[House Hearing, 114 Congress]
[From the U.S. Government Publishing Office]
IRAN'S POWER PROJECTION CAPABILITY
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HEARING
BEFORE THE
SUBCOMMITTEE ON NATIONAL SECURITY
OF THE
COMMITTEE ON OVERSIGHT
AND GOVERNMENT REFORM
HOUSE OF REPRESENTATIVES
ONE HUNDRED FOURTEENTH CONGRESS
FIRST SESSION
__________
NOVEMBER 5, 2015
__________
Serial No. 114-83
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Printed for the use of the Committee on Oversight and Government Reform
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Available via the World Wide Web: http://www.fdsys.gov
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COMMITTEE ON OVERSIGHT AND GOVERNMENT REFORM
JASON CHAFFETZ, Utah, Chairman
JOHN L. MICA, Florida ELIJAH E. CUMMINGS, Maryland,
MICHAEL R. TURNER, Ohio Ranking Minority Member
JOHN J. DUNCAN, Jr., Tennessee CAROLYN B. MALONEY, New York
JIM JORDAN, Ohio ELEANOR HOLMES NORTON, District of
TIM WALBERG, Michigan Columbia
JUSTIN AMASH, Michigan WM. LACY CLAY, Missouri
PAUL A. GOSAR, Arizona STEPHEN F. LYNCH, Massachusetts
SCOTT DesJARLAIS, Tennessee JIM COOPER, Tennessee
TREY GOWDY, South Carolina GERALD E. CONNOLLY, Virginia
BLAKE FARENTHOLD, Texas MATT CARTWRIGHT, Pennsylvania
CYNTHIA M. LUMMIS, Wyoming TAMMY DUCKWORTH, Illinois
THOMAS MASSIE, Kentucky ROBIN L. KELLY, Illinois
MARK MEADOWS, North Carolina BRENDA L. LAWRENCE, Michigan
RON DeSANTIS, Florida TED LIEU, California
MICK MULVANEY, South Carolina BONNIE WATSON COLEMAN, New Jersey
KEN BUCK, Colorado STACEY E. PLASKETT, Virgin Islands
MARK WALKER, North Carolina MARK DeSAULNIER, California
ROD BLUM, Iowa BRENDAN F. BOYLE, Pennsylvania
JODY B. HICE, Georgia PETER WELCH, Vermont
STEVE RUSSELL, Oklahoma MICHELLE LUJAN GRISHAM, New Mexico
EARL L. ``BUDDY'' CARTER, Georgia
GLENN GROTHMAN, Wisconsin
WILL HURD, Texas
GARY J. PALMER, Alabama
Sean McLaughlin, Staff Director
David Rapallo, Minority Staff Director
Andrew R. Arthur, National Security Subcommittee Staff Director
Sharon Casey, Deputy Chief Clerk
------
Subcommittee on National Security
RON DESANTIS, Florida, Chairman
JOHN L. MICA, Florida STEPHEN F. LYNCH, Massachusetts,
JOHN J. DUNCAN, JR., Tennessee Ranking Member
JODY B. HICE, Georgia ROBIN KELLY, Illinois
STEVE RUSSELL, Oklahoma, Vice Chair BRENDA L. LAWRENCE, Michigan
WILL HURD, Texas TED LIEU, California
C O N T E N T S
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Page
Hearing held on November 5, 2015................................. 1
WITNESSES
Mr. Thomas McInerney, Lieutenant General, USAF, Retired, Member
of the Iran Policy Committee
Oral Statement............................................... 5
Written Statement............................................ 8
Mr. Jonathan Schanzer, Vice President for Research, Foundation
for Defense of Democracies
Oral Statement............................................... 11
Written Statement............................................ 13
Mr. Steven Bucci, Director, Center for Foreign and National
Security Policy, The Heritage Foundation
Oral Statement............................................... 22
Written Statement............................................ 24
Mr. Alireza Nader, Senior International Policy Analyst, Rand
Corporation
Oral Statement............................................... 35
Written Statement............................................ 37
IRAN'S POWER PROJECTION CAPABILITY
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Thursday, November 5, 2015
House of Representatives
Subcommittee on National Security
Committee on Oversight and Government Reform
Washington, D.C.
The subcommittee met, pursuant to call, at 9:04 a.m., in
Room 2154, Rayburn Office Building, Hon. Ron DeSantis [chairman
of the subcommittee] presiding.
Present: Representatives DeSantis, Russell, Hice, Hurd,
Lynch, Kelly, and Lawrence.
Also present: Representative Welch.
Mr. DeSantis. The Subcommittee on National Security will
come to order.
Without objection, the chair is authorized to declare a
recess at any time.
This hearing will conduct oversight over the enhancement
due to the Obama administration's nuclear deal of Iran's
current capabilities to project power by reviewing Iran's own
military arsenal, as well as its financing, training, and
arming of proxy groups throughout the Middle East. The hearing
will also examine how the U.S. should be prepared to defend its
national security interests in the Middle East and at home
against Iran's advancement in power projection as a result of
sanctions relief.
It has been reported that Iran's defense budget makes up
one-third of its national $300 billion budget. If these
estimates are accurate, an influx of $100 billion due to
sanctions relief would increase Iran's single-year budget by a
third, providing it with substantially increased financial
resources to further its foreign policy agenda.
It is well known that Iran projects power in the Middle
East through the funding of foreign terrorist organizations,
hostile governments, and political activist movements, and by
arming militant groups and offering training facilities. Iran
has long been a supporter of the Lebanese group Hezbollah, the,
``vanguard of resistance to Israel.'' Hezbollah is perhaps
Iran's most effective terrorist organization within the region
and of course was responsible for killing more than 240
Americans at the Marine Corps barracks in Beirut in 1983.
With Iran's financial and military assistance, Hezbollah
has become a prominent influence in Lebanese politics. The
State Department estimates that Iran has given Hezbollah
hundreds of millions of dollars and trained thousands of
Hezbollah troops at Iranian training facilities.
In 2014, the U.S. intelligence community Worldwide Threat
Assessment argued that Hezbollah has, ``increased its global
terrorist activity in recent years to a level that we have not
seen since the 1990's.''
Further Iranian funding of Hezbollah would be, of course,
of serious concern to the U.S. and our allies.
Hamas has also consistently received funds, weapons, and
training from Iran. People talk about Iran being a Shiite
power. They are absolutely willing to arm Sunni groups like
Hamas. And then when you have decent Shiite governments like in
Azerbaijan, Iran is opposed to that. Iran has frequently
assisted Shiite militias and terrorists in Iraq, Bahrain, and
Yemen. For these reasons, Iran has been designated by the State
Department as a state sponsor of terrorism since 1984.
Iran is maintaining and expanding an advanced ballistic and
cruise missile program that poses a threat to U.S. forces,
interests, and allies in the gulf region and beyond. The
recently signed nuclear accord does not limit Iran's ability to
continue to develop its ballistic and cruise missile programs.
The potential influx of funding as a result of sanction relief
may facilitate the advancement of Iran's ballistic and cruise
missile programs which will result in Iran posing an even more
lethal threat to the United States and our allied assets in the
region.
Our military leaders understand the threat posed by Iran.
During his confirmation hearing in July for JCS Chairman,
Marine Corps General Joe Dunford said, ``my expectation is that
regardless of there being an agreement or not, Iran will
continue to be a malign force and influence across the
region.''
Retired Marine Corps General Jim Jones further elaborated
on this threat during testimony before the Senate Armed
Services Committee hearing last month. He said, ``it is a
regime that artfully dodges its commitments, generates
international friction to exert greater domestic control on its
citizens, constantly hardens its grip on the country. The
mullahs' government seriously violates human rights, U.N.
Security Council resolutions and international law. They reject
the right of Israel to exist by opposing and actively
undermining the Middle East peace process. And Tehran remains
the chief antagonist of democracy and liberalization across the
Middle East where a better future for millions of people
struggles to emerge. Its goal is the consolidation of the
revolution, which is martially enforced at home by the Islamic
Revolutionary Guard Corps and prosecuted abroad by the Quds
Force and Iran's many proxy groups.''
And I think it is worth pointing out that under the
agreement with the Obama administration, the international
sanctions on the Quds Force are actually lifted.
Sanctions relief will exacerbate Iran's ability to pursue a
nefarious foreign policy agenda. Israeli officials have warned
that Tehran will direct billions of dollars it will reap from
the end of economic sanctions toward its anti-Israel proxies in
the region. Iranian officials often call for Israel's
destruction. Short of that, proxy forces like Hezbollah, Hamas,
and Palestinian Islamic Jihad provide Tehran with a shield
against a possible Israeli military strike on its nuclear
program.
And I would note today in the ``Wall Street Journal,'' we
have on the front page Iranian hacking surges in the U.S. And
so here you have an agreement. We claim that Iran is going to
start to change its ways and they are not going to have a
military use of nuclear energy, but yet how are they responding
to that? They are hacking inside the United States.
So Iran's foreign policy will remain at odds with U.S.
interests. And so with this understanding, we must turn to the
tasks of protecting U.S. national security issues and the job
of standing by our closest allies in the region.
And so we are delighted to have such a great group of
witnesses here for our hearing, and I will recognize them in a
minute. But before I do that, I would like to recognize the
ranking member of the Subcommittee on National Security, Mr.
Lynch, for his opening statement.
Mr. Lynch. Thank you, Mr. Chairman. I want to thank you for
holding this important hearing.
I also want to thank our witnesses for helping the
committee out with its work.
There is no doubt that Iran is a destabilizing force in the
Middle East, and I agree with the quote by General Dunford that
they will continue to be so in the future.
The United States first placed Iran on its terrorist list
in 1984 due to its support of Lebanese Hezbollah. In its most
recent country terrorism report, the State Department found
that throughout 2014 Iran did continue to support terrorist
groups, including Hezbollah, and providing financing, training,
and arms to Iraqi Shia militias and even some Afghan fighters
to bolster Bashar al-Assad in Syria.
Iran has also detained American hikers and journalists, and
most recently is reported to have arrested two American
citizens on unspecified charges.
It is clear that we cannot trust the Iranian regime, but
that is precisely why the Obama administration has worked so
hard to reduce their nuclear weapons capabilities. I believe
that the Joint Comprehensive Plan of Action, also known as the
Iran nuclear agreement, offers us the most viable path toward
limiting Iran's nuclear program and preventing its future
development of a nuclear weapon.
In referencing the nuclear arms race between the United
States and the Soviet Union in his 1960 inaugural address,
President Kennedy remarked that, ``sincerity is always subject
to proof'' The Iran nuclear agreement does not require us to
simply rely on the sincerity of the Iranian leadership. Rather,
it depends entirely on proof in the form of a robust nuclear
inspections and verification regime conducted by IAEA, the
International Atomic Energy Agency. To be clear, the lifting of
nuclear-related United Nations and European Union sanctions
will only occur after IAEA verification that Iran has complied
with its end of the deal.
Specifically, the IAEA must monitor and verify that Iran
has met a variety of the stipulations required by the
agreement. For instance, Iran must reduce its total uranium
stockpiles by 97 percent, from 10,000 kilos to 300,
immediately. It must also reduce the number of centrifuges from
19,000 to about 6,000, which Iran has reportedly already begun
to do so. The IAEA must also verify that Iran does not produce
or retain any weapons-grade uranium, and the little low-
enriched uranium remaining is to be for commercial and
scientific uses only.
The IAEA must monitor and verify the dismantling of the
heavy water reactor at Iran's water plant in Arak so that it
will not longer be able to produce weapons-grade plutonium.
These are just a few of the substantial physical and verifiable
reductions that Iran must undertake.
The Treasury Department estimates that upon implementation
of the agreement, Iran will have access to between $100 billion
and $125 billion in foreign exchange assets held in the U.S.,
EU, and mostly Asian banks, a lot of which is already
obligated, including nearly $20 billion owed to China.
In all, experts anticipate Iran to use the vast majority of
these funds to pay down current debt obligations and domestic
needs estimated to be over a half a trillion dollars. These
needs include as much as $200 billion in necessary oil
infrastructure investments and the purchase of commercial
aircraft to replace a deteriorated domestic fleet.
There is still the danger that Iran may direct a portion of
repatriated funds to finance terrorist activity or further
destabilize the Middle East. That is why it is critical that
the agreement leaves in place our sanctions pertaining to
terrorist financing, human rights, and weapons of mass
destruction. As noted by the nonpartisan Congressional Research
Service, the many U.S. sanctions that will remain include those
specified by Executive Order 13224 issued by President Bush
following the 9/11 terrorist attacks and authorizing the U.S.
Government to block the assets of foreign entities and
individuals to support terrorist organizations.
Chief among them is the Islamic Revolutionary Guard Corps,
which the State Department has deemed the regime's primary
mechanism for cultivating and supporting terrorists abroad.
Iran's designation as a state sponsor of terrorism will also
stay in effect along with the array of sanctions that accompany
it, from export controls and prohibitions on arms sales to
withholding economic assistance.
The nuclear agreement also includes a snapback mechanism to
reimpose sanctions in the event that Iran cheats.
Mr. Chairman, I look forward to discussing with today's
witnesses how we might build upon the Iran nuclear agreement,
the purpose of which is stated in the preface of the agreement
that we can all support, and that is, quote--and I am quoting
from the agreement--that under no circumstances will Iran ever
seek, develop, or acquire any nuclear weapons.
Thank you, Mr. Chairman. I yield back the balance of my
time.
Mr. DeSantis. The gentleman yields back. Thank you.
I will hold the record open for 5 legislative days for any
members who would like to submit a written statement.
We are going to recognize our panel of witnesses. We look
like we are going to have votes called in about an hour, so my
hope is, if you stay to the 5 minutes, we will then do our
questioning and hopefully we can get everyone or definitely
most people in because I would hate to have to recess and come
back. I know you guys have a lot to do.
So first, I am pleased to welcome Lieutenant General Thomas
McInerney, United States Air Force, retired, member of the Iran
Policy Committee; Dr. Jonathan Schanzer, Vice President for
Research at the Foundation for Defense of Democracies; Dr.
Steven Bucci, Director of the Center for Foreign and National
Security Policy at the Heritage Foundation; and Mr. Alireza
Nader, Senior International Policy Analyst at the RAND
Corporation. Welcome to you all.
Pursuant to committee rules, all witnesses will be sworn in
before they testify. So if you would please stand and raise
your right hands.
[Witnesses sworn.]
Mr. DeSantis. Witnesses, thank you. Please be seated.
All witnesses answered in the affirmative.
Your entire written statement will be made part of the
record, so please limit your testimony to 5 minutes. Lieutenant
General McInerney, you are now recognized for 5 minutes.
WITNESS STATEMENTS
STATEMENT OF THOMAS McINERNEY
Mr. McInerney. Chairman DeSantis, Ranking Member Lynch,
members of the Subcommittee on National Security, thank you for
the opportunity to give you my concerns on this important
subject to our Nation's current and future national security in
the Middle East.
The Iran nuclear agreement or, as it is officially titled,
The Joint Comprehensive Plan of Agreement, is the most
dangerous nuclear agreement ever signed by an American
President. Its impact on Iran's ability to dominate the Arabian
peninsula and force project in the future is profound.
I harken back to my days on active duty when I commanded a
U.S. Air Force Europe task force to a CENTO exercise in Iran in
1977, composed of 12 F-4's and six 111's flying out of Shiraz,
Iran. The Shah of Iran was highly motivated in expanding
stability in the region until the Carter administration threw
him under the bus, as the current administration has done in
Egypt, Libya, and Syria, as well as enabling the Iranians to
make Iraq a proxy with our withdrawal in 2011.
I say this for the following reasons.
Having read the document in full, one can make a reasonable
case that it limits Iranian nuclear weapons development over
the short term with some reasonable oversight procedures.
However, these are just words similar to what Neville
Chamberlain produced in September 1938 and yet a year later,
World War II started and 60 million lives were lost. My point
is that words might be acceptable if we believe that Iran was a
trustful partner in this agreement. Yet the mullahs have never
observed an agreement in the past.
This agreement should be a formal treaty in accordance with
our Constitution.
The Senate has not yet had a vote to approve it.
There is no coupling with the agreement and Iran's proxy
force projection of its radical Islamic terror activities
globally.
Iran has already made violations of the agreement even
before it was approved. These violations include the visit of
General Soleimani to Moscow where he met President Putin and
leaders in violation of U.N. sanctions to discuss the sale of
the S-300 SAM. They intentionally violate agreements and
nothing happens.
The Iranians launched a nuclear capable IRBM on 10 October
2015 in violation of U.N. Security Council resolution 1929. No
action has been taken against them.
Now, several months after the agreement was reached in
July, the Russians projected forces into Syria to keep Bashar
al-Assad in power and attack the Free Syrian Army's forces
supported by the U.S.-led coalition. The PRC is now supporting
the Assad government. Is something wrong with this picture of
Iranian bad behavior being supported by Russia and China after
the agreement was signed?
Israel who has the most to lose with this agreement is now
facing a third intifada instigated by Iran.
In the meantime, with a growing radical Islamic threat,
this administration has been unilaterally disarming the U.S.
military ever since they came into office starting in April
2009 with the cancellation of the F-22, the next generation
bomber, the missile defense system in Poland and the Czech
Republic, and withdrawing prematurely from a stabilized Iraq,
which has resulted in the creation of ISIS in 2009.
The administration shifted U.S. policy shortly after the
President's Cairo speech where he had Muslim Brotherhood
members in the front row. President Mubarak was not invited,
which resulted in the Muslim Brotherhood, a radical Islamic
organization, taking over Egypt until the Egyptian people and
General el-Sisi threw them out.
It further created instability in the Middle East by
attacking Libya to remove Colonel Qaddafi without congressional
authorization. This resulted in the deaths of four Americans on
11 September 2012 when the U.S. consulate was attacked. No
American military response was forthcoming.
Today a land and air bridge from Iran goes through Iraq
that the Russians and Iranians are using to reinforce Syria in
violation of the U.N. Security Council.
This is the most dangerous situation ever in the Middle
East. I am skeptical of the Iranians agreeing to follow this
nuclear agreement. They will continue to force project forces
throughout the region to spread radical Islam, which the
administration calls violent extremism. I know not the ideology
of violent extremism, but I do know the ideology of radical
Islam, the Koran, Hadith and Sharia Law.
In summary, I am very concerned we have signed an agreement
that will rival Neville Chamberlain's failed agreement and
encourage more Iranian force projection.
Who could have predicted 7 years ago we would leave a
vacuum for Russian reemergence into the region and Iran would
be the de facto hegemon?
Thank you for your time and God bless you all during these
very difficult times for America.
[Prepared statement of Mr. McInerney follows:]
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Mr. DeSantis. Thank you, General.
The chair now recognizes Mr. Schanzer for 5 minutes.
STATEMENT OF JONATHAN SCHANZER
Mr. Schanzer. Chairman DeSantis, Ranking Member Lynch,
members of the subcommittee, on behalf of FDD and its Center on
Sanctions and Illicit Finance, thank you for the opportunity to
testify.
Iran has long projected power through the financing of its
proxies around the Middle East. This strategy figures
prominently in Iran's plans for regional hegemony.
The nuclear deal signed this summer will now provide Iran
with an estimated $120 billion in sanctions relief and another
$18 billion in annual oil sales. The White House insists Iran
will invest this windfall in roads, schools, hospitals, and
other neglected infrastructure, but this is wishful thinking
given Iran's track record. Even if Iran earmarks only 10
percent for its proxies, we are looking at more than $10
billion in illicit finance.
The beneficiaries of Iran's largesse will include terrorist
groups, Hamas, Hezbollah, Palestinian Islamic Jihad, Kata'ib
Hezbollah, and other violent factions in Iraq and al-Sabireen,
a new Shiite group in Gaza.
On top of that, we can expect continued assistance to the
Assad regime in Syria which continues to drop barrel bombs on
its own population. And let us not forget the Houthis who
continue to play a destabilizing role in Yemen.
Iran's sanctions relief will further benefit Iran's
hardliners who bankroll those terror groups and rogue regimes.
This includes the Islamic Revolutionary Guard Corps, IRGC,
which will see many of its sanctioned entities de-listed in
Europe. Sanctions relief will further benefit companies
belonging to the Supreme Leader himself. I am referring here to
Ali Khamenei's economic empire known as EIKO.
Mr. Chairman, all this raises troubling questions about the
U.S. Treasury's mission. It was a little more than a year ago
when the New York Times' David Sanger wrote about the Treasury
sanctions team is President Obama's favorite noncombatant
command. The moniker was well deserved. The Office of Terrorism
and Financial Intelligence played a crucial role, along with
Congress in building the sanctions architecture that punished
Iran for its nuclear mendacity, ballistic missile development,
the funding of terror groups, human rights abuses, and the
backing of rogue states.
Above all else, Treasury's mandate was to protect the
integrity of the U.S.-led financial sector, but that mandate is
now in jeopardy. The banks, businesses, and persons said to be
de-listed have not earned it. Iran has provided no evidence
that they have ceased their illicit activities, and once they
are de-listed, the terms of the Iran deal forbid them from
being re-listed, even if they commit new financial crimes. And
the $120 billion in sanctions relief will flow regardless of
Iran's regional activity. In the end, Treasury's principles
were compromised to secure President Obama a diplomatic
victory, and it is doubtful that this will be a lasting one.
For Treasury's mission to be taken seriously, it must now
be able to resume its campaign against Iranian financial crimes
and to punish Iran for violations of the nuclear deal. How it
will do this, given the constraints of the Iran deal, is
unclear.
Mr. Chairman, the road ahead will be challenging, but I
offer several recommendations here for the committee's
consideration.
Number one, Treasury needs to reaffirm its mission.
Congress should request a road map from the Office of Terrorism
and Financial Intelligence. Treasury must now articulate how it
plans to continue to be an effective noncombatant command under
these new challenging circumstances.
Number two, change the way Treasury designates. Treasury
usually targets illicit financial actors by designating them
pursuant to one executive order, such as terrorism or human
rights or proliferation. But in the case of Iran, illicit
actors are often guilty of many financial crimes. Congress
should demand that Treasury designate more entities under
multiple executive orders simultaneously, making it harder for
them to de-list.
Number three, enforce what we have left. Congressional
oversight over what relevant sanctions architecture remains is
crucial to stemming the flow of Iranian illicit finance. The
rigorous enforcement of existing executive orders and the
creation of new ones, when appropriate, will be vital to
curbing Iranian support for terrorism.
Number four, enforce and expand designations of IRGC-
affiliated entities. Congress should direct Treasury to
designate the IRGC in its entirety under Executive Order 13224
for its role in financing, directing, and supporting
international terrorism. It is currently designated for
proliferation and human rights purposes, while only the Quds
Force, an IRGC subsidiary, is designated for terrorism.
And number five, lower the threshold for IRGC designations.
Congress should consider making it easier to designate IRGC
companies. The Financial Action Task Force suggests that the
threshold could be 25 percent controlled and that could include
both members of the board and stakeholders.
Mr. Chairman, on behalf of FDD and its Center on Sanctions
and Illicit Finance, thank you again for inviting me to
testify. If I have missed anything that you wish to discuss, I
am happy to answer your questions.
[Prepared statement of Mr. Schanzer follows:]
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Mr. DeSantis. Thank you.
Dr. Bucci, you are now recognized for 5 minutes.
STATEMENT OF STEVEN BUCCI
Mr. Bucci. Thank you, Mr. Chairman, Ranking Member, members
of the subcommittee. I am Director of the Allison Center for
Foreign and National Security Policy at The Heritage
Foundation. The views I express in this testimony are my own
and should not be construed as representing any official
position of The Foundation.
I retired from the Army as a special forces colonel, having
served as a human intelligence collector for DIA and as the
Commander of 3rd Battalion, 5th Special Forces Group in the
CENTCOM AOR. I later served as the Deputy Assistant Secretary
of Defense for Homeland Defense.
My focus here will be the threat that we face from Iran in
their efforts to project power and impose its extreme and
abhorrent will on the world.
The majority of my written testimony is taken from The
Heritage Foundation's recently released 2016 Index of U.S.
Military Strength.
The immediate threat is the IRGC Quds Force terrorism. The
IRGC is a very capable organization that matches its
operational expertise in guerilla warfare, terror, and murder
with an ideological purity that makes their only comparable
analog the old Soviet Spetznaz. They have done operations
around the Middle East and the world, including the attempted
murder of the Saudi Ambassador here in Washington, D.C.
Down the road, Iran will gain considerable capability in
ballistic missiles. They will undoubtedly gain nuclear weapons
eventually. They will definitely re-equip their conventional
forces with the help of the Russians. The real key here,
though, is the orders of magnitude greater and more dangerous
terror events that the Quds Force can fund and execute given
their share of the soon to be released $100 billion in new
money. There is no sequestration pending for the IRGC. The
windows of heaven or hell are about to open for them.
Iran is an anti-Western revolutionary state that seeks to
tilt the regional balance of power in its favor by driving out
the Western presence, particularly the United States,
undermining and overthrowing opposing governments, and
establishing its hegemony over the region. It also seeks to
radicalize Shia communities and advance their interests against
Sunni rivals. Iran has a long record of sponsoring terrorist
attacks against American allies and other interests. With
regard to conventional capabilities, Iran's ground forces dwarf
the relatively small armies of the other Gulf states.
Importantly, Iran has adopted a strategy that emphasizes
irregular warfare, asymmetric tactics, and the extensive use of
proxy forces. The IRGC has supported and collaborated with a
wide variety of radical Shia and Sunni militant groups, as well
as Arab, Palestinian, Kurdish, and Afghan groups that do not
even share its radical Islamist ideology. The Quds Force has
trained and armed numerous proxies, particularly Lebanese
Hezbollah, the Iraqi Shia militias, Palestinian groups such as
Hamas and Islamic Jihad, and groups that have fought against
the governments of Afghanistan, Bahrain, Egypt, Israel, Iraq,
Jordan, Kuwait, Saudi Arabia, Turkey, and Yemen.
Iran is the world's foremost sponsor of terrorism and has
made extensive efforts to export its brand of radical Shia
Islamist revolution.
One cannot discuss Iran's abilities to project power
without looking more closely at its main proxy. Hezbollah is a
close ally of, frequent surrogate for, and terrorist
subcontractor for Iran's revolutionary Islamist regime. Tehran
provides the bulk of Hezbollah's foreign support, arms,
training, logistical support, and money. Iran provides at least
$100 million to possibly $200 million annually in financial
support to Hezbollah. I expect this to grow substantially.
Iran presents a significant threat to U.S. national
security interests in the Middle East, to our key allies, and
to our position as the balancer and influencer there. It has
the ability to project power around the world and around the
region, particularly in asymmetric forms. The recent collusion
of Iran with Russia gives Iran additional abilities to move
around the world and do significant mischief. As mentioned,
there is no sequestration for the biggest purveyors of state-
sponsored terrorism in the world.
With respect to the Secretary of State and his comments,
you cannot logically separate Iran's terrorism from the JCPOA.
It is a mistake to underestimate either the intentions or
capabilities of Iran to do harm. Iran is not our partner, but
they are a clear adversary.
Thank you.
[Prepared statement of Mr. Bucci follows:]
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Mr. DeSantis. Thank you.
The chair now recognizes Mr. Nader for 5 minutes.
STATEMENT OF ALIREZA NADER
Mr. Nader. Chairman DeSantis, Ranking Member Lynch, and
members of the subcommittee, thank you for inviting me to
appear before you today to speak about the impact of sanctions
relief on the Iranian regime's policies at home and in the
Middle East.
The Joint Comprehensive Plan of Action between Iran and the
P5 Plus 1 will no doubt provide Iran with significant sanctions
relief and alleviate some of the stresses faced by the Iranian
economy. But several factors will constrain the Iranian
regime's ability to substantially grow the economy and use
newly found resources to achieve its foreign policy objectives.
First, sanctions relief will not be granted unless Iran
sharply reduces its nuclear capabilities. This means that Iran
will be unable to use its nuclear program to expand its
regional influence. Iran will only be rewarded economically
once it has met its obligations under the nuclear agreement.
Second, while the United States will lift secondary
sanctions against Iran, primary American sanctions targeting
the Iranian regime's support for terrorism and its human rights
abuses will remain, preventing Iran from gaining access to
American capital, and most importantly, American technology and
know-how.
Although the nuclear agreement is expected to provide Iran
with significant economic relief, the amounts involved are
unlikely to greatly empower the Iranian regime at home or
abroad. The regime is massively indebted due to its costly
nuclear policies. It owes as much as $100 billion to Iranian
banks and private firms. The Rouhani government was elected on
a campaign to improve the economy, which will require Iran to
spend at least $200 billion on its decrepit energy sector, in
addition to tens of billions of dollars on domestic
infrastructure, health care, and educational system. So while
the lifting of U.S. secondary and European nuclear sanctions
may enable Iran to increase its oil exports and give it access
to $50 billion to $100 billion held in escrow accounts, much of
this money will be used to pay debts and invest in the
country's infrastructure and social services.
In addition, because global oil prices are likely to remain
low for the foreseeable future, oil exports will not enable
Iran to get rich quickly. Iran faces stiff global competition,
and its reentry into the global market is unlikely to pose
serious competition to major oil producers such as Saudi
Arabia.
Even after the nuclear agreement, many foreign companies
will be hesitant to trade with Iran due to remaining U.S.
sanctions and, perhaps more importantly, due to the overall
reputation of the Iranian regime. Iran is one of the most
corrupt and least business-friendly countries in the world.
The Iranian regime's asymmetric capabilities will remain
the key challenge for U.S. interests, but increasing U.S.
military leverage in Syria and Iraq and a political solution to
the Syrian conflict decrease the regional instability, which
the Iranian regime exploits. The United States should be
willing to engage Iran diplomatically when it suits its own
interests.
Iran appears ascendant in Syria today, but it is more eager
to end its involvement in the conflict than it may appear.
I have four recommendations for the United States,
especially Congress.
Congress has a vital role to play in ensuring Iran's
adherence to the nuclear agreement by engaging in vigorous
oversight of the agreement's implementation. Congress should be
ready to impose new sanctions against Iran if it is found to be
violating the agreement. Moreover, Congress should remain fully
informed of the status of the nuclear agreement by holding
frequent hearings regarding its implementation.
However, Congress should not pass new legislation on
terrorism and human rights abuses, especially as the nuclear
agreement is implemented. Such steps could be viewed by U.S.
partners and the international community as an attempt to
undermine the nuclear agreement, endangering international
enforcement of sanctions against Iran.
The nuclear agreement will not end the rivalry between the
United States and the Islamic Republic. The Rouhani government
is very limited in its ability or willingness to reform Iran. A
U.S. focus on democracy promotion would, therefore, be
beneficial.
The United States should make it easier for Iranian
students to study at American universities, allowing them to
gain an even more positive view of the United States and its
values. U.S. programs that aim to increase cultural and sports
exchanges between Iran and the United States should be
expanded.
Finally, U.S. diplomacy with Iran can help resolve regional
crises while strengthening positive views of America within
Iran. Therefore, the United States should lift restrictions
against diplomatic engagement with Iranian diplomats. U.S.
diplomacy with Iran does not confer legitimacy on the Iranian
regime. Such legitimacy can only be conferred by the Iranian
people.
Thank you for the opportunity to share my views with the
subcommittee. I look forward to your questions.
[Prepared statement of Mr. Nader follows:]
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Mr. DeSantis. Thank you.
The chair now recognizes himself for 5 minutes.
Dr. Bucci, Mr. Nader stated in his written testimony that
the amount of sanctions relief is, ``unlikely to greatly
empower the Iranian regime at home or abroad.'' And he said
that they will likely use it to pay down debts and follow
through with President Rouhani's promises to invest in the
country. Do you agree that that is how Iran is likely to spend
the money it receives from sanctions relief?
Mr. Bucci. With due respect to my colleague, Mr. Chairman,
I think that is wildly optimistic. Clearly they will apply some
of the money. That is a ton of money they are going to get
suddenly injected into their economy. Some of it will go to pay
some debts. Some of it will go to some infrastructure things.
They have got a considerable domestic ferment there that they
need to address. A regime that under the sanctions was spending
as much money as they were spending on support of terrorism, to
think they are not going to siphon off at least some of that
money, maybe a big chunk of it, to upgrade that support of
terrorism once they get this new money is delusional.
Mr. DeSantis. And their proxies like Hezbollah have cheered
the agreement. I do not think they would do that unless they
saw benefits for them as a result of it.
Dr. Schanzer, Mr. Nader agrees with--this is with respect
to the increase in oil exports of $1 million per year. He
agrees with that, but he argues that Iran will use this
additional income to pay debts and invest in the country's
infrastructure and social services.
So what do you believe just based on the history of human
rights abuses that we have seen under the Supreme Leader? We
have seen the regime's conduct. That oil money--what is your
best guess as to what is going to happen with that?
Mr. Schanzer. Mr. Chairman, look, I would just say this as
an overall observation that those who are proponents of the
regime all of a sudden are also accountants and purport to know
how Iran is going to spend its money. We have seen, during the
time when Iran was building its nuclear weapons capability,
that it was spending money, not paying down its debts,
obviously. It was pursuing a reckless policy then. I do not
expect it to change a policy of recklessness even though they
have at least for now decided to curb their nuclear objective.
So I would certainly expect to see oil funds, as well as the
sanctions relief, flowing to groups like Hezbollah, Kata'ib
Hezbollah in Iraq, a lot of the other groups there that are
fighting on behalf of the Iranians. I would expect to see the
IRGC getting huge amounts of this.
But one other thing that is incredibly important to note is
that the IRGC controls roughly a third of the Iranian economy.
And so when you talk about money that is going to flow to
hospitals and schools and roads, what you are doing is you are
sinking money into companies controlled by the IRGC. So it is
simply a pass-through to this radical organization which will
then go and finance all these radical groups around the region.
Mr. DeSantis. Thank you.
Lieutenant General McInerney, as a result of this deal, you
sketched out kind of Iran's malign influence. Does this deal
make their project in, say, Yemen easier for them or more
difficult for them?
Mr. McInerney. It makes it much easier, Mr. Chairman.
Mr. DeSantis. How about their project--I know that they
have designs on Bahrain. Is this better for Iran and their
designs on Bahrain, or does it make their life more difficult
with respect to those ambitions?
Mr. McInerney. Again, better for their designs on Bahrain.
Mr. DeSantis. And we have talked about--and I think you
have pointed this out in your testimony very well. You know, we
talk about, hey, Iran--yes, they get this entire nuclear
infrastructure. It is basically being kept in place. They got
the heavy water reactor. But they have promised that there is
not going to be any plutonium production. Yes, they have an
underground facility at Arak, but they are going to--or in
Fordow--excuse me. But they promise they are just going to do
research there. So you have words on the paper. True. In your
judgment, do you think it is likely that you will see the type
of unfettered inspections that you need? I know in some of the
military sites, they are essentially going to self-inspect. So
are the words on the paper something that we would want to hang
our hats on?
Mr. McInerney. Mr. Chairman, they celebrated their 36th
anniversary of seizing our embassy yesterday. I expect no
changes in their conduct.
Mr. DeSantis. Let me ask you this. I think Dr. Schanzer
made some good recommendations about what Congress can do in
terms of the financing. What would you say--two-thirds of the
American people I have seen do not think this is a good idea.
What should Congress do? This was never passed by Congress. It
is essentially an executive-to-executive agreement that will
expire with the new administration. But in the meantime, what
would you recommend that Congress do to combat the threat?
Mr. McInerney. I would increase the sanctions, as Dr.
Schanzer mentioned. We have got to put bounds on that nation,
and we are not. We are encouraging bad behavior.
Mr. DeSantis. Dr. Bucci, what should we do? If we agree
with your testimony, we think this is a problem, we think
Iran--the net effect of this, Iran is stronger, more and more
of a malign force than they have already been. It hurts our
national security interest. But yet, we cannot really--I mean,
we voted the agreement down, but it did not matter. It is going
forward as an executive agreement.
Mr. Bucci. Mr. Chairman, I think you ought to take whatever
steps you think you can get away with to put the clamps back
on, particularly the Quds Force people, General Soleimani. He
is catting around the world going into Moscow to chat with
Vladimir Putin, those kind of things that are now legitimate
under this agreement. That is such a slap in the face of the
people that have been killed by this man's troops and his
plots. Those kind of sanctions, very specific, very directive,
at least ought to be put back in place.
Mr. DeSantis. And I would venture to guess that Soleimani,
of any living person, probably has more American blood on his
hands than anyone. I mean, Osama bin Laden has been killed. He
killed at least hundreds of our troops in Iraq. I have heard as
many as 1,500. General, do you think that sounds reasonable, a
reasonable estimate?
Mr. McInerney. Well, I have heard a number between 500 and
1,500.
Mr. DeSantis. You know, relieving international sanctions
of somebody that is not just a malign influence but has
actually killed a lot of Americans--and we have had people come
to Congress who were wounded by these EFP's that Iran was
providing these Shiite militias. And it is not a story I think
that is as well known as the Sunni insurgency during that time
period.
The one thing I would also mention--and we are working on
some legislation, but because this was not ratified as a treaty
or even passed this Congress as statutory law, what the
President has agreed to cannot supersede State sanctions. It is
not the supreme law of the land. And so we have States--I am
from Florida that has pretty tough sanctions in terms of the
investments in Iran and what can be done with the pension
funds. And we are going to be introducing some legislation
hopefully soon that will allow really saving the State
sanctions, making it clear and really encouraging States that
they should do what is right for their folks. And so those
States and those States that have acted are really an important
part of this right now, more important than we probably
thought.
With that, I am out of time, and I will recognize the
ranking member, Mr. Lynch, for 5 minutes.
Mr. Lynch. Thank you, Mr. Chairman.
America has always been somewhat forward-looking, and I
think the examples in our history where we have had tremendous
loss of life within our Nation--you know, wars against Germany,
against Japan, against Vietnam. And now we have got trade
agreements, and we are trying to move forward with those
relationships.
And I think that while there is need for great caution
here, no question about it--I do not trust the Iranian regime--
I think there is an opportunity here that has been created not
by just the United States but by P5 Plus 1. So we have got to
consider the implications here. I think that the verification
protocols have to be in place. They have to be robust.
Mr. Nader, I want to ask you about the state of the Iranian
economy and the impact of whatever money pours over--some say
$100 billion. Some say $200 billion--into the Iranian economy.
We have had a chance to talk to the IAEA inspectors who
have been in Tehran and around the country. They tell me that
they are afraid to fly commercially within Iran because our
sanctions, together with the Europeans and others--we have
blocked basic commercial airline parts as part of our sanctions
so that the IAEA inspectors--the way they operate is they fly
directly on Lufthansa mostly from Germany into Tehran. They
will not fly around the country because they are deathly afraid
of the safety conditions of the Iranian commercial airlines.
They have also indicated that this petrol economy--and Iran
is basically gas and oil. That is a huge part of their economy.
That has been devastated by the sanctions, which was the whole
idea to get them to the table.
What do you think the impact of this money--have any of the
financial sanctions been lifted so far? Has any of the money
gone to it? So nothing yet. So we have got a parade of
horribles that might happen, but nothing has gone.
And why is that? Why has no money gone to Iran yet?
Mr. Nader. Well, first of all, Iran has not implemented the
nuclear agreement. Once it implements the nuclear agreement and
the IAEA verifies that Iran has taken these steps and they are
verifiable, then Iran will meet with some sanctions relief.
But I think it is important to recognize that a lot of U.S.
sanctions are going to remain against Iran. You mentioned
Iran's civilian airlines. They have been without modern
technology and parts for decades. Iran's natural gas industry,
which Iran has one of the biggest gas reserves in the world,
cannot take advantage of the resources because of U.S.
sanctions preceding the nuclear sanctions. So if you look at
the long list of U.S. sanctions, a lot of sanctions, the
primary sanctions will remain against Iran. A lot of companies
will be hesitant to trade with Iran and deal with Iran.
And when we look at Iran's conventional military
capabilities, under the JCPOA Iran will face a 5-year embargo
on its conventional arms imports. It will face an 8-year
embargo on its missiles. Even after that, the U.S. primary
sanctions are going to deter a lot of foreign countries from
selling equipment to Iran. Even before the nuclear issue became
such a problem, Iran was having a difficult time importing
sophisticated weapons because the Europeans and even the
Russians and Chinese were hesitant to deal with Iran. So I
think there are going to be a lot of restraints on Iran, on its
economy moving forward.
And finally, I want to say that, yes, this regime will
support terrorism. It will deny human rights to its people. But
it is important that we have a nuclear agreement which takes
the nuclear capability away from the Iranian regime. And I
think this is why this agreement is important. It is a strong
nonproliferation agreement that will ensure Iran does not have
a nuclear weapons capability.
Mr. Lynch. The latent capability of the Iranian regime
really lies in oil and gas. There are some who say there is an
oil glut now. That is why prices are down. But the natural gas
piece there is a concern because there is a greater use around
the world. You know, people are getting away from coal and oil
to some respect, but natural gas--that could be a bonanza for
Iran.
How far behind are they? How long would it take--I know we
have a lot of--there are already contracts in place with a lot
of the European countries and the United States with Qatar, for
example. They have already rebuilt their whole natural gas
infrastructure, and they have not cornered the market, but they
have got a huge advantage there. What would it require for Iran
to sort of catch up? Because they are actually pre-LNG still
back in Iran. They have not even come forward with that
technology. So could you talk about how much time it might take
them to catch up?
Mr. Nader. Well, if you compare Iran to Qatar, it is years
if not decades behind. And Iran and Qatar share a very large
gas field, the South Pars gas field. And Qatar has really taken
advantage of it because it is a close U.S. ally. It has access
to liquefied natural gas technology through the United States,
and Iran lacks that technology. And I doubt that it will be
able to catch up anytime soon because of U.S. primary sanctions
against Iran.
And I think a lot of European companies and even Asian
companies will be reluctant to help Iran develop its natural
gas resources. So Iran is years if not decades behind in its
natural gas. And in terms of its energy sector, when you
compare it to Saudi Arabia, for example, or Russia, it is also
years and decades behind.
I talked to an economist who had worked on Iran's petroleum
industry during the shah's reign. At that time it was
relatively modern, and when he saw Iran's current status, he
said it brought tears to his eyes as an engineer and scientist
because how behind Iran had fallen because of the regime's
policies, because of its nuclear policies, and its reputation
overall.
Mr. Lynch. Thank you.
I thank the chairman for the indulgence. I appreciate that.
Mr. DeSantis. No problem.
The chair now recognizes the gentleman from Georgia, Mr.
Hice, for 5 minutes.
Mr. Hice. Thank you, Mr. Chairman.
And thank you, each of our witnesses, for being here.
It is my understanding from your testimony, what you have
shared to this point--yes or no--would you agree that if the
sanctions are lifted, that Iran will most likely, probably use
a significant portion of that revenue to advance their military
strategy?
Mr. McInerney. I concur with that, sir.
Mr. Schanzer. I do as well.
Mr. Bucci. Absolutely, yes.
Mr. Nader. Yes. I think it will use some of it.
Mr. Hice. Okay. All right.
Dr. Bucci, let me go with you. Any idea how many American
lives have been lost since 2001 in Iraq and Afghanistan?
Mr. Bucci. Total is up about 8,000 I think.
Mr. Hice. Any idea of how many have been killed by
specifically Iranian activity?
Mr. Bucci. The number that gets batted around that the
General mentioned, up around 1,500, is generally associated
with the use of the Iranian-provided shaped penetrators, the
sort of enhanced IED's that were provided to specifically the
Shia militias. I think you need to go a little beyond that
because it is not just the IED's that kill people. There were
bullets that killed people. There were advanced sniper rifles
that were given to those same Shia militias by Iran that also
killed American service members. So I would guess it is more
than the 1,500 that people generally quote.
Mr. Hice. All right, sir. If you had to give one weapon,
what is the key weapon that has been used against Americans?
Mr. Bucci. The enhanced penetrator.
Mr. Hice. Is that produced in Iran?
Mr. Bucci. Absolutely.
Mr. Hice. In an interview with a British paper, ``The
Telegraph,'' there were a couple of British military officers
who allegedly said that Iran had paid Taliban fighters $1,000
each for each American soldier that they killed in Afghanistan.
Is this accurate?
Mr. Bucci. I have not seen proof of that, Congressman, but
I have seen pretty good proof that the Iranians were paying the
Taliban's salaries, in some cases over $500 a month, which is a
pretty hefty salary in Afghanistan. So whether they were doing
it as a direct bounty or just the general funding of their
operations, it is still pretty significant.
Mr. Hice. So they are funding the Taliban soldiers against
us.
In your experience, what is the greatest threat Iran poses
to American ground forces?
Mr. Bucci. The exportation of terrorism around the Middle
East. None of our people are essentially safe anywhere in the
Middle East that the Quds Force can reach them, and that is
pretty much the entire region.
Mr. Hice. Would you agree that regardless of an agreement
being reached, that Iran is still going to be a significant
threat to both American interests and our allies?
Mr. Bucci. Not only is it my opinion that they will be so,
Congressman, the Iranians have said they will be. They have
said they will not back off on any of those type of operations
or policies regardless of this agreement.
Mr. Hice. Specifically, what kind of threat does Hezbollah
pose to Israel?
Mr. Bucci. They are the best supplied, the best equipped,
the best organized. While they are tied up in Syria right now,
that is frankly gaining them additional equipment and
experience that they could then turn around and apply against
Israel. So they are, by far, the biggest threat.
Mr. Hice. And I would assume that same threat would carry
over to America as well.
Mr. Bucci. Oh, definitely.
Mr. Hice. So what level of support has Iran contributed to
the funding, training, support, so forth of Hezbollah?
Mr. Bucci. Pretty much 100 percent of Hezbollah's support
comes directly from Iran.
Mr. Hice. So is it fair to say that at least in your
opinion if the sanctions are lifted, Hezbollah is going to see
a significant boost in its financial backing?
Mr. Bucci. They will benefit. Hezbollah, Hamas, and other
terrorist groups around the Middle East--they will all gain
from this largesse of the Quds Force.
Mr. Hice. Dr. Schanzer, you had mentioned a while ago--and
I would like to get a little more information about EIKO. Can
you give a little bit more information as to what that is?
Mr. Schanzer. Absolutely. That is a $95 billion fund owned
by the Supreme Leader, Ali Khamenei. It includes a big chunk of
the Iranian stock market, I think 5 or 10 percent, on top of
that, significant real estate holdings, international holdings
as well. We had sanctions on it. It is set to be de-listed now
as a result of this deal.
Mr. Hice. Again, I want to thank you for being here, each
of you.
My time has expired. I appreciate it very much. Thank you,
Mr. Chairman.
Mr. DeSantis. I thank the gentleman.
The chair now recognizes the gentlewoman from Michigan for
5 minutes.
Mrs. Lawrence. Thank you, Mr. Chair.
Mr. Nader, is it true that while this agreement was
announced in July, it was technically adopted on October 18th,
2015?
[Nonverbal response.]
Mrs. Lawrence. So a couple questions.
Iran is now expected to begin nuclear disarmament. Is that
right?
[Nonverbal response.]
Mrs. Lawrence. So technically adopted October 18, 2015. So
now the disarmament is expected to begin.
And as I understand it, the next milestone would be
implementation day. Is that correct?
[Nonverbal response.]
Mrs. Lawrence. Can you explain what implementation day is?
Mr. Nader. Sure. Once the nuclear agreement was adopted,
which you mentioned, Iran is expected to implement the
agreement over the next few months. That entails Iran
undertaking actions that block all the paths toward nuclear
weaponization. That means severely restricting its uranium
enrichment program, reducing its centrifuges that spin uranium
by two-thirds, by reducing its stockpile of enriched uranium by
97 percent, by reconfiguring the Arak facility that could
produce plutonium for nuclear weapons. So that would block
Iran's plutonium weapons production. And also Iran would accept
very intrusive inspections into its nuclear facilities.
From the bottom up, the IAEA and the United States will
have a very good idea of what Iran is up to. So when Iran is
building these centrifuges in its factories, we will know where
it is building them and what they are doing with the
centrifuges. So if they want to pursue a covert program and
take these centrifuges, we will know what is going on. And
these actions are expected to give us about a year warning if
Iran decides to produce breakout, meaning that if Iran races
toward a nuclear weapon, if it decides to violate the
agreement, then we will know and we will have the ability to
respond whether economically, diplomatically, and militarily.
So in terms of implementation, once Iran implements the
agreement, the nuclear program is going to be under very close
monitoring and inspection. And that is what really the
international community has asked Iran to do for the past 10
years.
Mrs. Lawrence. Thank you.
I have heard estimates for the implementation day could be
as soon as the end of the year or as far off as next spring. Is
that correct?
Mr. Nader. Yes. It could take a few months.
Mrs. Lawrence. Now, the sanctions are not to be lifted
until everything Iran has done has been physically verified as
complete by the IAEA. Correct?
Mr. Nader. Yes.
Mrs. Lawrence. Now, I understand that the implementation
day--only nuclear-related sanctions will be removed. You
mentioned it, but could you just restate what are some of the
other--because I understand the remaining conventional arms and
ballistics sanctions are to be removed in phases. So could you
please give us some information on that?
Mr. Nader. Yes. According to JCPOA, Iran will still face a
5-year embargo on the import of conventional weapons. So no
country can sell conventional weapons to Iran for 5 years. If
they do, they will be punished and sanctioned.
For 8 years, no other country can help Iran develop its
missile program. If any countries or companies help Iran with
its missile program, they will be punished and sanctioned.
And once the nuclear sanctions against Iran are eased, you
still have a number of U.S. sanctions that date from 1979 to
the Iran revolution. Whether you are looking at the freezing of
Iranian assets, Iran Sanctions Act that dates from the 1990's,
sanctions against the Revolutionary Guard and the Quds Force,
those will remain. The American sanctions will remain against
terrorism and human rights abuses.
Although the European Union is expected to lift its nuclear
sanctions against Iran, its human rights abuses sanctions will
also still remain. And a lot of the European countries do care
about human rights and look at human rights in terms of
investing in Iran.
Mrs. Lawrence. So in the last few minutes I have, I agree
with the statements that have been provided by our
distinguished panel. There are some bad guys in Iran. They are
not a friend of the United States.
This nuclear agreement is directed toward a verified system
of stopping Iran from getting the nuclear weapons. And we have
just begun this process so that we can examine and verify
before any sanctions will be lifted. Is that correct?
Mr. Nader. Yes, exactly.
Mrs. Lawrence. Thank you. I yield my time.
Mr. DeSantis. The gentlelady's time has expired.
The chair now recognizes the vice chair of the committee,
Mr. Russell from Oklahoma, for 5 minutes.
Mr. Russell. Thank you, Mr. Chairman.
And thank you, panel, for being here.
Mr. Nader, you said both in your testimony and in answers
to questions that no one that is on the terror and human rights
lists will have sanctions lifted. Yet, I like General McInerney
have read the entire agreement, have researched every single
name on the sanctions list. I have personally discovered over
50 individuals and entities that have violated terror and human
rights. Yet, they are listed for sanctions relief. For example,
General Soleimani, General Salami, General Hajizadeh, the Quds
Force, the Islamic Revolutionary Guard Corps, the Islamic
Republic of Iran's shipping lines, a known shipper of weapons
all over the region for terror.
So my question is, since the agreement clearly says that
these sanctions will be lifted, how can you state that?
Mr. Nader. Those are the nuclear secondary sanctions. So
the secondary sanctions under the nuclear sanctions that the
United States has passed compel other countries and companies
to stop trading with Iran. And in order to achieve the nuclear
agreement, those secondary sanctions will be eased.
But when you look at U.S. primary sanctions--for example,
Iran is designated as a supporter of terrorism by the United
States. It was designated in 1984. That puts a lot of sanctions
against Iran and deters foreign companies and countries from
trading with Iran. And there are a number of other sanctions
that precede the nuclear sanctions going back to 1979. There
are many overlapping U.S. and international sanctions against
Iran.
Mr. Russell. Well, and that is the concern. And I would
invite all of the panel and even, Mr. Chairman, our committee
to look at paragraph 37 of annex 2 in the agreement because
Iran has a much different view about these sanctions liftings,
and they believe that these individuals will be wide open for
business.
And in that regard, Dr. Schanzer, the Islamic Republic and
Guard Corps, the Quds Force, and others--it has a vast array of
business that it conducts. Can you very succinctly describe
what it is, that its legitimate business reach is? We think it
is nefarious, but yet, on the other hand, we see that it is
conducting itself normal and it will be able to conduct
enterprise in your hometown.
Mr. Schanzer. That is right. This was the point that I was
trying to make earlier that the IRGC has deep penetration
across just about every sector within Iran. This is
construction. It is petrochemical. It is gas. Basically every
major sector within Iran has IRGC companies that are set to
benefit from this. This is one of the reasons why we have
placed such a huge focus on targeting the IRGC itself, lowering
the threshold for designating the IRGC businesses to make it
harder for our money to flow there.
But there is one other thing that I think is worth noting.
We keep hearing that we have not lifted any sanctions yet. That
is untrue.
Mr. Russell. I agree.
Mr. Schanzer. After the signing of the JPOA, the interim
agreement, back in November of 2013, we began to provide Iran
with $700 million per month. We lifted sanctions on gold,
petrochemicals, auto, a range of other sectors, and that has
allowed Iran to benefit from this deal even before we signed
it. And so it is just simply not true to say that we have not
provided them with sanctions relief to this point.
Mr. Russell. I appreciate that.
And, General McInerney, you will not remember me, but we
served together when you were the Joint Task Force Alaska
Commander and I was the aide to General Sam Ebbessen when
General Tom Fields was there. And it is good to see you again
after all these years.
Mr. McInerney. You were dressed differently, sir.
Mr. Russell. I was indeed, sir. Thank you for being here.
Sir, can you speak to Iran's missile and cruise missile
threats and the development of the underground silos and what
the implication of that is?
Mr. McInerney. Briefly, sir. They are missiles. The primary
value is in the nuclear realm. So they are leading the problem
in developing conventional. And we just noticed on the 10th of
October, less than a month ago, that they launched an IRBM. And
they are going to continue to progress. They are getting help
from China, North Korea, and Russia.
Now, their eventual goal is to put nuclear weapons on
these. And we have seen the ability, when you then have that
capability and then when you go to underground silos, as well
as the Chinese have where they have roads underneath--you then
have the ability for a nation like Iran to hold hostage Europe,
the United States, other parts of the world. And that comes
back to then when them are negotiating. When you are
negotiating and you are looking at a person you are negotiating
with and he does not have to say it, but you know he has
nuclear weapons that he can put on your cities, that changes
the tone of the negotiations. And that is the direction that
they are going to. Will it happen next week? No, but that is
their long-term objective. And if they are still in power in 36
years from now, we are in trouble.
Mr. Russell. I thank you for that, General.
And, Mr. Chairman, my time has expired, but if we have a
chance for a second round at the end, I would have some more
questions. Thank you.
Mr. DeSantis. We have still got over 10 minutes on the
vote, 410 not voting. So I think we will be able to get through
a couple more.
So the chair now recognizes Ms. Kelly for 5 minutes.
Ms. Kelly. I will keep it short. Thank you, Mr. Chair.
Iran's neighbors such as Israel and Saudi Arabia are
concerned that the deal is not sufficiently strong and does not
prevent Iran from obtaining a nuclear weapon. This was a
serious concern that warranted consideration prior to
enactment. However, now with the deal in place, it is
imperative that we move forward and work to ensure that
compliance is strictly enforced and any and all sanctions be
implemented following noncompliance to ensure those fears
remain unwarranted.
Mr. Nader, what provisions of the deal hold Iran's feet to
the fire to ensure its compliance?
Mr. Nader. There are many provisions, from Iran having to
verify--or the IAEA having to verify that Iran has complied
with their program to the future restrictions in place against
Iran for the next 15 years, which is the duration of the
program. And then even after 15 years, there are components of
the program that last for 20 to 25 years giving the United
States insight into Iran's program and enable to reassure our
allies the United States has provided them with the technology
and weaponry to deter Iran's military capabilities. For
example, the United States has helped Israel develop a very
sophisticated antiballistic missile defense system. The same
goes for Saudi Arabia and the GCC states. And while those
allies have been concerned about Iran's nuclear activities and
have been concerned about the negotiations, as they should be
because Iran poses a threat to them, they have come to see that
the nuclear agreement can be beneficial to their interests.
Saudi Arabia and the GCC have approved of the program and are
working very closely with the United States to strengthen their
conventional military capabilities against Iran.
Ms. Kelly. A shortcoming of the deal many point to is that
provisions expire at all. However, to my knowledge, no arms
treaty or agreement has ever been without expiration. But in
fact, even the much hailed Nuclear Nonproliferation Treaty had
an expiration date until it was renewed. Is that not correct?
Mr. Nader. Yes. All nonproliferation treaties do have an
expiration date.
I think what is unique about JCPOA is it does last 15
years, but even after 15 years, the IAEA has a very close
inspections regime against Iran's nuclear program. Some of the
measures last 20 and 25 years. From the time Iran mines uranium
from the ground to the time it builds its centrifuges and takes
them for enrichment, we will know what it is doing even after
the agreement has expired.
Ms. Kelly. Because these provisions do not extend into
perpetuity, compliance with the agreement is even more
dependent on Iran's domestic politics and leadership. Moving
forward, what must Congress do to ensure future Iranian regimes
continue to abide by the agreement and we do not have to keep
going back to the negotiating table and face a threat of a
nuclear Iran?
Mr. Nader. I do not think the Iranian political system is
going to change any time soon. Ayatollah Khamenei still rules
Iran as long as he lives. The Revolutionary Guards are a
powerful force.
But there are millions of Iranians who want change in their
country. We saw in 2009 millions of Iranians come into the
street in support of democracy. And moving forward, I think
there is a lot the United States can do to foster democracy in
Iran whether it is increasing exchanges between Iranians and
Americans. And I think that is very important actually because
the Iranians get to come here, see what the United States is
like, and not be subject to their government's propaganda. So
strengthening civil society, public diplomacy, U.S. broadcasts
to Iran can all be very helpful.
Ms. Kelly. Thank you.
I yield back the balance of my time.
Mr. DeSantis. The gentlelady yields back.
The chair asks unanimous consent to welcome Mr. Welch of
Vermont, who is not on the subcommittee, but to allow him to
participate in today's hearing. Without objection, so ordered.
Mr. Welch, you are now recognized for 5 minutes.
Mr. Welch. Thank you very much.
I really appreciated the testimony and the points that you
made.
We had this fierce debate, obviously, about the nuclear
deal. The majority of Congress was against it. The minority was
for it. It has been implemented. I did support it but share a
lot of the concerns that have been expressed.
And in listening to the testimony and reading beforehand,
there is an aspect of what you have said--and I will start with
you, General McInerney--that, on the one hand, cautions us
about the future, and we have got to take that seriously. But
on the other hand, there is an aspect of it that I hear as a
continuation of the fierce debate that we had about the deal
itself. The deal is done. So that is not going to be undone
realistically.
So when you are talking about the sanctions relief, how is
it that we would not comply on our part with the sanctions
provisions that were part of the nuclear deal even as we are
extremely wary and watchful about what Iran is doing to cause
difficulties in an already difficult Middle East situation? In
other words, what is the tool that we have? We have to comply
with the agreement. Right?
Mr. McInerney. This administration does, yes, sir.
Mr. Welch. Would you just elaborate on that?
Mr. McInerney. Well, this administration that signed it as
an executive agreement is going to comply with relieving those
sanctions when they meet their appropriate endpoints.
We think that we should put as a Congress additional
sanctions on certain elements like the Quds Force, IRGC, et
cetera.
Mr. Welch. Let me just understand this because I think it
is important. A lot of people I think probably agree with you.
But if the administration signed this agreement, what I am
hearing you say is that the next administration is going to
have its own option to review it and perhaps change it. Is that
your suggestion?
Mr. McInerney. Yes. As a matter of fact, some of the
candidates have already announced that they will cancel it. And
that is a clear option.
My personal course of action on this altogether would have
been never to have the JCPOA but we should have continued the
sanctions, which were very effective, and we have to, in the
long run, look for regime change. Remember the difference that
this government is. It is a radical Islamic government. If you
look at Saddam Hussein, he was a Baathist. If you look at
Bashar al-Assad, he is a Baathist.
Mr. Welch. Yes. I do not have that much time. So your view
is that the stability that we need will come only through
ultimately a regime change in Iran.
Mr. McInerney. Correct.
Mr. Welch. And, Dr. Schanzer, do you agree with that?
Mr. Schanzer. I am not going to speculate as to whether the
next President would cancel the deal, but what I can tell you
is that there are measures that can be taken in the interim --
--
Mr. Welch. I am wondering whether you agree with General
McInerney that regime change is ultimately the option that is
the only option that will really assure us that there will be
stability with respect to Iran.
Mr. Schanzer. Look, as long as this regime is in place, you
will continue to see the sponsorship of terrorism in other
proxies around the region. There is no question about it. We
should be working toward regime change. 2009 was a huge missed
opportunity.
Mr. Welch. Dr. Bucci?
Mr. Bucci. I would agree with that also, Congressman. This
regime has stated publicly--they are actually quite honest
about it--that they are not going to give up any of those
things. They do not see that they have to with this deal, so
they will not. And in fact, the deal will enable those efforts
to be stronger and more widespread than they were before. So I
think regime change is the only way it achieves stability in
that country and in the region.
Mr. Welch. There were a number of people who agreed with
you on that. A number of people disagreed, myself among them,
partly on practical grounds. Regime change did not work out so
great in Iraq.
But the original sanctions that we had did not stop the
nuclear program. They froze the Iranian assets overseas, but
the Iranians proceeded even further along the nuclear program,
which means that there is a judgment all of us have to make as
to the effect of our actions. And what we hope it will
accomplish will not necessarily be the case.
General McInerney?
Mr. McInerney. We with those sanctions, sir, needed to
continue our covert operations, which I will just say that if
we were in a closed session, we could talk about it.
Mr. Welch. My time is up. Mr. DeSantis, thank you very much
for letting me participate.
Mr. DeSantis. Absolutely.
I am going to recognize the vice chair. He has got one more
question. We are all pretty much out of time on the votes, and
so we will do this question and then I think we will wrap up
the hearing.
Mr. Russell. Thank you for your indulgence, Mr. Chairman.
Dr. Bucci, my last remaining question was for you. Could
you speak to the recent activity of the Quds Force and its
terrorist activity? And by recent, I mean within the last 2 to
5 years.
Mr. Bucci. Yes. They tried to kill the Saudi Ambassador
here in Washington. I think that is within that time period.
They hired one of the Shia militia groups in Iraq to rocket the
*MEK camp that is there, people that were under our protection
and the protection of the Iraqi Government. They are behind the
cyber attacks that the chairman mentioned at the beginning of
the hearing and the ones who did the attack on Saudi Aramco
where they destroyed 30,000 computers in one day using a very
heavy-handed piece of malware. They have done operations in
Latin America, Africa, and they are behind the Houthis in
Yemen. So they are pretty busy fellows and very, very
effective.
Mr. Russell. Thank you.
And thank you, Mr. Chairman.
Mr. DeSantis. Well, I would like to thank all of our
witnesses for taking the time to appear before us today.
If there is no further business, without objection, this
subcommittee stands adjourned.
[Whereupon, at 10:18 a.m., the subcommittee was adjourned.]
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