran's exports, I don't
see Iran itself as stopping or cutting back the flow of oil to
its customers. Iran would be reluctant to jeopardize
contractual relationships, nor would they want to lose the
revenues. Iran's oil exports of 2.4 million barrels per day
fetch over $50 a barrel for the government, and this results in
huge revenues for the budget. Iran will earn over $50 billion
on oil exports this year alone.
The United States buys no oil from Iran. Japan may be
Iran's largest customer, followed closely by China. In fact,
Japan and China take about a third of Iran's oil exports. Any
disruption in oil supplies from Iran would probably hit Japan
In conclusion, the United States has to weigh carefully
what it wants to gain from additional sanctions. The cutoff of
gasoline imports could be just another item on another long
list of sanctions already imposed on Iran. This certainly
creates problems for the government, but then as we've seen the
government adjusts, and its power isn't seriously undermined,
its behavior isn't changed, and certainly it doesn't do what
the United States wants it to do because of sanctions. In fact,
it may not even affect the government's position on nuclear
enrichment. Therefore, when I look at the oil sector, I see
that the United States has very few options, or none, that it
[The prepared statement of Ms. Nanay follows:]
Prepared Statement of Julia Nanay, Senior Director, PFC Energy,
Good morning. Senator Lugar and distinguished members of this
committee, it is a pleasure to come before you today to address such an
important topic. My name is Julia Nanay and I am a senior director at
PFC Energy. PFC Energy is a strategic advisory firm, based in
Washington, DC. We are advisors to the petroleum industry on oil
markets and various aspects of investment risks related to the global
IRAN IS A MAJOR RISK FACTOR DRIVING ENERGY PRICES HIGHER
The timing of today's hearing is important as it occurs in an
extremely volatile period for oil markets. Here are some of the
headlines from the news over the course of just a few days May 3-May
12: Oil hovered near $75 a barrel, within striking distance of record
highs, because of mounting tension over Iran's nuclear plans; oil held
steady near $70 a barrel after major powers failed to come up with a
strategy for containing Iran's nuclear ambitions; oil fell below $70 a
barrel on hopes tension over Iran's nuclear ambition will ease after
Iran's President made an unprecedented move to contact Washington.
Uncertainty over the ability of the markets to supply the world's
oil requirements if Iran's oil supplies were reduced has kept oil
markets on edge. The day-to-day volatility in today's oil markets is
driven by the news about Iran. The more that Iran is in the news and
the more that the United States presses for sanctions and holds out the
possibility of military action, the higher that oil prices stay. Any
news about the easing of tensions and possible talks between the United
States and Iran causes the price to drop. Estimates of the Iran premium
in today's oil price run as high as $15 a barrel.
IRAN'S PRODUCTION AND EXPORTS
Iran's oil production capacity today is about 4 million barrels per
day. Its oil production is estimated to average 3.8-3.9 million barrels
per day. The country's OPEC quota is 4.11 million barrels per day.
Iran's oil exports have held steady at 2.4-2.5 million barrels per day,
without any significant drops related to tensions over the nuclear
problem. Iran's oil export policies have not changed.
Since President Ahmadinejad was elected in June 2005, however, no
new contracts for oil or gas development have been signed. Production
from Iran's existing old oil fields is being depleted and without
significant new investment, oil production declines of at least 200,000
bbl/d per year are foreseen. Iran has been unable to meet its OPEC
quota because of the lag in capacity expansion plans. The Iran Libya
Sanctions Act (ILSA) prohibits U.S. investment in Iran's oil and gas
sector and has discouraged many Western companies from investing.
One solution being promoted by the Government of Iran is to dip
into the Oil Stabilization Fund to finance oil and gas developments.
One idea floated in Iran is to take loans from the Oil Stabilization
Fund to spend on oil and gas fields, using future revenues to repay the
loans. Information on the actual level of this fund is difficult to
come by since the government has been drawing against it for various
purposes. The Oil Stabilization Fund does not show up in Iran's
national budget. It is run as an account at the Central Bank by a
handful of senior government officials. A better way to look at the Oil
Stabilization Fund would be to refer to it as a hard currency reserve
The threat of additional sanctions on Iran's oil and gas sector and
the rumors about possible military action are keeping foreign investors
away from Iran. This could lead to less oil being available from this
country over time, depending on how long the current standoff
continues. In a period of increasingly tight oil markets, this will
keep a floor under oil prices.
COUNTRIES THAT BUY OIL FROM IRAN
The United States buys no oil from Iran. According to a report from
the Joint Economic Committee of Congress in March 2006, 56 percent of
Iran's oil exports are to Asia and 29 percent to Europe. The remainder
goes to Africa, the Middle East and Latin America. Japan and China
together buy over 800,000 bbl/d of Iran's oil exports or over one-
third. Japan is particularly dependent on Iran and the Middle East in
general since it imports every barrel it uses and over 90 percent of
its imports come from the Middle East. China purchases less oil from
Iran than Japan and its oil import sources are more diversified. Angola
and Russia are both large suppliers of oil to China. Japan, therefore,
is most vulnerable to any supply interruptions from Iran.
Worries about oil disruptions from Iran are forcing Japanese and
Chinese buyers to try to diversify their import sources. Japanese
refiners have changed their purchasing patterns to reduce Iranian
volumes. Both Japan and China are making overtures to Russia to open up
East Siberia to their companies and to allow them to help finance and
build new East Siberian export pipelines. This could pose a challenge
to Western buyers of Russian crude and gas as these resources could be
diverted from the West to feed Asian buyers clamoring for non-Middle
East supplies. Chinese companies are also becoming increasingly active
in Africa. In a recent bidding round in Angola, China's Sinopec offered
a signature bonus of $1.1 billion for two deepwater blocks offshore
significantly outbidding U.S. companies in a region that in the past
was the preserve of the United States and European oil industry. U.S.
efforts to further isolate Iran are being felt in ways big and small in
global petroleum markets as international investors scramble to
diversify away from the Middle East.
Still, unless there are major disruptions caused by some sort of
military intervention or sanctions on Iran's oil exports, Iran itself
is unlikely to stop or cut back the flow of oil to its customers. For
one thing, it would be reluctant to jeopardize its contractual
relationships; for another, it would not want to lose the revenues. For
every barrel of the 2.4 million barrels a day that Iran exports, it
earns over $50 a barrel. Iran's net oil export revenues in 2005 were
close to $47 billion and it will earn over $50 billion in 2006.
IRAN IMPORTS GASOLINE
Despite being OPEC's second largest oil producer, Iran has a
deficit in refining capacity to manufacture gasoline. Iran uses about
422,000 bbl/d of gasoline and imports 170,000 bbl/d of it, paying
upward of $4 billion in 2006 for these imports. Gasoline is heavily
subsidized in Iran, with the price set at under 40 cents per gallon;
$2.6 billion was withdrawn from the Oil Stabilization Fund last year to
pay for gasoline imports.
Again according to a report from the Joint Economic Committee of
Congress in March 2006, an estimated 25 percent of Iran's gasoline
imports come from Persian Gulf countries, 15 percent from India, and
the remainder from a variety of sources, including France, Turkey,
Singapore, the Netherlands, and China.
At the same time, volumes equivalent to as much as half of the
amount of Iran's gasoline imports are being smuggled abroad. Subsidized
prices at home make it lucrative for smugglers to move this product out
of the country, with Iraq being a favored market along with Pakistan.
Many people in border areas earn a living from smuggling gasoline.
Iran is looking into rationing gasoline, so that low prices would
apply to a certain level of purchases by each car owner after which the
full cost of the gasoline would be paid. This two-tier pricing system
is still being discussed but it could be implemented later in 2006.
If gasoline import sanctions were imposed, one affect would be to
cut down on smuggling and another, to alleviate the traffic pollution
problems in Tehran. Gasoline import sanctions might cast the United
States in a negative light since unlike other oil and gas sanctions,
their impact would fall directly on Iran's people.
U.S. POLICY OPTIONS IN THE OIL AND GAS SECTOR
About 60 percent of Iran's export earnings come from the oil and
gas sector and 40 to 50 percent of the government's revenues.
Investments in Iran's oil and gas sector are already dramatically
reduced and timetables delayed due to the sanctions currently in place,
as well as weak terms on offer under the buyback contract model. Short
of disrupting Iran's oil trade with sanctions on oil exports, which
would drive up oil prices and negatively impact the U.S. economy, there
is limited impact to be gained for the world community from any other
additional sanctions on Iran's oil and gas industry. In a market where
companies and countries seek to secure their economic lifelines through
access to oil and gas, the idea that you can create a fool-proof
sanctions system targeted at any oil and gas producer is a nonstarter.
There will always be those who violate the sanctions.
Sanctions on gasoline imports would be disruptive and would result
in creating dislocations in Iran's economy. However, their impact would
be offset to some extent by the likely elimination of the smuggling of
gasoline to neighboring countries. Such targeted sanctions will have
their own unintended consequences of probably encouraging the smuggling
of gasoline from such offshore sources as Dubai from where many
products already enter Iran.
The United States has to weigh carefully what it wants to gain from
such sanctions. The cutoff of gasoline imports could just be another
item on a list of sanctions already imposed on Iran, which certainly
creates problems for the government but then results in adjustments
without seriously undermining the government's power or changing its
behavior with regard to nuclear enrichment.
IRAN-PAKISTAN-INDIA GAS PIPELINE
Finally, just a few words about the status of this pipeline. This
is a project that has been talked about for many years and it is still
being discussed. Let's put it in the context of the Baku-Tblisi-Ceyhan
oil pipeline which at 1,780 km is 1,000 kms shorter than the 2,775 km
Iran-Pakistan-India pipeline. It took almost a decade for BTC to be
realized from first project appraisal and this is a pipeline that had
private oil company investment and where BP took a strong lead.
Constructing and financing such multibillion dollar projects is
difficult and expensive and it takes serious commitment from all
parties. With an estimated $7 billion price tag, the Iran-Pakistan-
India pipeline still has a long way to go before it can be considered a
serious project. While the energy is clearly needed by Pakistan and
India, there is no agreement in place yet among the three countries to
build the pipeline, with the question of who would pay for it not even
The Chairman. Thank you very much for your testimony.
STATEMENT OF JAMES A. PHILLIPS, RESEARCH FELLOW FOR MIDDLE
EASTERN AFFAIRS IN THE DOUGLAS AND SARAH ALLISON CENTER FOR
FOREIGN POLICY STUDIES, THE HERITAGE FOUNDATION, WASHINGTON, DC
Mr. Phillips. Thank you, Mr. Chairman, for this opportunity
to testify today. I think the efforts of the United States and
its allies to dissuade Iran from pursuing its long-sought goal
of attaining nuclear weapons have so far failed to yield
satisfactory results. Iran made temporary tactical concessions
in October 2003 under strong international pressure--to
temporarily freeze its uranium enrichment operations and enter
into diplomatic negotiations led by the EU3 to temporarily
diffuse the crisis. But Tehran later dropped the charade of
negotiations after it apparently concluded that the
international situation had shifted in its favor for reasons
that those testifying before me have mentioned--rising oil
prices, the United States commitment in Iraq and Afghanistan--
and I think the incoming Ahmadinejad government which had
bitterly criticized previous Iranian governments for those
Thus far, Iran has escaped paying any significant price for
its apparent violations of its commitments under the Nuclear
Non-Proliferation Treaty, and failure to fully cooperate with
the IAEA, and I would contend that it won't negotiate seriously
on the fate of its programs until its started to pay a price.
Therefore, the United States should mobilize an
international coalition to raise the diplomatic, economic, and
as well as potential military--costs to Tehran of continuing to
flout its obligations under its nuclear safeguard agreements.
This coalition of the willing should seek to isolate the
Ahmadinejad regime, weaken it through targeted economic and
other sanctions, and explain to the Iranian people why their
government's nuclear policies will impose economic costs and
possible military risks on them.
Yes; we should contain Iran's military power, but I don't
think we should abandon the possibility of democratic change.
If Tehran persists in its drive for nuclear weapons, despite
these escalating pressures, I think then the United States
should consider military options to set back the Iranian
nuclear weapons program.
I think the United States must continue to push in the
strongest possible sanctions in the U.N. Security Council. But
experience has demonstrated that Washington can not rely on the
United Nations to halt the nuclear program. Russia and China--
who have extensive economic, military, and energy ties to
Iran--may veto, delay, or dilute any effective resolution. The
United States should, therefore, make fallback contingency
plans to work with the EU3, the broader EU community and
Japan--other interested countries--to work on sanctions outside
the U.N. framework, if necessary.
An international ban on the import of Iranian oil is a
nonstarter for reason that Ms. Nanay has mentioned. It's
unrealistic to expect oil importers to stop importing Iranian
oil in a tight, high-priced oil market. I think, instead, the
focus should be on denying Iran loans, foreign investment, and
favorable trade deals. Washington should cooperate with other
countries to deny Iran loans from international financial
institutions, such as the World Bank, and try to block proposed
pipelines out of Iran, such as the one considered for India and
In addition to economic sanctions, the United States should
press its allies and other countries to ban nuclear assistance,
arms sales, and the export of dual-use technology to Iran.
Symbolic sanctions, such as travel ban on Iranian officials or
a ban on Iranian participation in international sports events
would be important to drive home to the Iranian people that the
international opposition to Iran's nuclear program is
widespread and not just an artificial issue created by the
United States as their government claims.
The United States should also support Iran's democratic
opposition. Iran has a well-educated group of young reformers
who seek to replace the current monocracy with a genuine
democracy that is accountable to the Iranian people. Yes; they
are weak and divided, but they constitute, I think, Iran's best
long-term hope, and the United States should not turn its back
on them. The United States should not try to play favorites
among the various Iranian opposition groups, but it should
encourage them to cooperate under the umbrella of the broadest
possible coalition. And I think we have to be really humble
about our ability to spark democratic change, but in the long
run, I think it's something that cannot be ruled out.
The United States Government should also launch a public
diplomacy campaign to explain to the Iranian people how the
regime's nuclear weapons program and hard-line policies hurt
their economic and national interests. Iran's regime has
tightened its grip on the media in recent years, shutting down
more than 100 independent newspapers, jailing journalists,
closing down Web sites and arresting bloggers. The United
States and its allies should work to defeat the regime's
suppression of the independent media, by increasing Farsi
broadcasts by government-sponsored media such as the Voice of
America and Radio Farda, and other information sources. The
free flow of information is an important prerequisite for the
free flow of political ideas, and the Iranian people need
access to information about the activities of the democratic
opposition groups both within and outside Iran, and the plight
Finally, I think the United States must be prepared for the
use of military force as a last resort. There's no guaranteed
policy that can halt the Iranian nuclear program short of war,
and even a military campaign may only delay Iran's acquisition
of nuclear weapons. But United States policymaking regarding
the Iranian nuclear issue inevitably boils down to a search for
the least bad option, and as potentially costly and risky as a
preventative war against Iran would be, allowing Iran to
acquire nuclear weapons would result in far heavier potential
costs and risks.
Thank you, Mr. Chairman.
[The prepared statement of Mr. Phillips follows:]
Prepared Statement of James A. Phillips, Research Fellow for Middle
Eastern Affairs, the Douglas and Sarah Allison Center for Foreign
Policy Studies, the Heritage Foundation, Washington, DC
Thank you, Mr Chairman and distinguished members of the committee,
for this opportunity to discuss U.S. policy regarding Iran's nuclear
The efforts of the United States and its allies to dissuade Iran
from pursuing its long-sought goal of attaining a nuclear weapons
capability have so far failed to yield satisfactory results. Iran made
temporary tactical concessions in October 2003 under strong
international pressure to temporarily freeze its uranium enrichment
operations and submit to increased inspections of its nuclear
facilities by the International Atomic Energy Agency (IAEA). Tehran
feared that referral to the Security Council could result in diplomatic
isolation, economic sanctions, or possible military attack. It
undoubtedly also was motivated by the examples set by the rapid
overthrow of the Taliban regime in Afghanistan in 2001 and Saddam
Hussein's regime in Iraq in early 2003 by U.S.-led coalitions.
Tehran made enough tactical concessions to stave off international
sanctions and engage the European Union in diplomatic negotiations led
by Britain, France, and Germany (the EU3) to temporarily defuse the
crisis. But Tehran later dropped the charade of negotiations after it
apparently concluded that the international situation had shifted in
its favor. It now apparently believes that it is in a much stronger
position due to the continued need for U.S. military forces in Iraq and
Afghanistan; the rise in oil prices which has given it greater
bargaining leverage with oil importers; and its diplomatic cultivation
of China and Russia, which can dilute or veto resolutions brought
before the U.N. Security Council.
The installation of a new hard-line government led by President
Mahmoud Ahmadinejad in August 2005 also was a major factor that led
Tehran to renege on its agreement with the EU3. Iran's new President is
firmly committed to Iran's nuclear program and vehemently criticized
Iran's previous government for making too many concessions in past
negotiations with the EU3. Shortly thereafter Iran resumed operations
at the Isfahan uranium conversion facility, converting yellowcake into
uranium hexafluoride, a preliminary step before enrichment. In January
2006 Iran announced its intention to resume uranium enrichment
activities and removed IAEA seals at its Natanz facility. Iran remains
determined to develop a complete nuclear fuel cycle, which would
eventually give it the fissile material for a nuclear weapons
capability. Thus far, Iran has escaped paying any significant price for
its apparent violations of its commitments under the NPT and failure to
fully cooperate with the IAEA.
The United States should mobilize an international coalition to
raise the diplomatic, economic, domestic political, and potential
military costs to Tehran of continuing to flout its obligations under
its nuclear safeguards agreements. This ``coalition of the willing''
should seek to isolate the Ahmadinejad regime, weaken it through
targeted economic sanctions, explain to the Iranian people why their
government's nuclear policies will impose economic costs and military
risks on them, contain Iran's military power, and encourage democratic
change. If Tehran persists in its drive for nuclear weapons despite
these escalating pressures, then the United States should consider
military options to set back the Iranian nuclear weapons program.
THE GROWING THREAT OF AHMADINEJAD'S IRAN
Mahmoud Ahmadinejad rose up through the ranks of the Islamic
Revolutionary Guard Corps (IRGC), the praetorian guard dedicated to
advancing and exporting the revolution that Ayatollah Ruhollah Khomeini
inspired in Iran in 1978-1979. Ahmadinejad is a true believer in
Khomeini's radical vision of Iran's role as the vanguard of a global
Islamic revolution. He has lambasted the United States as ``a failing
power'' and a threat to the Muslim world.
In sharp contrast to his predecessor, former President Mohammad
Khatami, who advocated a conciliatory ``dialog of civilizations'' but
was blocked by the strong opposition of the ideological hard-liners,
Ahmadinejad has returned to the fiery rhetoric of the Khomeini era. In
September he delivered a truculent speech at the United Nations,
warning foreign governments against meddling in Iranian affairs. On
October 26, he made a venomous speech attacking Israel in which he
quoted Khomeini: ``As the Imam said, Israel must be wiped off the
Ahmadinejad's vehement return to Khomeini's radical line has been
accompanied by a purge of pragmatists and reformers within the regime.
Forty of Iran's senior ambassadors have been recalled from overseas
posts, including diplomats who were involved in the EU3 negotiations in
Britain, France, Germany, and at the United Nations in Geneva.
Ahmadinejad has appointed many of his IRGC cronies to key positions
throughout the government.
Iran also has been increasingly aggressive in stirring up trouble
inside Iraq. In October, the British Government charged that the
Iranians had supplied sophisticated bombs with shaped charges capable
of penetrating armor to clients in Iraq who used them in a series of
attacks on British forces in southern Iraq. Iran also has given
discreet support to insurgents such as Moqtada al-Sadr, who twice has
led Shiite uprisings against coalition forces and the Iraqi Government.
Iranian hard-liners undoubtedly fear that a stable democratic Iraq
would present a dangerous alternative model of government that could
undermine their own authority. They know that Iraq's preeminent Shiite
religious leader, Grand Ayatollah Ali al-Sistani, whose religious
authority is greater than that of any member of Iran's ruling clerical
regime, rejects Khomeini's radical ideology and advocates traditional
Shiite religious doctrines. Although Iran continues to enjoy
considerable influence with many Iraqi Shiites, particularly with
Iraq's Supreme Council for the Islamic Revolution in Iraq and the Dawa
Party, the moderate influence of Sistani dilutes their own
revolutionary influence. Therefore, Tehran plays a double game in Iraq,
using the young firebrand al-Sadr to undermine Sistani and keep
pressure on the U.S. military to withdraw, while still maintaining good
relations with Shiite political parties who revere Sistani and need
continued American support.
In addition to its destabilizing role in Iraq, Iran continues to be
the word's leading sponsor of terrorism. Secretary of State,
Condoleezza Rice, recently called Iran ``the central banker'' of
international terrorism. It has close ties to the Lebanon-based
Hezbollah terrorist group, which it organized and continues to finance,
arm, and train. Tehran also has supported a wide variety of Palestinian
terrorist groups, including Fatah, Hamas, and Palestinian Islamic
Jihad, as well as Afghan extremists such as Gulbuddin Hekmatyar. Iran
was involved in the 1996 Khobar Towers bombing, which killed 19
American military personnel deployed in Saudi Arabia. Moreover, Iran
reportedly continues to give sanctuary to elements of al-Qaeda,
including at least one of Osama bin Laden's sons, Saad bin Laden, and
Saif al-Adil, a top operations coordinator.
This long and deep involvement in terrorism, continued hostility to
the United States, and repeated threats to destroy Israel, provide a
strong warning against the dangers of allowing such a radical regime to
develop nuclear weapons.
LEADING AN INTERNATIONAL RESPONSE TO IRAN'S NUCLEAR CHALLENGE
Diplomatic efforts centered on the United Nations to pressure Iran
to abandon its clandestine nuclear efforts are unlikely to solve the
problem, in part due to the institutional weaknesses of the U.N.
Security Council, where a lack of consensus often leads to paralysis or
lowest common denominator policies that are not effective.
Nevertheless, the Bush administration must resolutely press the
diplomatic case at the Security Council to set the stage and improve
the U.S. position in the push for possible diplomatic and economic
sanctions targeted at Iran's recalcitrant regime, or, as a last resort,
possible future military action.
Another goal should be to make sure that the end result of the
Security Council's interactions with Iran clearly lays the
responsibility of any failure on Tehran, not Washington. Washington
should seek to focus the Security Council debate on the critical
issue--the threat posed by Iran's nuclear program--not the broader
question of whether to seek a multilateral ``grand bargain'' with an
untrustworthy revolutionary power that exploited and sabotaged past
American efforts to stage a rapprochement under the Carter and Reagan
administrations and failed to respond to the tentative detente offered
by the Clinton administration. Getting drawn into a multilateral dialog
with Iran through the auspices of the United Nations would allow Iran
to divert attention from its safeguard violations and history of
terrorism, while subjecting the United States to growing international
pressure to bribe Iran with diplomatic carrots to comply with
international legal commitments that it already has violated and could
renege on again in the future.
Iran already has provided ample evidence that it has no intention
to fully cooperate with the IAEA or end the uranium enrichment
activities that eventually will give it a nuclear weapons capability.
If it merely seeks a nuclear power capability for economic reasons, as
it insists, then it would not have rejected the Russian offer to enrich
uranium at facilities in Russia, which would have saved it considerable
costs in building and operating uranium enrichment facilities.
Moreover, Iran also would have received additional economic benefits
from the EU3 if it had not broken off those negotiations.
Under these circumstances, the EU3's recent undertaking to put
together a new package of incentives for Iran is the triumph of wishful
thinking over experience. Beginning a new round of negotiations while
Iran continues to work to perfect its uranium enrichment technology
will enable Tehran to buy time for its nuclear weapons program,
forestall sanctions, and weaken the perceived costs of violating the
nuclear nonproliferation regime in the eyes of other countries who may
consider following Iran's path. To change Iran's course, the EU3 should
be considering larger disincentives, not just larger incentives.
Forge a coalition to impose the strongest possible sanctions on the
Although it has greatly benefited from the recent spike in world
oil and natural gas prices, Iran's economic future is not a promising
one. The mullahs have sabotaged economic growth through the expansion
of state control of the economy, economic mismanagement, and
corruption. Annual per capita income is only about two-thirds of what
it was at the time of the 1979 revolution. The situation is likely to
get worse as President Ahmadinejad follows through on his populist
promises to increase subsidies and give Iran's poor a greater share of
Iran's oil wealth.
Iranians are sending large amounts of their capital out of the
country due to fears over the potentially disastrous policies of the
new government. Shortly after Ahmadinejad gave his October 26 speech
threatening Israel, Iran's stock market plunged to its lowest level in
2 years. Many Iranian businessmen understand, even if Ahmadinejad does
not, that Iran's economic future depends on access to world markets,
foreign investment, and trade.
The United States should push for the strongest possible sanctions
at the U.N. Security Council. But experience has demonstrated that
Washington cannot rely on the United Nations to halt the Iranian
nuclear program. Russia and China, who have extensive economic,
military, and energy ties to Iran, may veto or dilute any effective
resolution. The United States, therefore, should make contingency plans
to work with Britain, France, Germany, the European Union, and Japan to
impose sanctions outside the U.N. framework if necessary.
An international ban on the import of Iranian oil is a nonstarter.
It is unrealistic to expect oil importers to stop importing Iranian oil
in a tight, high-priced oil market. Instead, the focus should be on
denying Iran loans, foreign investment, and favorable trade deals.
Washington should cooperate with other countries to deny Iran loans
from international financial institutions such as the World Bank and to
deny Iran loans for a proposed natural gas pipeline to India via
Although Iran is one of the world's leading oil exporters, it is
also an importer of gasoline due to mismanagement and inadequate
investment in its refinery infrastructure. An international ban on
gasoline exports to Iran would deprive Tehran of approximately 40
percent of its daily gasoline consumption. This would significantly
drive up the price of Iranian gasoline and underscore to the Iranian
people the shortsighted policies of Iran's ruling regime.
In addition to economic sanctions, the United States should press
its allies and other countries to ban nuclear assistance, arms sales,
and the export of dual-use technology to Iran. Symbolic sanctions, such
as a travel ban on Iranian officials or ban on Iranian participation in
international sports events, would drive home to the Iranian people
that international opposition to Iran's nuclear program is widespread
and not an artificial issue created by the United States, as their
Support Iran's democratic opposition
The Bush administration has correctly aligned the United States
with the Iranian people in their efforts to build a true democracy, but
it has held back from a policy of regime change, partly in deference to
the EU3 negotiations with Iran about its nuclear program. However, now
that it is clear that Iran has reneged on its promises to the EU3,
Washington should discreetly aid all Iranian groups that support
democracy and reject terrorism, either through direct grants or
indirectly through nongovernmental organizations. The Iran Freedom and
Support Act of 2005 (H.R. 282 and S. 333), currently under
consideration by Congress would authorize such aid and tighten U.S.
economic sanctions on Iran.
Iran has a well-educated group of young reformers who seek to
replace Iran's current mullahcracy with a genuine democracy that is
accountable to the Iranian people. They have been demoralized by the
failure of former President Khatami to live up to his promises of
reform and his lack of support for the student uprisings of 1999, but
are likely to be reenergized by a brewing popular disenchantment with
the policies of Ahmadinejad's hard-liners.
The United States and its allies should discreetly support all
Iranian opposition groups that reject terrorism and advocate democracy
by publicizing their activities internationally and within Iran, giving
them organizational training indirectly through Western NGOs, and
inviting them to attend international conferences and workshops outside
Iran, preferably in European or other countries where Iranians could
travel relatively freely with minimal fear of being penalized upon
their return to Iran.
Educational exchanges with Western students would be an important
avenue for bolstering and opening up communication with Iran's restive
students, who historically have played a leading role in Iran's reform
movements. Women's groups also could play a key role in strengthening
support for political reforms among young Iranian women, a key element
opposing the restoration of harsh social restrictions by Iran's
resurgent Islamic ideologues.
The United States also should covertly subsidize opposition
publications and organizing efforts, as it did to aid the anti-
Communist opposition during the cold war in Europe and Asia. But such
programs should be strictly segregated from the public outreach efforts
of the United States and its allies, to avoid putting Iranian
participants in international forums at risk of arrest or persecution
when they return home.
The United States should not try to play favorites among the
various Iranian opposition groups, but should encourage them to
cooperate under the umbrella of the broadest possible coalition. But
Washington should rule out support for the People's Mujahideen
Organization (PMO), which is also known as the Mujahideen Khalq, or its
front group, the National Council of Resistance. The PMO is a
nondemocratic Marxist terrorist group that was part of the broad
revolutionary coalition that overthrew the Shah, but was purged in 1981
and aligned itself with Saddam Hussein's dictatorship.
While this cult-like group is one of the best-organized exile
organizations, it has little support inside Iran because of its
alliance with arch-enemy Iraq during the Iran-Iraq war. Moreover, the
PMO resorted to terrorism against the Shah's regime and was responsible
for the assassinations of at least four American military officers in
Iran during the 1970s. It demonstrated in support of the Soviet
invasion of Afghanistan in 1979 and against the release of the American
hostages in 1981. The United States cannot afford to support an
organization with such a long history of terrorism, if it expects
Tehran to halt its own terrorism.
Launch a public diplomacy campaign to explain to the Iranian people how
the regime's nuclear weapons program and hard-line policies
hurt their economic and national interests
Iran's clerical regime has tightened its grip on the media in
recent years, shutting down more than 100 independent newspapers,
jailing journalists, closing down Web sites, and arresting bloggers.
The United States and its allies should work to defeat the regime's
suppression of independent media by increasing Farsi broadcasts by
government-sponsored media such as the Voice of America, Radio Free
Europe (Radio Farda), and other information sources. The free flow of
information is an important prerequisite for the free flow of political
ideas. The Iranian people need access to information about the
activities of Iranian opposition groups, both within and outside Iran,
and the plight of dissidents.
The Internet is a growing source of unfiltered information for many
Iranians, particularly Iranian students. Farsi is reportedly the fourth
most popular language used online and there has been a proliferation of
political blogs devoted to Iranian issues. The United States should
consider ways of assisting Iranians outside the country to establish
politically oriented Web sites that could be accessed by activists and
other interested people inside Iran.
Mobilize allies to contain and deter Iran
The bellicose resurgence of Iran's hard-liners, Iran's continued
support for terrorism, and the prospective emergence of a nuclear Iran
pose threats to many countries. President Ahmadinejad's belligerence
gives Washington greater opportunity to mobilize other states,
particularly those living in the growing shadow of Iranian power. The
United States should maintain a strong naval and air presence in the
Persian Gulf to deter Iran and strengthen military cooperation with the
The United States and its European allies should strengthen
military, intelligence, and security cooperation with threatened
states, such as Iraq, Turkey, Israel, and the members of the Gulf
Cooperation Council (Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, and
the United Arab Emirates), which was founded in 1981 to provide
collective security for Arab States threatened by Iran. Such a
coalition could help contain the expansion of Iranian power and
possibly would cooperate in facilitating military action, if necessary
Washington could also offer to deploy or transfer antiballistic
missile defense systems to threatened states, enhance joint military
planning, and step up joint military and naval exercises. In
particular, the United States and its allies should stage multilateral
naval exercises to demonstrate the will and capability to defeat
Tehran's threats to block the Strait of Hormuz, through which flow
about one-fifth of the world's oil exports.
Prepare for the use of military force as a last resort
A strong U.S. military posture is essential to dissuading and
deterring Iran from fielding nuclear weapons and supporting terrorism,
and when necessary responding decisively and effectively to Iranian
threats. To deal with a nuclear or terrorist threat from Iran several
military capabilities are particularly important. They include (1)
expanding and strengthening the proliferation security initiative; (2)
theater missile defense; (3) robust special operations forces and human
intelligence (HUMINT) assets; (4) assured access to bases and staging
areas in the theater for both special operations and conventional
ground, air, and sea forces; and (5) energy security preparations.
Proliferation security initiative (PSI). PSI is a multinational
effort to track down and break up networks that proliferate chemical,
biological, and nuclear weapons technologies and materials. The
administration should field more modern capabilities that can provide
the right intelligence, reconnaissance, surveillance, and interdiction
assets for the U.S. military. In particular, modernization of Coast
Guard and Naval forces that can help prevent seaborne trafficking of
weapons material is vital.
Theater Missile Defense (TMD). TMD is also essential. Missile
defenses provide the means to intercept a ballistic missile in flight
and destroy it before the missile can deliver a nuclear warhead to its
target. The United States should work with its friends and allies to
provide theater missile defense to countries in the region. The United
States should continue to pursue a mix of air, land, and sea-based
missile defense systems.
Special Operations Forces and HUMINT. These military and
intelligence assets provide the capacity for focused operations against
specific targets. Today, these forces are overstretched, performing
many missions in the global war on terrorism. The Pentagon must end the
use of special operations for training foreign militaries and other
tasks that can be done by conventional military units. In addition, the
administration must bolster the ranks of the special forces and HUMINT
assets that might be required to operate in Iran, ensuring they have
the right language skills, area knowledge, and detailed, actionable
Theater Access. The United States must ensure it retains the means
to deploy and sustain forces in the theater. The Pentagon should work
to secure a variety of basing options for staging military operations.
In addition, the military must have robust means to ensure its ability
to operate in the gulf and defeat ``antiaccess'' weapons that Iran
might employ such as cruise missiles, sea-based mines, terrorist
attacks, and biological or chemical weapons.
Energy Security Preparations. In the event of a military clash with
the United States, Iran undoubtedly will try to follow through on its
threats to close the Strait of Hormuz to oil tankers and disrupt oil
exports from other Persian Gulf oil exporters. Washington should take
immediate steps to limit the future impact of such oil supply
disruptions by working with the Arab Gulf States to help them reduce
the vulnerability of their oil infrastructure to Iranian military and
terrorist attacks; pressing U.S. allies and other oil importers to
expand their strategic oil stockpiles; encouraging Saudi Arabia to
expand its excess oil production capacity; and asking Saudi Arabia to
upgrade the Trans Saudi Arabian pipeline to increase its capacity and
make preparations to bring the Iraq-Saudi pipeline back online to
reroute oil exports away from the Persian Gulf to the Red Sea oil
THE NIGHTMARE SCENARIO OF A NUCLEAR IRAN
There is no guaranteed policy that can halt the Iranian nuclear
program short of war, and even a military campaign may only delay
Iran's acquisition of a nuclear weapons capability. But U.S.
policymaking regarding the Iranian nuclear issue inevitably boils down
to a search for the least bad option. And as potentially costly and
risky as a preventive war against Iran would be, allowing Iran to
acquire nuclear weapons would result in far heavier potential costs and
The United States probably would be able to deter Iran from a
direct nuclear attack on American or Israeli targets by threatening
massive retaliation and the assured destruction of the Iranian regime.
But there is a lingering doubt that a leader such as President
Ahmadinejad, who reportedly harbors apocalyptic religious beliefs
regarding the return of the Mahdi, would have the same cost-benefit
calculus about a nuclear war as other leaders. The bellicose leader,
who boldly called for Israel to be ``wiped off the map'' before he
acquired a nuclear weapon, might be sorely tempted to follow through on
his threat after he acquired one. Moreover, his regime might risk
passing nuclear weapons off to terrorist surrogates in hopes of
escaping retaliation for a nuclear surprise attack launched by an
Even if Iran could be deterred from considering such attacks, an
Iranian nuclear breakout would undermine the NPT and trigger a nuclear
arms race in the Middle East that could lead Saudi Arabia, Egypt,
Turkey, Iraq, and Algeria to build or acquire their own nuclear
weapons. Each new nuclear power would multiply the risks and
uncertainties in an already volatile region.
Iran also may be emboldened to step up its support of terrorism and
subversion, calculating that its nuclear capability would deter a
military response. An Iranian miscalculation could easily lead to a
future military clash with the United States or an American ally that
would impose exponentially higher costs than a war with a nonnuclear
Iran. Even if it could not threaten a nuclear missile attack on U.S.
territory for many years, Tehran could credibly threaten to target the
Saudi oil fields with a nuclear weapon, thereby gaining a potent
blackmail threat over the world economy.
I believe that Senator John McCain was correct when he concisely
stated: ``There is only one thing worse than the United States
exercising a military option, and that is a nuclear-armed Iran.''
The Chairman. Well, thank you very much, Mr. Phillips. We
will now have a round of questions. We'll have a 10-minute
round at this point. Let me commence by asking a general
question. Several of you have made comments, but I want to
explore this further.
We have been discussing in the Senate, and I gather similar
conversations have occurred in the House, as to what kind of
support the United States ought to give to so-called
prodemocracy forces in Iran. In fact, $75 million has been
appropriated for activities of this variety, but it's not at
all clear exactly with whom we should be interacting, and how
these people are selected.
We had some testimony yesterday that if, in fact, we were
bold enough to identify persons in Iran, they, themselves,
might be targets of the Iranian Government and persecuted for
their interests in cooperating with us. There has been a
diaspora of Iranians in the United States. Sometimes
suggestions are made that we ought to be working with them, and
helping their efforts that they may have some contact. We have
talked about our public diplomacy efforts. Mention has been
made of the BBC and likewise our own radio and television
broadcasts. There are conflicting views as to the effectiveness
of our public diplomacy. Suggestions have been made about the
nature of who listens to BBC in Iran--what effect this may
have. I raise these issues to begin with because there are
currently many Americans who believe that we ought to be
proactive, that we ought not to leave those in Iran who are
interested in democracy simply to their own activities without
the ability of our communication or even our money or our
Mr. Nasr, you addressed this a good bit in your testimony,
so let me start with you and ask you again, because you've
touched upon this, what advice do you give to Americans who
want to work in a prodemocracy way with Iranians, or more
distantly through public diplomacy?
Dr. Nasr. Senator Lugar, I think it's an important issue. I
think we have to separate clarifying and broadcasting our
message to the Iranian people from trying to become a part of
their domestic political engagement in Iran.
First of all, I don't think access to information is a
problem in Iran. Over a third of the Iranian population already
listens and gets its news from BBC. I've been on McNeil-Lehrer
news hour and I've had comments from Iran of people who've seen
it on satellite television. Iran is very different from Eastern
Europe. The issue is not to get information to it, it is to get
the correct information to it. And that is part of my argument;
that it requires a clarity of purpose and message here.
I do agree that identifying partners in Iran will put them
in harms' way. A prominent intellectual was arrested earlier in
April and he's being charged with being involved in
dissemination of that $85 million in Iran because, at one
point, he was a fellow of the National Endowment for Democracy
in Washington, DC. I also think that as we move into the area
of sanctions and possibly military action, credible
prodemocracy forces in Iran will shy away from overtly
cooperating with the United States, because like all
politicians, they will not want to be associated, at a time of
war, with what would be seen in Iran as the adversary.
I think, therefore, we should support democracy in multiple
ways, but we should be much more precise in terms of how we go
about it, and I think the first step is actually to work on the
kind of message we want to convey to the Iranians.
The Chairman. Ambassador Wisner, you've dealt with several
governments in your career on important democracy efforts, and
I'm deeply interested in your views on this.
Ambassador Wisner. Senator, I have very little to add to
Vali Nasr's point, save a core contention--and that is it
depends where you start. If the starting point is that the
United States seeks, over time and in a reciprocal manner, to
normalize its relations with Iran, and live in peace with Iran,
and develop the normal connections between nations, then
engagement with Iranian forces, academics, intellectuals has a
context, it can work.
If, on the other hand, your declared political purpose is
to see an end to the regime, if you make it a key, cardinal
point that you want to blunt its national security, then you
don't have a basis. You don't have a political basis on which
you can engage civil society or any other number of
institutions, and you will be looked at as intrusive and
So, I believe that engagement with Iran in a manner that
would promote democracy over the long run is a direct result of
the political posture we take, and we'll have a lot better luck
if we're seen to be approaching normalization. Now, that ain't
going to happen tomorrow morning, so what else can we do?
I have the gravest reservations about trying to find groups
and put money into them, for the reasons, Senator, you cited. I
do believe that sensible news programs that have good debating
content about different aspects that are listened to by
Iranians using the Voice of America, other intermediaries,
makes perfectly good sense.
I also believe that it makes a lot of sense for Iranians
who want to study in this country--and there are a number--to
find opportunities to do so. Right now we have an absolutely
bewildering array of visa restrictions that deny the access to
this country of Iranians, whether they are businessmen or
individuals or family trying to come for family reunification
purposes and visits, or students. I'd like to see a relaxation
of travel to give Iranians a chance to meet, think with us in
dialog, and even scholarship assistance.
My last thought is that over many years of the estrangement
that's existed between the United States and Iran, a once
modest force in this country, Iranian studies in our
universities and think-tanks have lapsed, and shriveled around
issues like just the nuclear question at the cost of serious
analysis of Iranian society, the political dynamics. So if
there is money to be spent, I think some could be spent at home
on revitalizing and strengthening Iranian studies and analysis
in American institutions.
The Chairman. Mr. Phillips, let me ask you your take on
this same issue.
Mr. Phillips. Well, I think the primary responsibility--the
absolute responsibility--to build democracy in Iran is up to
the Iranian people and we shouldn't think that we're going to
be able to build it from the top down from outside, it's not
something that can be militarily imposed, it must grow
organically from the ground up. But I think there are
substantial consensus in Iran that they want change, and they
want to see their regime evolve into a more accountable form
that represents their interests. So I think it's important
that, although Iranians are getting information from the BBC,
that they also get information from the United States, that
we're aware of their struggle and that we supported the
peaceful democratic change there. Also to make it clear that
their government which claims this nuclear issue is a dispute
over peaceful nuclear power, that it's much more than that. Let
them know that their government has been dealing with A.Q.
Khan, who is not someone who sells nuclear reactors; he's
someone who sells nuclear weapons. Let them know their
government is harboring al-Qaeda terrorists, and do they really
think that's a responsible position for a group that is very
anti-Shiite, that has killed Shiites in Afghanistan and Iraq--
including many Iranians, and do they really want to bear the
risks of what would happen if an operation against the United
States came out of al-Qaeda in Iraq, as apparently happened to
Saudi Arabia in 2003? I think those are the kinds of wedge
issues that public diplomacy would be important in setting the
The Chairman. Thank you.
Senator Coleman. Thank you, Mr. Chairman.
I'm going to probe a little bit deeper, Mr. Chairman, into
the question you raise, because I really think that's the core
issue, one of the core issues here. And I have grave concern
about folks in Washington, bureaucrats saying we've got $75
million--whatever the figure is--and here's how we're going to
spend it, and here's the impact. So, I want to probe a little
Before I go, just a couple of questions. Ambassador Wisner,
you started off by saying, not clear that, in kind of the
underpinnings of your approach--one of them was it's not clear
that Iran has decided to develop a nuclear weapon ambiguity. If
it were clear, if there wasn't ambiguity, would you still
advocate the same course of action? If, in fact, it was clear
that Iran wants to develop and use nuclear power for a nuclear
weapon, would you advocate for the same course of action you're
Ambassador Wisner. I shorthanded my testimony, if you have
a chance to look at it, it goes into it in a bit more detail.
The point I wanted to make is whether Iran, has at the end of
the day, the intention to produce a weapon, or to enrich to a
degree that would make civil nuclear power the outcome--both
absent any confidence in what Iran is doing and how it intends
use--are unacceptable outcomes from the United States and must
be opposed. We are correct in trying to oppose an enrichment
Now, the question is, How do you oppose it? And my answer,
if in the hypothetical circumstance, that Iran took a decision
that I don't think she will take because the program of
enrichment hasn't evolved to that state, and there is a
disagreement in Iranian society, political society, over the
wisdom of a nuclear weapon.
But if Iran, if you want to put the hypothetical question
on the table, I would still argue that our options--military
and sanction options--are not likely to be decisive. And
however we come at it we've got to find a political way to
engage and think through what causes Iran to produce, to
develop a policy of confrontation, how else can you address
that, how do you create a basis of a broader coalition
internationally--we don't have that coalition today--therefore
a political approach would still suggest itself to me if the
hypothetical were to exist, and I argue we're not at that stage
Senator Coleman. One thing--I tried to stay through Senator
Biden's question, I didn't get through the whole thing, we had
a vote and it was a long question. But I do want to, at least,
make one point for the record. The sense I got from the
question was that somehow that our engagement of Iraq is kind
of a, some kind of cause, has an impact on Iran's openness to
work with democratic forces. And I would note, Mr. Chairman,
that in 1999 before Iraq, there was a student uprising and it
was crushed; it was crushed. I think this regime's intentions
have been very clear. To have some linkage between what we did
in Iraq that somehow that's empowered a movement against
democracy is--at least history doesn't reflect that.
Dr. Nasr, I very much agree with your vision, and it's
clear that democracy is not a short-term effort, and I don't
believe that those in this body--I can't speak for all my
colleagues--but I don't think that there's a sense that the
movement toward democracy is a short-term effort, it's a long
But I want to probe a little deeper into the chairman's
questions. You said that we should support democracy in
multiple ways--could you outline a little more specifically
what are some of the multiple ways that we can support
democracy, understanding that this is a long-term objective?
Dr. Nasr. The first way in which we should support
democracy is by clearly asserting and pursuing the moral
imperative and using the United States moral authority to do
so. And I think that is best done by decoupling it from any
other objective we might have. In other words, I do agree with
the other comments that it is in the interest of Iran, it is in
the interest of the United States, and the people of Iran
deserve democracy, and that should be the political objective.
But it should also be clear that this is not part and parcel of
any other policy objective.
There are, I do believe that the United States should put
its views on multiple issues on the table, and communicating
these to the people of Iran are important. I don't think they,
by themselves, will make any difference because as I said,
information is not the problem in Iran.
I want to add also, much of our efforts always are
directed--including engaging expatriate Iranians--are on the
more affluent middle-class Iranians which already agree with
everything you are saying. The problem is reaching the
supporters of Ahmadinejad among the poorer, much more
religious, much more--if you would--provincial population in
Iran which are the ones who support him, and the ones who voted
for him. And that actually requires thinking much more
imaginatively with how you communicate with that population. It
is a problem that's not only unique to Iran, we have the same
problem also, say, with Venezuela in terms of how you go past
the population that you already know agrees with you, to the
one that doesn't.
Senator Coleman. Let me ask the other, Dr. Phillips, to
respond again with a little more specificity, are there
diaspora groups out there that have that connection, who should
we be listening to? Who should we be talking to who has a good
sense of what's going on in Iran today who has the capacity to
reach out beyond the middle-class to those who are more
susceptible to Ahmadinejad's message.
Dr. Nasr. Well, the diaspora group in the United States is
Senator Coleman. I would say internationally, not even in
the United States, if we were reaching out, there's a group in
France, in Germany, in Britain--who's out there who we should
be talking to? Listening to?
Dr. Nasr. There are multiple groups--they range from
monarchists to Marxists to Islamic dissident groups--they're
often, a factor that we often overlook is the academic group.
Having no population in the United States which is more in
touch with what happens in Iran than actually Iranian and
American academics who spend time in that country.
For instance, during the Iranian elections, other than
American journalists, academics from the American universities
were the larger population on the ground who was observing
things that were happening. And it's important if you are
aggregating information that those views be channeled into the
way in which we think about policy.
Senator Coleman. Dr. Phillips, again, a little more
specificity and also the second question of who we should get,
other than the MEK, or I think the PMO, but other than the
Ahmadinejad cult--who else should we be engaging, and a little
more specificity in responding to the chairman's questions
about what is it that we can do to promote democracy?
Mr. Phillips. I think we should be speaking to all the
Iranian groups, with the exception of the MEK's as you
mentioned. In my longer testimony, I think they're a terrorist
group and they're identified with the Iraqi regime by many
Iranians, but I think we should be not trying to pick
favorites, we're really bad at that--so we should be helping or
talking to all of them. Also, I would add, perhaps clerics in
Khom who are increasingly exasperated with the regime, some of
whom never bought into Ayatollah Khomeini's radical vision of
the Supreme Guide or Supreme Leader. There may be back channels
there, women's groups, labor unions--I think that could loom
large in the future of Ahmadinejad's support, because he came
to power promising an anticorruption drive, which he hasn't
delivered on and there is increasing labor unrest inside Iran
because of that.
I think we should be publicizing wherever possible, the
corruption of the regime, the wealth of the families around
leading clerics. I think the Iranian people recognize this--
according to a recent visitor there that I talked to--he said
before taxis wouldn't pick up mullahs in clerical garb, but now
it's come to the point where buses won't even stop at the bus
stop if they see a mullah there and I think that's an important
sign that there is increasing disenchantment with this regime.
But I would be very humble about the U.S. ability to spark
or provoke an immediate democratic regime change. I think this
is definitely a long-term process and it probably won't come
about until after Iran has a nuclear capability, but it's
something that we should seek to encourage in the long run.
Senator Coleman. Ms. Nanay, I apologize, I missed your
testimony and I know you were talking about the energy side, my
time is just about up but if I could just ask very quickly--I
understand Iran's infrastructure has not had a lot of
investment, I presume they have great needs. Is that a--how
strong of a bargaining chip is that in any discussion with
Iranians? Any of that investment?
Ms. Nanay. I think it's clear that for Iran the future will
be gas. They have the second largest gas deposits in the world
after Russia. That gas is not being developed efficiently
today, and it's certainly not being developed for exports.
But that being said, I think that where I agree with some
of the other testimony is that while Iran would like those
investments, I think the real question here is: Is U.S. policy
regime change or not? And if it is regime change, I think
they're willing to sit back and live with what they have today,
with high oil prices, and go along with the investments that
they can make as it is, and their production is at about 3.9
million barrels a day, some say it's a little less, some say
it's a little more--but that's substantial. And as I say,
they're getting substantial revenues from exports.
So, that's on the oil side, now the gas side, as I said, is
being developed inefficiently, and maybe they'll just wait. The
United States has very few options, I think, in terms of
convincing Iran that they need investments in the energy sector
right now, so just let us change your regime and then those
investments will come--I think, if we take a policy of
negotiations and then accept that the regime stays, and we
negotiate with this regime, then potentially, yes, you can use
that as a bargaining chip.
Senator Coleman. Thank you, Mr. Chairman.
The Chairman. Thank you very much, Senator Coleman.
Senator Nelson. Mr. Chairman, thank you. I would like you
all to tell me to what extent you think that the relationship
between Iran and Hezbollah will continue and to what degree is
there the chance that as we confront Iran on all of these other
issues that we could get Iran to start backing off its support
of Hezbollah, particularly to such a large degree in Lebanon?
Dr. Nasr. The relationship, Senator, is likely to continue,
but it has been changing. Partly because Hezbollah has its own
interests now that it's following within Lebanon itself, it's
relations with Iran and Syria have been viewed as a, now as a
handicap in terms of its popularity in Lebanon, but it also
relies significantly on financial assistance from Iran, if not
other assistance in terms of managing its social services and
Iranians view Hezbollah as a strategic asset, it is the
only large political movement in the Arab world that is
specifically pro-Iranian, and it is a channel for Iranian
influence in Lebanon. Whether or not Hezbollah will be willing
to fight Iran's fight if it comes to that, if there is, say, a
military confrontation, is open to question. There are segments
within Hezbollah, particularly paramilitary segments, are
likely to be mobilized in terrorist operations. But whether the
broader Hezbollah is willing to jeopardize its current position
in the Lebanese Parliament and the Lebanese Government, is open
Mr. Phillips. Yes, I would agree, and it's generally
underestimated the ideological component of support for
Hezbollah, especially President Ahmadinejad who came out of the
Revolutionary Guards which was the link with foreign
revolutionary and terrorist groups--I think it's going to be
very difficult to separate his regime from Hezbollah and I
don't see economic incentives coming into that, because I think
a lot of the decisions made by Tehran are not for economic
reasons, and it does see Hezbollah as not only a useful club
against Israel and other Middle Eastern states, but a potential
weapon against the United States.
Senator Nelson. How does the Lebanese Government perceive
the Iranian influence of Hezbollah?
Dr. Nasr. I think it's, Senator, at least part of it is
tied to the larger issue in the region which has to do with the
Sunni governments in the region now viewing developments in
Iraq as a threat to their internal stability, because it is
encouraging Shiites to demand more rights and privileges. The
Lebanese Government has repeatedly renounced views that the
Shiites are connected with Iran within Lebanon, whether they
are Hezbollah or not, and that Iranian involvement in Lebanon
has become part of the domestic fight, if you would, within
Lebanon. It is very similar to the comments that were made of
President Mubarak in Egypt of the Shiites being loyal to Iran.
So I think the Lebanese Government is looking to limit
Hezbollah's political power in Lebanon and it views Iran as
providing financial, and political and foreign policy support
to Hezbollah, and it would like to limit those powers, its way
of managing the Shiite vote in Lebanon.
Senator Nelson. Is there an oppor----
Ambassador Wisner. Would you permit me, Senator Nelson to
just add a thought? My experience with the Lebanese Government
over the years is that it is an extraordinarily weak
institution and it is based, fundamentally, on sectarian
balances. No Lebanese Government in my lifetime has been
willing to take on any sectarian element, any ethnic or
religious component of Lebanese society because it is so
closely balanced. Therefore, the Lebanese Government is not
going to pick a fight with Hezbollah, or Hezbollah's Iranian
But I think the opposite is also true, that Hezbollah is
part of Lebanon's corpus and the country has a way of
assimilating politically over time, its political elements. And
that includes Hezbollah. I think Vali Nasr made a very
important point--Hezbollah is changing. It is no longer the
militant--only the militant--group that faced Israel. It's also
competing for seats in the Lebanese Parliament and for
influence in the hitherto fore downtrodden population. So an
attack on its connections with Iran from the outside will
neither galvanize other Lebanese communities, or the Lebanese
Government, or is likely to have a decisive sway inside of
Shiite politics domestically. But working to strengthen the
Lebanese polity, get the Lebanese to agree on common purposes--
that's the way over time, I think, you'll see Hezbollah begin
to mitigate the role, continue to mitigate the role it's played
in the past.
Senator Nelson. And so, the United States should approach
this conundrum how, in your opinion?
Ambassador Wisner. Cautiously, quietly, and without laying
demands on our relationship to a Lebanese State that can't bear
those demands, that it take actions that are violent or
disobliging or disciplinary. Versus Hezbollah in the south, we
can make our choices about how much money we want to give, but
to publicly condition it is something that will produce an
impossible political circumstance for the Lebanese Government,
and indeed, other Lebanese political forces.
Senator Nelson. Is there any daylight between the Lebanese
Shiites and Hezbollah, that we can lessen the influence of
Ambassador Wisner. I will be honest with you, Senator
Nelson, I don't know why we have to pick enemies? There is, of
course, a contending force, there is Amal. I would not argue
that you have to pick friends, either. The United States can
stand above the interplay, the fray of Lebanese politics, and
encourage directions, as opposed to try to pick one side or
another. They're all filled with defects.
Senator Nelson. You all are familiar with the Hezbollah-
sponsored television station, Al-Manar, which spews out a good
bit of hate. Just recently the administration declared this
television station as a specially designated terrorist
organization. It was sponsoring hate and violence and
terrorism. And as a consequence--one consequence that I know
that happened was that the sister radio station, which was up
on a Spanish satellite system, was knocked off the satellite by
Now, this is a television station and a radio station
that's really doing some pretty bad things--they're out there
broadcasting how to do a self-destructive vest and all of that.
I'd like your comments on this. Both of you.
Dr. Nasr. That is true. Al-Manar has been broadcasting not
only contentious programs like the one you mentioned, but also
has been having an impact on public opinion on a host of
issues, and it's actually a very popular television site, it's
the second most popular after Al-Jazeera in the region. And
dealing with it is a public diplomacy, it's a media challenge,
and not only just for the United States, it's actually a
challenge for some of the other media outlets in the region as
well. There has to be a sort of--United States should follow a
policy of demanding that its content be curtailed--but it will
be difficult to completely shut it off, mainly because it's
very well tied to all the political and social operation of
Hezbollah, and it has a wide viewership, not in Lebanon itself
alone, but also in the Palestinian territories, in Iraq and all
the way into the Persian Gulf as well.
Senator Nelson. Are the changes in Hezbollah ultimately
going to change the message of hate that is being broadcast
over Al-Manar, in your opinion?
Dr. Nasr. Ultimately, it will. This process may be slow.
Over the period of elections that occurred in Lebanon in the
past year, Hezbollah had to build a coalition with more
moderate Shiite forces, particularly with Amah, the two of them
ran under one umbrella, and won about 80 percent of the Shiite
vote in Lebanon, which is probably 40 percent of the vote in
the country as a whole.
It had to make certain compromises, at least in its message
within the community. Part of the reason Hezbollah is reluctant
to do that was Hezbollah's popularity among the Palestinians is
very closely attached with its very strong anti-American and
anti-Israeli position. And when Iraq occurred, Hezbollah came
under attack from other Arabs in Lebanon and the region for
being complicit in Shiite empowerment in Iraq, is a vague way,
being responsible for the loss of power by the Sunni
population. And some days Hezbollah is trying to compensate for
that loss of face by shoring up its credentials by toughening
its stance on the United States and Israel and trying to divert
attention from the fact that its sympathies in Iraq lies not
with the insurgents, but with the Shiites.
The Chairman. Thank you very much, Senator Nelson.
Senator Obama. Thank you, Mr. Chairman, and thanks to the
panel. I apologize for having missed your initial
presentations, but I have read them and I appreciate you being
A lot of the questions that I would have asked have already
been put to the panel, but I want to just touch on a couple of
things to amplify them, if I could. The first question I'll
direct to Dr. Nasr.
I continue to be interested in our approach to
democratization, and it strikes me that in an environment like
Iran that it is possible that our funding of reformists make
them a target, or make them actually distance themselves from
the general population that, ultimately, they would need
support from, to accomplish change. I know that some of these
questions were touched on, so I don't want you to repeat
yourself at length, but I'm just wondering if you could comment
on the general assessment, and if that's the case, can you tell
us what would be an appropriate way in which we're encouraging
human rights, intellectual freedoms, and so forth without being
heavy handed and actually undermining the very groups that we
are trying to empower?
Dr. Nasr. Thank you, Senator. Part of the problem rests in
the fact that we've approached this issue in the way--based on
the experience we had in Eastern Europe, where I believe that,
fundamentally, the context was different.
First of all, there were much more clear-cut political
forces on the ground to partner with and channel the money to.
The governments were more alienated and isolate, but also we
had embassies and operations on the ground that could actually
manage the money and know that it is going to the appropriate
We do not have a presence in Iran. It is not clear how we
would establish a channel with the right people to send them
money. Second, unlike Eastern Europe, or other cases like Asia
and Latin America, the major push for democratization, at least
through this appropriation, is coming right at the time of
heightening tensions between the United States and Iran, with
threat of sanctions and possibly military action on the table.
That makes it very difficult for democrats to be able to
cooperate with the United States overtly.
I remember, one reformist told me that we want support, but
we don't want it put on a bumper sticker, because it
stigmatizes them. And they do not want to be put in a position
politically to have to choose between nationalism and
democracy. And that's exactly the way in which the Iranian
Government is posing the issue. That democracy is not supported
by the country that could eventually be the adversary of Iran
or be dropping bombs on Iran. And the regime has begun to
legitimate its crackdown on intellectuals and human rights
voices in Iran by no longer saying they are putting them in
prison because they're criticizing us, but by saying they are
distributing this money, and, therefore, they are ``foreign
agents.'' In that sense it could be counterproductive, you
could actually squash that movement rather than help it.
Senator Obama. So is there anything we can do that would be
useful? Or should we just keep a hands off policy until some of
the larger geopolitics have been resolved?
Dr. Nasr. I think, Senator, now that the appropriation has
been declared, in other words, money has been put on the table,
it is very important to have very clear transparency and
accounting of what the money is being spent on. Because the
very ambiguity of where the money is going or who might get it,
allows the Iranian regime to argue that the money's being spent
on subversive activities or is being channeled to particular
groups that it wants to stigmatize. So, if the money is being
spent on broadcasting that should be clarified, if it's being
spent on academic material, as Ambassador Wisner suggested,
that should be clarified as well.
Senator Obama. Ambassador, I think it was in your
testimony, and correct me if I'm wrong here, that you were
suggesting that engagement would be a wise course of action.
You know, I've had conversations with folks in the State
Department, and previously their feeling was, ironically, that
politics inside Iran oftentimes prevented engagement. It wasn't
just an unwillingness on the part of the United States, but, in
fact, there was some resistance from the Iranians because it
caused them problems if interlocutors seemed to be too friendly
to the United States. You seemed to indicate in your testimony
that may have shifted, because you actually think there's
greater confidence, politically? I'm wondering if you can
expand on that, and if there are particular openings--are you
suggesting here that now is the time for us to, for example, in
response to the letter from the Iranian President--to write
back, see if we can get some sort of direct talks? Do you think
the model that we're using with North Korea, the six-party
talks, is a way to help the thaw, and again, I'm sure that some
of these questions were asked before, so I apologize, but if
there's anything you either want to reiterate, or expand upon?
Ambassador Wisner. Senator, there is a long history of
American attempts to engage Iran and a respectable history of
Iranian attempts to engage the United States. It's my
conclusion that these attempts have failed in the past.
Obviously, over sharp differences of points of view, but,
principally, because they were not linked coherently within a
political objective, they were individual initiatives.
Senator Obama. Can you explain what you mean by that?
Ambassador Wisner. An individual initiative, for example,
we and the Iranians talked about the American hostages in
Lebanon, we found a basis to solve that particular problem, but
it had no spillover effect on the range of disagreements. And
as soon as it clashed with our electoral cycles--we were going
into an election--the initiative dried up. We opened a
multilateral channel of dialog with the Iranians, inside--over
the issue of our hostages in Iran. And the Iranians took a
number of steps that were, frankly, helpful to the United
States over Afghanistan. That didn't lead anywhere, because it
was in isolation.
I would argue that solely a discussion of Iraq, in Baghdad,
with our Ambassador in Baghdad, may reveal some interesting
outcomes, but ultimately it's not going to effect the totality
of the relationship, unless there's a political decision at the
top on both sides, to aim for a different construct, to aim for
a normalization between the two sides, and then--as we did with
China--once we link at the top, between our President, the
Iranian leadership, a desire, a determination to live in peace
with one another, than you can address the subordinate portions
of the puzzle: Iraq, Afghanistan, Palestine, Israel--but if you
try to go at the bottom up, you will fail. You will be
frustrated. That was the core of my contention.
Now, do I believe that the letter should be answered? No
and yes. The letter is very complicated for an American mind to
get around--it's a strange formulation is about the nicest
thing you can say. But I believe it offers the United States an
opportunity to state our case.
Senator Obama. Right.
Ambassador Wisner. To put on the table what we want to talk
about, and what we believe is important. So, I would hope that
a way can be found to signal back that we're open for dialog,
but here are the issues that have to be talked about. Not try
to answer line by line the contentions that all of us would
disagree are well founded.
Senator Obama. Is it fair to say that such engagement,
though, would necessarily be premised on the idea that we are
not pursuing a regime change in Iran--as long as that is, at
least, on the table here in Washington, then presumably we
couldn't--it would be contradictory.
When we engaged China, the presumption was that, for all
their flaws, we did not have it within our power to change
regimes, and as a consequence we approached it somewhat
differently. It seems to me that, up until now, the
administration's posture has been that we might, we might just
replace the folks.
Ambassador Wisner. Senator, you have certainly stated my
view that a policy of regime change runs countercurrent to an
ability to engage on the issues of vital importance to the
United States, which are issues of national security importance
to us. I argued that the domestic dispensation in Iran, while
important, as a level of principle is not a national security
threat to the United States. Therefore, we can find a way to
live in peace--though not in agreement on principle--with the
Iranian regime. And until you make the point that you are
prepared to seek peace, then engagement on issues of enormous
importance--nuclear or any other others--won't be possible.
The Chairman. Thank you very much, Senator Obama.
Let me commence the second round of questioning and simply
note that we come together in large part today because we
believe that there is the potential threat of nuclear weapons
in Iran, a threat of this sort.
Now, you have testified, at least some of you, that we
ought to decouple the democracy objective from any other
objective--in other words, if our situation is one in which the
threat of a nuclear development is the major thing we're
looking at, then we should look at that. The suggestion is, in
fact, that there probably is a degree of normalization between
our country and Iran or other countries in the world and Iran.
It is going to be a requirement before vigorous dialog on
democracy is likely to be productive. Furthermore, you've
testified, Ms. Nanay, that that probably is going to be the
case before the natural gas industry in Iran is more fully
developed, or energy resources are available to the world. More
dialog on democracy is productive if we are to have a degree of
normalization. It's not easily come by, this engagement that
brings a sense of normalization. On the other hand, a call for
normalization is a different thing than a call for regime
change. So, an argument could go on on that one, but at least
some of you come down on the side that probably you talk about
normalization as productive on the democracy scene, the energy
scene, and maybe even with discussion of the nuclear business.
We had some testimony yesterday that in order for serious
thoughts about normalization to occur, there has to be at least
some degree of economic sanction, and not just the threat of
it, but the actualities. It was suggested by some witnesses
yesterday that this can be more subtle than overt--
specifically, for example, with bank account changes in which
all sorts of things get dropped in the background--likewise,
withdrawal of foreign investment or failure of projects to
proceed. There has been some testimony today that on those
grounds alone, Iran is unlikely to change its mind.
On the other hand, they offer some credibility that the
world is not helpless in these respects, and that we can take
steps that do not overtly harm ordinary Iranian people in the
process of attempting to make our point.
I ask you, first of all, Mr. Wisner, if there is any sort
of parallel with our experience with Libya. I can recall from
an earlier term in the Senate, being summoned by President
Reagan to the White House. Senator Byrd and Senator Dole were
there, and I have a photograph of us. That's why I remember who
all was sitting around the table. President Reagan comes in and
informs us we're going to have consultation about military
action. That, while we are sitting here, there are American
planes flying toward Libya, and that they were going to be over
Libya in 3 hours. So, our conversation would have to be less
than 3 hours, because, in fact, something's going to happen
The implication is--although it's not a promise--that if we
come to the conclusion that it's not a good idea, then the
planes might be called back. They've already gone around France
because they had difficulty getting across there and all of
these other machinations of the time. And so we discussed this
for about 2\1/2\ hours, and it was not a lay-down hand, because
it was an act of war. The reason we're doing this is because an
American soldier--or maybe more--had been killed in Germany,
and we attributed that to Libyans. And we felt that that was a
sufficiently hostile act to, in fact, bomb what could have been
Muammar al-Qaddafi and his family, in addition to other targets
that were there.
So, that's pretty serious stuff, and as people are talking
about overt military action, I can recall this.
In any event, we did attack and the bombs were dropped and
there was damage, Muammar al-Qaddafi's family suffered some
casualties, as a matter of fact. He, himself, lived.
I thought about that when I was asked by the State
Department and the NSC to visit with Libya in August. I was
invited by Muammar al-Qaddafi to come into the middle of the
desert. And given an Air Force plane and the proper escorts, we
got there and we had a 1\1/4\-hour-long conversation about life
in the times. It was a productive conversation. It might not
have been. There was no reason for him to invite me, no reason
for the State Department to ask me to go over to Libya and see
what you can do.
But I mention this because this is the same man that we
were talking about in the White House about 20 years ago. So
times change. Libya had changed. And we can't go through all of
the negotiations that led to their renouncing of their nuclear
program or their chemical program. There's still cleanup to be
done, although most of it has been carted out to Oak Ridge, TN.
And just this week we have set up an embassy there. We are
removing Libya from the terrorist list. This is not without
dispute, I might add. On the other hand, my recommendation
reflected American interests in Libya presently given Chinese
and Indian workers populating the Corinthian Hotel in Tripoli
and going after every last acre of the country. Lybia has
demonstrated a change in attitude toward the Bulgarian medics,
toward the Saudi Government, toward a whole list of things that
were previously very legitimate foreign policy issues.
There always has to be credibility. I would not suggest
that an attack upon Iran is one way of establishing that, a way
in which, perhaps, we did so in other times, but I'm asking--
after we settle the fact that we are credible--and I say we,
the Europeans, the Russians, the Chinese, who are busy
negotiating with them to get into a common posture--at the end
of the day, what is your judgment that the Iranians might take
the Libyan path? In other words, that they might decide that
they want to be a part of the world, that they want to develop
resources that could, in fact, enable a great deal of wealth to
come to all of their citizens?
Or, in fact, is there such an obsession to have nuclear
weapons--come hell or high water--that there is really nothing
on earth that can change their view? I will ask you, Ambassador
Wisner, to have a try at that.
Ambassador Wisner. Senator, it's fascinating and I listened
with rapt attention to your memories of the past----
The Chairman. You were on duty during that period.
Ambassador Wisner. I was, and I remember the circumstances,
but also your more recent engagement with the Libyan leader.
I would be the first to argue that drawing parallels at one
level between Iran and Libya would be a dangerous exercise--
they're such very different societies. Libya, Muammar al-
Qaddafi is the government--Iran's political realities are
infinitely more complicated. The nuclear programs are
different, there's so much you could draw as differences.
But what I think is encouraging, and I believe you put your
finger on it perfectly, with great accuracy, is that we have
indicated there is a way forward with the United States, it's
not just a regime of perpetual confrontation. And the same, if
I follow Senator Biden earlier in his reference to the front
page of the New York Times and hints--intriguing hints about
where we might be able to go with North Korea that we are a
nation that engages diplomatically, we look for outcomes and
Now, I believe the ability of the United States to conceive
of and use military force is without question. And I really
warn any country that assumes we're bogged down in Iraq and
can't use military force--we can. It's a reality and it's on
the table. If we're defied, or threatened, or most
particularly, if action is taken against the United States.
Second, sanctions. We have a long list, elaborated
painfully, of sanctions over some 20 years with Iran. Also my
memory contains many of those features. Our ability to deal in
sanctions is not open to question. And if, in the time ahead,
you've got to find a new sanction, I think there are a couple,
multilaterally, for example, the use of official credits--that
offer some merit, if you're looking for and need fresh
But I believe my colleague on the stand today put her
finger on the key--it's not what further punishments you can
deliver, but how you can help Iran escape a quarter of a
century of isolation, a quarter of a century of denial in which
she has not been able to deliver for her people the promises of
what Iranians said was their own revolution. And that
engagement with the United States is--in the minds of Iranians
we play such an important role in their calculations and
thinking at a popular level, and at a government level--
engagement with the United States is a real inducement. Not
what punishments we can do, but what can come out in a positive
way. And that, I feel, is the moment we are understating.
My formula that I argued with you today, Senator, is not
normalization as the starting point, but a determination that
we're prepared to live in peace. And to pursue a course that
could end in a normalization of diplomatic relations. In which
we address, systematically, those points of difference. In the
region, what Iran needs economically, and at the end of the day
arrive at a point where diplomatic relations are normalized.
But the starting point is one of respect, not challenging
the others' legitimacy to hold office, but rather to sit down
and work through toward the objective of a comprehensive
The Chairman. I thank you.
Mr. Phillips. If I could just add something on that point.
I think a Libyan model demonstrates that the use of force and
strong diplomacy are not mutually exclusive. In fact, when
dealing with rogue regimes, the credible threat of force
greatly bolsters diplomacy. And I think one of the reasons that
Colonel Qaddafi made his decision to give up WMD and disavow
terrorism was his experience with the Reagan administration way
back when, and also with the conclusions he drew from the Bush
administration's intervention in Iraq, and Colonel Qaddafi told
Prime Minister Berlusconi of Italy that the reason he gave up
his WMD was the example of Saddam Hussein.
So I think the disincentives are extremely important when
dealing with these kinds of regimes. Not that they're
necessarily similar--Iran is much more complex, much more
difficult to ascertain which multiple power center to deal
with, but I'd be willing to accept the Libya model in Iran if
the Iranians would follow through the way Qaddafi did, which is
to surrender two of his intelligence agents for trial--one of
them is in jail. If Iran is willing to surrender Mr. Ahmad
Sharifi, who was involved in the bombing of the 1996 Cobart
Towers, then I'd be willing to talk to Iran further on that
also. But I think it's important that we not just talk about
incentives, because as President Ahmadinejad said just
yesterday, was quoted in today's Washington Post, ``Do you
think you are dealing with a 4-year-old child to whom you can
give some walnuts and chocolate and get gold in return?'' He
sees that nuclear program as gold, and until he's convinced
it's going to cost Iran a lot of gold, he's not going to give
that up. So I think we need to talk about disincentives and not
The Chairman. Let me just issue a warning, once again. I'm
sorry. We had this problem yesterday, and we'll have it again
today, apparently. But we cannot have these interruptions. It's
not fair to the witnesses nor to the dialog of the Senators. So
please, just be quiet.
Please remove the persons so we can continue with our
The Chairman. Continue, Senator Coleman.
Senator Coleman. I see regime changes and promoting
democracy as, to me, the same concept. I mean, how do you get
there? As Dr. Nasr says, it's a long-term process, but I think
it's certainly in our best interest and the Iranian people.
Dr. Nasr, your point--and a couple of times you indicated
that--in building and promoting democracy, what it does is that
it kind of fuels the flames of nationalism in Iran. So my
question is, Is your sense that we should not be promoting
democracy? That if we want to deal with the issues of Iranian
nuclear capacity, if we want to deal with the range of other
things that Ambassador Wisner has talked about--do we step back
from promoting democracy?
Dr. Nasr. We should continue to support democracy, and we
should demand human rights for Iranians, freedom of conscience
for intellectuals, we should demand that the political process
in Iran move in that direction. But looking at democracy, or
parceling democracy into our current efforts to change regime
behavior, specifically regarding the nuclear issue--it just
confuses, essentially, the purpose of democratization.
I think as relations are becoming increasingly tense, with
sanctions and military threats on the table--and you can look
at political debates in Iran that within the regime and
society, people are taking these extremely seriously--and
that's partly why there probably is the letter writing that has
begun on that side. The population is reacting, obviously by a
rally to the flag phenomenon. Now, if democracy is combined
into the policy that they are reacting to, into a policy of
confrontation with the outside forces, it will immediately
complicate and hurt the democracy future in Iran. And it's very
likely that most of the prodemocracy forces will shy away from
being put in that kind of a bind.
Senator Coleman. Mr. Phillips, I assume you've had a chance
to read Dr. Kissinger's article--do you have any reaction to
his sense that it might be possible to devise multilateral
venue talks with Iran on the nuclear issue and that we should
Mr. Phillips. I think we should definitely leave open the
possibility of talking directly to Tehran, but I would be
hesitant to involve the United States in U.N.-centered public
talks. I would prefer Kissinger's own model--secret diplomacy--
because that would limit the ability of the Ahmadinejad regime
or whatever interlocutors we have in Iran to posture and try to
drive a wedge between the United States and its allies. I think
direct talks--secret talks--could reduce the possibilities of
Iran just using it as public relations purposes and kind of
talking down the clock and involved in endless negotiations,
kind of whipsawing the United States between its allies who
believe more in the carrots than talking about sticks, which I
think Iran pays more attention to.
We've opened the possibility of talking to Iran, but I
would draw the line at actually engaging in the sense of
economic engagement because I think the problem there is, this
is a state-dominated economy, it strengthens the clique in
power and also the semiquasi-state bonyads or foundations are
the ones who profit from any opening to the West, not the
Iranian people, and economic engagement like that would
strengthen the regime, not weaken it, in the long run.
Senator Coleman. And isn't that the window we have, we have
a regime--which is a repressive regime, which does sponsor
terrorism around the world, kills Americans, kills people--and
so the challenge we face is that if we engage and normalize, we
strengthen a regime which is probably the largest state-
sponsored supporters of terrorism in the world today. And yet,
we don't always want to be in this position, can we move it
forward? Can we move it forward, and the challenge is how do
you do that? Can we move it forward externally or even
internally, not us directing, but making resources available to
those who are seeking democracy, pushing democracy. The
challenge is how you get there.
Ambassador Wisner, as I listen and I've read your material,
this kind of push ultimately into normalization--at a certain
point there's got to be something from Iran, something from the
regime. If the regime--and I get back to my hypothetical and I
agree with you, it's not absolutely clear the intention--but
there are those who would say that the discussion now is simply
an opportunity to buy time to allow Iran to develop a nuclear
weapon. And Iran now has a nuclear weapon, and their actions of
supporting terrorism and, are such that that would be dangerous
to stability in the region, and then you have Ahmadinejad and
his comments--and I take it he's not a sole actor out there,
he's not going solo, that his comments reflect the thinking of
the mullahs or others in Iran, though it may not be uniform
So the question is, What do we have to see--what would you
think that we should see from Iran to give some indication of
an approach other than what Ahmadinejad is quoted as saying in
the paper yesterday?
Ambassador Wisner. First of all, I listened very carefully
about what you had to say about Iran being the principle state-
sponsor of terrorism around the world. I respect you have
access to much more information than I do, but my assessment of
the Iranian terrorism connection is that this connection has
changed, metamorphosed, and over time, in some interesting ways
that are material to us, that the threats that the United
States is most directly faced--time of 9/11, al-Qaeda, and even
threats of military forces with some significant, some Shiite
sectarian groups with Iranian connections have been involved--
that the great majority are not connected to the Iranian
Just exactly where we and Iran stand in our views on terror
and the connections and the groups that are involved would, to
my judgment, be a legitimate subject for a political dialog
Let me return to the core of your contention. I've argued
that to find out where we are with Iran, to create a political
framework within which you can address issues of terror,
nuclear, regional differences, Iraq, Afghanistan--you have to
have a political vision. You have to be able to go to the
Iranians and say, ``Hey, what's the starting point? What are we
trying to accomplish?'' And I've argued, we're trying to live
in peace, one with the other. And if that's the case, then how
do we demonstrate it?
Now we have issues that need to be addressed by the
Iranians--they're the several we've talked about. And before we
end up at the end state of normalization and the resumption of
a normal relationship, and investment and a relaxation of
sanctions, we have to get through this list of disagreements,
and the Iranians will have to match us step for step.
But we can't start until we lay down the core premise, see
if there's an Iranian acceptance of it, agree on the agenda,
and then outline what our considerations are, and what the
Iranian reciprocal gestures we're looking for, and let them put
their view on the table.
I ended my remarks this morning to you saying the diplomacy
of engagement is also about the exploration of what might be
possible. And that's where I would like to see our policy
Senator Coleman. And is the approach that you're advocating
one because of Iran and the history and the people or is it--in
other words, would you take the same approach with Kim Jong-Il?
Ambassador Wisner. Let me start back--I think there is a
respectable history of American engagement, I cited the two
principle examples. We had the gravest differences with the
erstwhile Soviet Union, and yet through detente, we engaged and
figured out the areas that divided us and reduced tensions on
those, and found common positions.
With regard to China, Senator, when President Nixon sat
down, he didn't try to resolve the Taiwan Straits issue, the
first question--he created a political view--we in China would
live side by side with each other, with respect. And then from
there we addressed the issues that divided us. I'm suggesting
the same approach is necessary with Iran. I would argue that if
we're going to find our way through--if we're going to find our
way through the nuclear thicket with North Korea, the starting
point is a willingness to live in peace. No. 1, to not have on
our list of pretensions, regime change in North Korea. That
will come when it comes. But our problem is an external
military threat posed to our troops, to our allies, and that
you have to turn for the story, or the front page piece Senator
Biden referred to this morning--to me is a good starting point,
that we're prepared, after 50 years, to begin to talk about
negotiating peace with North Korea as a handmaiden on engaging
on the nuclear issue that divides us.
Senator Coleman. Thank you. Thank you, Mr. Chairman.
The Chairman. Thank you very much, Senator Coleman. We
thank the witnesses for your excellent testimony, and the
statements that you have made. They are a part of our permanent
record. We look forward to your forthcoming responses to our
additional questions for the record.
We will continue to pursue this area in additional
hearings, and we look forward to a continued dialog with each
of you. The hearing is adjourned.
[Whereupon, at 11:40 a.m., the hearing was adjourned.]