[Senate Hearing 114-802]
[From the U.S. Government Publishing Office]


                                                        S. Hrg. 114-802

                      EXAMINING THE JCPOA (JOINT 
                     COMPREHENSIVE PLAN OF ACTION)

=======================================================================

                                HEARINGS

                               BEFORE THE

                     COMMITTEE ON FOREIGN RELATIONS
                          UNITED STATES SENATE

                    ONE HUNDRED FOURTEENTH CONGRESS

                               CUMULATIVE

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             JANUARY 21, JUNE 3, 24, 25, JULY 23, 29, 30, 
                   AUGUST 4, 5, AND DECEMBER 17, 2015
           JANUARY 20, APRIL 5, JULY 14, AND DECEMBER 6, 2016

                               ----------                              

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                COMMITTEE ON FOREIGN RELATIONS         
                 114th Congress--First Session        
                January 6, 2015 to April 1, 2015        

                BOB CORKER, TENNESSEE, Chairman        
JAMES E. RISCH, Idaho                ROBERT MENENDEZ, New Jersey
MARCO RUBIO, Florida                 BARBARA BOXER, California
RON JOHNSON, Wisconsin               BENJAMIN L. CARDIN, Maryland
JEFF FLAKE, Arizona                  JEANNE SHAHEEN, New Hampshire
CORY GARDNER, Colorado               CHRISTOPHER A. COONS, Delaware
DAVID PERDUE, Georgia                TOM UDALL, New Mexico
JOHNNY ISAKSON, Georgia              CHRISTOPHER MURPHY, Connecticut
RAND PAUL, Kentucky                  TIM KAINE, Virginia
JOHN BARRASSO, Wyoming               EDWARD J. MARKEY, Massachusetts


              Lester E. Munson III, Staff Director        
           Jodi B. Herman, Democratic Staff Director        
              Jamil Jaffer, Majority Chief Counsel        
            Margaret Taylor, Minority Chief Counsel        
                    John Dutton, Chief Clerk        



                          ------------        

               April 2, 2015 to December 18, 2015        

                BOB CORKER, TENNESSEE, Chairman        
JAMES E. RISCH, Idaho                BENJAMIN L. CARDIN, Maryland
MARCO RUBIO, Florida                 BARBARA BOXER, California
RON JOHNSON, Wisconsin               ROBERT MENENDEZ, New Jersey
JEFF FLAKE, Arizona                  JEANNE SHAHEEN, New Hampshire
CORY GARDNER, Colorado               CHRISTOPHER A. COONS, Delaware
DAVID PERDUE, Georgia                TOM UDALL, New Mexico
JOHNNY ISAKSON, Georgia              CHRISTOPHER MURPHY, Connecticut
RAND PAUL, Kentucky                  TIM KAINE, Virginia
JOHN BARRASSO, Wyoming               EDWARD J. MARKEY, Massachusetts


                  Todd Womack, Staff Director        
           Jodi B. Herman, Democratic Staff Director        
               Chris Ford, Majority Chief Counsel        
            Margaret Taylor, Minority Chief Counsel        
                    John Dutton, Chief Clerk        


                              (ii)        

                           C O N T E N T S

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                                                                   Page

                            January 21, 2015
                      Iran Nuclear Negotiations: 
                Status of Talks and the Role of Congress

This hearing was printed under a separate cover and can be found 
  at the link below.



https://www.govinfo.gov/content/pkg/CHRG-114shrg97532/pdf/CHRG-
  114shrg97532.pdf
                              ----------                              

                              June 3, 2015
              Implications of the Iran Nuclear Agreement 
                   for U.S. Policy in the Middle East

Hon. Bob Corker, U.S. Senator From Tennessee.....................     1
Hon. Benjamin L. Cardin, U.S. Senator From Maryland..............     3
Hon. James Jeffrey, Philip Solondz Distinguished Visiting Fellow, 
  The Washington Institute for Near East Policy, Washington, DC..     5
    Prepared statement...........................................     6
Hon. Martin Indyk, Executive Vice President, Brookings 
  Institution, Washington, DC....................................     8
    Prepared statement...........................................    10
                              ----------                              

                             June 24, 2015
               Lessons Learned From Past WMD Negotiations

Hon. Bob Corker, U.S. Senator From Tennessee.....................    45
Hon. Benjamin L. Cardin, U.S. Senator From Maryland..............    46
William H. Tobey, senior fellow, Belfer Center for Science and 
  International Affairs, John F. Kennedy School of Government, 
  Harvard University, Cambridge, MA..............................    48
    Prepared statement...........................................    49
Dr. Graham Allison, director, Belfer Center for Science and 
  International Affairs, Douglas Dillon Professor of Government, 
  John F. Kennedy School of Government, Harvard University, 
  Cambridge, MA..................................................    52
    Prepared statement...........................................    54


                                 (iii)
                             June 25, 2015
                 Evaluating Key Components of a Joint 
                 Comprehensive Plan of Action With Iran

Hon. Bob Corker, U.S. Senator From Tennessee.....................    87
Hon. Benjamin L. Cardin, U.S. Senator From Maryland..............    88
David Albright, president, Institute for Science and 
  International Security, Washington, DC.........................    89
    Prepared statement...........................................    91
Dr. Ray Takeyh, senior fellow for Middle Eastern studies, Council 
  on Foreign Relations, Washington, DC...........................   104
    Prepared statement...........................................   106
Dr. Jim Walsh, research associate, Securities Studies Program, 
  Massachusetts Institute of Technology, Cambridge, MA...........   109
    Prepared statement...........................................   111


Additional Material Submitted for the Record

Public Statement on U.S. Policy Toward the Iran Nuclear 
  Negotiations...................................................   148
                              ----------                              

                             July 23, 2015
                     Iran Nuclear Agreement Review

Hon. Bob Corker, U.S. Senator From Tennessee.....................   153
Hon. Benjamin L. Cardin, U.S. Senator From Maryland..............   157
Hon. John F. Kerry, Secretary of State, U.S. Department of State, 
  Washington, DC.................................................   161
    Prepared statement...........................................   164
    Responses of Secretary John F. Kerry to questions submitted 
      by Senator Bob Corker......................................   235
    Responses of Secretary John F. Kerry to questions submitted 
      by Senator Marco Rubio.....................................   237
    Responses of Secretary John F. Kerry to questions submitted 
      by Senator Jeff Flake......................................   251
    Responses of Secretary John F. Kerry to questions submitted 
      by Senator David Perdue....................................   255
Hon. Ernest Moniz, Secretary of Energy, U.S. Department of 
  Energy, Washington, DC.........................................   166
    Prepared statement...........................................   169
Hon. Jacob Lew, Secretary of the Treasury, U.S. Department of the 
  Treasury, Washington, DC.......................................   170
    Prepared statement...........................................   173
                              ----------                              

                             July 29, 2015
                 The Joint Comprehensive Plan of Action

Hon. Bob Corker, U.S. Senator From Tennessee.....................   275
Hon. Benjamin L. Cardin, U.S. Senator From Maryland..............   276
Mark Dubowitz, executive director, Foundation for Defense of 
  Democracies, Washington, DC....................................   278
    Prepared statement...........................................   334
    Responses of Mark Dubowitz to questions submitted by Senator 
      Johnny Isakson.............................................   327
Nicholas Burns, Goodman Professor of Diplomacy and International 
  Relations, Harvard Kennedy School, Boston, MA..................   281
    Prepared statement...........................................   330

                             July 30, 2015
                        Sanctions and the JCPOA

Hon. Bob Corker, U.S. Senator From Tennessee.....................   363
Hon. Benjamin L. Cardin, U.S. Senator From Maryland..............   365
Hon. Juan C. Zarate, chairman and senior counselor, Center on 
  Sanctions and Illicit Finance (CSIF) at the Foundation for 
  Defense of Democracies, Washington, DC.........................   367
    Prepared statement...........................................   370
Richard Nephew, program director, Economic Statecraft, Sanctions 
  and Energy Markets Center on Global Energy Policy, New York, NY   383
    Prepared statement...........................................   385
                              ----------                              

                             August 4, 2015
     JCPOA: Non-Proliferation, Inspections, and Nuclear Constraints

Hon. Bob Corker, U.S. Senator From Tennessee.....................   429
Hon. Benjamin L. Cardin, U.S. Senator From Maryland..............   430
David Albright, founder and president, Institute for Science and 
  International Security, Washington, DC.........................   431
    Prepared statement...........................................   433
Ambassador Robert G. Joseph, Ph.D., senior scholar, National 
  Institute for Public Policy, Washington, DC....................   447
    Prepared statement...........................................   449
Dr. Gary Samore, executive director for research, Harvard 
  University, Belfer Center for Science and International 
  Affairs, Cambridge, MA.........................................   452
    Prepared statement...........................................   454
                              ----------                              

                             August 5, 2015
                   Implications of the JCPOA for U.S.
                       Policy in the Middle East

Hon. Bob Corker, U.S. Senator From Tennessee.....................   485
Hon. Benjamin L. Cardin, U.S. Senator From Maryland..............   486
Michael Singh, managing director, Lane-Swing Senior Fellow, the 
  Washington Institute, Washington, DC...........................   488
    Prepared statement...........................................   491
Ken Pollack, senior fellow, Center for Middle East Policy, 
  Brookings Institution, Washington, DC..........................   496
    Prepared statement...........................................   498


Additional Material Submitted for the Record

Statement submitted by Abraham D. Sofaer, George P. Shultz Senior 
  Fellow, The Hoover Institution, Stanford University, Stanford, 
  CA.............................................................   527

                           December 17, 2015
         The Status of JCPOA Implementation and Related Issues

Hon. Bob Corker, U.S. Senator From Tennessee.....................   533
Hon. Benjamin L. Cardin, U.S. Senator From Maryland..............   534
Hon. Stephen D. Mull, lead coordinator for Iran Nuclear 
  Implementation, Department of State, Washington, DC............   536
    Prepared statement...........................................   539
    Response of Ambassador Stephen Mull to a question submitted 
      by Senator Benjamin L. Cardin..............................   583
Hon. Thomas M. Countryman, Assistant Secretary, Bureau of 
  International Security and Nonproliferation, U.S. Department of 
  State, Washington, DC..........................................   541
    Prepared statement...........................................   542
    Responses of Thomas Countryman to questions submitted by 
      Senator David Perdue.......................................   583
    Responses of Thomas Countryman to questions submitted by 
      Senator Tim Kaine..........................................   588
Lieutenant General Frank G. Klotz, USAF, [Ret.], Under Secretary 
  for Nuclear Security and NNSA Administrator, U.S. Department of 
  Energy, Washington, DC.........................................   543
    Prepared statement...........................................   544


Additional Material Submitted for the Record

Remarks at a briefing by the Chair of the U.N. Security Council's 
  Iran Sanctions Committee.......................................   589
Letter Received by Senator Coons from President Obama............   590
Introduction to International Safeguards, Office of 
  Nonproliferation and Arms Control (NPAC).......................   593
                              ----------                              

                      Wednesday, January 20, 2016
                    The Middle East After the JCPOA

Hon. Bob Corker, U.S. Senator from Tennessee.....................   609
Hon. Benjamin L. Cardin, U.S. Senator from Maryland..............   610
Michael Singh, managing director, Lane-Swing Senior Fellow, The 
  Washington Institute for Near East Policy, Washington, DC......   612
    Prepared statement...........................................   615
Brian Katulis, senior fellow, Center for American Progress, 
  Washington, DC.................................................   620
    Prepared statement...........................................   623
    .............................................................
                              ----------                              

                         Tuesday, April 5, 2016
                    Recent Iranian Actions and the 
                   Implementation of the Nuclear Deal

Hon. Bob Corker, U.S. Senator from Tennessee.....................   659
Hon. Benjamin L. Cardin, U.S. Senator from Maryland..............   660
Hon. Thomas A. Shannon, Jr., Under Secretary for Political 
  Affairs, U.S., Department of State, Washington, DC.............   662
    Prepared statement...........................................   663
    Responses of Hon. Thomas A. Shannon, Jr. to questions 
      submitted by Senator Barbara Boxer.........................   698
    Responses of Hon. Thomas A. Shannon, Jr. to questions 
      submitted by Senator Johnny Isakson........................   700

                         Tuesday, July 14, 2016
               The Iran Nuclear Agreement: One Year Later

Hon. Bob Corker, U.S. Senator from Tennessee.....................   705
Hon. Benjamin L. Cardin, U.S. Senator from Maryland..............   706
Mark Dubowitz, Executive Director, Foundation for Defense of 
  Democracies, Washington, DC....................................   709
    Prepared statement...........................................   739
Richard Nephew, program director, Economic Statecraft, Sanctions 
  and Energy Markets; Center on Global Energy Policy, School of 
  International and Public Affairs, Columbia University, New 
  York, NY.......................................................   711
    Prepared statement...........................................   713
    Additional material for the record submitted by Richard 
      Nephew--Six Months Later: Assessing the Implementation of 
      the Iran Nuclear Deal......................................   783
    Additional material for the record submitted by Senator 
      Robert Menendez--The Iran Nuclear Agreement: The 
      International Atomic Energy Agency's Authorities, 
      Resources, and Challenges..................................   803
                              ----------                              

                       Tuesday, December 6, 2016
                 Defeating the Iranian Threat Network: 
                 Options for Countering Iranian Proxies

Hon. Bob Corker, U.S. Senator from Tennessee.....................   853
Hon. Benjamin L. Cardin, U.S. Senator from Maryland..............   854
J. Matthew McInnis, resident fellow, American Enterprise 
  Institute, Washington, DC......................................   856
    Prepared statement...........................................   858
Melissa G. Dalton, senior fellow and chief of staff, 
  International Security Program, Center for Strategic and 
  International Studies, Washington, DC..........................   863
    Prepared statement...........................................   865
                              ----------                              

                                APPENDIX

a. Text of the Nuclear Agreement with Iran and Annexes to that 
  agreement......................................................   887
b. JCPOA Contingent Waviers......................................   887

 
                    IMPLICATIONS OF THE IRAN NUCLEAR
                       AGREEMENT FOR U.S. POLICY
                           IN THE MIDDLE EAST

                              ----------                              


                        WEDNESDAY, JUNE 3, 2015

                                       U.S. Senate,
                            Committee on Foreign Relations,
                                                    Washington, DC.
    The committee met, pursuant to notice, at 9:28 a.m., in 
room SD-419, Dirksen Senate Office Building, Hon. Bob Corker 
(chairman of the committee) presiding.
    Present: Senators Corker, Risch, Johnson, Flake, Gardner, 
Perdue, Isakson, Cardin, Menendez, Shaheen, Udall, Murphy, 
Kaine, and Markey.

             OPENING STATEMENT OF HON. BOB CORKER, 
                  U.S. SENATOR FROM TENNESSEE

    The Chairman. This meeting of the Foreign Relations 
Committee will come to order.
    I want to thank Ambassadors Jeffrey and Indyk for being 
here. I know Ambassador Indyk has a hard stop at 11 o'clock, 
and we will try to honor that.
    This hearing is part of a series of events we are holding 
this month to prepare members of the committee to evaluate a 
possible nuclear agreement with Iran. We are not here today to 
focus on the specific parameters. Just for edification, last 
night we met in a classified setting with three of our leaders 
of our labs from around the country, and the Secretary of 
Energy, and it was a very technically focused briefing. Matter 
of fact, we had tremendous attendance, and people were most 
interested in many of the technical details of the deal. The 
rest of the month, we will have similar hearings so people are 
prepared, as of June 30, if an agreement is reached, to really 
be able to assess that agreement and not be starting from a 
cold start, if you will. But, we appreciate you being here 
today to help us understand some of the regional implications 
of a deal.
    This is intended to highlight some of the concerns that the 
administration is so concerned about in reaching an agreement 
with Iran. Some of the regional alliances that we have are not 
being really looked at--some of our U.S. interests. So, against 
the backdrop of unprecedented turmoil in the Middle East, the 
administration is negotiating a nuclear agreement with the arch 
rival of many of our closest allies. Instead of reassuring our 
traditional allies that the United States will remain a friend, 
some would say that the administration has implemented a string 
of incoherent and self-defeating policies. And I know you all 
will discuss those back and forth.
    The administration has threatened to revoke support for 
Israel at the U.N. while accommodating a nation that is 
dedicated to the destruction of Israel. They have rebuked the 
Emirates for striking ISIS in Libya while asking them to strike 
ISIS in Syria. They have withheld military equipment from 
Egypt, Bahrain, and Qatar while asking them to join in the 
fight against ISIS. They have criticized Saudi Arabia for 
acting in Yemen while providing the Saudis military assistance 
for the same operation. So, there are a lot of crosscurrents 
here that are difficult for some of us to string together.
    In Iraq, Iraqi leaders are increasingly turning to Iranian-
backed militias in the fight against ISIS. And perhaps most 
tragically in Syria, thousands of Syrians continue to die at 
the hands of Assad and his Iranian backers while the 
administration implements a strategy consisting of the 
ineffective use of military force to be used only against ISIS 
itself. And I think you may have seen a communique that came 
from one of the leaders of the Syrian opposition, where they 
were asked to sign a statement saying they would only--they are 
being trained and equipped by the United States--but they would 
only use that potential against ISIS, and not against Assad. I 
know they sent out a communication saying that they were going 
to stop the training and not participate. I understand 
sometimes that is a negotiating point, but certainly somewhat 
alarming.
    As Iran deepens its influence in capitals from Baghdad to 
Damascus, to Beirut to Sanaa, the perspective of many in the 
region is that the United States is Assad's air force in Syria 
and Iran's Air Force in Iraq. I will say I was in Iraq 
recently, and it really did feel like--while I support what we 
are doing with the 3,100 personnel we have there--it really 
felt like what we were doing is helping create a better country 
for Iran in Iraq. Even though, again, I support what is 
happening there, it feels very much that way, with their 
infiltration into the parliament and their tremendous efforts 
on the ground.
    As we begin to look at how to evaluate a prospective 
nuclear agreement, we cannot ignore the lack of coherent 
American leadership in the region, which has left a vacuum that 
will continue to be filled by violence. Without defined, 
committed engagement to counter Iranian regional aggression and 
to support our partners, the need for American involvement will 
continue to grow as conditions deteriorate.
    In your testimony today, I hope you will touch on what I 
see as some of the puzzling claims from the administration 
about what an agreement with Iran would mean for the region.
    One of those claims is the apparent view of the 
administration that Iran will become a stabilizing force in the 
region. President Obama said in a recent NPR interview that 
opening up Iran's economy through sanctions relief in many ways 
makes it harder for them to engage in behaviors that are 
contrary to international norms. I know that, again, many of 
our allies are concerned that, in accessing $150 billion, 
potentially, over time, and having a growing economy, will have 
just the opposite effect and will cause them to be even more 
strident in the region.
    Do you accept the view that the world's leading State 
Sponsor of Terrorism--a nation that has directly contributed to 
the deaths of thousands of Americans--would somehow reform 
their behavior after being enriched and empowered for pursuing 
an illegal nuclear program?
    And finally, I hope you will touch on what the 
administration portrays as a choice between war and a deal. I 
think that is a false choice.
    And again, I look forward to your testimony today.
    I want to turn it over now to our distinguished ranking 
member, and appreciate his cooperation in every effort. And I 
look forward to your comments.

         OPENING STATEMENT OF HON. BENJAMIN L. CARDIN, 
                   U.S. SENATOR FROM MARYLAND

    Senator Cardin. Well, Mr. Chairman, first of all, thank you 
very much for convening this hearing. This is an important 
month, and I think we have already started, with the briefing 
last night and today's hearing, in the right way to keep not 
only our committee, but the U.S. Congress, very much informed 
and involved in what is happening in the Middle East.
    As I explained to you last night, after I left the 
committee briefing, I went to the French Embassy. Mr. Indyk was 
there, along with about 50 other people who are very much 
engaged in Middle East policies. The theme of the evening was a 
discussion about the Middle East. And there were many people 
who expressed grave concerns about what is happening in the 
Middle East. For good reason. Just about every country in the 
Middle East is at war. And there is a lack of stability in that 
region that affects U.S. interests. There is no question about 
it. But, what I found last night was, they were very short on 
recommendations on how we should proceed.
    And let me just point out, the United States is deeply 
involved in the Middle East. There is no question about that. 
We are deeply involved with our military, we are deeply 
involved with our diplomacy, and we are deeply involved in 
building coalitions to advance goals in the Middle East which I 
think are universal, and that is respect for human rights in 
all ethnic communities and territorial integrity. These are 
important goals that we are trying to achieve in the Middle 
East. They are not easy to achieve, but they cannot be attained 
without the U.S. involvement. And the United States is clearly 
involved.
    Throughout that discussion last night, Iran was probably 
mentioned the most. And we know there are many, many problems 
in regards to Iranian behavior. We know that Iran is one of the 
major violators of the basic rights of its own citizens. We 
know that it is a sponsor of terrorism. We know that they have 
influence in so many countries, in a negative way, in Yemen. 
And the Saudis, of course, have expressed their grave concerns 
about the Iranian influence in Yemen, and what they are doing 
in Syria and Iraq, in compromising our ability to go after 
ISIL. There are so many areas that we are concerned about Iran. 
But, what we have concentrated on, at this particular time, is 
whether we can achieve a diplomatic solution to prevent Iran 
from becoming a nuclear weapon state.
    And, Mr. Chairman, I just really want to underscore your 
leadership and how incredibly important that was in order to 
get the Iranian Nuclear Review Act of 2015 signed by the 
President and enacted into law. It is now the law. And this 
committee played a critical role in achieving that 
accomplishment. Pssing the Iranian Nuclear Review Act did 
several things, but I still want to underscore this one. It 
showed unity, unity here in our government, that we are focused 
on Iran, not on the fights in Congress. And it set up the right 
way to review a potential agreement reached between the P5+1. 
And that is exactly what we should have done. And I really do 
applaud your leadership and the work of every member of the 
Senate Foreign Relations Committee.
    Which brings us to, What do we do this month? And, as the 
chairman pointed out, last night we had, I think, a very 
helpful discussion, in a closed setting, in regards to the 
technical aspects of what an agreement needs to include. And 
today, we have two experts who can help us understand the 
consequences of an agreement with Iran as to United States 
involvement in the Middle East, which is not in isolation. 
There are many other areas that are involved. And what will an 
agreement mean for the United States in the Middle East?
    I understand we are not going to talk about the specifics 
of an agreement today, but I think we all agree that the 
diplomatic course would be the best, with Iran complying with 
an agreement that would provide ample time before any potential 
breakout that we could discover if they are violating the terms 
of the agreement, and take appropriate action. Because any 
agreement is not based upon trust, it is based upon terms of an 
agreement that make sure that we can keep Iran from becoming a 
nuclear weapon state.
    One last point, if I might. If we are successful in 
reaching a diplomatic agreement, we have removed one threat. 
That is a nuclear Iran. That is an important goal for us to 
achieve. But, then what does Iran do next? Do they take a 
course of joining the community of nations in peaceful 
activities and nonproliferation? We certainly hope that would 
be the case, but we do not have any illusions that that will 
automatically occur. Or do they act, with the increased 
economic empowerment, to have more negative impact in Yemen, in 
Syria, in Iraq, and spreading terrorism? We need to be prepared 
in how the United States can best act to make sure that the 
Iranian activities are channeled towards positive, rather than 
negative, activities.
    And then, lastly, if we are not able to reach an agreement, 
we also need to be prepared as to how we act to make sure Iran 
does not become a nuclear weapon state.
    I look forward to hearing from our witnesses.
    The Chairman. Thank you very much.
    We will now turn to our witnesses.
    Our first witness is the Honorable James Jeffrey, currently 
with The Washington Institute. Ambassador Jeffrey previously 
served as the Deputy National Security Advisor to President 
Bush, Ambassador to Albania, Turkey, and Iraq.
    We thank you for being here.
    Our second witness is the Honorable Martin Indyk, executive 
vice president of the Brookings Institution. Ambassador Indyk 
has twice served as Ambassador to Israel, and most recently as 
the U.S. Special Envoy for the Israeli-Palestinian 
negotiations.
    Both of you have done this often. You can summarize your 
comments, and, obviously, your written documents will be 
entered into the record. We thank you very much for being here, 
and look forward to your testimony.

 STATEMENT OF HON. JAMES JEFFREY, PHILIP SOLONDZ DISTINGUISHED 
VISITING FELLOW, THE WASHINGTON INSTITUTE FOR NEAR EAST POLICY, 
                         WASHINGTON, DC

    Ambassador Jeffrey. Thank you, Mr. Chairman, Ranking Member 
Cardin, members of the committee. It is an honor to be back 
here.
    The question of Iran, as you have just said, be it in the 
nuclear context or in the regional context, is one of the most 
important issues today in the Middle East; but it is not the 
only one, because we are dealing with a region, again, as you 
said, Senator Cardin, that is in crisis, a set of crises we 
have not seen since the end of the Ottoman Empire, almost 100 
years ago. And these crises impact our vital interests in the 
region: combating terrorism, weapons of mass destruction, 
supporting our allies and partners, and ensuring the free flow 
of hydrocarbons for the world economy.
    The action of the U.S. Congress, in passing the Iran 
Nuclear Agreement Review Act, is a step in the right direction, 
because it will allow the American people to have a say in 
something of great importance to their security as well as the 
security of the people in the region and around the world.
    As we do not know, at this point, what an agreement will 
look like--at best, we only have a sketch of the possibilities, 
based upon the April 2 understandings--we cannot make a final 
determination. Obviously, that will be based on verification 
questions, what happens with the nuclear materials, and the 
status of the infrastructure. But, in any case, in looking at 
Iran's program, it is important, again, as you said, to put 
this in the context of its actions in the region. And I would 
propose the following as areas of consideration:
    First, agreement cannot be considered without looking at 
Iran's record of destabilization throughout the region. Either 
an Iranian nuclear weapons capability or an agreement that 
grants Iran a special status just short of having a nuclear 
weapons capability would pose extraordinary new threats to a 
region already under stress.
    Second, it is the nature of the regime, itself. Two of my 
colleagues at The Washington Institute, Mehdi Khalaji and Soner 
Cagaptay, and I published a piece in the New York Times, April 
26. We wrote, ``Iran is a revolutionary power with hegemonic 
aspirations.'' In other words, it is a country seeking to 
assert its dominance in the region and will not play by the 
rules. Any decision on Iran's nuclear deal must bear this 
sobering thought in mind and must not read Iran's willingness 
to sign an agreement as a change of heart about its ultimate 
goals. I am not passing a decision on the agreement itself. We 
signed agreements with the Soviet Union on nuclear issues when 
we knew they were out to, as Khrushchev said, ``bury us.'' But, 
we did this with our eyes open. We need to do this with Iran, 
as well.
    Third, in particular, given Iran's role in the region, no 
nuclear agreement is better than one that might push back by 
some months Iran's ability to break out a weapons capability if 
such an agreement were to undercut the current coalition.
    Fourth, the administration's assertion that there is no 
alternative to approving an agreement is incorrect and 
tantamount to advocating that any agreement is better than 
none. Were Iran to walk away from the agreement that was laid 
out in general terms in April, the United States probably could 
ensure that the international sanctions currently in place stay 
on. If we decided, in the end, to not go along with an 
agreement such as the one laid out on April 2, I think it would 
be hard, frankly, to keep the international sanctions that the 
EU and that other countries have put on, but we would have 
other means to do this.
    But, in the end, getting to your point, Mr. Chairman, any 
agreement is based upon our willingness to use military force 
to stop Iran from trying to achieve a breakout capability, 
trying to achieve a nuclear weapons capability. We cannot get 
around that fact. The administration officially has that as its 
position, that it will act if Iran does that. But, these words 
are undercut constantly by arguments that military force will 
have no effect, or it will have little effect, or it will lead 
to war. Having spent a fair amount of time in war, I do not say 
this lightly, but it is unlikely that we would see anything 
like Vietnam or Iraq. We have tremendous military capabilities 
if we need to. I hope we do not.
    Finally, there is the issue, as you said, of reassuring our 
friends and allies. Camp David was a step in the right 
direction, but it focused only on conventional threats to these 
Arab states. That is not what they are worried about. They are 
worried about infiltration of the Arab areas--as you said, 
Iraq, Lebanon, Syria, Yemen--by Iran in many different ways. 
Iran's equivalent of ``the little green men.''
    So, in short, in looking at this agreement, what is 
important is not only what is in the agreement, but our 
willingness to use force to back up our commitment that they do 
not ever get a nuclear weapon and our willingness to push back 
against Iranian efforts throughout the region. Those are the 
three issues that I think are crucial.
    Thank you, sir.
    [The prepared statement of Ambassador Jeffrey follows:]

                 Prepared Statement of James F. Jeffrey

    Chairman Corker, Ranking Member Cardin, it is an honor to be here 
today.
    The question of Iran, in the related contexts of a possible nuclear 
agreement with it, and its worrisome role in the region, is one of the 
most important in Middle East affairs. But it is not the only one, as 
the region is shaken by crises, threats to stability, popular unrest, 
and ideological and theological turbulence not seen since the end of 
the Ottoman Empire. All these developments are linked. Separately, and 
even more together, they threaten American core national interests laid 
out by President Obama in September 2013: supporting our allies and 
partners, protecting the free flow of hydrocarbons to the world's 
economy, and combating terrorism and proliferation of weapons of mass 
destruction. The action of the U.S. Congress in passing the Iran 
Nuclear Agreement Review Act is an important step in coping with these 
threats, ensuring that the American people will have a say in 
developments affecting their security.
    As we do not know at this point what an eventual nuclear agreement 
between the P5+1 and Iran will look like, it is not possible to make 
any detailed judgment on the final package. If we arrive at that point, 
an agreement will have to be judged based on its specifics on issues 
such as verification, disposition of unauthorized enriched uranium, and 
sanctions status, to ensure a long-term check on Iran's nuclear weapons 
ambitions and possible covert programs. Furthermore, in reviewing any 
nuclear agreement with Iran, I urge the U.S. Congress to consider the 
following.
    First, the agreement cannot be considered outside the context of 
Iran's record of destabilization in the region. Two Middle Eastern 
states either have acknowledged, or are widely believed to have, 
possession of nuclear weapons. But the region's leaders do not lose 
sleep over these weapons, nor does the U.N. Security Council pass 
multiple chapter VII resolutions about them, as with Iran. The reason 
is that Iran's behavior in the region is profoundly troubling to many 
states. Either an Iranian nuclear weapons capability, or an Iran 
politically empowered by an agreement that stops it just short of such 
a capability, would pose extraordinary new threats to a region already 
under stress, and undermine the above U.S. vital interests.
    Second, in reviewing Iran's behavior in the region, we all must 
bear in mind that Iran is not a status quo power. As my two Washington 
Institute colleagues, Mehdi Khalaji and Soner Cagaptay, and I wrote in 
the New York Times April 26, ``Iran is a revolutionary power with 
hegemonic aspirations. In other words, it is a country seeking to 
assert its dominance in the region and it will not play by the rules . 
. . Iran, however, has brazenly defied (the) international order and 
continues to expand its reach.'' In short, we concluded, ``Do not 
expect Iran to compromise its principles any time soon.'' Any decision 
on the Iran nuclear deal must bear this sobering fact in mind, and must 
not read Iranian willingness to sign an agreement as a change of heart 
about its ultimate hegemonic goals.
    Third, in particular given Iran's role in the region, no nuclear 
agreement is better than one that might push back by some months Iran's 
ability to break out to a weapons capability, if such an agreement were 
to undercut the current huge international coalition against an Iranian 
nuclear weapon, enhance Iran's prestige, and undermine the credibility 
of U.S. containment both of Iran's nuclear ambitions and its wider 
regional agenda.
    Fourth, the administration's argument that there is no alternative 
to approving an agreement is incorrect, and tantamount to advocating an 
``any agreement is better than none'' position. It is not beyond the 
skill of U.S. diplomacy, were Iran to walk away from the deal struck in 
early April, to persuade other countries to keep the current oil and 
other international sanctions in place. Additional international 
sanctions would however be difficult to impose in all but an egregious 
case of Iranian provocation, but retaining the current sanctions would 
be a heavy price for Iran to bear. If the United States did not, but 
Iran did, accept a final deal similar to that laid out in the White 
House April 2 paper, increasing or even maintaining the current 
international oil import sanctions under the NDAA and the EU's separate 
boycott would be most difficult. That does not rule out the United 
States opting out of an agreement, but in that case the tools to 
pressure Iran would be more limited. The United States would still have 
its direct sanctions, U.N. sanctions (as lifting them is subject to 
U.S. veto), banking and commercial pressure points, and perhaps some 
residual third-country limits on importing of Iranian oil. Between 
these two variants--Iran refusing anything like the April outline, or 
the United States not accepting it--there are various scenarios, each 
with more or less difficulty in maintaining sanctions and other 
international pressure on Iran.
    With or without the support of the international community, 
however, if there is no agreement, then the main restraint on Iranian 
breakout would have to be U.S. and partner intelligence collection and 
U.S. readiness, understood by all, to use force if Iran approaches a 
nuclear weapons capability. While that is stated U.S. policy, albeit 
expressed indirectly such as ``preserve all options,'' the President 
has effectively undercut this policy by repeated warnings about 
inevitable ``war'' if no agreement is reached. Without an agreement a 
military confrontation would be more likely, but not inevitable. Of 
course, a military confrontation with Iran could be costly and risk 
escalation, but, absent spectacularly bad U.S. decisions, it is 
unlikely to produce either a U.S. defeat or a ``war'' in the sense 
normally used in American political debate--endless, bloody ground 
combat by hundreds of thousands of troops as in Iraq or Vietnam. Based 
on my experience I know how uncertain any resort to force is, but all 
our security interests are ultimately anchored on willingness to use 
force, and success doing so.
    Fifth, even with an agreement, the ultimate restraint on Iran 
reaching a nuclear weapons capability resides as well in the capability 
and intent of the United States to stop Iran militarily from reaching a 
nuclear weapons capability. Thus, the U.S. Congress could usefully 
support such a deterrence policy by passing in one or another form an 
advance authorization for the use of military force against an Iran in 
breakout. The administration for its part should make clear what its 
redline is for military action against Iran--what Iranian steps or 
situation would be considered a ``threshold'' requiring the United 
States to act on its ``prevent a nuclear-armed Iran'' policy. Clarity 
on congressional and thus American public support for military action, 
and clarity on when that action would be taken, would go far to 
refurbish American deterrence and make it less likely that we would be 
tested.
    Sixth, in the end, everything related to Iran revolves around its 
role in the region. If a nuclear accord leads to a new Iran, willing to 
accept the regional status quo, that is all for the better, however 
unlikely. But until such an outcome is clear, the United States should 
not bet on it occurring, and in particular should not pull its punches 
in restraining Iran out of concern that a U.S. response could stymie an 
alleged budding moderation. Those who hope for such an Iranian change 
of heart should consider Iran's threat to Israel via weapons to 
Hezbollah and Hamas, its actions in Iraq, and the attempt by senior 
Iranian intelligence officials to bomb the Cafe Milano here in 
Washington.
    While the President's Camp David initiative sought to allay the 
fears of regional states that an Iran ``empowered'' by the prestige of 
a nuclear agreement (and eventually over $100 billion dollars of 
returned frozen funds) would continue to make mischief, skepticism is 
called for. The administration's focus at Camp David and in most 
exchanges with our regional allies is centered on our commitment to 
their conventional defense, and our assistance to their military 
forces. But they fear far less an outright Iranian invasion than 
Iranian infiltration of the weak areas in the Arab world, promoting 
instability and stresses on the Sunni nation states of the region in a 
religious, political, and psychological sense. As we wrote in our New 
York Times piece, Iran ``uses an assortment of terrorism, 
proliferation, military proxies, and occasionally old-fashioned 
diplomacy to further its dominance.''
    What these states need is a commitment by the United States, backed 
at this point by action, that Washington will use all the tools in its 
arsenal, including military, to combat and drive back illicit Iranian 
efforts to infiltrate and undermine Arab States throughout the region. 
This includes pushing back on Iran's actions in Iraq, Syria, Yemen, 
Lebanon, and Gaza. Supporting the Saudi-led coalition operating in 
Yemen, threatening to inspect Iranian ships allegedly bringing 
humanitarian supplies to Yemen, agreeing with the Turks on preliminary 
plans to train 5,000 Syrian personnel in Turkey, and other recent steps 
are examples of what the United States must be ready to routinely do to 
regain regional partners' confidence.
    In sum, any agreement should be judged not only on the basis of its 
verifiable, real restraints on Iran, but also by the context within 
which the agreement would operate: readiness to back it by far more 
explicit and credible readiness to use force to stop a breakout, and a 
far more active U.S. program to contain Iran's asymmetrical military, 
ideological, religious, economic, and diplomatic moves to expand its 
influence in the region.

    The Chairman. Mr. Ambassador.

   STATEMENT OF HON. MARTIN INDYK, EXECUTIVE VICE PRESIDENT, 
             BROOKINGS INSTITUTION, WASHINGTON, DC

    Ambassador Indyk. Thank you very much, Mr. Chairman. 
Gentlemen, I greatly appreciate the opportunity to testify 
today on this critical issue. And I want to applaud all of you, 
if I may, for the way in which, as Mr. Cardin said, you came 
together and drafted and passed legislation which will give the 
Senate a very important role in overseeing the details of this 
agreement. And I also applaud the deliberate way in which you 
are going about making sure that you understand the technical 
dimensions of this, which I could not come close to 
understanding. So, thank you, on behalf of all of us, for 
taking this so seriously.
    I think that if you are presented with an agreement, you 
will likely have to make a choice either to endorse an 
agreement that will remove sanctions on Iran, but should ensure 
that it remains nuclear-weapons-free for at least 10 to 15 
years, or, on the other hand, to reject the agreement, which 
would leave Iran 3 months from a nuclear weapon, under eroding 
sanctions. It is a difficult choice. In making that choice, you 
will need to take account, among other things, of the regional 
implications of the deal and what can and should be done to 
ameliorate the negative fallout from such an agreement in the 
region. And that is what I have endeavored to address in the 
short time available to me today.
    In my view, if the arrangements currently being negotiated 
for inspection and monitoring, together with the mechanisms for 
reimposing sanctions, should the Iranians be caught cheating, 
if those are robust enough to deter and detect Iranian 
cheating, the deal will be worth upholding. In other words, the 
likely regional implications of the deal, in my view, are not 
sufficiently negative to justify opposing it. Indeed, given the 
state of turmoil engulfing the Middle East, ensuring a nuclear 
weapons-free Iran for at least a decade and tight monitoring of 
its nuclear program for much longer than that will help remove 
a primary source of tension and may foster greater cohesion 
amongst our partners in the region in dealing with the other 
sources of conflict and instability there. Put simply, 
everything that we are all concerned about in the Middle East 
will become a much greater concern, were Iran to acquire 
nuclear weapons.
    One question that I think is on the minds of a lot of 
people is whether this deal will lead our regional allies to 
decide that they, too, should pursue a nuclear weapons program, 
or at least a civilian nuclear program that would give them 
ability to cross over to nuclear weapons. The former Saudi 
Ambassador to the United States has said that, ``Whatever Iran 
has, we will have the same.'' And that has fueled speculation 
that the Saudis and others--Egypt, Jordan, perhaps Turkey--will 
go down the nuclear road, as well, as a result of this 
agreement. That would be a bitter irony, indeed, Mr. Chairman, 
since the whole purpose of this agreement is to prevent a 
nuclear arms race in the region. So, it would be ironic, 
indeed, if it were to spark one.
    I actually do not believe that there is a high risk of that 
happening. And, to put it simply, why would Saudi Arabia, which 
has not embarked on a nuclear program for the decades in which 
Iran was pursuing one, now decide to go for a nuclear program 
in the context of a deal in which serious curbs are going to be 
placed on Iran's nuclear program? Plus, if they want the same, 
then they would have to agree to the same kinds of inspections 
and arrangements that will be imposed on Iran as a result of 
this agreement. And I find it hard to believe that the Saudis 
would be prepared to do that.
    Much the same applies to the others. Egypt talks about a 
nuclear program. The same with Jordan. But, they do not have 
the scientific capabilities, the costs, the time. And the 
restrictions that would have to accept, including the 
additional protocol that Iran will accept as part of this 
agreement, seems to me make it unlikely that we need to face 
that kind of problem.
    What about Israel? I think that Israel's leadership is 
deeply alarmed by this, to say the least, and has good reason 
to be concerned about the intentions of the Iranian leadership. 
And they have the duty to take that seriously. But, since this 
agreement will turn the clock back on Iran's nuclear program, 
placing it at least 1 year away from a breakout capability for 
the next 10 to 15 years, Israel has no reason to preempt, for 
the time being. And I think that Israel's concerns later on 
about the way in which this agreement could pave the way to a 
nuclear weapon can and should be addressed, including by the 
Congress, in terms of entering into agreements with Israel to 
expand its assistance to give it the capability to defend and 
deter against a possible nuclear Iran, which, as a result of 
this deal, I believe, will be put off long into the future.
    Thank you, Mr. Chair.
    [The prepared statement of Ambassador Indyk follows:]

                   Prepared Statement of Martin Indyk

    In the coming months, Congress is likely to have to make a choice: 
either to endorse an agreement that removes sanctions on Iran but 
should ensure that it remains nuclear weapons-free for at least 10-to-
15 years; or to reject the agreement, which would leave Iran 3 months 
from a nuclear weapon under eroding sanctions. In making that choice, 
Congress will need to take account, among other things, of the regional 
implications of the deal and what would need to be done to ameliorate 
the negative fallout. That is what I have endeavored to address in this 
written testimony.
    In the end, each Senator will have to make a judgement based on the 
credibility of the deal itself and on its likely implications for 
American interests in the Middle East and for the broader global issues 
that will be impacted. In my view, if the arrangements currently being 
negotiated for inspection and monitoring, together with the mechanism 
for the ``snap-back'' of sanctions, are robust enough to deter and 
detect Iranian cheating, the deal will be worth upholding. In other 
words, the likely regional implications of the deal are not 
sufficiently negative to justify opposing it. Indeed, given the state 
of turmoil engulfing the Middle East, ensuring a nuclear weapons-free 
Iran for at least a decade will help remove a primary source of tension 
and may foster greater cohesion in dealing with the other sources of 
conflict and instability there.
    The completion of the Iran nuclear deal and its endorsement by the 
Congress would represent a major development for U.S.-Iranian relations 
and would likely have profound ripple effects across the troubled 
Middle East region. It will impact the security of our allies from 
Egypt, to Israel, Jordan, the Gulf Arab States, and Turkey at a time of 
heightened insecurity because of the collapse of state institutions and 
the rise of jihadist forces on all their borders. It might trigger a 
regional nuclear arms race or a preemptive Israeli strike. And it could 
give a turbo-boost to Iran's conventional military capabilities and its 
destabilizing activities in the region.
    If these potential consequences are so great, why haven't they been 
addressed in the nuclear deal itself? There are good reasons. The 
Iranians were keen to include regional issues in the negotiations 
because they believed it would be advantageous to them to offer the 
United States a ``grand bargain,'' exchanging regional cooperation in 
Syria and Iraq, for example, in return for lowering American 
requirements for curbs on their nuclear program. The American 
negotiators wisely rejected this attempt at linkage. In addition, our 
Gulf Arab allies feared that their regional interests would be 
sacrificed on the altar of a U.S.-Iran nuclear deal and insisted that 
the United States had no business discussing regional issues with their 
strategic adversary when they were not represented in the negotiations. 
Consequently, there is nothing in the agreement itself that constrains 
Iran's regional behavior. But by the same token there is nothing in the 
agreement that constrains the United States and its regional allies 
from taking steps to contain and roll back Iran's hegemonic regional 
ambitions and counter its nefarious activities there. Ten-to-fifteen 
years of an Iran under intense scrutiny and constrained from acquiring 
nuclear weapons provides a significant breathing space for its regional 
opponents, backed by the United States, to build an effective 
counterweight.
    Will our regional allies choose to use that time to build their own 
nuclear programs, thereby fueling a nuclear arms race that the 
agreement with Iran was supposed to prevent? To be sure, Prince Turki 
al-Faisal, the former Saudi Ambassador to Washington and former 
intelligence chief, has declared, ``Whatever comes out of these talks, 
we will want the same.'' But it seems unlikely that Saudi Arabia will 
actually embark on building an enrichment capability, one that would 
require them to establish or acquire a significant scientific 
establishment that they currently lack. For 30 years, while Iran 
developed its ambitious nuclear program unconstrained, its Saudi 
archrival did not feel any need to do the same. Why would it do so now 
when serious constraints will be placed on Iran's nuclear program?
    Moreover, ``wanting the same'' actually means that Saudi Arabia--
and any other regional state that seeks to match Iran's capabilities--
would have to accept the same intrusive inspections and monitoring that 
the Iranians are in the process of accepting. Some suggest that Saudi 
Arabia would simply acquire a bomb off the Pakistani shelf. But if this 
option is a real one--and Pakistan's refusal to join Saudi Arabia's war 
in Yemen raises significant doubts--it has existed for decades and does 
not in itself fuel a nuclear arms race as long as the bomb stays on the 
Pakistani shelf.
    While Egypt is building a nuclear power plant and Jordan is talking 
about establishing an enrichment capacity, they are both signatories to 
the Non-Proliferation Treaty and will have to submit to the NPT's 
Additional Protocol of intrusive inspections that Iran has accepted if 
they are to get the nuclear cooperation they will need. The UAE has 
signed the 123 agreement, which prevents it from ever acquiring 
enrichment capacity and requires it to sign the Additional Protocol. In 
any case, these countries have made clear in their statements and 
behavior that they are far more concerned by Iran's unconstrained 
efforts to promote sectarian strife in their neighborhoods than they 
are about what will become a heavily constrained Iranian nuclear 
program.
    Meanwhile Turkey, as a NATO ally, already enjoys the cover of an 
American nuclear umbrella under article 5 of the treaty and therefore 
has little reason to head down the costly nuclear weapons road itself.
    What about Israel? Its leadership is alarmed by the deal-in-the-
making; Prime Minister Netanyahu has declared that it represents an 
existential threat to the Jewish state. Certainly, Israel has good 
reason to be concerned about the intentions of the Iranian regime since 
its leaders declare at regular intervals that their objective is to 
wipe Israel off the map. Israel's leaders have the duty to take those 
threats seriously and they have invested a vast fortune, with the 
considerable assistance of the United States, in ensuring that Israel's 
Defense Forces have the ability to deter Iran or, if necessary, preempt 
it from acquiring nuclear weapons. But since this agreement will turn 
back the clock on Iran's nuclear program, placing it at least 1 year 
away from a breakout capability for the next 10-to-15 years, Israel has 
no reason to preempt for the time being. If it did, it could only hope 
to set back Iran's nuclear program by some 2 years--far less than 
provided for in the nuclear deal. And it would in the process free Iran 
of all its obligations under the agreement and earn Israel the 
opprobrium of the other powers that support the deal.
    Israel's concern is greatest when it comes to what happens at the 
end of the 15-year period when Iran will have a full-fledged nuclear 
program rendered legitimate by its compliance with this agreement and 
therefore not subject to sanctions. But we will also by then have much 
greater visibility into Iran's nuclear program, much greater ability to 
detect any attempt to switch from a civil to a military nuclear 
program, and an American President will have all the current military 
capabilities and much more by then to deal with an Iranian breakout 
should they attempt one. Indeed, time is not neutral in this situation. 
The United States, Israel, and Iran's Arab adversaries can do much 
during this long interval both to encourage Iran to abandon its 
destabilizing and threatening regional activities, and to contain and 
deter it if it refuses to do so.
    Taking up that challenge will be essential because of the potential 
impact of sanctions-relief on Iran's regional behavior. Once sanctions 
are removed, Iran will be the beneficiary of the unfreezing of some 
$120 billion of assets; its oil revenues are likely to increase by some 
$20-$24 billion annually. It is reasonable to assume that a good part 
of that windfall will be used to rehabilitate Iran's struggling economy 
and fulfill the expectations of Iran's people for a better life. But it 
is an equally safe bet that the Iranian Revolutionary Guard Corps 
(IRGC), the Ministry of Intelligence (MOIS), and the Iranian Armed 
Forces will be beneficiaries too. It's true that punishing sanctions 
have not prevented these extensions of the Iranian revolution from 
exploiting the upheavals in the region and the collapse of state 
institutions to build positions of considerable influence across the 
Sunni Arab world from Lebanon to Syria to Iraq and now Yemen. 
Nevertheless, Iran's hegemonic ambitions are likely to be boosted by 
the availability of more resources. For example, the Assad regime in 
Syria is struggling to survive economically at the same time as it is 
losing control of more territory to opposition forces; a timely 
infusion of cash and arms might help it cling to power. Similarly, 
Iraq's Shia militias, which are armed and trained by Iran, could be 
boosted at a time when the United States is struggling under Iraqi 
Government constraints to arm and train Sunni militias and Kurdish 
forces.
    Iran will also have money to procure weapons systems for its armed 
forces, using the extensive Western arms sales to its Arab adversaries 
as justification. Iran will still be subject to curbs on its ability to 
acquire some types of sophisticated military equipment, but with money 
to spend it will probably find a way around those sanctions. Russia's 
high profile announcement that it would proceed with the sale of 
S-300 long-range surface-to-air missile systems, even before the 
nuclear deal is signed, represents the harbinger of future sales of 
sophisticated weapons. Indeed, rather than focusing on a nuclear arms 
race in the region, we should be more concerned about a conventional 
arms race.
    The nuclear agreement with Iran was never intended to deal with 
these likely consequences of the sanctions-relief that is the quid-pro-
quo for Iran's acceptance of meaningful and extensive curbs on its 
nuclear program. That puts a particular burden on the United States to 
develop a regional security strategy to complement the nuclear deal, 
one that is designed to counter and neutralize these unintended 
consequences. In doing so, the United States will need to send a clear 
and consistent message to Iran that if it chooses to abandon its 
nefarious regional activities and become a responsible partner to the 
United States and its allies, it will be welcomed into the community of 
nations in good standing. But if it decides to take advantage of its 
newly available resources to wreak further regional havoc, the United 
States will lead a concerted effort to oppose it.
    President Obama has already taken the first step in this effort 
through the Camp David summit he hosted with our Gulf Arab allies last 
month. That was an important first step in providing them with the 
necessary strategic reassurance in the face of the uncertain 
consequences of the nuclear deal on Iran's behavior in their 
neighborhood. In the joint communique, the President reiterated a U.S. 
``unequivocal'' commitment to ``deter and confront external aggression 
against our allies and partners in the gulf.'' The two sides also 
agreed on a new strategic partnership that would ``fast-track'' arms 
transfers, enhance cooperation on counterterrorism, maritime security, 
cybersecurity, and ballistic missile defense, and develop rapid 
response capabilities to regional threats. The communique and its annex 
provide all the understandings necessary for laying the foundations of 
an effective regional security architecture. However, those words will 
need to be translated into concrete actions at a time when the regional 
turmoil is generating competing priorities and interests. The GCC 
states are not united in their approach to the region's problems and 
they will continue to fear an American-Iranian rapprochement at their 
expense no matter how reassuring the President's words. Nevertheless, 
the combination of the nuclear deal, a potentially more potent Iranian 
adversary, and rising instability on their borders, should concentrate 
their minds and therefore could create the necessary conditions for an 
effective strategic partnership with the United States that was called 
forth at Camp David. If they are willing to get their acts together, we 
should certainly be willing to respond with a determined effort.
    Providing strategic reassurance to our Gulf Arab allies is but the 
first step. The United States will also need to build more effective 
strategic partnerships with Israel, Egypt, and Turkey, our other 
traditional regional allies who wield much greater capabilities and 
influence than most of the GCC states. For a variety of justifiable 
reasons, the Obama administration is at loggerheads with each one of 
these regional powers: with the Government of Israel because of its 
unwillingness seriously to pursue the two state solution or freeze 
settlement activity; with the Egyptian regime because of the treatment 
of its own people; and with the Turkish President because of his 
unwillingness to cooperate with the United States against ISIS. But at 
this sensitive moment, reassuring each one of them is essential if they 
are to be enlisted in the effort to lay the groundwork for a regional 
security framework that begins to reestablish order in this troubled 
region and prevents Iran from further exploitation of the chaos.
    Just having the conversation with Prime Minister Netanyahu is 
proving exceedingly difficult since he is so determined to scuttle the 
Iran nuclear deal that he does not want to give any hint that he might 
be prepared to compromise on his opposition for the sake of strategic 
reassurances from the United States. Nevertheless, if the deal goes 
through, it will be important for the United States in the immediate 
aftermath to take a series of steps to strengthen Israel's ability to 
defend itself from, and therefore deter, any potential Iranian nuclear 
threat. Such measures could include completing the negotiations on a 
new 10-year agreement to provide military assistance to Israel at an 
increased level (this is something that Congress could initiate in 
coordination with the administration). The funding could be used to 
cover the purchase of additional F-35s and the development and 
deployment of the full array of air defense systems from Iron Dome to 
Arrow III to protect Israeli civilians from Hezbollah and Hamas rockets 
all the way up to Iranian ballistic missiles. Additional funding could 
also be used to strengthen Israel's deterrent capabilities, including 
the purchase of additional submarines.
    Finally, to take care of the likely increasing nervousness among 
our regional allies as the nuclear agreement approaches its expiration 
date 10-to-15 years from now, the United States needs to begin to lay 
the groundwork for establishing a nuclear umbrella over all of them. 
This form of extended deterrence will be an important element in an 
American-sponsored regional security framework. Neither Israel nor our 
GCC allies are prepared to consider that at the moment, nor is it 
likely that Congress would approve such a commitment for any regional 
ally in the Middle East except Israel (ironically, Turkey already has 
such a commitment through NATO). But if the policy of strategic 
reassurance is pursued consistently by this President and his 
successors, it is possible that all sides may come to see the virtue of 
a nuclear and conventional security guarantee that will effectively 
deter Iran, render an Israeli preemptive strike unnecessary, and remove 
any incentive for the Arab states to pursue their own nuclear weapons 
programs.
    Mr. Chairman, a credible nuclear agreement will provide an extended 
breathing space for the United States and our regional allies free from 
the threat of a nuclear Iran that should last beyond the next 
administration and probably the one after that. It will nevertheless 
raise many concerns in the Middle East about Iran's destabilizing 
behavior and hegemonic ambitions that the United States cannot address 
in the agreement itself but will have to address outside the agreement. 
In my view, that is not a justification for opposing the agreement. It 
is rather a reason for complementing the agreement with a robust effort 
to promote a regional security strategy that takes advantage of the 
respite to begin to rebuild a more stable order in this chaotic but 
still vital region.

    The Chairman. Thank you both for your testimony.
    I know we have got a lot of participation. I know 
Ambassador Indyk has a hard stop at 11:00, so I am going to 
defer on my questions--I may interject one or two along the 
way--and defer to the ranking member so that other members will 
have the opportunity to ask questions.
    Senator Cardin. Well, thank you, Mr. Chairman.
    And again, let me thank both of our witnesses. As I said in 
my opening statement, if we reach an agreement with Iran, if we 
are successful in having an agreement that prevents them from 
moving forward with a nuclear weapon program, there are still 
many other issues in our relationship with Iran.
    So, I just want to sort of crystal-ball where we are after 
an agreement. Iran could very well continue its current policy 
of supporting terrorism and its interference in so many other 
countries that is making it very challenging for our partners 
in the region. How do we influence the Iranian calculations? We 
have seen, in the past, that the passage of sanctions in 
regards to their nuclear proliferation was effective to bring 
them to the table to negotiate and, we hope, reach an 
agreement. What type of strategic alliances and what type of 
actions should the United States be contemplating in order to 
affect the calculation Iran is using in its engagement in 
Yemen, its engagement in Lebanon, its engagement in Iraq and 
Syria? Do you have any advice as to where we should be trying 
to develop those types of alliances and strategic partnerships?
    One last point on this. And that is, you know, in the last 
10 to 15 years, our strategic partnerships in the region have 
changed. You know, we have had very close relations with Egypt. 
That went through a very difficult period. We are trying to 
rebuild that today. Jordan has been a trusted strategic partner 
for a long time, but there have been issues in regards to that 
relationship. The only partner that we have had that is been a 
consistent partner to the United States has been Israel, and 
they, of course, have problems with where we are heading on the 
Iranian agreement. What advice would you have for the United 
States in a post-agreement Middle East?
    Ambassador Indyk. Thank you, Senator Cardin.
    The problem of rolling back Iran's nefarious activities in 
the region, in the places that you have focused on--Lebanon, 
Syria, Iraq; Yemen, in particular--is that they have been able 
to exploit two advantages, which we have a hard time dealing 
with. First of all, the collapse or erosion of the 
effectiveness of state institutions in these countries provides 
fertile and low-cost ground for them to exploit by building 
parallel institutions; in effect, to exercise considerable 
influence in these countries. And when they do so, they do so 
by taking advantage of the fact that there is a Shia 
population, in each of these countries, that is open to their 
influence, whether it be through cash or arms or training. And 
they have, of course, the Iranian Revolutionary Guard Corps 
specifically designed for that purpose. And they are very 
effective at it. And so, that combination presents a great 
vulnerability; and therefore, presents great difficulty, in 
terms of how we can counter it.
    The answer lies, essentially, in strengthening the 
institutions of governance in those countries, but that is a 
difficult challenge, which we do not usually do very well. I 
think you used the word ``partnership'' and ``partners.'' And 
think that that is essential in this effort. First of all, yes, 
we have to provide strategic reassurance that we are not about 
to abandon our traditional allies, whether it be Israel, Egypt, 
Jordan, Saudi Arabia, and the Gulf States. And that is a very 
important adjunct to the process of doing this deal with Iran.
    But, then we have to work with them--particularly, of 
course, the Sunni Arab States--in terms of building 
capabilities to go in and bolster the institutions there that 
can counter the vulnerabilities that Iran exploits. The people 
of Frond* ***28:30*** are now--particularly administration 
spokesmen--are saying that this is a long-term project and 
thereby, somehow, I think, perhaps trying to escape 
responsibility--direct responsibility for making something 
happen on their watch. It is a long-term project. But, we have 
to start now, and we have to start in the context of this 
nuclear deal, precisely because the fear of abandonment, which 
I think is vastly exaggerated by our allies and traditional 
partners in the region, needs to be addressed if we are to 
ensure that we start a process of containing and rolling back 
Iran's destabilizing activities in the region.
    Senator Cardin. Mr. Jeffrey.
    Ambassador Jeffrey. Senator, Ambassador Indyk has outlined 
exactly what the problems are and a lot of steps that we could 
take. A few very specific short-term ones, because, long term, 
we can foresee doing anything, anywhere in the world, but the 
question is, What are we going to do right now?
    First of all, we have to restore our military credibility. 
We have to have congressional support for use of military force 
if Iran goes to a breakthrough. We have to know what the 
administration and the next administration's redlines are for 
when they would strike if Iran did that. Besides the impact of 
that on a nuclear negotiation, that would have an impact in the 
region by making people think that we really will live up to 
our commitments and that we are restoring our deterrent power.
    In terms of specifics in this region, we need to do more in 
Syria against Assad. I am not advocating trying to overthrow 
him or going to war, but ideas like a no-fly zone, like arming 
the resistance fighters not just to fight ISIS, but also to 
fight the Assad government, to basically ensure that the other 
side, Assad and his friends, Russia, Hezbollah, and Iran, 
understand we are not going to let them win, we are pushing for 
a negotiated settlement that will ensure that that place 
remains independent, and independent among others, from Iran.
    Same thing in Yemen. There are various steps we can do, 
again, to reassure these people that it is not just their 
physical security from an Iranian and--land invasion that they 
are worried about, but the infiltration of the region by an 
Iranian--as Ambassador Indyk said--Shia-supported almost 
ideological religious movement.
    Senator Cardin. Thank you.
    Thank you, Mr. Chairman.
    The Chairman. Senator Perdue.
    Senator Perdue. Thank you, Mr. Chairman.
    And thank you both for being here today, and your 
testimony, and your service to our country.
    I have a question about the money and the sanctions. Today, 
it is estimated that we have as much as $140 billion in held 
cash through these sanctions on just their oil exports, alone. 
President Obama, back in April, mentioned that there would be a 
signing bonus. We do not know any details about that, but we 
have seen estimates as high as $50 billion on that. You know, 
Iran, right now, is producing their potential capacity, 
somewhere around $36 billion annually, in terms of oil exports. 
So, that is larger than Venezuela, to put it in perspective. 
And that is just an estimate. Iran spends about $10 to $17 
billion a year on their current military. Those are estimates 
that we have seen. That sounds awfully low to me, but those are 
the estimates that we have seen. So, it puts it in perspective 
that they are about to have a cash windfall. And what I am 
concerned about, with their nefarious history of supporting 
terrorism around the world, what--what is your two learned 
opinions about what we can expect from this windfall of cash? I 
do not think it is going to go to domestic programs. So, the 
question is--and it looks like we have two differing points of 
view here. I would really be interested in both your points of 
view about what we can expect, given this windfall of cash 
upcoming at the end of these negotiations, if, in fact, we get 
a deal.
    Ambassador Jeffrey.
    Ambassador Jeffrey. Sure. Senator, thank you.
    It begins with the idea, Do we think that signing this 
agreement is going to either flip Iran into being a status-quo 
power in the region or serve as some kind of encouragement that 
that will happen over the longer term? I see no evidence of 
that, given Iran's past and given its ideological and religious 
role in the region, and the very strong efforts it has made, 
not just under the current regime, but, frankly, under the 
Shah, to have a hegemonic position in the region. I think we 
can expect that to continue. And, frankly, we have seen this 
around the world with other countries that have achieved 
regional power. And Iran is probably not all that different, 
totally aside from the religious aspect.
    So, it is very hard for me to believe that they will not 
use some part of that to further enhance their efforts from 
Gaza to Lebanon to Iraq to Syria to Yemen, and they will find 
new places, as well. So, it will be more of a threat because of 
that.
    I also think that they will take some of the money and 
devote it to their domestic side, as well, because the Rouhani 
government came to office on that basis.
    Ambassador Indyk. Thank you, Senator.
    I think that we need to, first of all, bear in mind that 
this is the kind of inevitable cost of doing an agreement that 
puts meaningful curbs on Iran's nuclear program. We need to 
make sure that they are meaningful, that we can ensure that the 
Iranians do not cheat, or we detect them if they do, and that 
we can put the sanctions back on if they violate the agreement. 
But, we are not--if we are going to go ahead with the 
agreement, we do not have an option but to lift the sanctions. 
That is the basic deal, here.
    I think you are absolutely right to be concerned about the 
windfall and how it will be used. I think, as Jim has said, 
some of it will be used for the economy. There is a high 
expectation amongst the Iranian people that this is going to 
produce economic benefits. And I think the regime will want to 
do some of that. But, they have got a lot of money to spend for 
other purposes. And I find it hard to believe that the Iranian 
Revolutionary Guard Corps and the Ministry of Intelligence, who 
are the main vehicles for spreading their destabilizing 
influence across the region, are not going to get paid off to 
go along with an agreement which they have made clear that they 
are not happy about. And it does not cost a lot of money to do 
what they have been doing. So, a boost to that activity could 
be problematic.
    So, one example is that the Assad regime in Syria is 
hurting economically now. It is also hurting militarily. But, 
were the Iranians to infuse some cash into that regime, it 
would help it hold on. And there are other ways in which it 
could provide funding and arms and so on to, for instance, the 
Shia militias in Iraq, which would tilt the balance even 
further in the favor of the Shia militias versus these nascent 
Sunni militias that are barely able to stand up. And that is 
not a good thing. So, there are all sorts of ways in which it 
could become problematic.
    Having said that, there are things that we can do, and need 
to do, to prepare for that and to counter it. And that is what 
is so important about needing to recognize that, as a 
complement to the deal, there has to be a U.S. strategy for the 
region that is designed to deal with Iran's destabilizing 
activities.
    Senator Perdue. Have you seen such a strategy yet?
    Ambassador Indyk. You know, it is nascent, I would say. I 
think that the Camp David meeting with the gulf countries is 
the start to that. It has some specific references, which I 
think would be worthwhile for you to get further explanation 
from the administration, have some closed hearings. But, there 
are public references to working on counterinsurgency, 
counterterrorism, developing capabilities in that regard, 
cybersecurity, other things. Those are the kinds of things that 
they really need help with, that we need to be focused on. We 
have too easily responded to their needs by selling them more 
aircraft. And that is good for our industries, and I understand 
that, but, in these circumstances, as we can see in Yemen, 
aircraft are not the most effective thing. We need their troops 
on the ground because of our own reluctance to put troops on 
the ground.
    Senator Perdue. Right. Thank you. I am sorry to interrupt, 
but I have only got a few seconds left. I really want to get to 
this question.
    On the S-300s, Russia just announced that they have done 
this deal and they are going to sell these missiles to--these 
are surface-to-air missile programs. Russia has used these in 
the Ukraine, we are told. And Russia has said, ``Well, this is 
mainly a defensive weapon,'' but it also allows, I think, Iran 
to project power in the region.
    Ambassador Jeffrey, are you concerned about this 
development?
    Ambassador Jeffrey. Very much, Senator, for several 
reasons.
    First of all, while there is no U.N. resolution or 
requirement against that, the U.N. language says, ``Exercise 
restraint in providing weapons to Iran.'' The Russians just 
blew through that. And there is no lifting of these resolutions 
until the U.N. does so, and it has not yet. So, that is problem 
number one.
    Problem number two is the fact that these do have a 
capability that is, under certain circumstances, threatening to 
our airpower and those of some of our friends and allies.
    Thirdly, it sends a signal to the region that Iran has a 
big and, let us face it, very aggressive buddy backing it--
again, leading to what Ambassador Indyk and I have been talking 
about, a desire on the part of our folks in the region to say, 
``Who is backing us? And how are you backing us?''
    Senator Perdue. Thank you.
    Thank you, Mr. Chairman.
    The Chairman. I said I might interject a question. I am 
just going to ask--Is it in our national interest that Iran 
dominate the region as they are beginning to do? And, if not, 
should Congress take into account--as we look at the details 
and facts of any deal--or, look at whether the administration 
has that countervailing strategy with, potentially, this much 
money coming into their hands and their influence in the 
region--should that be a factor, as we look at whether a deal 
with Iran should be approved?
    Both of you, briefly, and then we will move to Senator 
Menendez.
    Ambassador Indyk. Well, I think you are right to focus on 
the details of the deal. It is going to be complicated enough 
in itself. But, certainly, I do not see any reason why you 
should not question what the strategy is. I believe that the 
administration is developing that strategy. But, definitely, 
you should look into that and see what they are doing. Because, 
as I said, it is critical. It is not, in my view, sufficient--
the problems that Iran can create in the region, additional 
problems to what it is already doing, as a result of this deal 
is not a reason for not doing the deal, but is a reason for 
insisting that there be an effective strategy to deal with the 
kind of turbo boost that the Iranians are going to have in the 
region.
    As to answering your question about what our interests are 
in the region, well, basic interests come down to the free flow 
of oil at reasonable prices, which is less important to us 
directly now but still critical for the global economy, which 
we depend upon, and, of course, the protection of our allies in 
the region, starting with Israel. And, in that context, 
domination by Iran would be dangerous for all of those 
interests, and therefore, something that we have traditionally 
opposed, and, I think, should continue to oppose.
    Ambassador Jeffrey. Very quickly, Senator, I agree. The 
answer is, absolutely not.
    Furthermore, our whole foreign policy since World War II, 
and particularly since 1989, has been based upon not allowing 
anybody to dominate any region. We went into combat against 
Milosevic for that in the Balkans, against Iran in 1987-88 in 
the Tanker War, against Saddam in 1991, and then later several 
times, because if you have that, the whole international order 
goes down the drain as one regional hegemon dominates the other 
countries and starts robbing them of their sovereignty and 
their rights to live in peace and follow their own will.
    Iran has a model for this. One of the more moderate Iranian 
officials, Hussein Mousavi and a friend of Rouhani and Zarif's, 
who was in exile actually, has laid it out, and it basically is 
a security arrangement in the region with Israel weakened, the 
United States out of the region, arms sales to our allies 
stopped, and, again, Iran playing a predominant role. So, they 
know what they want, and they are working on it.
    Ambassador Indyk. I had one--one quick point occurs to me 
is that--it is important to understand, Sunni Arab States will 
not accept Iranian domination. And so, the consequences of a 
greater success by Iran in dominating the region will be a 
countervailing effort to prevent that from happening and, 
therefore, a deepening sectarian Sunni-Shia conflict.
    Ambassador Jeffrey. I would--and I would add to Martin's 
point--and Sunni Arab States, if not helped, coached, led, and 
backed by us, are going to go about resisting this domination 
in ways we are not going to like, leading exactly to this 
conflagration, Sunni versus Shia, that he just warned about.
    The Chairman. Thank you both.
    Senator Menendez.
    Senator Menendez. Thank you, Mr. Chairman.
    And thank you both for your long service to our country.
    You know, the more I listen to your responses, the more I 
am concerned that the strategy that should exist, under the 
hope that we will get an agreement that actually could be 
supported and embraced as a good agreement, is a strategy that 
is all on the come, when it should be upfront, because the 
turbo boost that you said, Ambassador Indyk, is something that 
we will be behind the curve on. What worries me as part of that 
is when the administration says to those who are skeptical 
about the nature of what the final deal will be, based upon the 
interim agreement, and based upon the different understandings 
of that interim agreement, and based upon actions like Iran 
increasing its fuel enrichment by 20 percent, which may be 
within the JPOA, but ultimately has to be totally eliminated by 
June 30, which is an extraordinary action that they will have 
to do--unless they ship it out, which they say they are not 
willing to do--so, when you tell your adversary that you are 
negotiating indirectly, ``If not an agreement, then what?'' The 
suggestion, ``It is an agreement or war,'' which I reject. I 
think there is a third way. But, when you send that message, 
``If not an agreement, then what?''--and when you say that, 
``Well, if necessary, we will use our military capabilities,'' 
but then undermine the essence of that capability by saying, 
``But, it will not have much of a result at the end of the 
day,'' the message that you are sending in your negotiation is 
one of weakness, not of strength. You let the other side know 
that you need or want this deal as badly as they do. And that 
is a dangerous negotiating posture, from my perspective. With 
the lack of a strategy upfront to deal with the aftermath, and 
already sending those messages, I think it is a dangerous 
proposition.
    So, it seems to me that this strategy is something that we 
have had 2 years of thinking about during negotiations, we 
would have been evolving a strategy in the hope that we achieve 
successful negotiation, and know what to deal with in the 
aftermath.
    Let me ask you. Should our focus in the region not be to 
strengthen the state system in the Middle East?
    Ambassador Indyk. Yes. But, of course, it is----
    Senator Menendez. I will take that for an answer. 
[Laughter.]
    Ambassador Indyk. [continuing]. Easier said than done, 
Senator Menendez.
    Senator Menendez. Go ahead, I am sorry.
    Ambassador Indyk. It is very good to see you.
    Just on the first point, if I might, I do not think that 
the alternative is war, but I do think we need to look 
seriously at what the alternative is, given where we are.
    Now, if the Iranians do not agree to a regime that provides 
verification, inspection, monitoring, and snap-back sanctions, 
then we should walk away, in my opinion, because we will be 
justified in doing so, and we will have a credible case to make 
to our partners in this negotiation, the P5+1 and others, that 
the Iranians were not prepared to agree to a deal that was 
acceptable. And that is the critical point, here. But, if they 
are willing to accept all of our stipulations when it comes to 
inspection and verification and snap-back, then I think walking 
away from that deal will have consequences. It will mean that 
we will not be able to hold the sanctions. And faced with the 
kind of erosion of support, we will have a much harder time 
dealing with the Iranian nuclear program. That will continue 
and pick up steam.
    And then we are 3 months away from----
    Senator Menendez. What is verification? What is snap-back? 
What is possible military dimensions? How far can research and 
development go? How you define those are incredibly important. 
Because, for example, when we started this negotiation, we were 
told that Arak would either be destroyed by them or destroyed 
by us. We were told that Fordow would be closed. The reality 
is, neither one of those is the case. And there is a whole 
history of goalposts that have been moved, my concern is, what 
is the definition of those elements that you describe?
    But, getting back to my question, your answer is, ``Yes, we 
should strengthen the state system in the Middle East.'' Now, 
is it fair to say that Iran's influence, at least up to this 
date, has been to destabilize state actors in the Middle East? 
And we see that in Yemen, we have seen it, you know, in 
Lebanon, we see it throughout the region. Is that a fair 
statement?
    Ambassador Jeffrey. Senator, it certainly is. There are two 
major threats to the state order in the Middle East. And 
everything, including our security and that of the region, is 
based upon that. One is extremist Sunni movement, such as al-
Qaeda and ISIS; another is Iran, which uses both religion and 
traditional statecraft to try to subvert countries. And we know 
the tools. It is denying a monopoly of force by governments. It 
is winning over the loyalties of part of the population--
Hezbollah in Lebanon, the Houthis in Yemen, for example, some 
of the Shia militias in Iraq--more to Tehran than to their own 
countries. And there is a religious element to some of this, as 
well.
    This is worrisome.
    Senator Menendez. So, let me get to two last questions. And 
that is, ``If our interest is to support state systems, and 
Tehran's whole purpose has been undermining state systems, is 
it also fair to say that, even with the sanctions and the drop 
in oil prices that have bit significantly on their economy, 
they are still using a fair amount of their resources to do 
exactly that, to undermine state actors?'' Is that fair to say?
    Ambassador Indyk. Yes. It certainly is fair to say. And 
that is part of what I was----
    Senator Menendez. And if that is fair----
    Ambassador Indyk. [continuing]. Referring to.
    Senator Menendez. And if that is fair to say, then, when 
you have even greater amounts of money, it would seem to me 
that, yes, some of it will go for domestic purposes, but a fair 
amount of money--if you are suffering, and you are using your 
money not to help your people but to go ahead and promote 
terrorism, so, when you have more money, you can help your 
people to some degree, but you can still promote that 
terrorism--that is a real concern.
    And finally, let me just say, you know, do you think the 
gulf partners, looking at the Budapest Memorandum, think that 
our guarantees really mean a lot? We told Ukraine that if they 
gave up its nuclear weapons, we would guarantee its territorial 
integrity. That has not worked out too well for the Ukrainians. 
So, you are going to tell this to the gulf region, ``Do not 
pursue a nuclear pathway because Iran is at the precipice of 
it, and we are going to, you know, guarantee your security.'' I 
think that is a little tough for the gulf partners to believe, 
in and of itself. If you add the obligation to keep Israel's 
qualitative military edge to whatever you are going to give the 
gulf partners, and the real concern is a nuclear one, I do not 
quite see how that works.
    Ambassador Indyk. Well, first of all, I think that our gulf 
partners are far more concerned about Iran's activities in 
their neighborhood than they are about Iran's nuclear 
ambitions. And that is the only way to explain why they have 
not sought nuclear capabilities themselves. They certainly have 
not lacked the funds to do so.
    So, I do think that you could see, coming out of the Camp 
David summit, that they do care about getting these assurances 
from the President. And they have committed themselves, in that 
communique, to endorsing--supporting or welcoming a deal that 
would have the kinds of things that we have been talking about, 
in terms of inspections and verification and snap-back and so 
on.
    But, I think that what they are looking for reassurance 
about is that the United States is going to be with them, in 
terms of the problems that they face with Iran in their region. 
It is not about nukes, as far as they are concerned. And that 
is a much harder thing for us to do for them. We can protect 
them against an external Iranian threat, but dealing with the 
kind of subversion that Iran is involved in, exploiting the 
chaos and collapse of institutions in that region, is much 
harder to do, especially if we are not prepared to put our own 
forces on the ground to do it. Then we have got to find other 
forces to do it, and we have got to look to them to do it. That 
is why we talk about partnership. That is--it is going to 
require them to work with us on this, as well.
    The Chairman. Senator Isakson.
    Senator Isakson. Thank you, Chairman Corker.
    Thank you both for being here, and thank you for your 
service.
    I want to follow up on Senator Menendez's point, because, 
to me, it is absolutely critical. We have done nothing, since 
we left Iraq with all our--pulling all of our troops out, to 
demonstrate, in the past 18 months, exactly what our commitment 
is, in my judgment. There are--you mentioned the Ukraine. There 
were conversations about that. We--about whether or not we had 
backed the right people in the Middle East, whether or not we 
would confront Iran, in terms of its nefarious activity. But, 
you know, I remember, from my business career, the best deals I 
ever made were deals where I first walked away from the table 
before I came back, because I found out how bad the other guy 
really wanted to make a deal. And the worst deals I ever made 
was when the deal was more important to me than common sense. 
And I worry we are getting into a situation where we would not 
walk away.
    Have you heard, credibly, either one of you, from your 
positions, some of the conversations the Iranians have said, 
like, ``We will not allow military bases to be inspected,'' or, 
``We are not going to allow this,'' or, ``We are not going to 
allow that''? Are those not the type of things they should know 
we will walk away from immediately? And should we not have made 
that statement definitely so it is without question?
    Ambassador Jeffrey. We have heard these statements. I have 
heard, for example, the deputy negotiator to Zarif, Araghchi, 
has, in conversations that did come to our attention with the 
parliament in closed session in Tehran, say that, ``In fact, 
maybe some of these things are negotiable with the Americans.'' 
So, I think it is still in play. Again, that is the problem we 
have, because we have not seen the agreement in its final form 
yet, Senator.
    But, certainly those are very, very important points. You 
do not have full eyes on, which supposedly is critical to--it 
is critical to this agreement, if you cannot visit military 
installations and if you cannot interview their scientists and 
other technical officials. So, that is very, very important. 
And this is something that the administration should insist on. 
And if they do not get it, then they should either walk away or 
wait until they do get it.
    Senator Isakson. We must be believable in our negotiation, 
or we will get taken. That is the point that I want to make.
    Secondly, on what Senator Perdue raised, is not the 
Russian--it is the 300, is it not? Surface--yes, is the S-300 
not capable of carrying a tactical nuclear warhead?
    Ambassador Jeffrey. I do not believe so, Senator. And 
again, it is a surface-to-air system. In theory, surface-to-air 
systems can be refigured to carry nuclear warheads. But, 
frankly, Iran has a really disturbing arsenal of long-range 
missiles. That is why we are putting the missile defense 
systems into Europe, some 3-4,000 miles away. They have 
missiles that either can, or soon will be able to, go that far, 
which is further, I think, than the S-300 will fly. So, its 
basic threat is to shoot down our aircraft and cruise missiles.
    Senator Isakson. Let me ask both of you a question, because 
I have tremendous respect for your ability and your service to 
the country and your knowledge, which I certainly do not have. 
Let me just ask you this. What do you fear the most about 
making a deal with the Iranians, or not making a deal with the 
Iranians? What should our biggest concern and fear be?
    Ambassador Indyk. In terms of making the deal, I think 
there are two major concerns we have--which we have been 
discussing. One is that they will cheat. They have cheated 
before on their obligations under the Nonproliferation Treaty. 
We have seen, in the case of Korea, that they got away with 
cheating and built a nuclear weapon. So, that has got to be the 
concern within the deal, to make sure that they do not have 
that ability. And I agree with you that, if we do not get that, 
we should be prepared to walk, and that you are absolutely 
right, in a--any negotiation, as you pointed out, but 
particularly a negotiation with Iran, being ready and willing 
to walk away if we cannot get the--our minimum requirements is 
critically important to the negotiations. And I think that 
these statements that they have making--they have been making, 
which actually do not accord with the things that they have 
already agreed to in the negotiating room, is an indication 
that they are posturing for their public, that their public--
that they have a problem with their public opinion. They have 
raised the expectations of public opinion there, that there is 
going to be a deal on their terms. And so, I think that 
actually we have a better ability to walk away than they do at 
this point. And so, we are, in fact, in the stronger position 
if we focus on the issues within the parameters of the deal and 
make sure we get what we need in that regard.
    The second problem is outside the deal--and we have 
discussed that already this morning--which is, How do you 
contain and roll back their activities in the region? You 
cannot do that as part of the deal, but you are going to have 
to have a strategy to deal with it alongside the deal.
    Ambassador Jeffrey. Senator, in terms of a deal, the thing 
that I am most worried about is that we will wind up looking 
like we keep on making compromises and, therefore, we are seen 
as either weak--and that has a huge impact on our ability to 
deter them in the region--or people will think that the U.S. 
Government actually believes that this deal will change the 
tune in Tehran and that they will be a potential status-quo 
power or a potential partner in regional security. And I think 
that is very worrisome.
    Now, in fairness, you said, What do you worry about either 
with a deal or without a deal? And having taken a few hits at 
the deal, here is one of the things that the deal will give us. 
It will give us more international support. This is important 
for two things. First of all, the international sanctions--and 
they are the most effective ones--do hinge on a good 
relationship between us, the EU, and some of the other players, 
including China, in particular, as an Iranian oil importer. 
But, secondly, I have several times cited the importance of us 
being willing to use military force. Our experience has been, 
sadly, that, when we did not have international support for us, 
Iraq and Vietnam being two examples, we had a much harder time. 
And therefore, international support is a value that you do get 
in this agreement. It has to be balanced against other ones, 
possibly sending a signal of weakness, possibly people 
questioning our deterrence in Tehran. But, nonetheless, there 
is a certain value to an agreement if it is verifiable and if 
it does give you the 1-year time before they could break out.
    Senator Isakson. So, I will just follow--so, to 
understand--a good deal, in the definition of--your definition, 
and mine, of a good deal, which is a good deal for the American 
people and the people of the Middle East, would be preferable 
to not making a deal, because it would raise our stature with 
the international community? Is that what I heard you say?
    Ambassador Jeffrey. No, sir. There is no good deal at this 
point. A good deal would be ``no enrichment.'' A good deal 
would be--they are out of the business of having a nuclear 
weapons threshold capability. So, it is a question of a bad 
deal that may be better than a set of other circumstances or 
perhaps living with the other circumstances.
    One of the things that a deal does give us is the ability 
to mobilize the international community if Iran breaks out. And 
that ability to mobilize the international community typically 
has been very successful when we have had to use military 
force, such as in Korea in 1950 or in Kuwait in 1991.
    Senator Isakson. Thanks, to both of you, very much.
    The Chairman. Senator Kaine.
    Senator Kaine. Thank you, Mr. Chairman.
    And thank you, to our witnesses.
    Just a couple of comments and some questions.
    My assessment of the status of the U.S.-Iran dynamic as 
adversaries pre-JPOA, pre-November 2013, was that the combined 
weight of congressional/executive/international sanctions were 
putting deep pressure on the Iranian economy, hurting and 
affecting the Iranian economy. That helped bring them to the 
table. But, I do not necessarily think that combined weight of 
sanctions was slowing down their nuclear program. In fact, it 
may have accelerated their nuclear program. To the extent that 
they felt isolated, you can look at them as a resistance 
economy. They were putting an unreasonable amount of effort 
into advancing the nuclear program. So, the status before the 
President and American diplomats engaged in this discussion, I 
think, was one where the sanctions were working against the 
economy, but the Iranian nuclear program was accelerating in a 
dangerous way.
    During the pendency of the JPOA, since November 2013, I 
have been to Israel twice, once in January--February 2014, and 
then back in January 2015--and even the Israelis, who were 
worried about an ultimate deal, acknowledged, some grudgingly, 
some enthusiastically, that they think the JPOA period has 
actually been a positive, that the combination of rollback of 
some elements of the Iranian program together with additional 
inspections has been a positive. They like that better than the 
pre-November 2013 status quo. Now we move to the situation of 
what we are going to think about with respect to a final deal.
    This is a sincere question. It is going to sound like I am 
not sincere, but I am going to ask it this way. I do not view 
this as a negotiation about whether Iran will be a friend or an 
adversary. I view this as a question about whether an adversary 
will have a nuclear weapon or will not have a nuclear weapon. 
Do either of you doubt that the region, the United States, and 
the world are safer if Iran does not have a nuclear weapon than 
if they do?
    Ambassador Indyk. I think this is the primary benefit of a 
deal that is enforceable. That is that it will give the region, 
and the United States and our allies there, particularly 
Israel, a 10-to-15-year nuclear-free Iran, in which we will no 
longer be faced with this kind of sense that Iran is about to 
cross the nuclear threshold.
    Senator Kaine. In other words, a bellicose Iran without a 
nuclear weapon may still be bellicose, but a bellicose Iran 
with a nuclear weapon is really dangerous in terms of 
potentially throwing its weight around in the region and in the 
world.
    Ambassador Indyk. Correct. And we are talking about a 
region which is in chaos. And so, add a nuclear Iran to the mix 
and then the other states in the region will have a very strong 
incentive to go get nuclear weapons, so we get a nuclear arms 
race on top of everything else that is going on there. So, yes, 
we need the breathing space. The breathing space is worth 
something to us. And time is not neutral in this situation. Ten 
to 15 years, we can use the 10 to 15 years to roll back Iran.
    Senator Kaine. Absolutely.
    Let me explore now the decision tree of ``no deal'' and 
``deal.'' I think I agree with what the Chair said. I do not 
think ``no deal'' automatically means ``war,'' but, ``no deal'' 
does have some consequences.
    How important is it, to the effect of the sanctions that 
currently exist and more that we might want to put on, that 
there is an international coalition supporting the sanctions, 
versus the United States just proceeding alone? I would like to 
hear both of you talk about that.
    Ambassador Jeffrey. At this point, it is very, very 
important, because the sanctions that have really bitten deep 
are the NDAA sanctions, which run third countries through their 
financial systems, which countries actually could resist, but 
we had both temporary waiver authority, or--if they were 
reducing, bit by bit--and, frankly, they wanted to help us put 
Iran under wraps, so they did cooperate. But, the cooperation 
was getting tougher and tougher, if you talk to the people who 
were actually trying to execute it on the U.S. Government side.
    The second set of sanctions that are really effective are 
the EU sanctions, which not only ended all imports of Iranian 
oil, but, frankly, through hitting insurance, funds transfers, 
banking, and other auxiliary elements of the international 
trade system, really led to Iran losing more than--roughly half 
of its oil exports. That, combined with the drop in oil prices, 
put Iran in the economic situation we see.
    So, it is important to maintain that if we cannot get a 
deal.
    Senator Kaine. Well, then let me follow up and ask this. 
So, if there is no deal, then it is very critical whether the 
community perceives that the absence of a deal is because Iran 
is being unreasonable or they were willing to be at least 
somewhat reasonable and the United States or other parties 
refused to make a deal. So, if it looks like Iran is being 
unreasonable, there is a greater chance to hold the coalition 
together to keep sanctions tough. If it looks like the United 
States or other partners are being unreasonable, it is more 
difficult to hold the coalition together. Would you both agree 
with that?
    Ambassador Indyk. I think that that is exactly right. It 
depends very much on how the deal breaks down. If there is a 
deal that meets the requirements of the P5+1, in terms of 
inspection, snap-back, and so on, then--and let us say that the 
Congress decides, in its wisdom, that this is not a deal that 
they can support, so we are responsible for, in effect, walking 
away, I think it will be very hard to maintain the 
international sanctions in those circumstances. But, if Iran 
refuses to agree to, for instance, inspection of its military 
bases, then we have a great deal of credibility in walking 
away. And I think, actually, we should, because I believe that 
they will then buckle under and accept what we need.
    Senator Kaine. Let me ask about the other part of the 
decision tree. If there is a deal--if there is a deal that 
generally meets the April 2 framework, and Iran accepts it, and 
we are going to have to dig into the details--I am particularly 
interested in inspections--there will be inspections. We want 
to make sure that they are vigorous, immediate, everywhere.
    Credible military threat. To my way of thinking, a credible 
threat to take out an Iranian nuclear program is combined of 
some elements: capacity to do it; backbone, willingness to do 
it; but also the intel that gives you the information about how 
to do it. Now, we have intel now. That has been demonstrated in 
the past, the intel that we have. And that is not going away. 
But, is intel plus the additional information that you get from 
an aggressive and significant inspections regime not better 
than intel without that? And so, would a deal that gives us 
significant inspections not enhance our intelligence, and 
hence, enhance the credibility of our military threat?
    Ambassador Indyk. Yes, I think that that is absolutely the 
case. Being on the ground and being able to go anywhere, 
anytime, is critically important. We are going to still need 
the intelligence assets that we have been using, and working 
with our allies and their intelligence capabilities. But, being 
on the ground makes a huge difference.
    In Iraq--and I had some experience when I served in the 
Clinton administration on this--when we had inspectors on the 
ground, even though they were being blocked in various places--
you remember that cat-and-mouse game that we always played--
nevertheless, we had a much better insight into Iraq's nuclear 
program. And, in fact, we were, at that point, comfortable 
about retiring the nuclear file, because we were persuaded, 
because of the inspections, that, on that front, as opposed to 
chemical and biological, we actually knew what they had and 
knew that we were able to monitor it and control it and prevent 
them from getting nuclear weapons.
    So, I think that that was a very interesting example of the 
way in which both give us an ability to know. And, in this 
case, the inspectors are going to be at the mine head, at the 
milling, at the enrichment process, at the stockpiling, and 
every--and in Arak, the plutonium reactor, heavy water reactor, 
we are going to have a full visibility on their program. And 
that goes on for--I think it was 25 years of that kind of 
inspection. I think that will give us some degree of assurance 
that we will know if they cheat.
    The Chairman. Thank you.
    I will interject that--and that was a good line of 
questioning, and I appreciate it--there is an agreement that we 
have not had access to that lays out what Iran is able to do 
from year 10 on. It is called the Iranian Nuclear Development 
Program. There is a document that outlines that. For some 
reason, the administration will not share it with us. I have 
asked both at the Energy level, the Secretary of State level, 
and the Chief of Staff of the President. And so, I think that 
there are legitimate concerns about what happens after year 10. 
And it makes me concerned that their unwillingness to share 
that--with us means they think it is something that will 
undermine the American people's confidence in what they are 
doing. So, hopefully, they will be forthcoming with that soon.
    Senator Gardner.
    Senator Gardner. Thank you, Mr. Chairman.
    And thanks, to the ambassadors, for being here today.
    In Ambassador Indyk's testimony, there was a quote that I 
will read here, ``Once sanctions are removed, Iran will be the 
beneficiary of the unfreezing of some $120 billion of assets, 
its oil revenues are likely to increase by some $20-$24 billion 
annually. It is reasonable to assume that a good part of that 
windfall will be used to rehabilitate Iran's struggling economy 
and fulfill the expectations of Iran's people for a better 
life, but it is an equally safe bet that the Iranian 
Revolutionary Guard Corps, the Ministry of Intelligence, and 
the Iranian Armed Forces will be beneficiaries, too.''
    Do you know what the amount that Iran sponsors terrorism at 
the level of funding that they actually contribute to funding 
of Hezbollah and other terrorist organizations?
    Ambassador Jeffrey. It runs, by the estimates I have seen, 
to the tens of billions, if you put in the Syrian operation, 
which is the biggest one, support for Hezbollah and some of 
their other activities around the region.
    Senator Gardner. We think it is around $200 million or so. 
And I think that is--tens of millions, certainly up to $200 
million, according to reports----
    Ambassador Jeffrey. Billion, sir.
    Senator Gardner. Billions? Okay, I am sorry. Yes.
    Ambassador Jeffrey. Not $200 billion, but probably in the 
$10-$20 billion range.
    Senator Gardner. Okay. And the economy is going to turn 
around. Would this encourage them--would they stop, once this 
economy turns around--from funding that line item?
    Ambassador Jeffrey. It is almost inconceivable, from any 
analogy or historical example I have seen, that a country that 
has an aggressive foreign policy, if it comes upon further 
resources, would then ratchet back. Typically, they will double 
down and try harder. That does not mean they will use all of 
that money, or even most of that money, because they do have 
pressing domesticate needs, and they have a lot of popular 
pressure to spend more on a consumer economy. So, some of that 
will flow to the domestic side. But, clearly, some of it will 
flow almost--by all evidence we have seen with Iran and in 
other countries, towards their nefarious activities through the 
region.
    Senator Gardner. And these nefarious activities are not 
going to make Israel more safe as a result of this agreement 
and a growing economy. Is that correct?
    Ambassador Jeffrey. They are not going to make anybody, 
including the Iranians, safe, in the end, Senator.
    Senator Gardner. Thank you, Ambassador.
    And in your testimony, you stated that, ``Any agreement 
should be judged not only on the basis of its verifiable real 
restraints in Iran, but also by the context within which the 
agreement would operate, readiness to back it by far more 
explicit and credible readiness to use force to stop a 
breakout, and a far more active U.S. program to contain Iran's 
asymmetrical military, ideological, religious, economic, and 
diplomatic moves to expand its influence in the region.''
    The President has said that there is no military solution. 
The President has talked that we cannot back away now. Could 
you explain that remark a little bit further?
    Ambassador Jeffrey. To the extent I can, because the 
President has said several different things.
    First of all, officially he said that he will use all 
necessary measures if Iran were to break out to a nuclear 
weapon. But, he has also said that he does not think that a 
military solution is going to buy you very much. He said, the 
other day to an Israeli journalist, that it would give you a 
temporary stop. That is true. But, we have seen military force 
before--against Iraq, three times, by the Israelis and by us in 
1991, and then by us in 1998--lead to the termination of 
weapons of mass destruction programs. We have seen it, 
obviously, in the case of Israel striking Syria. And after 
2003, when we went into Iraq, that is when the Iranians halted 
their weaponization program, and it is when the Libyans decided 
that it was high time for them to give up their programs.
    So, military force can have an effect beyond how many 
targets you hit and how long it will take to reconstitute. It 
does have a political influence on the other side. So, I would 
not rule it out. Never.
    Senator Gardner. There has been conversations--I think, 
opinion pieces written in the Wall Street Journal and others--
talking about this bifurcation in these negotiations of 
political restraint with nuclear restraint, that the agreement 
seems to sort of have almost a tunnelvision on the issue of 
nuclear restraint without addressing any other areas of Iranian 
political restraint. And that is ideological, religious, 
economic, diplomatic moves to expand influence in the region, 
or perhaps use those efforts in nefarious ways against our 
allies and, indeed, against the United States. Do you think, 
under these negotiations, have we lost track of the fact that 
we also have other areas that need to be restrained?
    Ambassador Indyk. I do not think so. And--but, I think it 
is important to understand that it was not possible to address 
those concerns in this negotiation without weakening our 
ability to get what we needed, in terms of blocking Iran's four 
pathways to a nuclear weapon. If we had allowed the agenda to 
widen to address the issues of their activities in the region, 
they would have used it as a tradeoff, they would have linked 
their behavior in the region to the negotiations about their 
nuclear program. And so, if they agreed to less regional 
disturbing activity, they would expect us to be more lenient on 
their nuclear program. We could not enter into that.
    Plus, our Arab allies said, ``It is none of your business 
to be discussing those issues with them when we are not at the 
table, because that affects our direct interests.''
    So, I do not think it was possible to address it within the 
context of the deal, but we need--we do need to address it 
outside the deal and in parallel to the deal. And that is the 
burden of my argument here.
    Could I say one other thing about force? I think that the 
use of force--the threat of the use of force, and a credible 
threat of use of force, is critically important, in terms of 
deterring a breakout by Iran or, in fact, cheating on this 
agreement. But, actually using the force has a problem. That is 
what the President was referring to. That is--and that is what 
happened in the case of Israel's bombing of the Osirak nuclear 
reactor. What the Iraqis did was, they took their whole nuclear 
program underground. We had no visibility on it. And we were 
surprised when we actually went into the country, in 1992, to 
discover that they had this massive nuclear program that we 
knew nothing about. And that is the danger, here, that if we 
have to use force, what we will end up with is something less 
than what we can have through the deal, itself. Ten to 15 years 
of a nuclear-free Iran versus 2 to 3 years by bombing all their 
facilities, but they have got the know-how, they can rebuild, 
they will no longer be under any obligations, and they will 
claim that they then have a justification for getting nuclear 
weapons, because they were attacked when they did not have 
nuclear weapons.
    Senator Gardner. Ambassador Jeffrey, would you like to 
respond?
    Ambassador Jeffrey. Ambassador Indyk's absolutely right 
about the Osirak bombing, but I would just add that the reason 
we went in in 1992 to find that was on the back of American 
tanks.
    The Chairman. Senator Udall.
    Senator Udall. Thank you both for your service to the 
country. And I think this has been a very good discussion and 
you have had some very insightful comments.
    One of the issues here that has been raised is Iranian 
dominance, Iranian hegemonic desires, that kind of thing. Do 
you believe our U.S. foreign policy has contributed to the 
strengthening of Iran in the region, some of the decisions that 
we have made?
    Ambassador Indyk. Well, now we are--now we will get 
contentious, and I do not mean to be so.
    Senator Udall. Well, I am not----
    Ambassador Indyk. But, I do----
    Senator Udall [continuing]. I am not trying to be 
contentious----
    Ambassador Indyk. No, I will be contentious.
    Senator Udall. Oh, okay.
    Ambassador Indyk. Not you, Senator. [Laughter.]
    Ambassador Indyk. The--because, look, again, I will go back 
to the experience of the Clinton administration. There were--we 
had real concerns about what Saddam Hussein was doing to his 
people, and we were constantly looking at what we needed to do 
to prevent that. But, we were always constrained by the concern 
that we had that, if we took him out, we would open the gateway 
to the influence of Iran in Iraq. That was a major concern 
during that time.
    Now, that is what happened as a result of taking Saddam 
Hussein out. Now, I was in favor of that war, but I was also in 
favor, similarly today, of doing a whole lot of things that 
would have prevented that from happening. But, that is what 
happened. Once the gates of Babylon were opened to Iran, that 
opened the way for them to exert their influence across the 
region. They were already in Lebanon via the Shia community 
there, and Hezbollah. But, Iraq was a big prize for them. And 
it was done, courtesy of the U.S. Army and the U.S. taxpayer.
    Senator Udall. Ambassador Jeffrey, do you have the same 
view?
    Ambassador Jeffrey. Certainly going into Iraq was a benefit 
to Iran, but it did not have to be as bad as it turned out to 
be. I mean, there were steps that we could have taken over the 
last----
    Senator Udall. But--so, what should we have done?
    Ambassador Jeffrey. We could have made it clear that, in 
other ways, we would have stayed there longer, and that Iraq's 
security was in our interests, and that we were there for the 
long haul, not trying to get out. That is the first thing. But, 
second----
    Senator Udall. But, staying there for the long haul would 
have meant changing the Shia government in such a way that they 
were going to be inclusive. You actually think we could have 
made them do that?
    I mean, it looks to me like the--that there was just a real 
desire, in terms of dominance and not being inclusive, and I do 
not know, really, how the United States--can you tell me how 
that they, the United States, can make the government do that?
    Ambassador Jeffrey. The answer is, we cannot, Senator--and 
it is a very important point--even at the point of a gun. What 
we can do is have influence. These are rational people, in all 
of the political parties in Iraq. Some of them are pro-Iranian, 
some of them are not, some of them are opportunistic. In the 
period from roughly 2008, when the Shia militias were put down 
by the Maliki government, to roughly 2012-13, the country was 
able to live in relative peace and relative rapprochement 
between the various groups. Two things happened. One is, 
slowly, in part because we did not have the influence that we 
should have, other forces, including Iran leading the charge, 
pushed toward a more Shia-dominated system. Secondly, and far 
more seriously--and I think this is the point where we have 
most contributed to Iran's spread in the region--Syria 
happened. Nothing in the last 15 years has had the same effect 
on the region as what happened in Syria and the fact that we 
did not react to it. It has delivered repeatedly in bad ways: 
the rise of ISIS, one of the biggest humanitarian and----
    Senator Udall. Could you not also make the argument that 
the rise of ISIS came as a result of what was done in Iraq? I 
think there is a significant connection there to what is going 
on.
    But, let me ask--Ambassador Indyk--he has mentioned Syria 
and there should be a no-fly zone. Do you think that should be 
done unilaterally by the United States, or should it be done 
collectively through the U.N. or other multinational 
organizations?
    Ambassador Indyk. Well, I do not think that U.N. collective 
action is an option here, because the Russians will veto it.
    Senator Udall. Is there any reason to push it anyway to 
show what their position is?
    Ambassador Indyk. We are operating a kind of de facto no-
fly zone in parts of Syria already, just because the Syrian Air 
Force will not fly where our Air Force flies. And we can--there 
are plenty of ways in which we can affect the calculus of the 
Syrian Assad regime. You know, I do not know why we cannot take 
out helicopters that are dropping barrel bombs on Syrian 
civilians. We would only need for us to take out one or two, I 
believe, and the Syrian regime would get the message. So, there 
are certainly things that we could do that I think would stop 
short of a formal declaration of a no-fly zone but would give 
relief to the Syrian people and would send a very important 
signal to not just our Arab allies, but so many across the Arab 
and Muslim world that are deeply affected by the fact that we 
are not doing anything. We are flying there against ISIS, but 
we are not doing anything against the Syrian regime.
    Senator Udall. Thank you very much.
    Thank you, Mr. Chairman.
    The Chairman. Senator Flake.
    Senator Flake. Thank you, Mr. Chairman.
    Thank you for the testimony.
    I have been supportive of these negotiations with Iran, 
partly because I sense that it would be tough to hold the 
coalition that we have put together, together for much longer. 
And I agree with your assessment that it was the international 
nature--the multilateral nature of the sanctions that really 
bit, particularly the financial sanctions, and the success came 
because it was Iran versus the West rather than Iran versus the 
United States. And so, I think going through these negotiations 
was probably the only way to really keep this coalition 
together. If Iran does not comply now, and we can come back, 
and it will not be that simply nothing will be good enough for 
the United States, but there is a material breach that is 
demonstrated that Iran simply will not live to the agreements 
that were set out, if that is the case. So, I have been 
supportive of the negotiations.
    I agree with the formulation that Senator Kaine put 
forward, that Iran--that the sanctions were effective, 
certainly in debilitating their economy, but it did not do much 
to slow their drive toward a nuclear weapon. And I do not know 
how the same level of sanctions, you know, over another period 
of time--why we would expect that to have any different result. 
So--but, now, given where we are--and I agree with the 
formulation that an agreement that really, truly does limit 
their ability to move forward to a nuclear weapon, if only for 
10 or 15 years, is better than not having an agreement, and 
then we can focus on the other issues. But, that is what I want 
to ask you a bit about.
    Ambassador Jeffrey, in your remarks, you state that, ``The 
region needs a strong commitment from the United States to push 
back Iran's actions in Iraq, in Syria, and elsewhere.'' What 
would that look like in Iraq? What would a stronger commitment 
from the United States look like right now in Iraq?
    Ambassador Jeffrey. The Camp David meeting actually had a 
final statement that had some pretty good language. It said 
that the parties believe that Iran should be required to 
agree--engage on the principles of good neighborly relations, 
strict noninterference in the affairs of other countries, and 
respect for territorial integrity throughout the region. These 
are, of course, exactly the things it is not doing. And in 
Iraq, one reason Iran is gaining influence--and we saw this in 
the balance between Tikrit and Ramadi--is that we are not as 
present as we should be. And therefore, the Iraqi people, 
including even many of the Sunnis I know in Ramadi, are having 
to turn to the Shia militias, some of--not all of them, but 
some of whom are under the thumb of Iran, the Khatib Hezbollah, 
Asa al-Haq, and, to a considerable degree, the Badr Corps--
those are the three major ones--because there is not an 
effective Iraqi military. One of the reasons there is not an 
effective Iraqi military is that we have not put our troops, as 
we have done in every other conflict I have been involved in, 
on the ground with these units, technically to advise them, to 
call in air support, but, frankly, in many respects, to 
strengthen their spine and to reassure them that, as long as 
our troops are there, they will get air support, they will get 
medevac, they will get resupply, and they will not be overrun, 
because we will not let it happen. I cannot describe what a 
difference that makes. I saw it in Vietnam in 1972, I saw it in 
Iraq in 2010. Having Americans out there would increase the 
capabilities of the Iraqi forces tremendously. It would also 
show America cares, we are willing to put skin in the game. If 
we take casualties, we are willing to do this because Iraq's 
important to us. Iran is willing to put people out there.
    Senator Flake. Ambassador Indyk, do you have any thoughts 
on that? What would a more robust----
    Ambassador Indyk. Yes, I think that it starts at the 
political level. Abadi is definitely the--the Prime Minister is 
definitely better than Maliki. But, his commitment to 
inclusiveness is somewhat constrained; in particular, by 
pressure from Iran. And we need to be equally assertive, in 
terms of pressing him to go through with the commitments he has 
made to inclusion, when it comes, on the political level, to 
the Sunnis. They feel excluded, and that is--as long as that 
continues, it is going to affect the morale of the military, 
the willingness of Sunni soldiers to fight. And so, that is 
point number one: inclusion is critically important, and we 
need to be actively engaged in that.
    Point number two is, we should be building more actively 
the capabilities of the Sunni militias and the Kurdish 
peshmerga. Again, because of our respect for the sovereignty of 
Iraq, we are going through the Iraqi Government. And the Iraqi 
Government, under the pressure from Iran, is restraining what 
we can do there. And we need to--I think we have made some kind 
of breakthrough on that front now, that I heard just this 
morning, with the Sunni militias, that arms will be going to 
the Sunni militias. I think that is critically important. We 
need to be arming the Kurdish forces, as well, in a more robust 
way.
    So, it is on the military level--I endorse what Ambassador 
Jeffrey said, in terms of embedding our special forces--but, it 
is also political and arming of the militias.
    Senator Flake. Let me return to the nuclear negotiations 
for a minute. If we concede that Iran--what our goal is, is to 
try to keep them from a 1-year breakout period. If we assume 
they are that close now, what is their motivation--their real 
motivation now to come to the negotiating table? Would they not 
have more leverage if they were to complete that march toward a 
weapon and then negotiate after that? Why do you suppose they 
are coming to the table now? Do they fear a strike or perhaps 
are they not as close as we think they are?
    Ambassador Jeffrey. My view, Senator, is, they were very 
close to that point. Remember, when Prime Minister Netanyahu 
went to the U.N., I think, in 2013, and he drew the redline on 
the 20-percent enriched uranium. They were close to 200 
kilograms. When you get a little bit above 200 kilograms, you 
will have enough for what is called a significant amount, SA, 
of--you have had the briefings--25 to 27 kilos of 90-percent 
enriched for at least one nuclear device. So, they were right 
up to that point. But, that was also when the international 
community was really hitting them hard with sanctions, they 
were having a huge impact on their economy. Also, both Israel 
and the United States were at least making noises about a 
military strike. That not only had an effect on Iran, it had a 
frightening effect on many of our friends, including the 
Europeans, who have never seen a war they do not want to run 
away from. So--that may be a bit unfair, but, you know, they 
were very nervous about either us or the Israelis striking, so 
they were willing to do these very, very dramatic sanctions, 
ending all oil imports and doing other things against Iran. So, 
you had a combination of events that put Iran under pressure, 
and then it decided, ``Maybe we will back off a little bit.''
    But, the important thing is, they are giving up nothing. 
And this is on the express decision of the Supreme Leader. They 
are not closing anything down, they are not blowing up a 
reactor, like the North Koreans did, they are not admitting 
guilt on the possible military dimensions. They are basically 
just putting things in storage for a while, or converting 
things. But, they are not admitting guilt, and they are not 
really changing their entire program to get to this 1 year.
    Ambassador Indyk. Could I just add to that one point that I 
think is worth noting about the agreement?
    They are giving up something very significant when it comes 
to their Arak heavy water reactor, which is the most dangerous 
and expeditious way that they could get plutonium for a nuclear 
weapon. And they have agreed, there, to reconfigure the core, 
to ship out the spent fuel, and not to have any kind of 
reprocessing facility. That is a very robust measure, and it is 
designed specifically that way because that is precisely the 
way that the Koreans broke out.
    And so, while it is true that they have not blown up 
anything, as Ambassador Jeffrey suggests, they have accepted 
the kinds of curbs that we need to be sure that they have 
blocked--that we have blocked their pathway. We have to be 
concerned about cheating. We have to be concerned about what 
happens at the end of the road. But, I think that, in terms of 
what our negotiators have generated here within the confines of 
the Iranians having to be able to say, you know, ``We did not 
blow up anything,'' essentially is not a bad deal. In that 
regard, it is a good deal.
    Senator Flake. Thank you.
    The Chairman. Senator Markey.
    Senator Markey. Thank you, Mr. Chairman, very much.
    Ambassador Jeffrey, in your testimony, you call for an 
advanced authorization for use of military force against Iran 
to prepare for the possibility that they will violate an 
agreement that has not yet been reached. So, this is the 
committee would have to pass an advanced authorization for the 
use of military force against Iran. We already have two such 
authorizations that are open-ended, not limited by geography, 
and we have a third one that is pending before this committee 
with regard to what the limitations should be for the 
authorization.
    Could you talk a little bit about what you think should be 
in that resolution, what type of military force we should be 
explicitly putting into that resolution, and what should be the 
conditions under which this committee passes an authorization, 
given the fact that we do not know what the conditions will be 
that could possibly then trigger the use of that use of 
military force in the resolution that you would recommend.
    Ambassador Jeffrey. Thank you, Senator.
    To be specific, this is something that would be part of a 
package if, in fact, the Senate did not take--if we do get to 
an agreement--the first step, then, under the Iran Nuclear 
Review Act, you looked at the act, and you did not take action 
to stop the lifting of sanctions; thus, the agreement would go 
forward. This would be a measure to ensure that, if we do have 
this agreement, it is clear to all, including the Iranians 
and--but also including--to our friends in the region that this 
is not a watershed event in our relations with Iran, it is 
simply a deal to get them to stop moving towards nuclear 
weapons capability. So, therefore, if they were to try to break 
out--and they still could do this within a year under the 
agreement, as we understand it--that current U.S. policy laid 
out by the President repeatedly is that we will use military 
force to stop Iran from getting a nuclear weapon. Given recent 
events, including the Syrian debacle, it would be helpful if we 
knew that the U.S. people, through the U.S. Congress, supported 
that action----
    Senator Markey. Can I--may I just ask, just so I 
understand--you want us--you want this committee to authorize 
the use of military force against Iran explicitly in the event 
that they violate the agreement, or in the event that there is 
no agreement?
    Ambassador Jeffrey. In the event, with or without an 
agreement, that Iran is on the verge of getting a nuclear 
weapon, and the--this administration nor no other 
administration has ever said what that red line would be; that 
is another issue--but, certainly it is U.S. policy that we 
would use all means at our disposal--it is euphemisms, but it 
is clear it means military force--to stop Iran from actually 
achieving a military capability. As that is our policy, but as 
there is some question to our willingness, given the Syrian 
experience, to carry out that redline policy, it would be 
helpful if the U.S. Congress were to do that. In particular----
    Senator Markey. Well, again, it was not necessary--it was 
not necessary to carry out the redline policy, because Assad 
acceded to what it was that, in fact, the goal of the 
administration was, which was to put their chemical weapons 
under--so, in fact, we did not have to go beyond the redline, 
because Assad accepted the conditions. So, I guess--again, and 
I am trying to just zero in, here, on--in terms of what you are 
asking for. It--is it that we should be having this debate now, 
or should we have this debate after the administration 
concludes the deal with the Iranians?
    Ambassador Jeffrey. After it concludes the deal with the 
Iranians. The other thing with the Syrian thing is----
    Senator Markey. And if the--let me just understand--and if 
the deal is one that is acceptable to the United States and to 
Iran, should we still pass an Advanced Authorization for the 
Use of Military Force Against Iran?
    Ambassador Jeffrey. Yes, I think so, because there are many 
people who think that, even with a deal, you are----
    Senator Markey. Really?
    Ambassador Jeffrey [continuing]. Going to have an Iran that 
either will cheat or will try to get around it.
    Senator Markey. What do you think of that idea, Ambassador 
Indyk, that, even after we reach an agreement, then this body 
would pass an authorization?
    Ambassador Indyk. It strikes me as a kind of a belt-and-
suspenders approach. We do not need it.
    I am wary about it, partly because it, in a sense, puts the 
Iranian finger on our trigger. And I am not sure that that is a 
wise path to go down. I think the President's statement that he 
is willing to use all means necessary to prevent Iran from 
getting a nuclear weapon is clear. We have deployed significant 
forces in the gulf, and taken measures with our gulf allies to 
ensure that the Iranians understand that there is a real 
capability. So, if we are trying to get at the question of will 
to actually use that, I think that there are other ways that it 
can be done without, in effect, producing a kind of 
automaticity to how we would respond.
    Senator Markey. Well, I tend to agree with you. I think 
that obviously the goal of an agreement with Iran is to move 
toward a normalization of relations with Iran. Now, is that 
possible? We do not know that, at this point. But, if there is 
going to be some attempt that is made towards a rapprochement 
between the Arab and Iranian Governments, then surely it is 
based upon an agreement that does not then lead to an 
automaticity of action that is already pre-approved by this 
committee, in terms of use of military against Iran if there 
are some questionable activities, questions that are raised 
with regard to compliance with the agreement.
    So, I just disagree with you, Ambassador Jeffrey. I just 
think that that would be a dangerous statement for us to be 
making at a point at which we have reached an agreement that is 
acceptable to the P5+1 and that is going to, I think, actually 
lead to a sigh of relief across the planet, and that this would 
be an unnecessary escalation, in terms of the dynamic that 
would have--potentially have been created between our country 
and Iran.
    Ambassador Jeffrey. Senator, one word on this. I understand 
your point. Nonetheless, it is the policy of the U.S. 
Government that we would do this. That is announced repeatedly 
by the President at almost every opportunity when he does talk 
about the Iranian situation.
    Secondly, the deal with Syria, the willingness of the 
Russians to try to negotiate a deal, I believe happened only 
after this committee passed a resolution authorizing the use of 
force by the U.S. Government against Syria.
    Senator Markey. I would say, again, sir, that, while it is 
the kind of the sotto voce policy of our country that Iran 
would not be allowed to have a nuclear weapon, the premise of 
the treaty will be that they are not going to get a weapon, 
because there will be full-scope safeguards that are in place 
that will give us the tripwire that we need to know. To then 
have us act as though they are not in compliance or that they 
will not be in compliance, and that we are authorizing military 
force, I think, would complicate, dramatically, our ability to, 
in fact, gain the full benefits of the treaty that we are 
hoping can be negotiated.
    Thank you, Mr. Chairman.
    The Chairman. Thank you.
    Ambassador Indyk, we fudged by 10 minutes. Usually, 
Secretary Kerry comes in and tells us he has a hard stop, but 
stays hours later. I did want to give you an opportunity to 
stay and make sure this is fair and balanced, until we end, or, 
if you need to leave and go to your board meeting, you are 
certainly welcome to do that, too.
    Ambassador Indyk. Thank you very much, Senator. I apologize 
to all of you that I have to chair a meeting that I convened 
with 30 people, and I could not change that. And I really 
apologize that I have to leave.
    The Chairman. Well, listen, thank you very much for your 
service, for being here today. And the record is going to 
remain open for some period of time. If you would answer 
questions, we would greatly----
    Ambassador Indyk. With pleasure.
    The Chairman [continuing]. Appreciate it. And, with great 
appreciation, you are dismissed.
    Ambassador Indyk. Thank you very much.
    The Chairman. With that, Senator Risch.
    Senator Risch. Thank you, Mr. Chairman.
    Mr. Jeffrey, I guess I would like your thoughts on this. My 
problem with all of this is, I have a threshold question that I 
have trouble getting beyond and that we have made reference to 
it here today. And that is the fact that when we started these 
negotiations, I said, ``This is great. We are going to sit down 
with the Iranians, we are going to get them to the point where 
they say, 'Well, we are going to--we want to be a normal 
country. We are going to give up meddling in other people's 
affairs. We are going to give up being sponsors of terrorism. 
We are going to actually quit doing acts of terrorism.' '' And 
then I find out they say, ``No, that is off the table. We are 
not going to talk about that at all.''
    And so, here is the problem I have got. If the--the 
negotiations are regarding what they are going to do over the 
next 10 years in developing a nuclear weapon, but, in so doing, 
if I vote for that, I am voting for a condition by which we, 
and everyone here who votes for it, is going to boost the 
Iranian economy by taking off these sanctions; and, secondly, 
we are going to release a whole lot more cash in oil. And we 
know for a fact--we know for an absolute fact that a portion of 
that money is going to go to sponsor terrorist activities, and 
are going to kill--releasing that money is going to kill fellow 
human beings. I do not know who they are, I do not know where 
they are, I do not know how many they are, but I know for a 
fact that my vote, in releasing the sanctions and releasing the 
cash, is going to result in the death of innocent human beings 
somewhere in the world.
    On the other side, they say, ``Oh, no, we need to vote for 
this because this is so wonderful. We are going to get them to 
stop building the nuclear weapon,'' et cetera, et cetera. Well, 
as they build a nuclear weapon, we do not know what is going to 
happen there. Israel, or we, may even get the spine to stop 
them from doing that, militarily. But, I know for a fact what 
is going to happen if I vote for this. How do you morally 
justify that kind of a vote?
    Ambassador Jeffrey. That is a tough question, Senator. I 
think that if I would make the case for an agreement, it would 
be, first of all, it is separate from all of its other 
nefarious activities. As you have pointed out, and as we have 
discussed here today----
    Senator Risch. But, it is not separate.
    Ambassador Jeffrey. Exactly. Because of the money.
    Senator Risch. It is tied closely and directly to that.
    Ambassador Jeffrey. But, if the agreement is not only 
linked with very clear American willingness, with our friends 
and allies, to use force against Iran either on the nuclear 
account--what we just had this discussion a moment ago on--or 
to block their actions in the region to kill more people, and 
if that agreement gives us more international support to do 
just that, that would be a case for doing it. That is, in the 
end, we might be able to be more effective in stopping these 
guys if it is very clear to everybody that we are really in the 
business of stopping these guys. And I think what you have 
heard today, from at least me, is that it is not clear that we 
are in the business of stopping them. That is the thing I focus 
on.
    Senator Risch. I appreciate that. And I hope you can 
appreciate the dilemma that this puts us in.
    But, the second dilemma that I have, when this whole thing 
started and I started drilling down into what we were actually 
doing here, is that, you know, we are--two parties are sitting 
down at the table and wanting to get to a different point. I am 
yet to be convinced that the Iranians are negotiating to agree 
to get to a point where they will never have a nuclear weapon. 
Indeed, as I have analyzed this, it seems to me they are 
negotiating for a path and a timeframe on which they can count 
on being able to have a nuclear weapon.
    Now, this is a 10-year deal. We are dealing with a culture 
that is 5,000 years old. I mean, 10 years to these people is 
absolutely--it is nothing in the overall scheme of things, even 
if you stretch it to 15, which people are--some people refer 
to. One of the things that concerns us, and I think it concerns 
the chairman, is, we are not getting the answers we want about 
what happens at the end of this 10-year period. Even in 
classified settings, they are not telling us things that we 
need to know, people who are going to--who are going to have to 
sign off on this thing.
    So, if I were the Iranians, I would say, ``Look, all right, 
let us cut the best deal we can. We will get the sanctions off, 
our economy grows, our people are happy, we are able to use the 
money to do the research that we need to do to get where we 
want to get at the end of this 10-year period.'' At the end of 
this 10-year period, they say, ``Okay, world, we made an 
agreement, we kept our part of the agreement. Now you keep 
yours and leave us alone, because we are going to build a 
nuclear weapon.''
    Now, so far, no one has been able to assure me that this 
agreement is going to be such that the Iranians are going to 
say, ``Okay, we are going to give up--we are never going to 
build a nuclear weapon.'' Everyone is saying, ``Well, that 
probably is not what we are going to see.'' Well, if that is 
not what we are going to see, then they have effectively 
negotiated a path and a timetable towards which they can have a 
nuclear weapon. And so, you know, just putting this off for 
this period of time seems to me to be not a good bargain at 
all.
    Your thoughts.
    Ambassador Jeffrey. First of all, this agreement does not 
stop anything. It is an agreement all about a period of time. 
If everything that the administration, on the 2nd of April, 
said happens actually happens, you get approximately 1 year of 
notification, assuming that you have inspectors on the scene, 
during which you can react if they start violating the 
agreement. At the end of that year, they will be at a point 
where they can get a nuclear device.
    At the end of 10 years, Senator, that time period shrinks, 
because two things happen. First of all, the restriction on 
5,000 functioning centrifuges goes away. They can increase that 
to almost any number. Secondly, the limitation on the kind of 
centrifuges--there are far more efficient ones, the IR-4s, -6s, 
and -8s--that restriction goes away, too. I----
    Senator Risch. Along with even more efficient ones that 
will be developed over the next 10 years.
    Ambassador Jeffrey. That, too, although there is a 
restriction in this--assuming, once again--the rules of my 
hypothetical case is that they adhere to all the rules. And 
there are rules that they cannot do any research on centrifuges 
during that period of time. In fact, that is a 15-year rule.
    So, at the end of the 10 years, with unlimited centrifuges, 
because they are going to have 18,000 plus some of these new 
ones, I have seen indications that, within just a couple of 
months, almost as fast as where they are now, they could 
probably return to a nuclear weapons capability, a significant 
amount, for one nuclear device. So, you shrink very much at the 
end of that time. It does not mean they are going to do it. 
Once again, whether we have 1 year or 1 week, the question is, 
If they are moving to a nuclear weapon, what are we going to do 
about it? And, more importantly, what do they think we are 
going to do about it? Which is why I get to the importance of 
not just the President, any President, saying that he or she 
will use military force, but the importance of the U.S. people 
and the U.S. Congress saying that. That is, in the end, the 
only thing that is going to stop them from getting a nuclear 
weapon.
    Senator Risch. And I think that is well put. And the 
comment that was made, by either you or Mr. Indyk, that all 
this is doing is putting things in storage for 10 years, I 
think the American people need to understand that, they need to 
understand what we are taking on, here.
    My time is up.
    Thank you, Mr. Chairman.
    Ambassador Jeffrey. But, Mr. Indyk was right about--and I 
am--let the record show that they do change the core of the 
plutonium heavy--well, the heavy water plant, and that is the 
one concrete thing that goes away in this entire agreement, as 
it is laid out.
    Senator Risch. For the period of time that the agreement is 
in effect.
    Ambassador Jeffrey. For that period of time, exactly. For 
15 years.
    Senator Risch. Thank you.
    The Chairman. Senator Murphy.
    Senator Murphy. Thank you very much, Mr. Chairman.
    Thank you, Ambassador Jeffrey, for sticking with us.
    Just one quick followup. So, we were never going to get a 
permanent agreement here, so it does not matter, when you are 
talking about, What is 10 years? What is 15 years? What is 20 
years? Because we were always going to be talking about a 
certain period of time, and then the world being different 
after that period of time.
    It is important to know that one of the 15-year 
restrictions is on the stored enriched content. That is a 15-
year restriction. And so, you would agree that, even though 
they will begin to spin more centrifuges after the 10-year 
period, the fact that, should they abide by their continued 
restriction on how much capacity they have, is a significant 
limitation on their breakout capacity.
    Ambassador Jeffrey. Absolutely, because then most of their 
feedstock would be pure uranium, and that does take longer. 
But, again, the 1-year period would drop to somewhere between 
one-half and one-third of that, I believe, in that period 
between 10 and 15 years. At the end of the 15 years, then 
almost all restrictions are off, because they can enrich up to 
20, or any, percent from that period on, and the amount of 
stocks they can have is unlimited. But, I think, as Chairman 
Corker said, the President, himself, on NPR some time ago, said 
it is 10 years. He has changed his mind since then, but I think 
the 10-year is basically--if you are going to make an argument 
for this agreement, you should hang your hat, I think, on 10 
years, sir.
    Senator Murphy. And, of course, important to note that the 
inspections last well beyond the 10- to 15-year timeframe, 
which is why many of us would make the argument that it is not 
a 10-year deal.
    But, I want to come back to this question of this 
comprehensive strategy to try to push back on Iran's growing 
influence in the region. I do think it is a rewrite of history 
to suggest that this set of sanctions on Iran to try to change 
their disposition on a nuclear weapons program was about all of 
their other behavior in the region. I certainly believed, when 
I was voting for those sanctions, that, should Iran choose a 
different path when it comes to a nuclear weapons future, that 
we would engage in a conversation about withdrawing some of 
those sanctions. And, in part, that is why we have a separate 
set of sanctions in place for some of their other behavior in 
the region, and we reserve the right to increase those 
sanctions, should they not change that behavior.
    So, I understand the moral question Senator Risch is 
getting at, in that we do have to accept that part of this 
money may be used to support a group like Hezbollah or the 
Houthis. But, I think we are just not accepting the premise of 
the sanctions in the first place if we extrapolate and expand 
it to all sorts of other behavior in the region.
    And so, let us talk about this more comprehensive approach 
that both you and Ambassador Indyk reference. And I guess part 
of my confusion is that it often seems to begin and end with a 
question of increased military capacity that we are going to 
give to our Sunni partners in the region to try to control the 
bloodshed once it starts happening, rather than talking about 
all of the ways in which we can try to tamp down on the reasons 
that groups like Hezbollah and ISIS and the Houthis have 
influence in the first place, which is deteriorating conditions 
of government, of rule of law. That does not seem to factor 
into a lot of our conversations about what we should be doing, 
in terms of growing a comprehensive strategy. And even, I 
think, your testimony is limited to a handful of military tools 
that you are recommending.
    As we sort of grow this comprehensive strategy next to a 
nuclear agreement, is it not more important to be putting in 
place a set of nonmilitary tools so that the conditions are not 
so ripe for both Sunni and Shia insurgencies in these regions, 
instead of simply having conversations about what our military 
toolkit is?
    Ambassador Jeffrey. You are absolutely right, Senator. The 
reason I focused on the military is that it is often the long 
pole in the tent in any administration, I would argue, 
parenthetically, particularly in this one; but, frankly, I have 
seen every administration, Republican and Democratic, have 
hesitations about using military force.
    Military force is a necessary, but not sufficient, part of 
the package to deal with the Iranian threats to the region, 
which, again, are not mainly about direct military aggression 
on the gulf states or our other allies, which F-15s and F-16s 
and air defense missiles might help, but infiltration in subtle 
actions. But, these subtle actions, be it in Ukraine or the 
South China Sea or in Iraq or Yemen, have a military component, 
and people are nervous about getting involved militarily if we 
are not backing them. And that requires some use of military 
force.
    But, many other things are necessary. One of the concerns I 
have is, if we do not get engaged, our allies will go off on 
our own, and they will conduct policies and operations that 
will be too military, too one-sided, will simply lead to 
escalation. We tend to bring a certain amount of moderation. I 
am a diplomat by profession, not a soldier. And that is what 
people like me go out and do. We try to leverage our military, 
our sanctions, our energy and other policies to get people to 
sit down and resolve disputes, be it in Syria, be it in Yemen. 
And we are capable of doing that. Those are all part of the 
package.
    But, the earnest money on the table, particularly now, but 
basically always, has to be a willingness, if necessary, to use 
military force. That has to be part of the package. And people 
do not think it is.
    Senator Murphy. Yes, I worry that you may misread where the 
reluctance lies in Congress today. There does not seem to be as 
much reluctance here to fund the military. The reluctance seems 
to funding all of the nonkinetic tools that are part of this 
comprehensive strategy.
    What about our other sets of sanctions? So, we have the 
ability to increase--maintain or increase sanctions against 
Iran for the continued development of a ballistic missile 
program, for their support of terrorist groups in the region. 
What do you make of the potential for a separate set of 
sanctions and their potential expansion to be part of this 
comprehensive strategy that we are talking about?
    Ambassador Jeffrey. To send a signal, it is always helpful 
when the U.S. Congress speaks with one voice and does something 
that is--that will get a lot of attention, such as impose 
sanctions. But, on Iran, the really effective sanctions are 
international ones. Those are the ones that brought it to the 
table. And those sanctions are, at this point, narrowly focused 
on the nuclear account. It would be hard to get U.N., or even 
EU, sanctions, and certainly global sanctions, on Iran for its 
activities. In Syria, of course, one of its allies is Russia. 
That is the problem right there.
    Senator Murphy. Well, and I think part of the reason that 
it has been hard to grow international support for those other 
activities is that the priority has been stopping Iran's 
nuclear ambition. And so, to the extent that you take that 
issue off of the table, at least for a short period of time, 
back to how Ambassador Indyk described it, it gives you the 
room in which to build a comprehensive set of international 
sanctions, with or without a country like Russia to influence 
their other behaviors.
    Thank you. I am over time, Mr. Chairman.
    Thank you, Ambassador Jeffrey.
    The Chairman. Thank you.
    Senator Shaheen.
    Senator Shaheen. Thank you, Mr. Chairman.
    And thank you, Ambassador Jeffrey, both for being here and 
for staying for people like me who had another hearing and so I 
am late coming to this.
    There has been a lot of speculation about if Iran gets a 
nuclear weapon, what that does to nuclear proliferation in 
there region, that the Saudis then follow, then other countries 
will feel like they need to do that. So, is there some reason 
to think that, if there is success in the final negotiations, 
that that could have the opposite effect for the region, that 
it would help to address some of the concerns that we have 
heard from other countries?
    Ambassador Jeffrey. We have heard nonofficial gulf-state 
personalities openly, and more official ones behind the scenes, 
say, ``This is an option if we are not happy with the result.'' 
I think it is a possibility. Ambassador Indyk, in his written 
testimony, took a somewhat different view that I urge you to 
take a look at, as well. What I think is, our friends in the 
region are going to look at everything we are doing. It is 
definitely not the policy of this administration, or any 
conceivable American administration, to have anybody in the 
region developing a breakout nuclear capacity, let alone actual 
nuclear weapons, so we are not going to be in favor of that.
    The more we are doing things that they need for their 
security that are hard for us to do--and that gets to the long 
pole, the military, again--the more influence we are going to 
have to persuade them not to go down that road. The more they 
are feeling lonely, ignored by us, threatened by Iran--and 
there is a certain pride here, ``Well, if Iran can have it, why 
can I not?''--then they are going to be more interested.
    Again, Ambassador Indyk, in his testimony, talked about a 
possible nuclear guarantee over the region. That is another 
idea, that these kinds of things that involve American 
commitments, particularly military commitments, will give us 
more leverage to try to persuade these people not go down that 
route. But, it remains open to them. If they do not like what 
they are hearing, and particularly seeing, out of Washington 
and in our actions in the field, there is a real possibility 
that some of them might go in this direction, sure.
    Senator Shaheen. Well, so talk a little bit more, if you 
would--I know it is Ambassador Indyk's idea, about the 
extension of the U.S. nuclear deterrent umbrella for some of 
the countries in the region, but do you see that as making a 
real difference? And how will countries like Iran react if we 
do that, post-negotiation?
    Ambassador Jeffrey. I think, rather like my suggestion for 
an Advanced Authorization for the Use of Military Force, which 
Ambassador Indyk was a little bit equivocal about, I would be a 
little bit a equivocal about that. But, both of us are trying 
to do the same thing. We are looking desperately for ways for 
the United States to show symbolically that we are in the game 
for these people, be it by decisions by Congress, be it by 
nuclear commitments. There are other ways. One or the other 
should be tried to, among other things, deter these people from 
trying to get their own nuclear capabilities. People are not--I 
am talking to the--preaching to the choir, here--people in the 
region are not happy with this agreement.
    Senator Shaheen. Well, to go back to Senator Murphy's line 
of questioning, you have suggested a range of other security 
supports for countries in the region. But, as we are looking at 
other potential ways to shore up the direction in which we 
would like them to go, what other options do you think are most 
important for us to be looking at? So, let us put the security 
situation on one side. But, what about on the economic, the 
other supports that we can provide? What is most important 
there?
    Ambassador Jeffrey. Senator, I would say--Ambassador Indyk 
indicated this, and some members of your committee have--
preserving the nation-states, preserving the stability of those 
states in the region against both local forces and these pan-
Islamic forces, be it Shia or be it Sunni, that is the threat 
we are all facing. That has a military component. But, you 
rightly said, What are the other components? For starters, we 
should not pick fights with these people. We should be careful 
about talking about their internal situations, because, right 
now, in a crisis situation, we are not going to be able to do 
too much about it. And there are ways you can do this quietly, 
there are ways you can do it in an open and crude fashion. We 
should not do the latter. That is one thing.
    Then, targeted economic assistance for refugees, for groups 
that are potential generators of instability, is another. Yemen 
leaps to mind. Syria leaps to mind. And more willingness to tie 
our military, which I have to keep coming back to, to a 
negotiated solution. There are ways to resolve Syria, but they 
require both sides being ready to start fighting. Right now, 
one is not.
    Senator Shaheen. Well, I hear what you are saying, but it 
appears to me that this is what we have tried to do in a number 
of countries in the region. Yemen certainly is in that 
category. Egypt is in that category. I think Syria, early on, 
was in that category. And yet, it has not led to success. And 
so, what is the missing ingredient? Not enough military might? 
I think there has been--there is a lot of concern, that I hear 
from people in this country, about engaging in troops in the 
same way that we have done in Iraq and Afghanistan over the 
last 13 years. So, how do we get--what are the missing 
ingredients that need to be included in order to get to 
success?
    Ambassador Jeffrey. In a somewhat happier period of my 
life, before I was totally involved in Near Eastern affairs, I 
was involved in the Balkans. And we had two conflicts there. 
And you remember, at one point Bosnia seemed to be more 
intractable than Syria, and almost as many people died there in 
a country one-tenth the size, right in the middle of Europe. 
When we went in, a lot of the attention was on our military, 
our bombing campaign--and again, later, in Kosovo, 4 years 
later--but, it was actually a whole series of international 
diplomatic efforts to mobilize the international community, 
parsing the claims of all of the sides so that everybody would 
get something out of this, offering for governance, economic 
support, caring for refugees. It was an entire package that was 
put together and led by the United States that had a--
obviously, a flashy military element, but had many other 
elements, as well. And it worked in Bosnia. And when the 
Milosevic regime did not get it and tried the same thing again 
4 years later, we did it again in Kosovo. And this time, the 
Serbian people decided they had enough of him. But, these were 
limited conflicts. Our military use was restrained. And it was 
backed by diplomacy, by international legitimacy, through the 
U.N. in the first case, NATO in the second, and by economic and 
development programs that are continuing to this day. So, that 
is what I would point to.
    Senator Shaheen. And again, you know, I do not--it appears 
to me that that is what we are--we have been trying to do in 
many of these countries. And yet, we have not seen the same 
level of success.
    Ambassador Jeffrey. I said ``happier days'' because the 
Balkans, while they seemed intractable, are a lot more 
difficult than the Middle East. Any of us who are out there, 
who have spent a lot of time there, know there are no easy 
answers to the underlying problems. We point to the underlying 
problems as why you have these accelerants of violence, of 
instability, of social breakdown, but neither we nor the people 
of the region have figured out how to deal with them. And there 
is not going to be any final and complete solution without 
dealing with those. But, for the moment, we are in a crisis 
situation, and we have to put out the flames.
    Senator Shaheen. Thank you.
    Thank you, Mr. Chairman.
    The Chairman. Thank you.
    Mr. Ambassador, thank you for your testimony and your 
service to the country.
    And, without objection, the record will remain open until 
the end of the day Friday. Hopefully, you and Ambassador Indyk 
will respond to questions that are asked.
    We thank you, again. And the meeting is adjourned.


    [Whereupon, at 11:35 a.m., the hearing was adjourned.]


                         LESSONS LEARNED FROM 
                         PAST WMD NEGOTIATIONS

                              ----------                              


                        WEDNESDAY, JUNE 24, 2015

                                       U.S. Senate,
                            Committee on Foreign Relations,
                                                    Washington, DC.
    The committee met, pursuant to notice, at 10:33 a.m., in 
room SD-419, Dirksen Senate Office Building, Hon. Bob Corker 
(chairman of the committee) presiding.
    Present: Senators Corker, Johnson, Flake, Gardner, Perdue, 
Cardin, Menendez, Shaheen, Coons, Murphy, Kaine, and Markey.

             OPENING STATEMENT OF HON. BOB CORKER, 
                  U.S. SENATOR FROM TENNESSEE

    The Chairman. This hearing of the Senate Foreign Relations 
Committee will come to order.
    We certainly thank our witnesses for being here.
    Today's hearing is the fifth in a series of six events [The 
total includes Closed Briefings held by the committee.] we are 
holding this month to prepare members of the committee to 
evaluate a possible nuclear agreement with Iran. The focus of 
this hearing is to examine the circumstances and outcomes of 
previous negotiations with countries engaged in weapons of mass 
destruction programs.
    Our witnesses will help us look at what lessons have been 
learned by the international community about these programs, as 
well as understand what parallels can be drawn with the current 
negotiations underway with Iran.
    Further, this hearing may help us more fully understand the 
importance of including critical elements such as full 
disclosure of possible military dimensions or anywhere/anytime 
access of any final deal with Iran.
    While some may reject comparisons between negotiations with 
Iran and previous negotiations with North Korea, Libya, or 
Iraq, there are important lessons that can be drawn from 
reviewing those experiences, including the reasons for the 
country to engage in WMD research and development, the factors 
that brought the international community to the negotiating 
table, negotiating postures or pressures that worked and did 
not work, why an agreement was successful or not, and lessons 
learned from monitoring and the inspection of agreements.
    Throughout the negotiations with Iran, I have been 
concerned that this administration has not learned from history 
and may repeat many of the same mistakes made during the North 
Korea negotiations. I fear that the administration may again 
provide the green light for a slow and measured nuclear 
development program that does little to deter Iran from laying 
the foundation for a weapons program after it reaps the 
benefits of sanctions relief.
    I hope our witnesses can provide us with some insight on 
the following questions.
    What were the key circumstances that led to the collapse of 
agreements and negotiations with North Korea on its nuclear 
weapons program? Do you see any similar warning signs from 
Iran?
    Did the United States enter negotiations on WMD programs 
with Libya, North Korea, and Iraq from a position of strength? 
Or did the desire to achieve an agreement overshadow key 
considerations that should have been taken into account?
    Are there similarities that can be drawn between the 
negotiations that occurred with Libya, North Korea, and Iraq 
and the current negotiations with Iran? What specific 
similarities or glaring contrasts should Congress evaluate 
closest?
    What political considerations led South Africa to fully 
dismantle their nuclear weapons program voluntarily? Is there 
anything about Iran's political calculus that should lead us to 
believe that they may take the same path?
    Perhaps most importantly, I hope our witnesses will apply 
their personal experiences with past negotiations and assess 
the current state of play in the Iran negotiations. Do you 
believe the deal being negotiated will go far enough to assure 
the international community that Iran will never get a nuclear 
weapon? What components would be necessary in a deal for that 
to be the case?
    As I have stated many times before, I want to see--and I 
think all of us here want to see--a strong agreement with Iran 
that will prevent them from obtaining a nuclear weapon and hold 
them accountable. Over the past month, this committee has been 
educating itself as much as possible so we can fairly evaluate 
any deal the administration may reach.
    And as we have met with nuclear scientists, regional 
experts, and former administration personnel, I have become 
more and more concerned with the direction of these 
negotiations and the potential redlines that may be crossed. It 
is our responsibility to examine this issue and any final deal 
that may be reached with a skeptic's eye so that we can 
determine whether it will be in the best interest of our 
country and the world. I hope you will be able to provide some 
historical perspective on that.
    And we thank you again for appearing before the committee, 
and I look forward to your testimony.
    And now I will turn it over to our distinguished ranking 
member, Senator Cardin.

             STATEMENT OF HON. BENJAMIN L. CARDIN, 
                   U.S. SENATOR FROM MARYLAND

    Senator Cardin. Well, Chairman Corker, first thank you very 
much for arranging this hearing.
    June is a busy month for Members of the United States 
Senate under any scenario. And we all serve on numerous 
committees. But the Senate Foreign Relations Committee has been 
particularly active in the month of June, and I want to thank 
you for the manner in which we have prepared ourselves for 
whatever may happen in the negotiations taking place between 
the P5+1 and Iran.
    And I think it is important to point out we have had 
incredible participation by all the members of our committee 
during this month. There is a real desire for us to be as 
prepared as we can to play the appropriate role for Congress if 
an agreement is reached.
    So today we continue that. Tomorrow we have another 
opportunity for getting information, which I think can be 
helpful.
    Today's hearing explores what lessons can be drawn from 
previous negotiations with other countries concerning weapons 
of mass destruction. Similar debates about the value of arms 
control occurred during the cold war. Between 1972 and 1991, 
the United States and the Soviet Union signed four treaties and 
one Executive agreement that limited offensive nuclear weapons 
and ballistic missile defenses. Arms control negotiations were 
often one of the few channels for formal communication between 
the two nations. The talks provided the United States and the 
Soviet Union with a forum to air their security concerns and 
raise questions about their plans and programs.
    As the volume of shared information grew over the years, 
each side could replace suspicion about intentions of the other 
with confidence in its understanding of the capabilities of the 
other's nuclear forces. The limits also helped each side 
predict and plan for the future size and shape of the other's 
forces. To most observers, this process reduced the risk of 
nuclear war and strengthened U.S. security. It helped both 
sides avoid worst-case assumptions about the future that could 
fuel an arms race or undermine stability.
    In spite of the predictions to the contrary, there was 
little evidence that the Soviet Union sought to evade the 
limits in the treaties in a systemic way. Instead, many of the 
concerns derived from ambiguities in the terms of the treaties 
were resolved and discussions held in compliance review 
commissions established by the treaties.
    Arms control agreements do not mean that all disputes 
between the United States and the Soviet Union disappeared. 
Quite the contrary. The United States continued its efforts to 
reduce Soviet influence in Europe, Asia, Latin America, and the 
Middle East. The United States also continued its effort to 
highlight the wide range of human rights abuses occurring 
inside the Soviet Union.
    One of the lessons I draw from the previous weapons of mass 
destruction negotiations such as the cold war interactions with 
the Soviet Union is that meaningful diplomacy, combined with 
pressures under the right conditions, can yield positive 
results for U.S. national security.
    Our experience with North Korea further demonstrates why an 
agreement must include full disclosure of a country's 
activities and be combined with an ironclad inspection and 
verification regime. That is what we are now seeking with Iran. 
We need an agreement with Iran that requires the resolution of 
the possible military dimensions, transparency. An agreement 
must allow for intrusive inspections and sanctions that will 
snap back forcefully should Iran breach its obligations. I have 
said many times the agreement will be evaluated based on having 
ample time to discover through inspection if Iran is not 
complying with the agreement so that we can take effective 
action to prevent them from becoming a nuclear weapons state. 
That is how we will evaluate the agreement.
    And I look forward to hearing from our witnesses as we 
further our own ability to evaluate any potential agreement.
    The Chairman. Thank you, Senator Cardin.
    And we will now turn to our witnesses. Our first witness is 
Mr. William Tobey, currently senior fellow at the Belfer Center 
for Science and International Affairs at Harvard University. 
Mr. Tobey previously served as Deputy Administrator for Defense 
Nuclear Proliferation at the National Nuclear Security 
Administration. I do not know how you ever introduced yourself. 
[Laughter.]
    And on the National Security Council staff in three 
administrations in defense policy, arms control, and 
counterproliferation positions. We thank you for being here.
    Our second witness today is Dr. Graham Allison, director of 
the Belfer Center for Science and International Affairs and 
Douglas Dillon Professor of Government at Harvard's John F. 
Kennedy School of Government. Even though I will note they are 
from the same institution, they have very differing views, 
which is helpful to us. Dr. Allison has also served as Special 
Advisor to the Secretary of Defense under President Reagan, as 
Assistant Secretary of Defense for Policy and Plans under 
President Clinton, and as a member of the Defense Policy Board 
for six Secretaries of Defense.
    So both are obviously very experienced. I know their 
testimony is going to be very helpful.
    If you could summarize, your written testimony will be 
entered into the record, without objection. And if you would go 
ahead and take about 5 minutes to give your opening comments, 
we look forward to your questions. Again, thank you for being 
here. And we will start with Mr. Tobey.

STATEMENT OF WILLIAM H. TOBEY, SENIOR FELLOW, BELFER CENTER FOR 
 SCIENCE AND INTERNATIONAL AFFAIRS, JOHN F. KENNEDY SCHOOL OF 
         GOVERNMENT, HARVARD UNIVERSITY, CAMBRIDGE, MA

    Mr. Tobey. Thank you, Senator Corker and Ranking Member 
Cardin and distinguished members of the committee. It is a real 
honor to be here to discuss a matter of surpassing importance 
to U.S. national security. And I appreciate that opportunity.
    Applying the lessons of history to our present situation is 
a matter that is best approached with some humility, and I do. 
In reviewing the Iran, North Korea, Libya, Syria and Iraq 
cases, five lessons were suggested to me.
    First, decisions to disarm or to comply with international 
obligations are often incremental and incomplete. Even in the 
case of Muammar al-Qaddafi, who initiated the discussions, 
Libya's path toward disarmament was full of fits and starts and 
was not a direct line.
    Second, temporizing or deception can appear to be progress. 
The best example of this that I know of actually comes from the 
Iran talks themselves. In 2004, Iran entered into an agreement 
with the European nations that froze their activities. And 2 
years later, Hassan Rouhani, then the negotiator, now the 
President of Iran, was defending his decision, and he explained 
that Iran had created a, ``calm environment it needed to 
complete the Isfahan uranium conversion facility.'' So those 
negotiations served the purpose, in that case anyway, of 
allowing Iran to advance its nuclear program.
    Third, intensive verification combined with effective 
intelligence can deter cheating, while lax verification will in 
fact foster it. Libya again provides a useful example where the 
initial declaration of chemical bombs, unfilled chemical bombs, 
was in the range of 750 to 800 such systems. But Tripoli was 
confronted with an aggressive verification scheme and 
ultimately was forced to disclose some 3,000 such munitions.
    The fourth lesson I would point to is that effective 
verification is not built on dramatic challenge inspections but 
rather on a declaration supported by documentary evidence, 
checked for inconsistencies, missing elements, and false 
information to verify its correctness and completeness. The 
process is exhaustive and painstaking, not dramatic and quick. 
And I think in some cases there has been a misunderstanding 
about the importance of anytime/anywhere inspections. That is 
the last step in the process. Far more important is a 
comprehensive understanding by international inspectors of the 
full dimensions of a particular program. And that is why I 
agree with the statements that the possible military dimensions 
of Iran's nuclear program are of great importance.
    The fifth and last lesson I would draw is that inspections 
and verification are only as effective as their political 
support. The International Atomic Energy Agency depends on 
support in the United Nations Security Council. If the Council 
is divided, the IAEA will be handicapped. And we saw in 
previous instances their ability to get to the bottom of some 
of these issues was limited by lack of support from Council 
members.
    Thank you.
    [The prepared statement of Mr. Tobey follows:]

                 Prepared Statement of William H. Tobey

    Chairman Corker, Ranking Member Cardin, distinguished members of 
the committee, it is an honor to speak with you on a matter of 
surpassing importance to U.S. national security.
    Attempting to gain knowledge from experience in nonproliferation 
negotiations is a laudable goal, but one that is best approached with 
humility. Alan Simpson, a late and distinguished historian--not your 
wise former colleague from Wyoming--cautioned regarding historical 
analogy that, ``our present state of knowledge is one of mitigated 
ignorance. In such situations, the honest enquirer always has one 
consolation--his blunders may be as instructive as his successes.'' \1\
    Bearing this warning in mind, the history of negotiations to 
prevent nuclear proliferation suggests interrelated five lessons.

1. Decisions to disarm or to comply with international obligations are 
often incremental and incomplete.

    After Operation Desert Storm in 1991, Iraq faced a unified United 
Nations Security Council that imposed the most rigorous inspection 
regime yet devised to disband nuclear, chemical, and biological weapons 
programs, backed by comprehensive and devastating sanctions. In 
response, Saddam Hussein temporized. Recalled Charles Duelfer, who 
worked longer than anyone in the world to uncover Iraq's secrets, 
``Saddam's top goal was to get out of sanctions. He gave up as little 
as possible to satisfy the Security Council. And it was the Council, 
not just the inspectors, he was dealing with.'' \2\ Key elements of the 
Iraqi program were divulged to inspectors only after Hussein Kamel, 
Saddam's son-in-law, defected to Jordan in 1995, and even then, the 
disclosure was grudging and incomplete.
    A second example is provided by the case of Libya's disarmament. In 
March 2003, Muammar el-Qaddafi sent emissaries to Britain indicating a 
desire to ``clear the air'' on WMD issues. Despite having initiated the 
talks himself, Qaddafi repeatedly balked at full disclosure. It was 
only after the interdiction of the BBC China--and with it an illicit 
shipment of centrifuge parts to Libya--and having been confronted with 
incontrovertible evidence of detailed U.S. knowledge of the Libyan 
nuclear weapons program, that Qaddafi reluctantly made a final decision 
to come clean and abandon his nuclear and chemical weapons programs.\3\

2. Temporizing or deception by the proliferator may appear to be 
progress.

    The case of Iran itself provides a salient example. In 2004, Iran 
agreed with Britain, France, and Germany to freeze its enrichment 
activities while the two sides negotiated a more permanent arrangement. 
In defending the deal in 2006, Iran's negotiator and now its President, 
Hassan Rouhani, made a stunning admission. He said in a speech not 
intended for Western ears: ``At that time, the United States was at the 
height of its arrogance, and our country was not yet ready to go to the 
U.N. Security Council. While we were talking with the Europeans in 
Tehran, we were installing equipment in parts of the facility in 
Isfahan, but we still had a long way to go to complete the project. In 
fact, by creating a calm environment, we were able to complete the work 
on Isfahan.'' \4\
    Thus, the negotiations with the Europeans bought time for Tehran to 
finish its uranium conversion facility.
    A second example of temporizing and deception is North Korea's use 
of the 1994 Agreed Framework. To its credit, the Agreed Framework 
suspended Pyongyang's plutonium production program for about 8 years. 
Unfortunately, however, while halting the plutonium program, the DPRK 
went ahead with its uranium enrichment program while the Clinton 
administration was still in office. According to Ambassador Robert 
Gallucci, the U.S. negotiator: ``[T]he Clinton administration 
concluded--at least I understand it did--that North Korea cheated on 
the agreed framework--that getting gas centrifuge components from 
Pakistan was inconsistent with the framework. The North Koreans did it. 
That's why they did it secretly. They cheated. And, the Clinton 
administration's response to that was to plan a new negotiation . . . 
'' \5\
    Although halting Pyongyang's plutonium production program was 
useful, the United States was far from halting the North's nuclear 
weapons program. The DPRK uranium enrichment capability was 
dramatically revealed to visiting Americans in 2010.

3. Intrusive verification, combined with effective intelligence 
collection can deter cheating--while lax verification and ineffective 
intelligence collection will foster it.

    In Libya, U.S. and British teams insisted on complete access to all 
relevant facilities. Toward the end of their first visit, a Libyan 
scientist pulled aside the American team leader, Ambassador Donald 
Mahley, and explained that he knew of an additional 750 unfilled 500-
kilogram chemical bombs that had not been declared. Previously, Libya 
had claimed possession of 750-800 of these weapons. Mahley told the 
Libyan that if that was the case, he should go back and review all the 
records and make a complete declaration, because inspections would 
reveal the truth. Libya eventually declared and destroyed nearly 3,000 
such weapons--four times the original declaration.\6\ Thus, fear of 
detection by intrusive inspections, backed by demonstrably effective 
intelligence induced more accurate declarations.
    In North Korea, conditions were just the opposite. North Korea 
controlled where inspections would take place. With but a single 
exception, they were limited to just one declared site, Yongbyon. U.S. 
personnel resided there from the autumn of 2007 to the spring of 2009. 
By November 20, 2010, Dr. Siegfried Hecker, a former director of Los 
Alamos National Laboratory, reported on a ``modern, small industrial-
scale uranium enrichment facility with 2,000 centrifuges that was 
recently completed and said to be producing low enriched uranium.'' It 
is virtually impossible that North Korea could have built a successful 
centrifuge enrichment plant in the space of about 20 months, if had not 
first built a pilot or even full-scale facility elsewhere and moved the 
fruits of that experience to Yongbyon. Thus, immunity from intrusive 
inspections likely gave the DPRK the freedom to construct a pilot 
enrichment facility before the plant at Yongbyon.

4. Effective verification is not built on dramatic challenge 
inspections, but rather on a declaration, supported by documentary 
evidence, and checked for inconsistencies, missing elements, and false 
information to verify its completeness and correctness. The process is 
exhaustive and painstaking rather than dramatic and quick.

    In 1991, Saddam Hussein was required to declare his programs, 
document the declaration, and then destroy the materials and equipment. 
Except in one case, early in the process,\7\ there were no significant 
discoveries of prohibited equipment or activities identified through 
challenge inspections. Rather, interviews, document reviews, material 
balance analyses, and intelligence data gradually forced more and more 
disclosures. Iraq's nuclear, chemical, and biological programs 
unraveled not because of any single dramatic discovery, but because of 
patient analytical work creating a mosaic of Iraqi activity.
    As has been noted, conditions in North Korea are very different. 
The DPRK has effectively limited inspection activities to the area 
surrounding Yongbyon.

5. Inspections are only as effective as their political support.

    One success and several failures offer evidence in support of this 
point. When Iraq was expelled from Kuwait and the Security Council was 
united, international weapons inspectors were backed by sweeping 
authorities and very strong sanctions. As support in the Council for 
those measures ebbed, inspectors found it more and more difficult to 
complete their mission. Finally, 1998, President Clinton was forced to 
order military strikes in Operation Desert Fox to induce Iraqi 
compliance. In preparation for that action, inspectors were withdrawn, 
not to return until there was renewed Security Council interest and 
action in November 2002. When a united Security Council backed 
inspectors, they had greater success; when the Council fragmented, 
Iraqi cooperation lagged.
    In the North Korea case in 1993 and 1994, the International Atomic 
Energy Agency (IAEA) wanted to inspect a waste storage facility as part 
of a determination of how much plutonium the North had separated. 
Pyongyang resisted. In the judgment of the Clinton administration, this 
required a choice between a full, but probably not much more detailed 
understanding of the past and an agreement that would suspend the 
DPRK's plutonium production in the future. The United States chose the 
Agreed Framework, in effect undercutting the IAEA, which never was able 
to complete the work it sought to conduct.

    To conclude, I would offer three observations about how these 
lessons apply to the Iran case:

   First, a complete and correct declaration including all 
        nuclear activities is imperative.
      The established and effective process for international 
        inspections is declaration supported by documentary evidence, 
        review by inspectors for completeness and accuracy, and pursuit 
        of any missing information, inconsistencies, or inaccuracies 
        until the matters are resolved. In the Iran case, Tehran has 
        never provided a complete and correct declaration of all its 
        nuclear-related activities. So called anytime, anywhere 
        inspections will be as ineffective as an Easter egg hunt if 
        they are not backed by an orderly declaration and verification 
        process.
   Second, unwillingness on the part of Iran to provide such a 
        declaration is evidence (albeit not conclusive) of Iran's 
        willingness to comply with an agreement.
      If experience is a guide, we are at the high water mark of 
        international pressure on the issue. It will ebb after an 
        agreement is completed and as time passes. If Tehran is not 
        willing to disclose now the full extent of what the IAEA calls 
        the ``possible military dimensions'' of its nuclear program, 
        Iran will be even more unlikely to do so at a later date. Those 
        activities would remain protected. Sacrificing knowledge of 
        past and possibly present actions for a future agreement would 
        signal to Tehran at the outset that verification and compliance 
        will not be serious priorities.
   Third, a successful agreement requires vigilance over an 
        extended period of time; it is not a matter that can be 
        ``solved'' and forgotten.
   By the IAEA's reckoning, the Iranian nuclear program is 
        about three decades old. Tehran has shown great patience and 
        persistence in pursuing that program. It has made sacrifices in 
        terms of moratoria or temporary restrictions, so long as it 
        could continue its actions at a later date. The negotiators 
        appear to be headed toward an agreement in which the central 
        restrictions will last less time than the period it took to 
        negotiate them. If an agreement is completed under the Joint 
        Comprehensive Plan of Action, a future president and congress 
        will likely face the very same dilemmas regarding the Iranian 
        nuclear program, but without benefit of a sanctions regime, 
        because Tehran will plausibly argue that was the deal it 
        struck. As President Obama warned, ``What is a more relevant 
        fear would be that in year 13, 14, 15, they have advanced 
        centrifuges that enrich uranium fairly rapidly, and at that 
        point the breakout times would have shrunk almost down to 
        zero.'' \8\
----------------
Notes

    \1\ Alan Simpson, ``The Wealth of the Gentry, 1540-1660'' (Chicago 
1961), p. 21, quoted by David Hackett Fischer, Historians' Fallacies, 
(New York 1970), p. xviii.
    \2\ Charles Duelfer, ``What Saddam Hussein tells us about the Iran 
nuclear deal,'' Fox News Opinion, April 6, 2015.
    \3\ William Tobey, ``A message from Tripoli: How Libya gave up its 
WMD,'' Bulletin of the Atomic Scientists, December 3, 2014.
    \4\ Elaine Sciolino, ``Showdown at U.N.? Iran Seems Calm,'' The New 
York Times, March 14, 2006.
    \5\ Robert L. Gallucci, ``The Status of North Korea's Nuclear 
Issues,'' Institute for Corean-American Studies Spring Symposium, May 
22, 2006.
    \6\ Tobey, 2014.
    \7\ The one exception is the 1991 discovery of calutrons, which the 
Iraqis attempted to prevent by firing warning shots over the heads of 
U.S. inspector David Kay's team and nearly running them off the road. 
Kay attributes this to a mistake by a local commander. David Kay, 
``Spying on Saddam,'' PBS Frontline, 1995-2014.
    \8\ ``Transcript: President Obama's Full NPR Interview on the Iran 
Nuclear Deal,'' NPR, April 7, 2015.

    The Chairman. Mr. Allison.

 STATEMENT OF DR. GRAHAM ALLISON, DIRECTOR, BELFER CENTER FOR 
SCIENCE AND INTERNATIONAL AFFAIRS, DOUGLAS DILLON PROFESSOR OF 
   GOVERNMENT, JOHN F. KENNEDY SCHOOL OF GOVERNMENT, HARVARD 
                   UNIVERSITY, CAMBRIDGE, MA

    Dr. Allison. Thank you very much, Mr. Chairman, and it is a 
great honor for me to participate in this discussion. And I am 
happy to be here with my colleague, Will Tobey, with whom I 
agree almost entirely with his comments here, but we will also 
have some differences as we usually do when we have lively 
conversations at Harvard.
    In any case, let me applaud the committee for its 
seriousness in trying to drill down on the most urgent, 
important issue on the agenda currently--namely, stopping Iran 
from getting a nuclear bomb--and also for the way in which you 
have been pursuing this as a bipartisan undertaking, as I think 
is exemplified so well in the Corker-Cardin legislation. I also 
commend you for stepping back from the news chatter of the day 
to ask about historical lessons that may be relevant for 
illuminating the challenge that you face.
    So I took your assignment seriously and spent a few days 
reviewing essentially 50 years of history in efforts to 
negotiate and reach agreements to constrain arms, starting back 
at the Non-Proliferation Treaty of 1968.
    I think the big takeaway from this was summarized best by 
Mark Twain who said, ``History never repeats itself, but it 
does sometimes rhyme.'' So as you listen to the rhetoric about 
the current Iran discussion, you will hear many echoes from 
previous debates. And in my written testimony that I submitted, 
I gave you a number of examples.
    But to take just one, a leading ``Washington Post'' 
columnist warned about a threat to the republic, he said, 
declaring that the President had ``accelerated moral 
disarmament of the West'' and predicting that actual 
disarmament will follow. So the columnist was George Will. But 
who was the President and what was the agreement? And it was 
Ronald Reagan and the INF agreement of 1987. As Reagan, for 
whom I worked enthusiastically, observed about this, he said, 
``some of my conservative supporters protested that in 
negotiating with the Russians I was plotting to trade away our 
country's future security. I assured them that wasn't the case, 
but I got a lot of flak from them anyhow.''
    Secretary of State Shultz, who was Reagan's Secretary of 
State, put the point more vividly. He said, quote, ``critics of 
the INF Treaty ``felt that President Reagan and I were naive, 
that the Soviet Union was not changing as we thought it was, 
and that we should not go forward with the treaty. They were 
absolutely wrong, deeply wrong. And if they had had their way, 
it would have been a tragedy. President Reagan was right. 
Anyway, we stuck to our guns, the treaty was ratified, and the 
Soviet Union changed,'' and note it is not there anymore.'' 
That is George Shultz.
    So what? My big takeaway is this, that if in the 
foreseeable future, Secretary Kerry and his team bring back a 
legally binding agreement for stopping Iran's nuclear 
aspirations and program, verifiably short of a bomb, there will 
be many good reasons to support it and many good reasons to 
oppose it, I can imagine. But they should not include these 
categorical claims that are made so frequently that simply do 
not wash, if you look at the record.
    So in fulfilling your responsibility under the Corker-
Cardin bill, it is going to be necessary to drill down on the 
details. And I, as I say, applaud the committee for trying to 
do that.
    In the prepared statement, I offer four arguments that I do 
not think are worthy.
    One argument claims that the United States cannot reach 
mutually advantageous agreements with regimes that are evil. 
And I cite Churchill who pointed out he was happy to ally with 
Stalin against Hitler, and Ronald Reagan who said he was 
perfectly able to deal with an empire he named and believed was 
the Evil Empire.
    Secondly, claims that we cannot reach advantageous 
agreements with regimes that inherently lie and cheat and seek 
to violate the agreement sounds right but is wrong. Decades of 
experience with a lying, cheating Soviet Union showed that 
good-enough compliance was good enough to achieve our 
objectives.
    Third, claims that we cannot reach advantageous agreements 
with regimes that are actively engaged in terrorism against us 
and even killing Americans have a ring of plausibility but turn 
out to be wrong on the historical record. Look at the fact 
during Vietnam when we were negotiating SALT I under President 
Nixon, Soviet-manned surface-to-air missiles were shooting down 
American pilots over Vietnam.
    And finally the claim that we cannot reach advantageous 
agreements to constrain arms with regimes who you are secretly 
or seriously trying to contain, subvert, or overthrow again 
sounds right but turns out to be wrong. I attached to the 
submission the Executive summary of Reagan's strategy for 
dealing with the Soviet Union, which was deeply classified at 
the time but now declassified. Again, as he points out, we 
resist imperialism. We exert internal pressure to weaken the 
sources of Soviet imperialism, and we engage with the Soviet 
Union in negotiations to reach agreements where they can 
advance our interests.
    So just to conclude, I would say, as we think about the 
debate in Iran, I think there are many lessons to be learnt 
from, among others, Ronald Reagan.
    [The prepared statement of Dr. Allison follows:]

              Prepared Statement of Dr. Graham T. Allison

    Mr. Chairman, Ranking Member Cardin, and members, it is my honor to 
address the Senate Foreign Relations Committee today on the question of 
lessons we can learn from earlier nuclear arms control negotiations and 
agreements to meet the current challenge posed by Iran's nuclear 
progress. Let me begin by applauding the leadership and members of the 
committee for your determination to assure that the U.S.-led campaign 
to prevent Iran from acquiring nuclear weapons is the most effective it 
can be, and for insisting that Congress plays its essential role in 
this process.
    One of my favorite quotations comes from the German philosopher, 
Nietzsche, who observed that: ``The most common form of human stupidity 
is forgetting what one is trying to do.'' I have a framed version of 
that quotation in my office and try to think about it every day.
    In the case of Iran's nuclear challenge, what are we trying to do? 
In one line: to prevent a nuclear weapon exploding on the territory of 
the United States or our allies. When asked, ``What was the single 
largest threat to American national security?'' Presidents Obama and 
George W. Bush agreed 100 percent. As both have said repeatedly: The 
single largest threat to American national security is nuclear 
terrorism.
    Most people cannot imagine terrorists successfully exploding a bomb 
in an American city. But few could imagine the 9/11 attack by al-Qaeda 
on the World Trade Center and the Pentagon--before it happened.
    I have written a book about nuclear terrorism and am happy to 
provide copies to any members or their staff who would be interested. 
While it has one chapter on Iran, the book attempts to address the 
danger of nuclear terrorism as a whole. I applaud the committee's role 
in drilling down on the Iranian challenge. But I hope that when you 
complete that work, you will turn with equal determination to 
equivalent or even larger potential sources of nuclear weapons that 
terrorists could use to destroy New York or Washington or even Boston.
    For perspective, it is worth pausing to consider: if in the next 
decade terrorists successfully explode a nuclear bomb devastating the 
heart of a great city in the world, where will the bomb have come from? 
Iran? Or: North Korea? Pakistan? Russia? Iran poses the most urgent 
nuclear threat today, but not, I believe, the most significant. If 
terrorists conduct a successful nuclear attack in the next decade, 
North Korea and Pakistan rank well ahead of Iran on my list of probable 
sources for the weapon or its components.
    The purpose of today's hearing, however, is to explore lessons from 
past nuclear negotiations and agreements as you prepare to assess an 
agreement with Iran to ensure that Iran does not acquire a nuclear 
bomb. At your request, I have reviewed the history of negotiations and 
agreements over the past seven decades since the end of World War II. 
These include: the Non-Proliferation Treaty of 1968; strategic arms 
limitation talks and agreements from SALT to New Start; the North 
Korean accord of 1994; the agreements that helped eliminate nuclear 
weapons in Ukraine, Kazakhstan, and Belarus in the early 1990s; and the 
agreement that eliminated the Libyan nuclear weapons program in 2003, 
in which my colleague Ambassador Joseph played a significant role. For 
members who are interested in reading further, Appendix A provides a 
short reading list. Recognizing the realities of your schedules, let me 
summarize my top-ten takeaways from this review.

    1. Negotiated agreements to constrain the spread and use of nuclear 
weapons have been an essential weapon in the arsenal of American 
national security strategy.

   Agreements contributed significantly to the fact that we 
        survived and won the cold war without Armageddon.

    2. Negotiated agreements to constrain nuclear weapons are not an 
alternative to military, economic, political, and covert instruments in 
geopolitical competition. Instead, they are one strand of a coherent, 
comprehensive strategy for protecting and advancing American national 
interests.

   ``Peace through strength'' means first and foremost military 
        strength. But military strength rests on the foundation of 
        economic strength. And military strength is most effective when 
        used as a complement to diplomatic, economic, political, and 
        covert tools--the entire arsenal of American power.

    3. Because negotiated agreements are by definition negotiated--not 
imposed--they require give and take: compromise. As any parent or 
legislator knows well, the results of any negotiation invites a 
standard litany of criticism: from buyers'/sellers' remorse about the 
possibility of a better deal, to more extreme charges of 
``appeasement'' or ``conspiring with the enemy.''

    4. The claim that the U.S. cannot reach advantageous agreements 
with a regime or government that is Evil has certain plausibility--but 
is false.

   No 20th century leader demonstrated greater strategic 
        clarity in identifying the evil of Hitler's Nazism than Winston 
        Churchill. No 20th century leader demonstrated a clearer-eyed 
        view of Stalin's Communist Soviet Union than Winston Churchill. 
        But Churchill eagerly allied with Stalin to defeat Hitler. When 
        critics accused him of having made a deal with the Devil, 
        Churchill replied: ``If Hitler invaded hell I would make at 
        least a favorable reference to the devil in the House of 
        Commons.''
   No American President was more determined to bury communism 
        than Ronald Reagan. No American President was more eager to 
        negotiate and reach agreements with what he rightly called the 
        Evil Empire than Ronald Reagan. As he noted, ``I didn't have 
        much faith in Communists or put much stock in their word. 
        Still, it was dangerous to continue the East-West nuclear 
        standoff forever, and I decided that if the Russians wouldn't 
        take the first step, I should.''

    5. Claims that the U.S. cannot reach advantageous agreements to 
constrain nuclear arms with governments that cannot be trusted, that 
inherently lie and cheat, and who will undoubtedly seek to deceive the 
U.S. and violate the agreement sound right--but are wrong.

   No regime was more inherently devious than the Soviet Union. 
        According to Lenin's operational codes, it was the Soviet 
        leader's duty to deceive capitalists and out-maneuver them. 
        True to character, the Soviet Union cheated, for example, in 
        placing radars in locations excluded by the ABM Treaty. But 
        reviewing the history, it is hard to escape the conclusion that 
        the cheating was marginal rather than material. The U.S. 
        discovered the cheating, called the Soviets out for it, and 
        engaged in a process that produced compliance good enough to 
        achieve our objectives.
   To minimize cheating, agreements focused on parameters that 
        could be verified by U.S. intelligence. Thus SALT and START 
        limited not nuclear warheads, which we could not monitor, but 
        launchers, which we could. While other nations' intelligence 
        committees and international organizations like the IAEA have 
        been important supplements, the U.S. has wisely not 
        subcontracted verification to others.

    6. Claims that the U.S. cannot reach agreements to constrain 
nuclear arms in ways that advance our interests in dealing with states 
that are actively engaged in terrorism against us or our allies, or 
even actively killing Americans in ongoing military conflict, have a 
ring of plausibility--but on the historical record are incorrect.

   During the Vietnam war, Soviet-manned surface-to-air 
        missiles shot down American pilots over Vietnam, and Americans 
        bombed Soviet air defense units. Despite these realities, 
        President Nixon negotiated and concluded SALT I, imposing 
        quantitative limits on the U.S.--Soviet missile buildup, and 
        creating, as Henry Kissinger described it, ``a platform of 
        coexistence.''

    7. Claims that the U.S. cannot reach advantageous agreements to 
constrain nuclear arms with states we are seeking to contain, or 
subvert, or even overthrow, again sound right--but are, on the 
historical record, wrong.

   Again, see President Ronald Reagan. His administration's 
        core national security strategy for competition with the Soviet 
        Union has been declassified and is attached in Appendix C. It 
        states that ``U.S. policy towards the Soviet Union will consist 
        of three elements: external resistance to Soviet imperialism; 
        internal pressure on the USSR to weaken the sources of Soviet 
        imperialism;'' and ``engaging the Soviet Union in negotiations 
        to attempt to reach agreements which protect and enhance U.S. 
        interests and which are consistent with the principle of strict 
        reciprocity and mutual interest.'' At the same time his 
        administration was negotiating and signing agreements, on the 
        one hand, it redoubled efforts to undermine the Soviet regime, 
        on the other. And in 1991 the Soviet Union disappeared.
   As President Reagan's Secretary of State, George Shultz 
        noted, ``Reagan believed in being strong enough to defend one's 
        interests, but he viewed that strength as a means, not an end 
        in itself. He was ready to negotiate with his adversaries. In 
        that readiness, he was sharply different from most of his 
        conservative supporters, who advocated strength for America but 
        who did not want to use that strength as a basis for the 
        inevitable give-and-take of the negotiating process.''
   Washington Post columnist George Will accused Reagan of 
        ``accelerating moral disarmament--actual disarmament will 
        follow.'' William Buckley's National Review called Reagan's INF 
        Agreement a ``suicide pact.'' About such criticism, President 
        Reagan observed: ``Some of my more radical conservative 
        supporters protested that in negotiating with the Russians I 
        was plotting to trade away our country's future security. I 
        assured them we wouldn't sign any agreements that placed us at 
        a disadvantage, but still got lots of flak from them--many of 
        whom, I was convinced, thought we had to prepare for nuclear 
        war because it was `inevitable.' '' Shultz put the point more 
        vividly: Critics of the INF Treaty ``felt that President Reagan 
        and I were naive, that the Soviet Union was not changing as we 
        thought it was, and we should not go forward with the treaty. 
        They were absolutely wrong, deeply wrong. And if they had had 
        their way, it would have been a tragedy. President Reagan was 
        right. Anyway, we stuck to our guns, the treaty was ratified, 
        and the Soviet Union changed. It is not there anymore.''

    8. From the record of arms control negotiations and agreements by 
both Republican and Democrat Presidents--from Nixon and Reagan and both 
Bushes, to Kennedy, Johnson, Clinton and Obama--one brute take-away is 
hard to deny: agreements have reduced risks of war, reduced the numbers 
of nuclear weapons, reduced uncertainties in estimating threats, and 
enhanced predictability.

   As Henry Kissinger said to this committee 5 years ago, ``A 
        number of objectives characterize arms control negotiations: to 
        reduce or eliminate the danger of war by miscalculation, which 
        requires transparency of design and deployment; to bring about 
        the maximum stability in the balance of forces to reduce 
        incentives for nuclear war by design, especially by reducing 
        incentives for surprise attack; to overcome the danger of 
        accidents fostered by the automaticity of the new technology.''
   To see graphically what impact agreements (together with 
        other strands of determined strategies) have had, see charts 1-
        4 in Appendix B. It is no exaggeration to say that the NPT bent 
        the arc of history.

    9. The case of North Korea is more complicated and is 
unquestionably a nonproliferation failure. The historical facts of the 
case, however, have been so swamped by narratives that they are now 
legend. I have a chapter in Nuclear Terrorism on North Korea. As you 
consider where policy failed, I suggested that you keep in mind four 
bottom lines:

   During the 8 years in which North Korea was constrained by 
        the nuclear agreement of 1994, how many additional weapons or 
        weapons equivalent of fissile material did North Korea add to 
        its arsenal (according to the best estimates of the U.S. 
        Intelligence community)?
   During the period of 2003-2008 when the U.S. confronted 
        North Korea for cheating, abrogated the agreement, and sought 
        to isolate and sanction it, how many additional nuclear weapons 
        or weapons equivalent did North Korea add to its arsenal 
        (according to the best estimates of the U.S. Intelligence 
        community)?
   Under which treatment--agreements or confrontation--did 
        North Korea conduct a nuclear weapons test?
   Under which treatment--negotiations or confrontation--both 
        in the Clinton-Bush period and the Obama period did North Korea 
        build its nuclear arsenal of the more than a dozen weapons that 
        it has today (according to estimates of the U.S. Intelligence 
        community)?

    10. Negotiated agreements to constrain nuclear weapons are not good 
or bad per se. Assessments of a specific agreement--including in 
particular the agreement with Iran, if there is one--depend first on 
the specific details of the agreement and second on the feasible 
alternatives.
    In sum, if Secretary Kerry and his team bring back an agreement 
that successfully translates key parameters of the Framework Accord 
reached by the P5+1 and Iran into legally binding constraints, 
including intrusive procedures for inspection, verification, and 
challenges, I believe it will be difficult to responsibly reject that 
agreement. The burden will be on those who propose to do so to describe 
a feasible alternative that will better protect and defend American 
national security.

                    Appendix A: Recommended Readings

   Graham Allison and Albert Carnesale, ``Can the West Accept 
        Da for an Answer?'' (Daedalus, Vol. 116, No. 3, Summer 1987.)
        Offers 10 propositions and principles as navigational aids 
            in assessing arms control agreements.
   Avis Bohlen, William Burns, Steven Pifer, and John 
        Woodworth, ``The Treaty on Intermediate-Range Nuclear Forces: 
        History and Lessons Learned'' (Brookings Institution, Arms 
        Control Series Paper 9, December 2012).
        Focuses on 1987 INF treaty and provides several good 
            insights in separate ``lessons'' section.
   George Bunn, ``Arms Control by Committee: Managing 
        negotiations with the Russians'' (Stanford, CA: Stanford 
        University Press, 1992).
        Historical overview of past arms control agreements, 
            arguing that continued attention to arms control still 
            necessary in post-cold-war era.
   Robert G. Joseph, ``Countering WMD: The Libyan Experience'' 
        (Washington, DC: National Institute Press, 2009).
        First-hand account of Gaddafi's decision to eliminate its 
            chemical and nuclear weapons programs.
   National Security Decision Directive 75, ``U.S. Relations 
        with the USSR''(White House, January 17, 1983) [full document 
        attached below].
        Declassified memo shows how Reagan sought to 
            simultaneously undermine Soviets and engage them in arms 
            control negotiations.
   Gary Samore, ed., ``North Korea's Weapons Programmes: A Net 
        Assessment,'' IISS Strategic Dossier (London: International 
        Institute for Strategic Studies, 2004).
        Provides assessment of North Korea's nuclear, chemical, 
            biological, and missile programs.
   Joel Wit, Daniel Poneman, and Robert Gallucci, ``Going 
        Critical: The First North Korean Nuclear Crisis'' (Washington, 
        DC: Brookings Institution, 2004).
        Proposes recommendations for resolving current North Korea 
            crisis. Many recommendations are applicable beyond DPRK 
            case.
   Amy Woolf, ``Next steps in nuclear arms control with Russia: 
        Issues for Congress'' (Congressional Research Service, January 
        6, 2014).
        Discusses cold war arms control precedent and includes 
            section on role of Congress in arms control.
           [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
            
    The Chairman. Well, thank you both for your testimony.
    I assume what you are saying, Dr. Allison, is what matters 
then is the details of the deal, and that is obviously what we 
need to focus on. I guess Mark Twain had no idea he was going 
to be a part of nuclear negotiations at some point, but we 
thank you for pointing that out.
    Mr. Tobey, in relation to concerns that the administration 
may not require Iran to adequately address possible military 
dimensions PMD, last week Secretary Kerry stated--this is a 
quote--``we know what they did. We have no doubt. We have 
absolute knowledge with respect to certain military activities 
they were engaged in,'' which to me is an incredible statement 
to be made when I know that we do not know those things.
    But I would just ask you, without requiring Iran to 
adequately address the issue of PMD, can we be assured that we 
do, in fact, have absolute knowledge of their past military 
activities. Should the international community rely on 
intelligence that may be flawed? In what other circumstance has 
the United States and the broader international community 
relied on intelligence to inform us of its understanding of the 
nuclear program and that turned out to be flawed? I think you 
can point to a very specific example. But why is PMD so 
important to a final deal?
    Mr. Tobey. Senator, those are very important questions that 
cut to the core of the issue. Can we be assured that we have 
absolute knowledge of Iran's nuclear program without full 
disclosure of their so-called possible military dimensions? No. 
The answer is no. And the reason for that--and it gets to your 
second question about relying on potentially flawed 
intelligence--is that in order to have confidence in our 
ability to verify agreements, we need to be able to use both 
intelligence information and verification information. They 
work together and they can check each other.
    One of the reasons why, in fact, the intelligence on Iraq 
was so flawed, I believe, was that after 1998 and Operation 
Desert Fox, inspectors were not allowed to be in Iraq. And in 
my opinion, the intelligence community largely just straight-
lined the projections where they were headed from before. So 
without the benefit of the verification activities, they did 
not understand what was going on in Iraq.
    Similarly, though, intelligence can help to inform 
inspection activities, and there are many instances in which 
that has happened.
    But to your third question, are there instances in which 
intelligence has been flawed with respect to evaluating the 
nuclear programs of other countries, history is replete with 
them. And the first one that I know of were the projections of 
when the Soviet Union would get a nuclear weapon.
    The Chairman. Dr. Allison, do you want to add to that?
    Dr. Allison. Sure, thank you. It is a very good question.
    As you could probably gather from my introductory comments, 
categorical claims I am usually suspicious of. So the fact 
that, quote, we know everything, I do not know any subject on 
which that is true, including Iran's nuclear program and 
activity.
    But where Will and I differ slightly, because I think the 
PMD issue is an extremely important question--if I tried to 
think about: Do I have any doubt in the world that Iran has 
seriously pursued a nuclear weapon? No. One hundred percent. 
One hundred percent. Do I have any doubt that some people in 
Iran continue to have that aspiration? No. I would put that 
down close to 100 percent. So if I am trying to understand how 
Iran can be constrained and kept from doing something that it 
very plausibly wants to do and would want to do, I think absent 
the danger of being bombed or perhaps even having its regime 
changed, if Iran could be assured that would never happen, it 
would have a bomb. And actually if you try to think about their 
perspective, there are quite plausible reasons for wanting a 
bomb. But the fact that they want something does not mean they 
should have it.
    Our objective is to prevent them doing something that they 
might plausibly want to do, that they have been trying to do, 
that they will continue to try to do. That is just the 
definition of the problem.
    And for that, for me, our national intelligence is 80 
percent of the picture, and what they say and do for the IAEA 
is 20 percent. So I am interested in everything I can find 
because often when they provide a confession of some sort or 
some information or answer some questions, that gives you a 
speck of evidence that you can connect.
    But I think if I look back at dealing with the Soviet 
Union, we knew a lot about them, but not very much. They tried 
to lie and steal when they could. We usually found them. There 
was a procedure for----
    The Chairman. I am going to sort of short circuit this 
because I want to respect my other members' time. But what I 
think you are saying is the military dimensions piece is a very 
important element, and what we have found in other agreements 
is when those declarations take place, those little snippets of 
information that we get from scientists have actually helped us 
find and uncover programs. And for the United States to enter 
into an agreement with Iran that does not fully cause them to 
come clean on PMD on the front end would be a flawed agreement.
    Dr. Allison. Almost. Okay? In my view, with respect. In the 
case of the Soviet Union, we did not have any equivalent of 
PMD. They did not give us any track of what the stuff they were 
doing. We were having to figure that out for ourselves.
    In the case even of Iraq, after we defeated them in a war--
so we defeated Iraq in 1991 in a very decisive war. We imposed 
on this country essentially semi-sovereignty, areas where they 
could not operate. They told us what they were going to tell 
us. Only when a brother-in-law defected, went to a different 
country, and told us more information, did we end up finding a 
treasure trove.
    So I think it is a combination of the intelligence and 
every other source we can get, but the intelligence is the tall 
pole in the tent for me.
    The Chairman. I will semi-filibuster beyond other 
questions. I will get those later. But thank you both for your 
fulsome answers.
    And Senator Cardin.
    Senator Cardin. Again, Mr. Chairman, thank you for 
arranging this hearing.
    I think everyone here agrees that our first priority is to 
resolve international conflicts through diplomacy and use our 
military as the last resort. So, Dr. Allison, your comment 
about entering into agreements by necessity even if it is going 
to be with bad actors because that is how we avoid the need for 
our military--I think your observations are very much in 
keeping with the historic use of diplomacy to avoid military 
actions.
    First, all of us, I hope, are remaining objective until we 
see an agreement. I mean, we are trying to get prepared. And as 
you point out, we are drilling down, and that is exactly what 
we are doing. We are trying to drill down to understand because 
we are going to be under, not only time restraints, but just 
the comprehensive aspects of any agreement.
    Could you just share with us briefly, please, what you 
think the most vulnerable aspects of the framework agreement 
are that we should concentrate on, in order to make sure that 
this agreement will be the most effective in preventing Iran 
from becoming a nuclear weapons state? We could concentrate on 
all of the good things that are likely in the framework that 
will be accomplished, and I understand that. But where do you 
see the most challenging aspects of the framework agreement 
from the point of view of achieving our objective of preventing 
Iran from becoming a nuclear weapons state?
    Dr. Allison. Thank you. So, again, to try to be brief, 
there are a half dozen, but I will just focus on one. I think 
the most important is the cluster of things that we call 
verification, inspection, and challenge. And as I say, I think 
this is only 20 percent of the information that I want. I want 
to work hard on the intelligence side too, and I think actually 
as you think about it, looking at that whole picture.
    But if Iran gets a bomb in the next 10 or 15 or 20 years, 
what is the likelihood that it happens at the facilities that 
we are constraining at Natanz and Isfahan? I would say less 
than 1 percent. So they are going to get a bomb either by 
building a bomb covertly somewhere or buying a bomb or material 
for a bomb. So I worry about those way more than I worry about 
what happens at Natanz, and it is why I do not care so much 
whether there are 5,000 or 6,000 or 7,000 centrifuges.
    But with respect to the inspection and verification 
regime--what we learned that can complement the intelligence 
picture that we already have--that is the place where I would 
look for the beef.
    Senator Cardin. That is very helpful.
    Dr. Allison. So, for example, if the procedures call for 
continuous inspection and surveillance of every place where 
they make centrifuges and centrifuge parts, that excites me a 
lot because if they do not have centrifuges, they are not going 
to enrich uranium.
    So the eyes on the whole set of steps from mining and 
milling right through are the pieces that I would push on.
    Senator Cardin. And, Mr. Tobey, the same question. What do 
you see as the most vulnerable part of the framework that we 
should be concentrating on?
    Mr. Tobey. I think there are two things that are 
vulnerabilities. First is the duration of the agreement, and 
some of the central limitations expire after 10 years, some of 
them last a bit longer. But as President Obama said, by year 
13, the so-called breakout time may be back to zero. And at 
that point, of course, all sanctions will be off and Iran will 
justifiably argue that they have fulfilled their obligations 
under the agreement and there should be no further sanctions 
imposed upon them.
    The second issue--and it gets to what Graham alluded to--is 
the covert path. The main focus of the joint plan of action, as 
I understand it, has been on the overt path, the declared 
facilities. The covert path is a far more likely one for Iran 
to use in pursuit of a weapon. And that is one of the reasons 
why, again, I return to the importance, as you both have 
alluded to, of the so-called possible military dimensions 
because unless we understand who did what, where, when, we will 
not be able to keep track of those people, places, equipment, 
and sites and know that they are not being used in the future.
    Senator Cardin. That is very helpful.
    And so looking from the historic perspective in previous 
negotiations to today, one thing that has changed is 
technology. We have greater capacity today to understand what 
is taking place in a country through the technologies that have 
been developed. Could you just briefly comment as to whether 
technology today can be used in a way to alleviate some of our 
concerns on the inspection and verification issues as compared 
to the previous negotiation agreements that we have entered 
into? Either one. Dr. Allison, briefly please.
    Dr. Allison. Thank you.
    Since the center that we both come from is called the 
Center for Science and International Affairs, we love that 
question, but I will try to be brief.
    The answer is ``Yes.'' The technologies have changed 
unbelievably and continue changing. And one of the reasons why 
the Iran case is easier than North Korea, for example, is that 
it is a fairly porous society and that in particular in the 
period after the false alarm about Iraq, the American 
intelligence community has devoted a lot of effort to it. I am 
sure you all have gotten private hearings about this. But I 
think the amount of information about what is going on inside 
Iran now is just not even--I mean, just a thousand times when I 
used to try to figure out what was going on in the Soviet 
Union, and mainly because of technology.
    Senator Cardin. Mr. Tobey.
    Mr. Tobey. I would say that technology helps, but it is not 
a perfect solution. And I would also note that it is a cat and 
mouse game. Iran has been caught with covert facilities now at 
their original enrichment facility at Natanz and then in Qom, 
and they are learning from these mistakes. An enrichment 
facility that would be capable of producing a weapon's worth of 
material in a year would fit into an average size supermarket 
and draw about the same amount of power. Iran is a big country. 
It is pretty easy to hide such a thing.
    Senator Cardin. Thank you.
    Thank you, Mr. Chairman.
    The Chairman. Senator Flake.
    Senator Flake. Thank you. Thank you, Mr. Chairman, for 
holding this hearing, and I appreciate the testimony.
    Mr. Tobey, you talk about five lessons learned looking at 
other negotiations. To what extent do you think our negotiators 
are taking this experience and applying these principles?
    Mr. Tobey. I know it is an experienced team, and I know 
they are backed by professionals at the State Department who 
have been through a lot of these same negotiations. But I do 
not have any detailed insight into what the negotiators are 
thinking.
    Senator Flake. Are there any red flags out there right now? 
What do you consider the biggest inconsistencies with past 
experience?
    Mr. Tobey. Well, again--and I hate to harp on this, but I 
do believe it is of central importance--it would be whether or 
not we do get through this issue of the possible military 
dimensions.
    I would note that we had a similar instance in the North 
Korea negotiations. When the agreed framework was negotiated, 
the IAEA wanted to inspect a waste facility that they believe 
could have given them insight into the total amount of 
plutonium North Korea had produced. North Korea refused 
absolutely, said, no, we are not going to do that, similar to 
what Iran has said about possible military dimensions.
    Ultimately the United States made the decision that in 
order to get an agreement, they had to drop insistence on that 
point, and the IAEA was undercut. So the decision in the 1990s 
was not to sacrifice the future for an issue of the past.
    Senator Flake. Dr. Allison, I have sensed from your 
comments a bit of a caveat. You noted there is one with regard 
to PMD. I mean, there are important aspects of it, but you say 
we can make certain assumptions about their past program and 
about their desire for a future program. Beyond that, what is 
the most important part of PMD? Is it simply to provide a 
benchmark for the IAEA to go forward? Is it possible to move on 
without a full accounting? Could you elaborate a little more on 
that? I sense that you wanted to before.
    Dr. Allison. So thank you very much.
    So I think Will and I have a difference that you picked up 
on over how important what level of disclosure with respect to 
PMD will be, because I will assume that the Iranians--there are 
two things that are in the agreement, as I understand it now, 
that are demanded. One is interviewing the scientists. I would 
be very interested in that. And two is visiting some sites that 
have been off limits, and I would be interested in that.
    But if you ask me what am I expecting to learn from them 
that really matters--not very much. Am I expecting them to 
confess that they have been beating their wife? No, I do not 
think they will. There is no doubt that they were. There is no 
doubt that they will in the future. But I do not think they 
will confess to this.
    So what I am doing, though, is looking for, as Will said, 
any little pieces or specks of information that may add to the 
picture, and the more I get, the better. Now, similarly, every 
time there is a defector, this is a spectacular event.
    So it is not different than the rest of the intelligence 
collection, and I think for the committee, if the negotiators 
bring back an agreement, you may want to drill down with folks 
from the intelligence community asking how many additional 
peepholes does this provide for us with the system that is set 
up, and what are the other things that you believe you could 
learn if it were even more fulsome?
    Senator Flake. Thank you.
    There was a lot of discussion on whether or not--as we 
judge whether this is a good deal or not, what the alternative 
is. If we went ahead with current sanctions, the interim 
agreement went away, we were not able to reach a final 
agreement, breakout time we estimate is somewhere--2 months or 
so. Is that consistent with what you think? Some say, well, 
Iran would not go there because they know that we would strike 
and why try that when they can wait and legally do it in 10 or 
12 years? Do you see it in that simple of terms, Dr. Allison? 
What in terms of Iran's motivation here--why would kicking the 
can down the road, a worst-case scenario, not be better than 
allowing them within 2 months to close the deal?
    Dr. Allison. It is a difficult question, and it is a good 
one. Basically what happened over the last 10 years is that 
Iran went from being 10 years away from a bomb to 2 months away 
from a bomb. And they proceeded steadily whenever they had a 
chance. From time to time, there was a pause. When they felt 
threatened, you could see some little inflections in the line, 
but basically creeping, creeping, creeping. And whether this is 
for establishing the knowledge of how to do something in my 
covert site, if I were the Iranian planner, so this is mainly 
my overt facility, but it is my learning lab, and I have my 
more advanced centrifuges that I am going to operate somewhere, 
that would be possible. Or it would be possible they stay where 
they are.
    I think the hardest part for us will be if there turns out 
to be an agreement and for whatever reason the U.S. decides we 
are not in favor of it in the end; what is going to happen to 
the sanctions regime? Because the sanctions regime we should 
not take for granted. It has been a pretty extraordinary thing 
to get the various parties to agree to the amount of 
constraints that they have, but you can already see it fraying 
at the edges. And I think in particular it will be a problem to 
imagine what will happen to the sanctions regime. We cannot 
simply hit the pause button and keep everything in place. Other 
dynamics will probably be at work undermining what we now think 
of as a sanctions regime.
    Senator Flake. But even with the current sanctions regime, 
they have moved from, as you say, 10 years to within a couple 
of months.
    Dr. Allison. Well, except that they moved at different 
paces. And the regime, if you look back at it, was kind of a 
nibbling regime or even, I would say, symbolic sanctions, for 
quite a long time. Not until the Senate actually put in the 
biting sanctions with the defense appropriation bill in 2012 
did you see a sharp drop in their oil exports. So that was the 
place where it had the biggest impact. And then we had the good 
fortune of oil prices falling in half, which has therefore also 
impacted their income.
    Senator Flake. Thank you.
    The Chairman. Thank you.
    Senator Menendez.
    Senator Menendez. Thank you, Mr. Chairman.
    Thank you both for your testimony.
    You know, the agreed framework agreement with North Korea 
in my view failed in large part over something that was not 
explicitly covered, which was Pyongyang's covert development of 
a uranium enrichment program. While we assess it was against 
the spirit of the agreement and that they were obligated to 
reveal all details of its nuclear activities, it was not laid 
out as covered in the fine print.
    So how likely is it that the P5+1 are making the same 
mistake in the proposed new agreement--permitting 
nonspecificity about Iran's nuclear activities--in order to get 
an agreement concluded? What sort of noncovered activities by 
Iran could undermine the basic purpose of an agreement? I would 
invite either one of you.
    Mr. Tobey. Well, that is an excellent question.
    Senator Menendez. Those are the only questions we ask here. 
[Laughter.]
    I am just kidding. A little humor.
    Mr. Tobey. In the case of North Korea, the North-South 
Denuclearization Agreement and the Non-Proliferation Treaty did 
prohibit the actions that North Korea took.
    I guess what I would say, though, is that there were 
essentially no verification features of the agreed framework 
that would have applied to the uranium path, uranium enrichment 
path, and of course, the North Koreans drove a truck through 
that loophole.
    The question really is what will Iran have to declare and 
what will it not have to declare under the new agreement. And I 
do not yet know what that looks like.
    I do know that Iran has not yet and has never submitted a 
complete and correct declaration of all its nuclear activities.
    Dr. Allison. Again, the question is long and complicated, 
but just trying to do the brief of it, I think there is no 
doubt that the constraints constrain what we can see but do not 
constrain and do not erase an overall set of impulses or 
competition that is going on otherwise. That is what arms 
control was about with the Soviet Union. We would constrain an 
area very dangerous for us but continue competing with them on 
everything else, including undermining the regime. And that is 
what we were doing, I thought, wisely.
    So in the case of North Korea, there was an agreement to 
shut down Yongbyon. It shut down. There was no additional 
plutonium produced in North Korea from 1994 to 2002. And that 
is a good thing because otherwise once it turned back on, there 
would have been six more bombs' worth of plutonium. They then 
proceeded in another path that neither the inspection regime 
nor, more importantly in my view, our American intelligence 
community, could discover. Eventually we discovered a piece of 
it and then we tried to deal with them. They are a particularly 
recalcitrant party to try to deal with. But I would say shame 
on our intelligence as much as on whatever----
    Senator Menendez. Well, here is part of the problem. First, 
you yourself said, Mr. Tobey, that we do not know the full 
verification of all of the sites, number one. We would have to 
depend upon our intelligence to know about undeclared sites. In 
the past that has not always worked in a timely fashion.
    Thirdly, we have a set of circumstances under which--this 
is not about Iran just pleading guilty to their intent to 
pursue nuclear weapons. I think the world has come to that 
conclusion notwithstanding what they say. It is about 
understanding how far along they got in terms of their 
weaponization efforts. And even though I see the Secretary of 
State make rather definitive statements that we know how far 
they got, General Hayden, who was the CIA Director and had all 
of the access to all of the intelligence, including on this 
element of the portfolio, said that we have estimates, but we 
have no conclusive evidence of how far they got.
    So the purpose of coming forth with and being clean on the 
possible military weaponization elements of it is not about 
admitting guilt. I am really not interested in that. But it is 
about how far they got along. And when I read that we have no 
definitive understanding of that, we have estimates, well, that 
is a dangerous conclusion because that all adds to your 
complicated equation of breakout time and other elements. So I 
think that is incredibly important.
    The other thing is one of the prevailing presumptions 
behind the negotiation of an agreed framework agreement with 
North Korea was that the United States and South Korea would 
never have to deliver the civilian nuclear reactors called for 
under it because the North Korea regime was on its last legs 
and that there would soon be presumably a more peaceful regime 
in place. Now, that was unfortunately extremely wrong.
    Are we not making the same mistake regarding Iran and the 
proposed new agreement? To what extent is there an assumption 
here that in 10 years or so the Iranian regime will either be 
significantly different in its quest for nuclear weapons 
capability or that it will have changed its mind-set, of which 
everything indicates to us that its mind-set is about regime 
preservation at any cost, it is about preserving the elements 
of the revolution, and it is about achieving nuclear weapons as 
a way of preserving the regime, in addition to supporting its 
hegemonic interests? That is a dramatic change that we are 
looking to see in 10 years. It seems to me very aspirational 
but not rooted in reality.
    Can you comment on that?
    Mr. Tobey. Absolutely. I agree wholeheartedly with your 
point, Senator.
    Secretary Kerry has understandably said that it is 
unacceptable that Iran be 2 months away from a nuclear weapon. 
I do not understand, if that is the case, why then it would be 
acceptable in 10, 12, or 15 years for Iran to be 2 months away 
or less from a nuclear weapon.
    And to return briefly to one of your points about the so-
called--they are often called past activities, but it is not at 
all clear they are past activities, the possible military 
dimensions. The administration itself sanctioned a number of 
Iranian individuals and entities on August 29, 2014. One of 
them went by an acronym SPND. It is headed by Mossen 
Fakrizideh, and the administration has alleged that he has been 
in charge of the Iranian nuclear weapons program. He has been 
sanctioned by the United Nations Security Council. The 
sanctions notice that went out on August 29, 2014, said that 
SPND was engaged in nuclear weapons development work, current 
work. So there seems to be an understanding by the 
administration that that work is not something of the past, and 
until we understand exactly its extent, I do not understand how 
we can have a successful agreement.
    Dr. Allison. So, again, you raised three different 
questions. Let me briefly.
    First, are we going to have any confidence that Iran is not 
pursuing a nuclear weapon? No. And I would say we should take 
it to the bank. They are pursuing a nuclear weapon. We are 
trying to constrain some element of that.
    For example, we do not know today that Iran has not bought 
a nuclear weapon or material for a bomb from North Korea. They 
are not going to confess that to us. We would have to discover 
that ourselves. I mean, if I were running the Iranian program, 
I might have had all this going on like a conjurer's act to 
keep you focused over here while I am doing my business over 
here. They are not going to confess that to the IAEA. The IAEA 
is not going to find it. We are going to have to find it from 
our intelligence. What would prevent them from doing that is 
their fear that we will discover them. And I am in favor of 
every conceivable source we can have.
    But I think we should take it as a--I mean, the chairman 
started with the question, can we be assured that Iran never 
gets a nuclear weapon? The answer is absolutely not. This is a 
forever challenge for us. You cannot have this agreement, put a 
bow around it, and say, boy, this one is solved or this thing 
is in the box. Not in the box. I would say this is a 
continuing, long-term struggle. That is the first thing.
    Secondly, on 1994 and Korea, yes, there was a belief from 
the U.S. Government--CIA said--John Deutch, our colleague and 
friend--the North Korean regime is going to collapse because, 
having not predicted the collapse of the Soviet Union 3 years 
before, the CIA in its usual form makes a countervailing error. 
Okay. So predict somebody else is going to collapse. It was not 
an incredible idea at the time, but it turned out not to be 
right. But we did not predict when regimes collapsed. 1991, the 
Soviet Union, that was not predicted by CIA. We did not predict 
correctly that North Korea was going to have the staying power 
that it does. So I would not make my judgment about the Iranian 
agreement on the basis of my forecast of whether the regime is 
going to collapse or not.
    The Chairman. Thank you very much.
    If I might just add before going to Senator Perdue, with 
North Korea we provided sanctions relief without causing them 
to comply on the front end, and it led to them getting a 
nuclear weapon. And I think there is a lot of concern at 
present about the type of sanctions relief we may allow here on 
the front end prior to many of the things we are raising being 
completed.
    Senator Perdue.
    Senator Perdue. Thank you, Mr. Chairman. I want to thank 
you and the ranking member for the bipartisan nature of this 
effort over the last few months. I think we all agree the goal 
here is that we do whatever we can for as long as we can to 
make sure Iran does not have a nuclear weapon, not now, not in 
10 years, not ever.
    And, Dr. Allison, I could not agree more. I think this is 
an ongoing effort. There is no one document that is going to 
protect that.
    Mr. Tobey, you mentioned the vulnerabilities and I agree 
with you.
    The two things that worry me is if the agreement stands, as 
we understand it today, that in 10 years, as the President 
says, that the breakout time goes to zero for Iran to become a 
nuclear weapons state, let us assume for the moment that does 
not happen.
    So then we move to your second concern of the covert 
nature. And I think, Dr. Allison, that is the area that long 
term is more concerning to me. I am not too concerned about 
what they declare they are doing in their overt effort. It is 
what they can do in their covert. Fordow is a good example. 
Natanz. I mean, the combination of our own inspection and our 
own intelligence failed us over the last 6, 7, 8, 10 years in 
that regard.
    I want to go, though--before I ask more about Fordow and 
intelligence, I want to ask about Libya and North Korea. Can 
both of you give us your experiences of, one, being a 
reasonable success in Libya where we control weapons control--
weapons development, and then in North Korea where it was a 
catastrophic failure? Mr. Tobey?
    Mr. Tobey. Sure. In Libya, I think the case was--one of the 
important differences with what seems to be going on in Iran 
was an insistence that Libya make a strategic decision not to 
pursue nuclear weapons. That was why there was an insistence 
that there be a statement by Qaddafi, and it was part of the 
negotiations that we wanted evidence that this was not merely 
temporizing on their part, but a watershed event that 
represented a real change in Libyan policy.
    One of the things that disturbs me about the Iran 
agreement, if we get one, is that no one seems to believe that 
this would be a fundamental change in Iranian policy. It would 
delay some of their aspirations, but it would not end them.
    With respect to North Korea, I think the opposite was the 
case. We were never able to get any assurance from the North 
that they had halted their nuclear weapons aspirations. And in 
fact, the negotiator of the agreed framework, Ambassador 
Gallucci, said that they understood--that the Clinton 
administration understood, even while it was still in office, 
that the North was cheating and pursuing a uranium path.
    Senator Perdue. Dr. Allison.
    Dr. Allison. So they are both very interesting cases, and 
both I think quite different from the Iran case but worth 
looking at the lessons.
    In North Korea, one needs to notice structurally, to start 
with, how different North Korea is from almost anything else. 
That is the hardest case. Structurally, first, there is no 
credible military threat against North Korea. Secondly, North 
Korea has a great power guardian who will not let it get 
squeezed too much. And thirdly, North Korea has an autarchic 
economy that is almost separated from the world. Let me go 
through the pieces very quickly.
    So there is no credible military threat against North 
Korea. We have a treaty-bound alliance with South Korea who is 
deterred by North Korea. So whenever it comes to a choice 
between yielding and threatening a war that would destroy 
Seoul, South Korea blinks. That is a problem. That is not the 
case with Iran. Actually the neighbors were encouraging us to 
act.
    Secondly, North Korea has a great power guardian, China. So 
when one tries to squeeze them economically, China does not 
allow it to threaten the regime. That is not the case with 
Iran, unless Russia were come to be a really bad actor, which 
is one reason to keep your eye on Russia.
    And thirdly, an autarchic economy. So I would say that 
situation is entirely different.
    In the case of Libya, which is also interestingly 
different, Libya was a pipsqueak country to start with. It was 
isolated. It has got around 6 million people, was just 
basically pumping oil. And you had in Qaddafi a thug that was 
running the regime. After the Bush administration toppled 
Saddam, he was terrified, and there was talk around town, 
including by some of my friends who said, hey, we can just do 
Libya on the way home. It was not a big operation. So being 
terrified by a credible military threat, he was moved to act. I 
would say if we could imagine an equivalent situation for Iran, 
that would be a big motivator. I think it is hard to imagine 
after we seem exhausted from a couple wars we have already had.
    Senator Perdue. Dr. Allison, you said that inspection and 
verification, challenge--that is part of our inspection regime. 
You know, I am not too worried about what they are telling us 
and what we see in the inspection. What I am really worried 
about is longer term past this agreement over the next decade 
or so our ability to manage and watch and pick up through our 
intelligence efforts what they are doing covertly.
    I have two questions. One is do you guys, both of you, 
believe that we have a third option here if this negotiation 
fails besides war, that doubling down on sanctions could in 
fact help us long term keep Iran from becoming a nuclear 
weapons state? And secondly, behind that, what is your 
experience and what is your confidence that our intelligence 
network today can help us maintain confidence that we know what 
is going on covertly within Iran? Mr. Tobey, quickly. I am 
about out of time. Sorry.
    Mr. Tobey. I do believe there is a third option. Of course, 
there are measures between capitulation and war. There are 
plenty of things that we could do.
    With respect to intelligence, Iran is a hard target, and we 
have had some intelligence successes, but I do not think we can 
bet all that would be bet on whether or not Iran gets a nuclear 
weapon on our intelligence successes.
    Dr. Allison. I agree with Will.
    On the intelligence piece, I think that we will never know 
for sure, and that it will be very important, if there is an 
agreement reached, that we do not lose interest in Iran. So I 
think from the bigger perspective of the committee, making sure 
that the intelligence community keeps this as a top priority, 
assuming that this is a country that will get a nuclear weapon 
whenever it can.
    With respect to the sanctions, I think it would be good to 
double down on sanctions, though I cannot imagine the political 
strategy that would keep the rest of the parties together for 
doing so unless Iran should walk away from the table.
    Senator Perdue. Thank you, Mr. Chairman.
    The Chairman. Thank you.
    Senator Kaine.
    Senator Kaine. Thank you, Mr. Chairman, and thanks to the 
witnesses for your interesting and provocative testimony.
    A number of folks in this country and with our allies who 
are fairly harsh critics of starting the negotiation with Iran 
have, at least to me, grudgingly said that they think actually 
the activity since November 2013 and particularly under the 
JPOA has been better than the status quo ante, that the 
concerns that Prime Minister Netanyahu was raising before the 
U.N. about the 20-percent enriched uranium stockpile, et 
cetera, that there has been an improvement in the status quo as 
a result of the JPOA.
    Before we get to a final deal, do you share the view that 
the JPOA period was an improvement over what was existing 
before?
    Mr. Tobey. My view is that it was neither a historic 
agreement nor an historic mistake. It was a standstill 
agreement that allowed talks to continue, and the value of that 
standstill agreement is best assessed when we find out what the 
final agreement is.
    Senator Kaine. And the standstill compared to an earlier 
period where there was not standing still, where there was 
forward progress on the nuclear program. Correct?
    Mr. Tobey. Correct, yes. And certainly there were some 
elements like the reduction in 20 percent uranium that were 
quite constructive.
    Dr. Allison. I agree. In fact, there is a little brochure 
that the Belfer Center put out on the facts about the 
agreement. And if you look at it, there is a curve that is 
going steadily up from 10 years ago until 2 months, and then it 
freezes. So the agreement actually succeeded in freezing and 
also rolling back with respect to the 20 percent activity that 
you would otherwise think would have just continued along the 
trend line.
    Senator Kaine. I agree with what both of you said in 
earlier questions that there is not two options here of an 
acceptable diplomatic agreement or war. There is also some 
middle grounds, and middle grounds may include doubling down on 
sanctions. Middle grounds may include continuing under a JPOA 
framework with a standstill and modest relief of escrowed 
funds. So there are other options. I do believe that.
    You both talked about the inspections. The thing that I am 
most interested in that I am going to jump right to when there 
is a deal is looking at the intrusive nature of the inspections 
and particularly with respect to giving us any confidence about 
the covert nature of the program.
    But I want to talk about inspections in the context of 
having a credible military threat. A credible military threat 
in my view toward stopping Iran from getting a nuclear weapon 
is composed of sort of capacity, backbone, but also the degree 
of information you have. Would you agree with me that we have a 
more credible military threat the more information we have 
about the scope of an Iranian nuclear program? So that seems 
easy enough, kind of almost a truism.
    And in terms of information, we have intel right now. We 
have used intel. It has been widely reported that we have taken 
steps with others that have slowed down the Iranian nuclear 
program based on intel. But would you agree with me that intel 
plus what you get from an intrusive inspections regime is 
better than just intel?
    Mr. Tobey. Yes.
    Senator Kaine. And so to the extent that an agreement that 
is put on the table has an inspections regime that is a 
significant one and to the extent we do what Dr. Allison said, 
which is maintain and maybe even grow our intel capacities, 
intel plus the information we get out of intrusive inspections 
will help have us have a more credible military threat because 
we would be able to more precisely target military activity--
God forbid--should we ever need to to stop Iran from getting a 
nuclear weapon.
    Dr. Allison. Absolutely, and I think the way you put it is 
very logical. So we are working an intelligence problem all the 
time, and intelligence is essential for having a credible 
military threat.
    A question to ask about the agreement, if it comes to you, 
is: what does the inspection and verification regime add to our 
current intelligence? What else are we getting that we do not 
already have? It is good for the IAEA to get it even if we 
already have it because that adds to the international 
legitimacy? But for us, because we have to take care, in the 
first instance, of this as our own problem, what else would we 
have in terms of a picture of what is going on in Iran, 
particularly in the covert arena, if we get a deal that has the 
parameters as described for verification and inspection? And 
I--having listened to a briefing on what people think they are 
going to bring back, that would be a big plus, if I were 
sitting back in the intelligence community, for my picture of 
what is going on. But I think the devil will be in those 
details, and if we listened to the Supreme Leader yesterday, a 
lot of those details do not seem to be settled.
    Senator Kaine. The inspection regime laid out in the April 
2 framework included some components that were 10, 15, 20, and 
25 years. But one of the items in the framework was the 
acceptance of the IAEA additional protocol, which was listed to 
be a permanent accession to that additional protocol. And so 
these are the kinds of things that I know I am going to be 
looking at to see what kind of information are we going to get 
through this inspections regime that will add to the intel that 
we can already develop.
    And Mr. Tobey, your testimony--one of your five lessons is 
the better the inspection regime, the more we can deter 
cheating together with existing intel, and I would say a caveat 
to that or maybe a corollary, the better the inspections regime 
plus our intel, the more we can have a credible military 
threat, or at least that is an element of a credible military 
threat.
    What lessons do you draw from the kind of earlier WMD 
negotiation experiences in terms of the nature of the regime 
you are dealing with? You know, you talked about Libya as a 
pipsqueak regime. Iran has more of an imperial--I think Iran is 
on kind of a historic rejuvenation project where they are 
trying to reclaim an element of social greatness that they have 
had in the past. And that is kind of part of what motivates the 
regime right now. And becoming part of the nuclear club in the 
modern parlance is one of the ways you show you are at the 
cutting edge of science and technology in a leading society.
    But talk about earlier WMD negotiations and the nature of 
the regime itself and how that makes you view this particular 
negotiation.
    Mr. Tobey. I think you are exactly right. At the strategic 
level, Iran is looking for regional resurgence. At a more 
tactical level, in terms of the insight into the regime, I 
think that there is important insight, maybe not determinative 
insight, offered into Iran's willingness to comply by how they 
treat this disclosure issue. So if in fact they continue to 
stiff the IAEA, I think we gain insight into whether or not 
they are likely to comply with a future agreement.
    Dr. Allison. So I agree that the regime issue matters a 
lot. I think in the case of the Soviet Union, people who saw it 
clearly had no illusions about the regime because it was a 
regime that was determined to bury us. So the agreements were 
agreements to constrain the competition simply in one arena in 
order to intensify the competition in other areas. If you were 
betting in the long run that we were going to be stronger 
because we have a free society, we have a market economy, we 
have a dynamic society--that was Ronald Reagan's bet--lo and 
behold, in the end this is going to turn out badly for them. So 
I would say, again if I try to think about it, the fact that 
the regime is inherently evil is perfectly fine to deal with; 
that is international relations.
    With respect to your first question, which I think is an 
extremely good one, how does the intelligence relate to 
credible military threats? And it is very interesting. I should 
have put it in my testimony, but I will send it to you. So the 
person who was a colleague of ours, an Israeli, Amos Yadlin, 
who led the attack on Osirak, who planned the attack on Syria, 
and who was Bibi's head of military intelligence planning for 
Iran--here is what he says about the agreement. He says, 
military action against the Iranian program in 2025--that is, 
if the agreement in 2025--would in all probability not be much 
more complicated or difficult than in 2015.
    Senator Kaine. Thank you, Mr. Chair.
    Thank you to the witnesses.
    The Chairman. Thank you.
    Senator Markey.
    Senator Markey. Thank you, Mr. Chairman, very much.
    Can you just talk a little bit about Iran and how they view 
their need to have a nuclear weapon, given what happened in 
Libya and what happened in Iraq and the lesson drawn that we do 
not attack North Korea, we do not attack countries that have 
nuclear weapons, but we do attack those that we are sure do not 
because we absolutely verified that they do not? So what lesson 
did they draw from that in terms of the confidence that we can 
have that any inspections regime can be successful?
    Dr. Allison. I do not think we are allowed to talk about 
this in public. I am teasing.
    Eric Edelman, who is a friend and who was President George 
W. Bush's Under Secretary for Policy in the planning for the 
attack on Iraq, has said the following, and I am quoting. He 
said, in terms of what lessons we have taught, if you are like 
Iraq and you do not have nuclear weapons, you get invaded. But 
if you are like Libya and you give up your nuclear weapons, we 
will only bomb you. Again, it is hard for Americans to say.
    Here is what the Supreme Leader said--he was doing the 
lessons after Libya--he said Qaddafi wrapped up all his nuclear 
facilities, packed them on a ship, and delivered them to the 
West, and said, take them. Look what position he is in now. So 
I think we have to take it as a fact that regimes that fear 
being attacked by us, on the basis of the record, would 
therefore be motivated to have nuclear weapons. That makes the 
problem harder for us. It does not mean they should succeed.
    Senator Markey. So can you talk about that, Mr. Tobey? 
Essentially Qaddafi and Saddam wound up in the same situation, 
pretty much in the same ditch after they gave up their nuclear 
weapons programs.
    Mr. Tobey. Well, I think you have made the important 
point--you and Graham and Eric Edelman. I think it is something 
to be regretted that what had been a nonproliferation success 
in Libya may be tarnished because it taught lessons to others 
around the world that it will be painful for us.
    Senator Markey. So then if I can go back to you, Dr. 
Allison. You draw an important distinction between material 
cheating and marginal cheating in your testimony. And there is 
no question that on this committee if there is, in fact, 
material cheating which is found, that this committee will act 
quickly if there is no action which is taken by our Government 
or the world. We will move quickly to reimpose sanctions.
    How do we deal with marginal violations? That is going to 
be the gray area, and what do you recommend to us if we cannot 
find the material but there is enough suspicion of a marginal 
violation? What should the American response be?
    Dr. Allison. An extremely hard question. So I think in the 
negotiations, folks have been trying to figure out what are the 
procedures for dealing with cases of known or suspected 
violations, both marginal and material. And in the case of 
dealing with the Soviet Union--or now, Russia--this continues 
to be an issue.
    So we have to, I think, first depend on our own 
intelligence, but we are happy for any other help we get from 
anybody else for discovering such cases. For example, in the 
case of the Soviet Union, they were building radars at 
Kresnyarsk, you will remember, back in the cold war. And we 
called it out. There came to be an issue of what our recourse 
would be, because if we could not impose some equivalent pain 
or punishment, it would be very hard even if a person has 
cheated or violated the agreement to get them to come back into 
compliance. In that case in the end, they had to give up the 
radars, and they did.
    So I would say in this case, it would be worth it, as you 
see the final details of the agreement, to see what process 
they have for doing this because I know they have attempted to 
address it. I do not know whether they will do so successfully.
    Senator Markey. So just following on the issue of Iran and 
how they perceive us. How does a perception that the United 
States still supports regime change inside of Iran complicate 
the P5+1 negotiations knowing that we still harbor our--some in 
America still harbor this ambition that the entire government 
be toppled? What does that do to the negotiations and our 
ability to get intrusive inspections successfully completed?
    Dr. Allison. Well, again, my take on it is that as another 
colleague--Bob Kagan wrote a book. He said the dangerous 
nation--I mean, the train that you are on. You know, we are a 
dangerous nation in that we do believe that these are bad 
regimes, and we do believe that they should change. This is a 
problem in dealing with Mr. Putin. It is a problem in dealing 
with President Xi. And we cannot say that we do not think that 
they are bad regimes or we do not think that there are 
violations of human rights. And I think as he looks at us, when 
we talk verification, he thinks we are doing target 
acquisition. So I think that produces an extreme struggle.
    But I am saying in the case of the Soviet Union, it was a 
struggle. We should not assume anything other than the worst, 
and we should try to deal with the worst. That is the task.
    Senator Markey. But do you think, given what happened in 
Iraq, given what happened in Libya, that the toppling actually 
led to a worse case scenario unfolding rather than a best case. 
Do you think we should be more humble in terms of our public 
pronouncements of the goal to topple the Iranian Government and 
just be happy if we can get an intrusive nuclear weapons regime 
and then to isolate it in its regional ambitions, its terrorist 
activities, or should we allow this kind of cloud to still be 
over the discussions at the back of our minds? And they are 
looking at Libya, obviously, and the Ayatollah has talked about 
that. Iraq. That we make it more difficult for ourselves to get 
true compliance with an inspections regime.
    Dr. Allison. Again, I would say two things quickly.
    The first, that even if we said that we were not trying to 
topple the regime, they would not believe it, and it might not 
be true.
    And secondly, I think that the idea of being more humble 
about our aspirations to change regimes by use of force is a 
lesson that we are trying to learn and that we should learn 
because if we are betting, Reagan's argument was a very 
interesting argument. He said we are on the right side of 
history. If we have our society perform effectively, lo and 
behold, most of these other societies will not perform because 
of all their inherent contradictions. And in the end, it is 
going to turn out okay. So I would go back to a bet more of 
that sort than trying by force to change the regimes.
    And I think actually in the case of Libya, I agree with 
Will. We have debated this at Harvard a lot. Yes, Qaddafi was a 
horrible, horrible person. Yes, he was doing horrible, horrible 
things. But if you look at Libya today, it is hard to say it is 
better.
    Senator Markey. Iraq, the same way. Thank you.
    Thank you, Mr. Chairman.
    The Chairman. Thank you.
    Senator Shaheen.
    Senator Shaheen. Thank you, Mr. Chairman.
    Welcome. So nice to have both of you here today and always 
nice to see you, Dr. Allison.
    And I apologize for having missed your testimony because I 
had another commitment. So if you have addressed some of these 
issues, I hope you do not mind doing it again.
    I wonder, Dr. Allison, if you could talk about how the 
Iranian negotiations differ from the North Korean negotiations 
because I know there are often comparisons to the two and the 
fact that we negotiated with North Korea and we were not 
successful and now they are on a path to producing more 
weapons.
    Dr. Allison. We discussed it a little earlier. I said I 
think in thinking about North Korea and Iran, one needs to 
start with three big structural factors in the case of North 
Korea. First, against North Korea, we did not have a credible 
military threat. Secondly, North Korea has a great power 
guardian. And third, North Korea has an autarchic economy that 
basically struggles and survives by a little bit of dealing 
with China but mainly on its own.
    We do not have a credible military threat because we have a 
defensive alliance with South Korea and South Korea has been 
effectively deterred by North Korea's ability to destroy Seoul.
    China is not prepared to see North Korea squeezed to the 
point that it collapses. So whenever the sanctions begin to 
bite, China violates them.
    And thirdly, the North Korean economy barely survives 
anyhow.
    Fortunately, in the case of Iran, these structural 
conditions are not the same. With respect to Iran, there is a 
credible military threat not only from us but from Israel. So 
the reason why I saw this line that was producing 20 percent 
enriched uranium in Iran--it went flat when Bibi put out a 
redline that said 250 kilos and we are going to act. And it 
approached 200 and then it went flat. Now, actually by the 
agreement, it has been reduced and is going to be eliminated, 
which is a good thing.
    Secondly, in the case of--there is no great power that is 
providing guardianship for Iran.
    And thirdly, its economy actually is connected to the rest 
of the economy.
    So I think those situations are, fortunately, different, 
which is good news for the Iranian case.
    Senator Shaheen. Do you agree, Mr. Tobey?
    Mr. Tobey. I do. I think the most salient point is that 
Iran differs from North Korea in that North Korea is a weak 
state surrounded by strong states, the largest economies, the 
largest populations, the largest land masses in the world, 
whereas Iran is a regionally strong power surrounded by 
relatively weak states.
    Senator Shaheen. So that would argue in my mind for--well, 
no, I guess not. I was going to say for why they would be more 
interested in holding onto weapons than in giving them up.
    I am also interested, Graham. In your testimony--and you 
referred to it a little while ago that the claims that we 
cannot reach advantageous agreements with governments that 
cannot be trusted is just not correct. And I wonder if you 
could talk about that a little bit more because that is one of 
the biggest concerns I hear from people who look at the 
negotiations with Iran and they say, well, how can we negotiate 
with them. We just cannot trust them.
    Dr. Allison. So I may be too much of an old cold warrior, 
but I think of Iran more or less like the Soviet Union as a 
first approximation. There are many, many differences, and I am 
sure many Iranians will take offense. But basically a society--
not the Iranian society; in the same way, not the Russian 
people, but the regime, which is a regime that makes no sense 
and which is pursuing objectives inimical to the U.S. and to 
most of its neighbors. So that is just I take as a fact.
    So when I then look at the situation, I say that is where I 
start. So will such a regime lie, steal, and cheat when it can? 
Yes. I think even Ronald Reagan said this is in their character 
for the Soviet Union, and Lenin explained that it was the 
nation's duty. So when you were tricking somebody, that was 
when you were a good Leninist. So I would say as a first 
approximation assume that the party is not trying to be 
forthcoming, is not trying to be--is trying to trick you, 
trying to deceive you, trying to cheat.
    So then the obligation for us is not to be deceived and not 
to be naive, but to expect behavior--the agreements need to be 
about items that we can see visibly and verify through the 
inspection regime with the expectation that for everything else 
that we cannot see, we are way back to ourselves and to 
intelligence independent of this constraint. So the reason why 
in the old cold war we constrained launchers, not warheads, 
even though warheads were the things that would kill us, was 
because we could only see launchers, and we could not get any 
inspection or any regime that would constrain the warheads.
    So that is why, again, if I look at the Iranian case, 
closing down Arak so that it is not going to produce 
plutonium--that is one of two ways for Iran to get a bomb. 
Great. I would say that is a good one. And similarly with 
respect to the enrichment, I have got that constrained enough, 
though I did not think that was where they were going to be 
acting before. So that drives me, as we were discussing 
earlier, to the covert route. And so it is what this agreement 
adds to our current national intelligence and that of our 
allies that will be, for me, the beef in the agreement.
    Senator Shaheen. So as we think about the covert route, 
because that is the other concern that I hear, that it is fine 
to address what we already know about what they are doing to 
build a weapon, but we are not going to know what we do not 
know. And so how do you build into these kinds of negotiations 
ways to address the potential to build other covert operations 
that we would not be aware of until too late?
    Dr. Allison. Well, in the fact sheet that was passed out, 
it was suggested--and now we will have to look to see what 
finally they bring home--that there would be continuous 
surveillance of Iran's uranium mills for 25 years. If that is 
the case, then they cannot be producing additional uranium, 
that there would be continuous surveillance of production of 
centrifuges and their storage facilities. Again, if they cannot 
produce centrifuges, they cannot enrich uranium. That there 
would be a dedicated procurement channel where all the things 
they bought that were dual-use would have to be reported. That 
is a very interesting one because they will go off buying some 
other stuff to be helpful to their program, and so that is an 
easy one to find them violating, if they do, that there would 
be a mechanism for challenge inspection. So there are a half 
dozen things of that sort. And if those were added, those seem 
to me to be likely to be big pluses to where we would be in the 
absence of an agreement.
    Senator Shaheen. But if I could just ask one final 
question.
    But opponents of the negotiations would say, well, there 
are not going to be any guarantees on all of those things 
because the IAEA is not going to get access to all of Iran at 
any time to be able to determine whether there are other 
efforts going on, whether there are other centrifuges being 
built, whether there are other--whether things are being 
smuggled in that could have an impact. So how do you address 
those kinds of concerns, or should we not be worried about 
that?
    Dr. Allison. Well, I think we should certainly be worried 
about it. And Will has something to say about that because, I 
mean, he has been thinking about what you would learn from the 
PMD might contribute to this.
    For myself, I would say, first, it is a requirement for 
American intelligence. Either we are successful--not only 
American. Israeli, French, others that are looking and who are 
looking intensely about the other activities that are not 
reported. And if it is an illegal activity, if they are buying 
material for a bomb from North Korea, they are not going to 
report that. They will proceed. So I would say the first is 
looking at it for ourselves.
    Secondly, the challenge mechanism will be very relevant for 
this. So if, as the Supreme Leader said yesterday, military 
facilities are off limits, and if something is going on in a 
military facility, IAEA cannot go inspect it, I would say that 
is a show stopper. No. The terms of the agreement is that it 
cannot be just fishing expeditions, but with the challenge 
inspection mechanism, one has got to be able to go to a place 
where there is probable cause. And we have to remember Fordow 
was built in a military facility. So if military facilities 
were off limits, this would be a loser's game. So I would say 
that is the way I would go with it.
    Senator Shaheen. Will, did you want to add to that?
    Mr. Tobey. Sure. With respect to--I would say that it is 
important to remember the process of verification is like 
constructing a mosaic. There are some tiles that are going to 
be missing and the inspectors need to go pursue those. There 
are some tiles that may be inaccurate. You may have a red tile 
that appears in the seascape that should all be blue and green, 
and they have to figure out why that has appeared.
    I believe if there is a complete and correct declaration, 
it is difficult to actually hide a covert program. Now, you 
could say, well, they will just lie in their declaration. But 
if there is access to documents and people and other things, 
which are actually less important than the anytime/anywhere 
inspection--it is really a much more mundane process that 
involves detective work--then you identify inconsistencies. 
Now, you may not identify the exact site that you are dealing 
with, but those inconsistencies lead you to other things. And 
if they are forced to answer those inconsistencies, it becomes 
difficult for them to actually maintain this lie. It also helps 
to deter them from pursuing that program because they know 
eventually they will either have to answer those questions or 
be caught stonewalling.
    Senator Shaheen. Thank you, Mr. Chairman. Sorry to run 
over.
    The Chairman. Thank you.
    Listen, we appreciate very much your testimony. I have just 
a few closing questions.
    Would it be fair to say that--back to PMD and I want to be 
fairly brief here--would it be fair to say that our insistence 
on the PMD piece would be indicative to Iran as to how thorough 
we are going to be as we move along with adherence to the 
agreement and just the inspections process in general? From the 
standpoint of us forcing that on the front end, they will take 
that, will they not, as an indication of how seriously we are 
going to try to enforce any agreement that takes place? Is that 
a fair statement?
    Mr. Tobey. Yes, absolutely. If we allow them to flout IAEA 
requests for data now, they have every reason to believe they 
will get away with that in the future.
    The Chairman. And do you agree with that, Dr. Allison?
    Dr. Allison. I am less clear. I would say that all of these 
things are being haggled about, and I think we have insisted 
that there be interviews with identified individuals and there 
be visits to sites. But if I were running the Iranian program, 
can I find a way to do that that still does not, quote, ``full 
disclosure?'' I do not think you will ever have, quote, ``full 
disclosure.'' So I think it will be a back and forth.
    The Chairman. Would it be fair to say that had we had 
anytime/anywhere inspections with North Korea, there is no way 
they would have advanced as far as they did unbeknownst to us?
    Mr. Tobey. I am actually not sure that is the case. If we 
had anytime/anywhere inspections but did not have the 
cooperation in terms of a declaration and access to people and 
documents, I am not sure that would have worked. And there is 
an historical example. The Clinton administration became 
suspicious of a facility called Kumchang-ri and actually forced 
an inspection of that place, and it turned out basically to be 
an empty underground facility. And that shows the weakness of 
relying too much on the anytime/anywhere concept as opposed to 
this building of a mosaic concept.
    The Chairman. Dr. Allison.
    Dr. Allison. I would go back: to the tall pole in the tent 
is American intelligence. So if we have good intelligence, we 
are going to find the things. If we do not, shame on us.
    The Chairman. Would it be fair to say that large amounts of 
sanctions relief without Iran being in full compliance could 
lead to the--that is exactly what we did, I guess, in North 
Korea--could lead to a similar outcome?
    Mr. Tobey. Yes, I believe so.
    Dr. Allison. I agree, but I would say that the sanctions 
relief needs to come as they implement the particular terms of 
the agreement. That is what the administration said they were 
going to insist on, and I think that is what they should do.
    The Chairman. And then this is somewhat controversial. I am 
going to phrase it. We have had, as you know, five briefings, 
three of which were private. And in those briefings, by the 
way, we had almost full attendance and a lot of debate.
    One of the more controversial statements that was made in 
those meetings by witnesses--Dr. Allison, you alluded to the 
fact that Iran believes there is a military threat today. Our 
intelligence says that is not the case. They do not believe 
there is a military threat by the United States. And so some of 
the witnesses have responded by saying there are multiple 
things we need to be looking at, much of which was asked about 
today.
    But another component, a fourth component, would be 
Congress weighing in now relative to our intentions militarily 
if they did not adhere to an agreement. And of course, you get 
into some qualitative issues as to whether it is marginal or 
whether something is in great violation. I can say it a little 
bit more strongly, but I do not want my question to be 
misinterpreted by people onlooking.
    But how important is it with an agreement in place for Iran 
to believe that if they do not comply, there will be military 
consequences?
    Dr. Allison. I believe there is a credible military threat. 
I believe that our Israeli friends provide an even more 
credible military threat. And I believe the fear of a military 
threat, if Iran should try to go the last mile, is a huge 
factor in their calculations about not going the last mile. 
About the current intelligence on whether today they fear a 
threat, given that we are negotiating with them, I would say 
that is on the side.
    The Chairman. But would you feel that Congress should 
somehow weigh in on that fact on the front end relative to an 
agreement being reached, that during the entirety of this 
agreement, that the Congress feels strongly that if it is 
violated, there should be a military threat? Is that something 
that you consider to be important?
    Dr. Allison. I would have to think hard about that, but I 
would myself think that if we had--not for some minor 
violation, but if we received evidence today that Iran was 
trying to dash the last 2 months to a bomb, would I be urging 
us to bomb them to prevent that happening? And I personally 
would.
    The Chairman. Will.
    Mr. Tobey. I think that expressions of unity by the U.S. 
Government always get the attention of foreign powers. And if 
the Congress were going to take such an action, it would likely 
attract attention in Tehran.
    The Chairman. I see Senator Coons has arrived. I am going 
to step out. I have such great trust for the ranking member I 
am going to leave it in his hands.
    I do want to say on the front end that the record will 
remain open, without any objection, until Friday, and if you 
all would answer questions up until that time, I would 
appreciate that very quickly.
    We thank you for being here today. We thank you for your 
testimony.
    And with that, I am going to defer to Senator Coons.
    Senator Coons. Thank you, Chairman Corker and Ranking 
Member Cardin, for holding not just this hearing but a whole 
series of very valuable hearings as we consider whether or not 
there will be a deal between the P5+1 and Iran about their 
illicit nuclear weapons program.
    And thank you to Mr. Tobey and Dr. Allison. It is a great 
honor to be with you today and get your insights on previous 
experiences and attempts at nonproliferation.
    Let me first just talk a little bit about what Iran is 
doing and their tactics and how you appraise their current 
tactics.
    There was, as you well know, an effort by some of our 
European allies in 2004 to negotiate a halt to Iran's 
enrichment activities. And since then, Rouhani has publicly 
remarked that they were negotiating with our European allies on 
a halt to their enrichment activities at the same time that 
they were completing the installation of some key components of 
their illicit nuclear program.
    In your view--and I would be interested in both your 
answers--is that essentially what they are doing now? They are 
negotiating for a 10-or-15-year pause or restructuring of their 
nuclear program fully intending that they will either continue 
the research and development vital to the next stage of their 
nuclear weapons acquisition during that 10-or-15-year period or 
intending to find other paths towards a sneak-out or breakout, 
or do you assess that they actually seriously are willing to 
give up on a nuclear weapons program?
    Mr. Tobey. I think all of their past activities and 
statements point to the former of your possibilities.
    Senator Coons. Dr. Allison.
    Dr. Allison. I believe that Iran has had serious ambitions 
to have nuclear weapons, does have serious ambitions to have 
nuclear weapons, will have serious ambitions to have nuclear 
weapons. So we should assume that as a constant. And the 
question in this is not can we convert them, but it is rather 
we can constrain them in ways that advantage us.
    Senator Coons. Exactly. So what we have heard, I think, 
from Senators on both sides of the aisle in these hearings is 
that distrust but verify is probably a better watchword for our 
negotiations with them.
    Dr. Allison, you are in many ways best known for a model of 
analysis of the actions of nations that presumes that they act 
as rational actors. Let us assume--and I know this is a big 
assumption--that the regime in Tehran within their own 
framework and their own ideology is behaving rationally in 
their negotiations. What piece of the proposed architecture of 
this agreement do you think they would be most likely to 
exploit in a determined, persistent effort to break out or 
sneak out? I agree with you that I am convinced they have 
nuclear weapons ambitions, and they are only engaging in these 
negotiations with us for tactical purposes for a temporary 
cessation. So let us imagine they are a rational actor. How 
would you assume they might try to break out, given the 
structure of the likely agreement as known to date?
    Dr. Allison. Again, a very good question. So an Iran that 
had serious nuclear ambitions would think of all the ways to 
get a bomb. So one way is to make them at an overt site, but of 
course, there are people watching. And the second way is to get 
them at a covert site, build them in a covert site. And the 
third way is to buy a bomb or material for a bomb from North 
Korea.
    So as I say in my written testimony that I submitted, I 
worry more about North Korea and Pakistan when I think about a 
bomb going off in the United States in the next 15 years than I 
do about Iran, though I think Iran is a worthy challenge and is 
the most urgent of them.
    So a rational Iranian could conceivably be engaged in this 
whole set of activities as a conjurer's act. It could easily be 
the case that this is what is going on with this hand while the 
other hand is actually doing the work. How will we know that? 
Only if American intelligence discovers it, not likely from 
IAEA--or one of our friendly intelligence colleagues. So do we 
need to be alert, looking, taking every possible source, 
assuming that something may be happening? Yes. I would say that 
would be reasonable.
    The buy option, again, is not much discussed, but would be 
a very interesting option. So what does North Korea need? 
Money. What does it have? Fissile material and bombs. What does 
it do? As Bob Gates testified here once before to Armed 
Services, what we know about North Korea is they sell anything 
they have to anyone who will pay. So why dismiss that 
possibility? I would not dismiss it for a second. So I would 
look at that as another possible route to be worried about. And 
the agreement will not solve all of those problems, though some 
aspects of the agreement, including the inspection and 
challenge mechanism, may again provide a few more peepholes.
    Senator Coons. So let us turn to that, if I could, for my 
last question, Dr. Allison. And I agree with you that the 
prospect of North Korea being willing to share, trade, sell 
both its proliferation knowledge and its actual weapons is a 
very sobering possibility.
    But to the inspection regime, one of the things that is 
held up as the most possibly beneficial-to-us component of an 
agreement, P5+1 with Iran, is actual inspections. So as you 
mentioned, if Iran continues its nuclear ambitions, it is most 
likely to do so at a covert site and our ability to get 
inspections anytime/anywhere of sites of any type is an 
absolutely critical piece of this. Previous inspection efforts 
with other regimes have faltered when the Security Council was 
no longer united in insisting on inspections.
    The proposed structure that is rumored in the press to be 
on the table would be a commission where, as long as our 
European allies stayed with us, the Iranians and even the 
Russians and Chinese, if they happened to come together in 
opposing an inspection, could not block an inspection. Do you 
think this sort of a commission structure could function, could 
function well, and could allow us some confidence that we would 
have the opportunity for meaningful inspections even of 
military sites, even of suspected sites? And what is your view 
on a possible 30-day timeline? Again, I am just working off of 
suggestions in the public sources about what might be on the 
table.
    Dr. Allison. Well, I can make a short comment and then Will 
actually addresses the question of anytime/anywhere and has 
been trying to drill down on that.
    I would say that from what I can understand about the 
negotiations that are now going on, they have recognized the 
problem that you point to, which is--one of Will's lessons is 
that the inspection regime is only as strong as the political 
support for it. So if the political support in the Security 
Council gets split, lo and behold, the inspection regime 
becomes weakened. So what they have tried to do is design 
around that risk. And if they design around it successfully, 
that would be a big plus. That would be a new step forward. 
Whether they will actually have that and how it will work in 
the agreement, I am not sure.
    Mr. Tobey. With respect to the unity of the political 
support for inspections, we had a rare moment in 1991 when 
Saddam was the undeniable aggressor against Kuwait. The Soviet 
Union was faltering at that point. And we really did enjoy an 
international consensus that was mustered against him. And even 
in those circumstances and even in circumstances in which there 
was undeniable evidence of nuclear, chemical and biological 
weapons work, the consensus eventually faded. And so I think 
that it will be very difficult to maintain such a consensus.
    Senator Coons. And is the structure that I described that 
may or may not be on the table one that you think might be 
sufficient to sustain that inspection regime or would you be 
very concerned about it?
    Mr. Tobey. I think it is a good idea. And a structural 
answer to that problem is helpful. But ultimately, you know, 
nations are independent actors, and Russia can make its own 
choices.
    With respect to paths that Iran might take, your previous 
question, as I noted earlier, if it is a problem that Iran is 2 
months away from a nuclear weapon today, I do not know how we 
can be comfortable with an agreement that allows them to be in 
that position in 10, 12, or 15 years.
    Senator Coons. Agreed.
    Thank you very much for your testimony. I appreciate the 
insights.
    Thank you, Senator Cardin.
    Senator Cardin [presiding]. Well, let me thank both of you 
for your testimonies.
    What we do know is what is in the framework agreement. What 
we have been informed about through hearings are some of the 
challenges in the negotiations. We have been briefed in a 
classified setting as to the status of intelligence information 
and the status of our negotiators, all of which goes into the 
equations of us being prepared to deal with the challenges that 
we will confront later this month or early next month, assuming 
an agreement is reached, or what we need to do if an agreement 
is not reached.
    But we also can learn from our past experiences, and I 
think both of you have been very helpful to us in sharing your 
insight as to previous circumstances and how it can be relevant 
to our analysis of an effective agreement with Iran to prevent 
it from becoming a nuclear weapons state.
    So on behalf of the committee, we thank you for your candor 
and for your testimony here today and advancing our ability to 
review a potential agreement.
    And with that, the committee stands adjourned.


    [Whereupon, at 12:20 p.m., the hearing was adjourned.]



                      EVALUATING KEY COMPONENTS OF
                       A JOINT COMPREHENSIVE PLAN
                          OF ACTION WITH IRAN

                              ----------                              


                        THURSDAY, JUNE 25, 2015

                                       U.S. Senate,
                            Committee on Foreign Relations,
                                                    Washington, DC.
    The committee met, pursuant to notice, at 10:25 a.m., in 
room SD-419, Dirksen Senate Office Building, Hon. Bob Corker 
(chairman of the committee) presiding.
    Present: Senator Corker, Risch, Flake, Perdue, Isakson, 
Cardin, Menendez, Coons, Kaine, and Markey.

             OPENING STATEMENT OF HON. BOB CORKER, 
                  U.S. SENATOR FROM TENNESSEE

    The Chairman. Today's hearing is the final in a series of 
six events we are holding to prepare members of the committee 
to evaluate a possible nuclear agreement with Iran.
    This month, we have heard from Secretary Moniz, from 
nuclear lab directors on technical aspects of Iran's nuclear 
program, and from retired diplomats on the regional 
implications of concluding an agreement with Iran. We held 
closed briefings on sanctions relief and the ability to verify 
an agreement.
    Yesterday, we held a hearing to examine lessons learned 
from past WMD negotiations.
    Today, our witnesses can cover a range of topics, from 
technical aspects of the Iranian program, to the interior 
politics of Iran.
    One common theme from these events is that Senators have 
left the events--I believe this to be true--with more questions 
and concerns about the agreement than answers.
    In the last few days prior to an agreement being reached, I 
think it is important for Senators to voice the concerns they 
have in hopes that those concerns will improve the deal. I 
think it is clear that the negotiators pay attention to what we 
say, so it is important that we say that now.
    I wish to call the committee's attention to the importance 
of PMD disclosure requiring the Iranians to address all of the 
IAEA PMD concerns prior to relieving sanctions. It is not just 
an issue about Iranian national pride. It is essential to 
properly verifying an agreement.
    I would appreciate it if the witnesses would comment on why 
PMD disclosure is important and, more specifically, why it is 
necessary to properly verify an agreement.
    The second issue I would like to highlight is the need for 
anytime, anywhere inspections. This issue goes hand in hand 
with PMD disclosures. If we do not know what Iran is capable 
of, and we do not have complete access to any and all suspect 
sites, I do not see how we can reasonably claim to know what 
Iran is doing.
    I would also appreciate your comments on the importance of 
inspector access and what level of access we should require in 
an agreement. I fear the administration may again provide the 
green light for a slow and measured nuclear development program 
that does little to deter Iran from laying the foundation for a 
weapons program after it reaps the benefits of sanctions 
relief. As I have stated many times before, I want to see, and 
I think all of us here want to see, a strong agreement with 
Iran that will prevent them from obtaining a nuclear weapon and 
hold them accountable.
    As we have met with nuclear scientists, regional experts, 
and former administration personnel, I become more and more 
concerned with the direction of these negotiations and 
potential red lines that may be crossed. It is our 
responsibility to examine this issue and any final deal that 
may be reached with a skeptic's eye so that we can determine 
whether it will be in the best interest of our country and the 
world.
    Thank you again for appearing before the committee. I look 
forward to your testimony.
    And with that, I will turn to our ranking member, Senator 
Cardin.

         OPENING STATEMENT OF HON. BENJAMIN L. CARDIN, 
                   U.S. SENATOR FROM MARYLAND

    Senator Cardin. Mr. Chairman, thank you very much.
    This hearing concludes a month of committee engagement on 
the nuclear talks and various elements of a possible deal, as 
well as Iran's role in the region and necessary considerations 
on United States foreign policy. I thank you very much for the 
manner in which I think our committee has prepared for the 
outcomes of the negotiations between the P5+1 and Iran. We, 
certainly, value the time.
    When we reconvene after this recess, we should know the 
status of those talks.
    President Obama and his administration deserve praise for 
boldly pursuing the diplomatic path. One of the consensuses 
that I think we have determined is that all of us agree that 
the right diplomatic path, the right agreement, would be the 
best course for us to pursue to prevent Iran from becoming a 
nuclear weapons state.
    The other area that I think has been broadly agreed to not 
only by the Congress and the American people, but by all of the 
surrounding states in the region, is that this world will be 
much safer if we can prevent Iran from becoming a nuclear 
weapon power, that that would be a game changer in the region.
    I want to underscore a couple important points, and that is 
that I will not reach a decision as to whether we should 
support or not support a potential agreement until I have seen 
that agreement, have seen the exhibits and have had a chance, 
in both an open and closed setting, to understand all of the 
information so that we know exactly what the agreement is and 
what the commitments will be and what the consequences will be, 
if those terms are not agreed to.
    I will evaluate the agreement on whether it achieves its 
objectives. Will this deal sufficiently extend the breakout 
time it would take for Iran to produce a nuclear weapon? Does 
the deal cut off all Iranian pathways, including a covert one 
to nuclear weapons? We know that they will try to do things in 
a covert setting. Will the inspection and verification regime 
be sufficiently robust to ensure that all possible pathways are 
cut off? Will this agreement require that Iran respond to all 
of the allegations that the IAEA has made about the possible 
military dimensions of a nuclear program? Does the agreement 
provide a path for the international community to respond to 
Iran's violations of an agreement?
    In other words, will we have adequate time in order to take 
the appropriate steps, if Iran does not comply with a potential 
agreement, to make sure that they do not become a nuclear 
weapons state?
    We have an important role to play, but we are not in the 
negotiating room, and we should not prejudge the outcome of the 
talks. What is clear to me is that we need an agreement with 
Iran that requires the resolution of possible military 
dimensions; demands verifiable, transparent, intrusive 
inspections; and ensures that the sanctions will snap back 
forcefully, should Iran breach its obligations.
    I look forward to the witnesses' testimony, and just as 
importantly, our ability to interact in questioning in order to 
further our capacity to appropriately review any potential 
agreement.
    The Chairman. Thank you, Senator Cardin.
    We will now turn to our witnesses. Our first witness is Mr. 
David Albright, certainly no stranger to this committee, the 
president of the Institute for Science and International 
Security.
    We thank you for being here.
    Our second witness is Dr. Ray Takeyh, senior fellow at the 
Council of Foreign Relations, also no stranger to this 
committee. We appreciate him being here.
    Our third witness is Dr. Jim Walsh, research associate for 
the Security Studies Program at the Massachusetts Institute for 
Technology.
    We want to thank you all for being here. This is our sixth 
briefing and/or hearing. We hope that you all are going to cap 
this off in a very appropriate way. We look forward to your 
testimony. If you would, I think you all know this, summarize 
your comments in about 5 minutes. Without objection, your 
written testimony will be entered into the record. And we look 
forward to our questions.
    Again, thank you very much for waiting through a business 
meeting, for being here today, and concluding our session on 
this prior to a potential agreement. Thank you very much.
    I will start with you, David.

 STATEMENT OF DAVID ALBRIGHT, PRESIDENT, INSTITUTE FOR SCIENCE 
           AND INTERNATIONAL SECURITY, WASHINGTON, DC

    Mr. Albright. Thank you, Mr. Chairman, Ranking Member 
Cardin, and other Senators.
    I particularly thank you for inviting me to testify today. 
It is a very technical agreement. It is very difficult to 
understand. And I think it does require a considerable amount 
of attention.
    It also is a very momentous agreement, if it comes to pass. 
And I think as Senators think about how to evaluate a nuclear 
deal, I would recommend that one model to follow is the 
procedure used when the President submits a treaty to the 
Senate for ratification.
    Now clearly, this is not a treaty and an Executive 
agreement, but because of the significant impact on U.S. 
national security, this agreement warrants special and 
extraordinary congressional scrutiny. And this scrutiny should 
not only lead to an up or down vote, but it should also result 
in legislation that enshrines and elaborates on its provisions 
and its implementation over time, makes key interpretations of 
its provisions, and establishes robust administration reporting 
requirements.
    More specifically, in evaluating a deal, Senators should 
use a set of criteria. And in my testimony, I have listed 11. I 
will not cover this now. I am sure other witnesses would add to 
that, but I would like to emphasize several.
    One is, I think it is clear that a breakout time has been a 
very important criteria in driving the negotiations. I think it 
has turned out to be extremely useful in establishing 
limitations on the Iranian program and has been used very 
effectively in the negotiations to, in a sense, corner the 
Iranians and get them to agree to the kinds of reductions in 
their centrifuge program that have been necessary.
    The administration has chosen to have a 12-month breakout 
time, and I think that on the basic deal of numbers of 
centrifuges that would remain, the amount of 3.5 percent low-
enriched uranium, at my institute we agree with their 
assessment that a 12-month breakout time has been satisfied.
    There are concerns, however, that there is other low-
enriched uranium that will probably stay in Iran under the 
current negotiating trajectory, namely the near 20 percent. We 
think that, if that material stays, that can lower the breakout 
times below 12 months and that the 20 percent material needs to 
leave Iran. I hope the administration would work to do that in 
the time remaining.
    There is also concern that Iran not be able to reconstitute 
its dismantled centrifuges. There will be over 10,000 declared 
excess, and under the Lausanne interim agreement, they would be 
dismantled and stored. The question is how quickly could they 
be brought back into play. I have no idea, but I think that is 
another area that needs scrutiny.
    Now, it has been brought up about the inspectors needing 
access, and I cannot emphasize that enough. And under the 
additional protocol, access to military sites would be 
guaranteed. And Iran's intransigence on this point is very 
disturbing, because it understands how the IAEA does its 
business. It does not distinguish between civilian and military 
sites. It needs to go to the sites it needs to go to. So I 
think if this issue is not resolved in a favorable light, then 
I do not see how there can be a deal, without access to sites 
that are suspicious anywhere and promptly.
    We use ``anytime'' as the term. In practice, it means 
promptly. Again, I do not see how you can verify this 
agreement. And Iran's recent statements about this have to 
worry everybody.
    As to Iran's recent comments and ongoing comments about the 
possible military dimensions of the PMD, the IAEA needs to know 
what Iran knows. How much progress did it make on nuclear 
weapons? Has it put that capability on the shelf to pull out? 
The IAEA learned in a very hard way that if they do not pay 
attention to the past, they cannot know what is going on now, 
and particularly they cannot determine that the program is 
peaceful.
    They learned this the very hard way in Iraq in the early 
1990s. They could not verify South Africa's denuclearization, 
and South Africa was put under tremendous pressure to reveal 
its past work on nuclear weapons, which it eventually did, and 
the IAEA was able to wrap up its investigation and declare that 
South Africa had given up all its nuclear weapons and was not 
hiding anything.
    So I think that without knowing the past, the IAEA cannot 
verify that Iran's program is peaceful.
    Again, the fact that Iran is becoming more and more 
intransigent on this point, it has to make one pessimistic 
about this deal.
    Another issue, and this will be the last one I cover, I see 
my time is up, is a very hard one to deal with. And I think 
Congress has a special role to play on this. This deal was set 
up, in essence, to limit Iran's program for a certain period of 
time. And I think I was disappointed that 10 years was really 
the baseline, not 15 to 20, as when you would have a very harsh 
limitation on the centrifuge program.
    With that being said, I think Congress needs to wrestle 
with this because if you have harsh limitations for 10 years, 
and they are good ones, unfortunately, the way this deal works, 
is that years 10 to 13, Iran is preparing for development and 
deployment. And after year 13, it is full-scale deployment. And 
by year 15, they could be having the capability that has 
breakout times far less than what we have now, and they could 
have some of that capability in the very deeply buried Fordow 
site.
    So in a sense, we would be worse off than we are now, and I 
think that this deal has to include in it some assurance to the 
United States that, if Iran is going to build up its nuclear 
program in the future, that it is guaranteed to be economically 
justified and consistent with a civil nuclear need.
    I think in the legislation that I mentioned, I think there 
needs to be some conditions put in on how the United States 
interprets this situation. I would argue it is unacceptable 
unless those kinds of conditions are met. And in that sense, if 
Iran does build up, as people fear, that would be seen as a 
violation of the intention of this deal and would allow the 
United States to act at that time.
    So thank you very much.
    [The prepared statement of Mr. Albright follows:]

                  Prepared Statement of David Albright

    The U.S. administration and its partners in the P5+1 are poised to 
conclude a momentous agreement with Iran designed to limit its nuclear 
programs in exchange for significant sanctions relief. Congress has a 
special responsibility to evaluate this agreement and judge its 
adequacy to protect U.S. national security interests in the short and 
long term. As part of this process, it should create legislation to 
codify the agreement, its implementation processes, critical 
interpretations of the agreement, reporting requirements, 
clarifications about violations and consequences of noncompliance, and 
steps needed to mitigate weaknesses in the agreement.
    The legislative branch must determine if the agreement is adequate 
to achieve the goal it originally set out to achieve--namely 
instituting international confidence in the peaceful nature of Iran's 
nuclear programs, not just for the duration of the accord, but for the 
foreseeable future. Special attention should be given to an agreement 
whose nuclear limits sunset after 10-15 years, potentially leaving the 
world with an even more insecure and heightened situation in Iran in 
terms of a greatly reduced Iranian breakout timeline, and more advanced 
centrifuges spinning and capable of creating weapon-grade uranium (WGU) 
within shorter periods of time.
    The United States and its allies cannot be certain about their 
ability to rely mainly on intelligence after the extraordinary 
arrangements in an agreement end, long after sanctions are removed, and 
Iran has more freedom to augment its nuclear program. Iran's regional 
neighbors would likely not wait to develop their own threshold nuclear 
capability in the face of an Iran that only a decade or two from now 
would be on the cusp of rapid breakout, capable of producing many 
nuclear weapons and within a shorter time period than it is today. 
Thus, Congress needs to proactively consider the implications of this 
deal for an ``enrichment race'' in the Middle East that could lead 
several countries to nuclear weapons capabilities in the next 10-15 
years.
    Congress should evaluate the technical limits and verification 
measures set out in the deal to ensure they adequately constrain Iran's 
nuclear activities and capabilities and its ability to violate the 
agreement. In particular, the verification arrangements should ensure 
the reaching of an understanding about past and possibly ongoing 
Iranian work on nuclear weapons and ensure prompt access to any Iranian 
sites, whether military or civilian. Enforcement will require 
maintaining leverage against Iran if it cheats, yet reliance on a 
snapback of sanctions as the only leverage in the case of an Iranian 
breakout appears deeply ineffective to pressure Iran to reverse course. 
In addition, the deal needs to be carefully scrutinized in how it 
guards against incremental and more ambiguous violations and set out 
procedures to address this type of cheating.
    As Senators think about how to evaluate a nuclear deal, one model 
is to follow procedures used when the President submits a treaty to the 
Senate for ratification. Although a Joint Comprehensive Plan of Action 
(JCPOA) is clearly an Executive agreement by nature, it will have a 
significant impact on U.S. national security and warrants and deserves 
extraordinary congressional scrutiny. This scrutiny should not only 
lead to an up-or-down vote of the agreement, it should result in 
legislation that enshrines and elaborates on its provisions and its 
implementation over time, and makes key interpretations of its 
provisions. While the Iran Nuclear Agreement Review Act of 2015 
satisfies some of the following provisions, Congress should ensure that 
any new legislation includes those provisions and additional measures 
and supporting reporting requirements that go further, such as:

   A detailed description of the motivation, intent, and scope 
        of the agreement;
   Key technical and policy interpretations of major 
        provisions;
   Assessments about the adequacy of the agreement's 
        verification regime;
   Clear statements of what constitutes violations, both 
        material and incremental;
   National and international mechanisms to determine a 
        violation and course of remediation;
   Consequences in case of Iranian noncompliance, in particular 
        those that go beyond or complement the snapback of sanctions; 
        and
   Procedures for addressing Iranian unwillingness to comply 
        with remediation or cease the disputed activity.

    While a full discussion of such legislation is beyond the scope of 
this testimony, a few examples would help clarify such an approach. It 
is important to state that the need for this agreement results from 
Iran's pursuit of nuclear weapons and secret nuclear capabilities and 
to provide details about these efforts. It would be useful that 
legislation lay out Iran's violations of its nonproliferation 
commitments and describe its history of noncooperation with the 
International Atomic Energy Agency (IAEA).
    The legislation could contain key interpretations of the deal. The 
Obama administration has already stated one interpretation, namely that 
uranium enrichment is not a right of Iran under the Nuclear Non-
Proliferation Treaty. Another it has articulated is that any production 
of uranium enriched over 5 percent after the end of the explicit 
prohibition on such production in the agreement (at year 15) would be 
viewed as a significant threat to U.S. and international security. 
Likewise, an interpretation by Congress could be that Iran's expansion 
of its nuclear program after year 10 of the agreement must be clearly 
related to the practical need for nuclear energy and consistent with a 
legitimate and economic, peaceful nuclear requirement.
    The legislation could include reporting requirements that require 
more detailed reports than laid out in the Iran Nuclear Agreement 
Review Act. Examples include requirements for the administration to 
produce annual unclassified compliance reports, including review and 
determination of the ongoing adequacy of the agreement's verification 
regime. More frequently, the administration should report on the 
adequacy of Iran's cooperation with the IAEA. Congress should be 
informed quarterly about the size of Iran's low enriched uranium (LEU) 
stocks, both less than 5 percent and less than 20 percent enriched, and 
whether the breakout timelines remain as they should. The 
administration should also inform Congress in detail about the status 
of Iran's centrifuge research and development programs.
    The legislation could also establish implementation steps. Some 
have suggested that there should be a senior administration official 
responsible for implementation. The IAEA's verification efforts in Iran 
should be supported with additional funding and other types of U.S. 
support. In addition, there should be actions to strengthen U.S. export 
control and counterproliferation efforts against Iran's illicit 
procurements for its missile and military programs and its potential 
illicit nuclear or nuclear-related procurements. As part of that 
effort, it is important to improve U.S. programs for the timely 
detection of Iran's illicit procurement attempts, utilizing and 
developing new technologies, and to expand cooperation with allies to 
improve timely detection of Iran's illicit trade.
    The remainder of my testimony seeks to address specific questions 
posed by the chairman in his invitation letter. Because of the 
complexity of some of the questions, a few of the responses are more 
technical than usually presented in congressional testimony. 
Nonetheless, I hope the testimony is useful. If desired, I can provide 
additional supporting information or elaborations.
           (1) what criteria should senators use to evaluate 
               a prospective nuclear agreement with iran?
    In particular, criteria weighing the adequacy of an agreement 
should include:

   The blockage of the four main pathways to the bomb: the 
        Arak/plutonium production pathway, Natanz/enrichment and 
        Fordow/enrichment pathways, and covert pathways.
   Achievement of a 12-month breakout timeline during the first 
        10 years of the agreement and a 6-month breakout timeline 
        remaining at year 13.
   The size of the near 20-percent LEU stock is consistent with 
        a 12-month breakout timeline. In particular, is the 
        administration making assumptions to unreasonably exclude 
        portions of a remaining stock of near 20 percent LEU?
   The methods, and their effectiveness or timeliness, in 
        reducing Iran's 3.5 percent LEU stockpile from its current 
        level of about 10,000 kg to the 300 kg cap agreed in the April 
        2015 interim agreement. How will this cap be maintained during 
        the agreement?
   Adequate verification, including the adequacy of Additional 
        Protocol Plus arrangements.
   Inspector access to Iranian sites where suspicious activity 
        may be occurring, including military sites, anywhere and 
        promptly, or ``anytime,'' and certainly within 24 hours. In 
        particular, if the agreement creates a P5+1 deliberative body 
        that has the authority to decide upon IAEA access in case of an 
        Iranian refusal, the length of the proceedings should not 
        increase access time significantly or create a process that 
        Iran can exploit to buy time to hide or destroy evidence at 
        suspect sites.
   An Iranian commitment not to conduct illicit nuclear and 
        nuclear-related trade.
   A procurement channel under a United Nations Security 
        Council resolution that controls a sufficient number and type 
        of goods and includes adequate monitoring. As part of verifying 
        Iran's compliance with this condition, the IAEA should ensure 
        that Iran's procurement of nuclear and nuclear-related goods is 
        within this channel and be mandated to investigate violations. 
        The IAEA should be able to have access to the actual end users 
        of goods imported by Iran through this channel and those who 
        have illicitly procured outside this channel.
   The deal can survive stress tests, namely assessments of the 
        durability and adequacy of the agreement against a variety of 
        scenarios that project the status and behavior of the Iranian 
        regime in the future, such as 10 and 15 years after the 
        agreement is signed. It is critical to evaluate the agreement's 
        projected goals and endpoints against an Iranian regime that 
        acts more responsibly than today as well as less responsibly. 
        The durability, strength, and value of any deal is truly 
        measured against an Iranian regime that remains as it is today 
        or worsens in terms of impact on U.S. interests regionally and 
        internationally.
   Understandings that at year 13 after implementation of the 
        deal, and in particular at year 15, any Iranian nuclear 
        expansion of uranium enrichment efforts or building of heavy 
        water reactors will be based on legitimate economic rationales 
        and clearly needed for civilian purposes. Any indications, 
        based on Iranian statements in the negotiations or learned by 
        U.S. intelligence, that Iran intends to enrich over 3.67 
        percent after year 15 of the agreement should be weighted 
        negatively.
   Evaluating the implications of the deal establishing a new 
        norm that legitimizes uranium enrichment despite the lack of 
        need for the enriched uranium and a history of noncompliance 
        and noncooperation with the IAEA. Will the deal herald an 
        ``enrichment race'' that threatens U.S. interests regionally 
        and more broadly? Congress should evaluate this threat of the 
        spread of dangerous nuclear technologies and develop 
        remediation steps to mitigate damages.
       (2) what concerns do you have about the interim agreement 
                      announced on april 2, 2015?
    Overall, the interim agreement achieved many U.S. objectives; 
however, it also raised several concerns. In an ISIS report published 
on April 11, 2015, we outlined in fuller terms the agreement's 
accomplishments, several weaknesses, and a number of unresolved 
issues.\1\
    The interim agreement succeeded in limiting the Arak heavy water 
reactor sufficiently, reducing Iran's centrifuge program in size, and 
increasing transparency and monitoring of a long-term deal. Other 
important provisions contained in the Fact Sheet of the interim deal 
include:

   No new enrichment facilities for 15 years;
   The removal and monitored storage of excess centrifuges and 
        associated equipment and not their disablement in place, as was 
        discussed in the past as a preferred possibility by the U.S. 
        negotiators;
   In particular, the removal and monitored storage of the 
        roughly 1,000 IR-2m centrifuges at the Natanz Fuel Enrichment 
        Plant and the removal and storage of the several hundred IR-2m 
        and IR-4 centrifuges at the Natanz pilot plant;
   The removal from Iran \2\ or blending down of most of Iran's 
        stock of about ten tonnes of 3.5 percent LEU and a long-term 
        cap of 300 kg of LEU hexafluoride enriched no more than 3.67 
        percent (Iran can possess other chemical forms of this LEU but 
        these amounts must fall within the cap, after calculating their 
        hexafluoride equivalent);
   Excess centrifuges and associated equipment can be used only 
        as replacements for operating centrifuges and equipment, 
        removing any need for further operation of IR-1 and IR-2m 
        centrifuge manufacturing operations and procurements;
   Containment and surveillance of centrifuge component 
        manufacturing plants; and
   A procurement channel for goods needed in authorized nuclear 
        programs.
Concerns:
   There are numerous concerns about whether the deal 
        adequately addresses limits on Iranian enrichment which have 
        implications for maintaining the 12-month breakout timeline.

      --The U.S. Fact Sheet about the interim agreement makes no 
            mention of Iran's stock of near 20 percent LEU, in 
            particular its fate. How much near 20 percent LEU will Iran 
            retain? How will the excess be determined? Will that excess 
            be shipped out of Iran or diluted to natural uranium? 
            Maintaining a 12-month breakout timeline depends critically 
            on the size of Iran's remaining stock of near 20 percent 
            LEU and its accessibility in a breakout (see also question 
            6). As of June 30, Iran will retain a dangerously large 
            stock of near 20 percent LEU, namely about 230 kilograms 
            (kg) of near 20 percent LEU. This LEU will be in three 
            principal categories, namely about 45 kg projected to be in 
            oxide powder form, approximately 135 kg in waste, in scrap, 
            or in-process and roughly 50 kg in fuel elements for the 
            Teheran Research Reactor (TRR).\3\ ISIS has recommended the 
            stocks of oxide powder and in waste/scrap/process be 
            blended down to natural uranium or shipped out of Iran. The 
            LEU in fresh or unirradiated TRR fuel should also be made 
            less usable in a breakout. One method to do that is to 
            irradiate all the TRR fuel, at least partially, to increase 
            the complication of extracting the LEU from the fuel. On 
            the other hand, the administration appears willing to allow 
            Iran to keep the bulk of this near 20 percent LEU, as long 
            as it is mixed with aluminum, a step in the manufacturing 
            process of TRR fuel. The JCPOA should be carefully 
            scrutinized as to whether, or how, these recommendations 
            are implemented and in particular it should be assessed as 
            to whether the breakout calculations should include near 20 
            percent LEU recovered from LEU/aluminum mixtures. We 
            believe they should.

      --The interim agreement does not provide the mechanisms to reduce 
            Iran's 3.5 percent LEU stockpile from its current level of 
            about 10,000 kg to the 300 kg cap. Excessive stocks of 3.5 
            percent LEU also negatively impact the 12-month breakout 
            timeline. About 4,000 kilograms of this LEU are slated to 
            be converted into oxide powder, albeit far behind the 
            schedule implied in the Joint Plan of Action (JPOA). In 
            fact, Iran has not met its commitments at the end of the 
            first period of the JPOA and its first extension to turn 
            newly produced 3.5 percent LEU into oxide form. It is 
            doubtful it will do so at the end of the current extension 
            that ends on June 30, 2015. The administration has publicly 
            downplayed this condition in the JPOA, focusing on a weaker 
            condition that Iran feed the newly produced LEU into the 
            uranium conversion plant, a technically simple step to 
            accomplish. The result is that this 4,000 kg of LEU will 
            likely be in several chemical forms, most not amenable to 
            blending down to natural uranium without further chemical 
            processing. Some of the LEU could be in chemical forms that 
            may not be amenable to either blending down or shipping out 
            of Iran. Congress should carefully scrutinize the 
            arrangements in a deal to achieve a cap of 300 kg of 3.5 
            percent LEU hexafluoride equivalent.

   Of concern is the lack of a ``soft landing'' or slow return 
        to shorter breakout timelines after year 10 and up to year 15. 
        Iran will also be able to deploy advanced centrifuges after 
        year 10. In fact, one senior negotiator described the 
        arrangement for centrifuges as a reversed program in years 1 to 
        10, preparation for full development in years 10 through 13, 
        and full development after year 13. A major concern is that 
        Iran can return to short breakout timelines, likely far shorter 
        than the 2 months or so projected today.

      --Lack of limits on Iran augmenting its enrichment capacity after 
            year 10. ISIS has recommended that breakout time should 
            decrease no faster than 1 month per year, resulting in a 
            breakout time of 7 months at year 15. During this 5-year 
            period, no IR-2m, IR-4, or more advanced model centrifuges 
            should be deployed.

      --Lack of a ``sunset clause'' for the agreement authorizing the 
            path forward for Iran, or at year 13 the ability for the 
            P5+1, collectively or individually, using IAEA findings and 
            other, nationally developed information, to determine if 
            Iran's nuclear program is consistent with a peaceful 
            program, exclusively for peaceful purposes, and expected to 
            remain so. Such a positive determination would then free 
            Iran to deploy large numbers of its centrifuges and thereby 
            lower breakout timelines.

      --Lack of a condition that explicitly states that Iran would not 
            enrich beyond the 3.67 percent indefinitely, rather than 
            the current provision to ban such enrichment for just 15 
            years. Iran is unlikely to have a civilian justification 
            for producing enriched uranium above 3.67 percent after 
            year 15. Iran enriching at near 20 percent would 
            undoubtedly risk increasing international concerns about 
            its intentions and create precedents for other nations to 
            follow.

   The weakness of provisions limiting centrifuge research and 
        development (R&D) during the first 10 years of the agreement.

      --No bans exist on Iran's research and development of the IR-6 
            and IR-8 centrifuges, the latter of which is up to 16 times 
            more powerful than the 
            IR-1 centrifuge. Failing to achieve such bans, the interim 
            agreement does not appear to mitigate the risks of Iran 
            being able to deploy these more powerful centrifuges after 
            year 13, other than some negotiators stating that they 
            believe that Iran will have trouble actually deploying them 
            in the future.

   Lack of additional conditions on Iran's allowed work at the 
        Fordow site for the indefinite future, because of its sensitive 
        nature of being deeply buried and difficult to access or 
        penetrate in the event of cheating or breakout.

      --An existing loophole in the interim agreement allows Iran to 
            operate advanced centrifuges at Fordow after year 10, 
            albeit not enriching uranium. ISIS has recommended that a 
            deal should prevent Iran from ever using Fordow to enrich 
            uranium or only allow it to enrich in IR-1 centrifuges.

      --After year 15, Iran could deploy any of its centrifuges at 
            Fordow to enrich uranium, allowing it to reestablish Fordow 
            as a uranium enrichment centrifuge plant with a capacity 
            far in excess of its current capacity. Unless additional 
            limits are included in the agreement, Fordow could reemerge 
            as a substantial uranium enrichment plant after year 15, 
            housing advanced centrifuges 10 to 16 times more capable 
            than the IR-1 centrifuge. So, instead of a plant with a 
            current capacity of about 2,500 separative work units (swu) 
            each year, the plant would have a capacity of 25,000-40,000 
            swu per year. Since bans to produce near 20 percent LEU 
            also sunset at year 15, this heavily fortified plant would 
            be capable of producing enough weapon-grade uranium for a 
            nuclear weapon within a few weeks, or enough WGU for two 
            weapons in less than a month.
Unresolved issues:
   The interim deal was largely silent on verification 
        conditions of key importance, including (described in detail 
        under question 4):

      --Anywhere, anytime access to Iranian military sites;
      --The need for a broad centrifuge-related declaration;
      --A raw uranium import declaration;
      --Key import and export declarations of sensitive or dual-use 
        goods; and
      --A plutonium related declaration.

    Our concerns about the interim deal outlined above should not be 
construed as opposition to the deal, particularly since the deal has 
yet to be finalized. Our judgement about a deal has to await the final 
details. Our concerns, however, provide another measuring stick upon 
which to evaluate a final agreement.
 (3) what redlines do you believe senators should hold in evaluating a 
                prospective nuclear agreement with iran?
    The U.S. Government's redlines have been difficult to identify. 
Iran has been far clearer about its redlines. Nonetheless, if a redline 
is defined as a condition that if unmet would immediately mean that the 
deal would be rejected, several key ones that should be considered are:

   Estimated breakout time, or the time to produce one 
        significant quantity of fissile material for a nuclear weapon, 
        is adequate to allow enough knowledge and time for action or 
        intervention to stop Iran. In the words of Under Secretary of 
        State Wendy Sherman: ``We must be confident that any effort by 
        Tehran to breakout of its obligations will be so visible and 
        time consuming that the attempt would have no chance of 
        success.''
   The rollback of Iran's centrifuge program and Arak reactor 
        modifications are irreversible during the duration of the 
        agreement, or at least not significantly reversible within 12 
        months of Iran's initiation of a reversal.
   A clear, timely pathway exists whereby the IAEA's concerns 
        are addressed about the possible military dimensions of Iran's 
        nuclear program, both in the past and those possibly ongoing 
        today. Ambiguity over Iran's nuclear weaponization 
        accomplishments and residual capabilities risks rendering an 
        agreement unverifiable by the IAEA. This pathway cannot simply 
        involve Iran checking boxes and the IAEA or the United States 
        accepting Iranian explanations. It must be accompanied by full 
        Iranian cooperation with an IAEA investigation, including 
        access to sites, people, and documents related to its past or 
        possibly ongoing efforts.
   Prompt IAEA access is guaranteed to all sites in Iran, 
        whether military or not, if suspicious activities are reported.
    (4) are there requirements on inspections or possible military 
    dimensions (pmd) that you believe are essential to a successful 
   agreement? do you believe there are other required elements of a 
                         successful agreement?
    A prerequisite for a comprehensive agreement is for the IAEA to 
know when Iran sought nuclear weapons, how far it got, what types it 
sought to develop, and how and where it did this work. Was this weapons 
capability just put on the shelf, waiting to be quickly restarted? The 
IAEA needs a good baseline of Iran's military nuclear activities, 
including the manufacturing of equipment for the program and any 
weaponization related studies, equipment, and locations. The IAEA needs 
this information to design a verification regime and determine if 
Iran's nuclear program is peaceful today.
    One important aspect of this issue has been the IAEA gaining access 
to a site at the Parchin military complex. This site is the alleged 
location of high-explosive testing linked to nuclear weapons 
development prior to 2004. Since the IAEA asked to visit this site in 
early 2012, Iran has reconstructed much of it, making IAEA verification 
efforts all but impossible. Tehran has undertaken at this site what 
looks to most observers as a blatant effort to defeat IAEA 
verification. Because of such extensive modifications, the IAEA, once 
allowed access, may not be able to resolve all its concerns. Thus, 
access to Parchin alone is no longer sufficient to resolve the issues 
underlying the IAEA's original request to access this site. The IAEA 
will need to visit related sites. One needs to now think of IAEA access 
to Parchin as including a list of actions that would involve the need 
for access to additional sites and individuals. More broadly, Iran will 
need to allow access to a range of sites as part of addressing the 
IAEA's PMD concerns.
    For a deal to be verifiable, Iran will also need to agree to IAEA 
requests to interview key individuals, such as Mohsen Fakhrizadeh, a 
reputed leader of Iran's nuclear weapons efforts, and Sayyed Abbas 
Shahmoradi-Zavareh, former head of the Physics Research Center, alleged 
to be the central location in the 1990s of Iran's militarized nuclear 
research. The IAEA interviewed Shahmoradi years ago about a limited 
number of his suspicious procurement activities conducted through 
Sharif University of Technology. The IAEA was not fully satisfied with 
his answers and its dissatisfaction increased once he refused to 
discuss his activities for the Physics Research Center. Since the 
initial interviews, the IAEA has obtained far more information, some 
supplied by my institute, about Shahmoradi and the Physics Research 
Center's procurement efforts.\4\ The need to interview both 
individuals, as well as several others, remains.
    There had been an expectation, or at least a hope, that Iran would 
address the IAEA's PMD concerns prior to the June 30 deadline. However 
Iran has become more intransigent on this issue over the last several 
months, eliminating any such hope. Because this issue is fundamental to 
resolving the nuclear issue, Iran's intransigence requires extra 
assurance early on in any deal that it will comply with its safeguards 
obligations and meet the fundamental goal of a long term deal that 
Iran's nuclear program be strictly peaceful.
    The administration has reportedly proposed to Iran that it allow 
access to a list of many sites and persons that are relevant to the 
IAEA's PMD concerns, prior to the lifting of key financial and economic 
sanctions. As of late last week, Iran had not accepted this list. But 
even if it does, it could mechanistically allow the IAEA access to 
these sites and persons while showing no real cooperation. As discussed 
above, the risk is too high that Iran would treat the exercise as 
simply checking a box, leaving the IAEA no further along in its effort 
to address its PMD concerns. If Iran can do this before the removal of 
sanctions, one can have little confidence that it will address the 
IAEA's concerns afterward.
    If Iran successfully stonewalls the IAEA prior to the lifting of 
sanctions, the IAEA's credibility will be undermined. Further, Iran may 
be able to maintain all of the knowledge and capabilities related to 
nuclear weapons that it has acquired and developed for a future date 
when it may want to break out of its nonproliferation obligations. 
Leaving Iran's past accomplishments in the shadows would solve nothing 
if in the future it can muster nuclear weapons capabilities unknown to 
the IAEA and the international community, to make nuclear weapons. As a 
result, Congress should look for more from the deal, namely prior to 
the lifting of sanctions, Iran should resolve in a significant and 
concrete manner the IAEA's concerns about its past and possibly ongoing 
work on nuclear weapons. Although Iran addressing all of the IAEA's PMD 
concerns would be ideal, that process will likely take years. The 
following aims to identify a sufficient set of conditions that are 
straightforward and realistic to achieve in the initial implementation 
period of an agreement. These conditions, or equivalent ones, should be 
included in a set of requirements that Iran must meet before key 
financial and economic sanctions are lifted:

   Iran accepting a robust list for visits to sites where 
        nuclear weapons-related activities are alleged to have taken 
        place (such as Parchin but involving at least a half a dozen 
        sites); and access to key equipment, companies, and individuals 
        identified by the IAEA as associated with past military nuclear 
        related activities. Congress should, on a classified basis, 
        compare this list to earlier proposed ones by the 
        administration and its allies and require the administration to 
        provide an explanation for which specific items were removed 
        and why. (The list should not in any way be considered a final 
        list; the IAEA will need to reserve the right to go to other 
        sites, interview the same or different people, and obtain other 
        documents as it seeks to finalize its PMD investigation, some 
        of which will likely have to occur after the lifting of 
        sanctions).
   The IAEA receiving full cooperation from Iran in its efforts 
        to conduct a rigorous investigation of PMD issues.
   Prior to the lifting of key sanctions, the IAEA having time 
        to assess the results of these visits and access and make a 
        preliminary determination over whether it has made concrete 
        progress. Such a positive IAEA determination would be necessary 
        to lift sanctions.
   If appropriate, the IAEA issuing a provisional 
        determination, and Iran not disagreeing, that it had a nuclear 
        weapons program prior to 2004, parts of which may have 
        continued after 2004.
   The U.S. intelligence community issuing a detailed 
        unclassified dossier describing to the best of its knowledge, 
        albeit incomplete, Iran's past nuclear weapons program and more 
        recent activities that are useful for the development of 
        nuclear weapons or that are associated with research in fields 
        of nuclear weapons development, such as those conducted by the 
        Organization of Defensive Innovation and Research (SPND), 
        headed by Mohsen Fakhrizadeh.\5\
   After the lifting of sanctions and the implementation of the 
        deal, a lack of Iranian cooperation with the IAEA on the 
        remaining PMD issues would be considered a material breach of 
        the JCPOA. It should be noted again that the IAEA investigation 
        of the PMD issues could last well past the date when key 
        sanctions are lifted. This ongoing IAEA investigation will 
        require access to additional sites, individuals, and documents.

    Olli Heinonen, former chief of IAEA safeguards and now at Harvard 
University's Belfer Center, has pointed out that Iran checking off a 
list is ``not sufficient to provide understanding on how far Iran got 
in various parts of its weapons related R&D.'' \6\ Such a list could be 
useful for the IAEA to establish ``choke points,'' he added, which can 
be monitored to ascertain that a nuclear weapons program is not 
restored. This would require ongoing, periodic access to these sites 
and individuals.
    In addition, the IAEA investigation into PMD should be iterative, 
according to Heinonen. That means that new persons, sites, and 
documents may arise during the discussions. Access to those persons, 
sites, and documents should also be provided. One also has to keep in 
mind that some activities could have been moved or will be moved to 
other military sites. If any new suspicions arise, the IAEA will need 
access to those sites as well.
    Heinonen also notes that it is important to dismantle any single 
use (nuclear weapon) capability in Iran, if they still exist. The 
agreement may go further, however, according to several negotiators, 
and ban certain nuclear weaponization-related activities. Examples of 
such activities include uranium and plutonium metallurgy and certain 
types of neutron generator and high explosive work. Achieving these 
bans and their verification conditions in the final deal is challenging 
but important to achieve.
    A difficult verification area is whether Iran has obtained nuclear 
weapons assistance from other countries or cooperated with other 
countries on sensitive nuclear matters. The Khan network is suspected 
of having provided Iran with nuclear weapons designs. There are 
suspicions that Iran and North Korea are cooperating on nuclear 
matters. As a result, a challenge is how to verify that Iran is not 
outsourcing nuclear technology or cooperating with other countries on 
sensitive nuclear issues.
    Verification conditions of key importance, some of which were 
outlined above, that are not addressed in the framework agreement or 
not addressed in much detail include:
    Anytime, Anywhere Access: The IAEA will need anywhere, prompt, or 
``anytime'' access to all relevant sites, facilities, material, 
equipment, people, and documents in Iran.
    Centrifuge Related Declarations: In addition to the broader 
declarations needed to address the IAEA's PMD concerns, the 
verification arrangements will also depend on Iran declaring how many 
centrifuges, of all types, that it has made and its inventory of raw 
materials and equipment for its centrifuge program. This baseline is 
necessary if the agreement is to provide assurances about the absence 
of secret centrifuge activities and facilities now and in the future.
    With regard to establishing a baseline on the number of centrifuges 
made by Iran, verification of centrifuge manufacturing is necessary, 
including the declaration and verification of key raw materials and 
components. The declaration needs to include the origin and amounts of 
key raw materials and the total number of major components, including 
the number held in stock, the number manufactured or procured, and 
their fate. A description of the locations used to produce these goods 
will also be needed.
    Without knowledge of past centrifuge manufacturing activities, 
centrifuge-related equipment and raw material inventories, and 
centrifuge-related procurements, verification cannot be adequate. 
Covert stocks of centrifuges and related equipment and materials could 
exist and be kept outside the purview of the inspectors. Ensuring a 
full declaration of the past should be a priority.
    Raw Uranium Declarations: Another element is the rigorous 
verification of uranium obtained from abroad and produced domestically, 
via any method in the past, present, and future. The framework deal 
signed in early April provides for the continuous surveillance of 
uranium mills over a 25 period. A final deal also needs to ensure that 
Iran cooperates with the IAEA in making a full, verified accounting of 
past uranium purchases and production.
    Key Import/Export Declarations: Iran should also provide the IAEA 
with details of past and future imports, exports, and uses of key items 
listed under INFCIRC 254 parts 1 and 2 and other critical goods that 
are used in Iran's nuclear programs. These declarations would go beyond 
the ones in the Additional Protocol and Iran's commitment to make these 
declarations should be in the comprehensive deal.
    Plutonium Related Declarations: As part of broader declarations, 
the JCPOA should also include a provision for verification of any past 
activities related to the separation of plutonium. These declarations 
should include information on any actual or attempted procurements 
related to acquiring capabilities to separate plutonium from irradiated 
material.
 (5) what effect do you believe a prospective agreement would have on 
 the nuclear nonproliferation treaty (npt)? on regional proliferation?
    The Iran deal may have the unintended consequence of stimulating a 
uranium ``enrichment race.'' In expectation of an Iran deal, Saudi 
Arabia is already indicating that it will match Iran's nuclear 
capabilities. Prince Turki bin Faisal, the 70-year-old former Saudi 
intelligence chief, has toured the world with the same message: 
``Whatever the Iranians have, we will have, too,'' he said at a 
conference in Seoul, South Korea. Other Sunni states apart from Saudi 
Arabia may accelerate their drive to develop their own domestic nuclear 
programs, even programs to enrich uranium, as they too seek to 
counterbalance Iran. Iran's other regional rivals such as Egypt and 
Turkey may seek to initiate or expand domestic nuclear enrichment 
programs in order to preserve their regional influence.
    The deal, rather than curbing the spread of dangerous nuclear 
capabilities, could as one aftereffect create a new norm that 
legitimizes uranium enrichment programs almost anywhere, even when 
unneeded for a civilian nuclear program and conducted by a country 
posing a clear proliferation risk. Instead of a deal that sets 
conditions that are so onerous that no one would want to follow that 
path, the conditions on Iran may be seen as bearable to other states. 
Moreover, if they first act by placing their programs under IAEA 
safeguards, they may avoid the burdensome sanctions that Iran has 
faced, despite being in regions of tension such as the Middle East.
    Congress and the administration must critically assess where the 
agreement will leave Middle East regional security after year 10 of a 
deal and ascertain whether the agreement would leave the region in 
greater turmoil or actually succeed in reigning in future 
proliferation. A sound agreement that introduces unprecedented 
transparency for the foreseeable future into Iran's activities and 
intentions, while limiting its ability to expand its program 
immediately after the agreement sunsets, may be an agreement that 
Iran's neighbors could live with and exercise restraint over regarding 
their own nuclear development. However, the net result of this deal may 
leave the Middle East facing a greater nuclear proliferation danger 
from the spread of sensitive technologies stimulated by a new, 
dangerous norm legitimizing enrichment almost anywhere. As part of 
evaluating an Iran deal, Congress should evaluate this threat of the 
spread of dangerous nuclear technologies and develop remediation steps 
to mitigate damages.
    In terms of impact on the NPT, the agreement's effects may be that 
nonnuclear weapon states (NNWS) more generally will exercise less 
restraint on developing fuel cycle capabilities that are of 
proliferation concern. They may view Iran's legitimized nuclear program 
as a new standard that can be reached by all NNWS. The Nuclear 
Suppliers Group and strong U.S. diplomacy will be required to convince 
additional states not to pursue the Iran path, which they may attempt 
through safeguarded means instead of trying to build covert advanced 
fuel cycle facilities, but with similar results for creating insecurity 
internationally and within their regions.
(6) how do you believe the administration is calculating breakout time? 
are they taking into account all forms of uranium that could be used to 
                         work toward a weapon?
    The administration's method of calculating breakout is classified 
and not available publicly. For many years we have also calculated 
breakout timelines in collaboration with centrifuge experts at the 
University of Virginia. Our understanding from U.S. officials is that 
the U.S. methods and ours are similar in approach. In some cases, we 
agree with the U.S. breakout estimates, particularly when we start from 
the same number and type of centrifuges and the same quantity and 
enrichment level of LEU. However, in other cases we have disagreements 
over the amount of LEU available for use by Iran in a breakout. In 
particular, we assess that Iran would have available more near 20 
percent LEU in a breakout than does the U.S. Government. As a result, 
in that case, our timelines are less than 12 months. We are also 
concerned that prior to a breakout Iran would accumulate more 3.5 
percent LEU hexafluoride than allowed, namely 300 kg of LEU 
hexafluoride, enabling a faster breakout. The short-term consequences 
for exceeding this cap appear minimal.
    In addition, we have concerns over whether the agreement will 
sufficiently ensure that Iran cannot reinstall excess, dismantled IR-1 
and IR-2m centrifuges. In particular, we are worried that Iran will be 
able to reinstall about 1,000 IR-2m centrifuges and some number of IR-1 
centrifuges in several months, a timeframe we assess as sufficient to 
allow these centrifuges to significantly reduce the breakout timeline 
below 12 months.
    After the limitations on centrifuge deployments start to end in 
year 10 of the agreement, we believe that breakout timelines will begin 
to decrease steadily and too rapidly. In addition, Iran has significant 
potential to master advanced centrifuges by this time and thus reduce 
breakout timelines more rapidly than expected after year 13 of the 
deal.
    Several of these issues are still in play in the negotiations and 
hopefully will be resolved to achieve and guarantee a 12-month breakout 
timeline during the first 10 years of the deal and create a soft 
landing for breakout timelines afterward. Nonetheless, during Congress' 
evaluation of an agreement, these issues should be closely scrutinized 
and evaluated and, if necessary, mitigation strategies called for and 
developed.
Similar Breakout Results as the Administration
    Our similarity in result to the U.S. administration's breakout 
estimates can be seen when considering the centrifuge limits Iran has 
accepted in the interim deal of April 2015. In the case of about 6,000 
IR-1 centrifuges and a stock of 300 kilograms of 3.5 percent LEU 
hexafluoride and no available near 20 percent LEU hexafluoride, our 
breakout estimate would have a mean of about 12-14 months, where the 
minimum breakout time would be 11-12 months.\7\ We have used the mean 
as the best indicator of breakout time and interpret the minimum time 
as a worst case. Thus, our estimate of breakout would confirm the 
United States assessment that these limitations satisfy a 12-month 
breakout criterion.
Iran's Stock of Near 20 Percent LEU \8\
    However, breakout estimates depend critically on Iran's usable 
stock of near 20 percent LEU. For example, Iran can significantly lower 
breakout times by inserting into the cascades a relatively small amount 
of near 20 percent LEU. If it recovers only about 50 kilograms of near 
20 percent LEU hexafluoride (or 34 kg of LEU (uranium mass), or about 
15 percent of its current stock of near 20 percent LEU) within the 
first 6 months of breaking out, and we assume the same conditions as 
above, the mean breakout time becomes about 10-11 months, with a 
minimal time of about 9 months. As a result, minimizing or ensuring 
that the near 20 percent LEU stock is unusable in a breakout is a 
necessity. The breakout times would be expected to be even lower, since 
if Iran decided to break out, it may have access to more near 20 
percent LEU and it could also be expected to have accumulated 
additional 3.5 percent LEU above the cap of 300 kg (see below).
    The accumulation of 34 kg of near 20 percent LEU (uranium mass) 
represents only a small fraction of Iran's inventory of this LEU. 
Despite the fact that Iran no longer has a stock of near 20 percent LEU 
in hexafluoride form (UF6), it continues to retain a significant 
portion of this material in the form of oxide (U3O8) and in scrap and 
waste. As discussed earlier, in total, Iran possesses about 228 kg of 
near 20 percent LEU (uranium mass). Extrapolating to the end of June 
2015, which is the end of the second extension under the JPA and the 
target date for a comprehensive agreement, Iran is estimated to have 
about 43 kg remaining in near 20 percent LEU oxide powder and about 
130-134 kg in scrap, in waste, and in-process (all uranium masses). 
Only about 50 to 54 kg of this LEU are expected to be in Tehran 
Research Reactor (TRR) fuel, or only about 22-23 percent of the total 
near 20 percent LEU. This extrapolation assumes that Iran will fulfill 
its commitments under the second extension to use all 35 kg of LEU 
oxide to make fuel. If it does not, 
then the estimate of oxide powder will be slightly greater and the 
amounts in fuel slightly less that projected.
    Much of this LEU material is in forms where the LEU could be 
recovered in a straightforward manner. Iran has stated that it intends 
to recover near 20 percent LEU from scrap. According to the May 2015 
IAEA safeguards report on Iran, ``In a letter dated 28 December 2014, 
Iran informed the Agency [IAEA] of the operational schedule for FPFP 
[Fuel Plate Fabrication Plant at Esfahan] and indicated its intention 
to establish process lines for the recovery of uranium from solid and 
liquid scrap. In its reply dated 19 January 2015, the Agency requested 
that Iran provide further clarification. On May 19, 2015, the Agency 
observed that the process lines had yet to commence operation and that 
Iran has continued its R&D activities related to the recovery of 
uranium from solid scrap.'' It is unknown how much near 20 percent LEU 
scrap Iran intends to recover. However, Iran moving to institute a 
scrap recovery capability poses a challenge to the deal, since the 
recovered LEU and the knowledge and experience gained by operating a 
scrap recovery operation would potentially allow Iran to speed up 
breakout.
    The Obama administration has been reluctant to discuss publicly the 
near 20 percent LEU and the media has largely missed this controversy. 
The April U.S. Fact Sheet does not discuss its fate at all. It does 
discuss a cap of 300 kg of LEU hexafluoride in Iran but this cap refers 
to LEU enriched under 3.67 percent and not the near 20 percent LEU.
    U.S. officials have stated that the near 20 percent remaining in 
Iran would need to be mixed with aluminum, a step in making the fuel, 
or be in TRR fuel elements. Once so mixed, U.S. officials have stated 
that they remove this near 20 percent from consideration in breakout 
calculations. However, is this condition justified? The U.S. condition 
in fact may undermine its claim that the limits on Iran's centrifuge 
program achieve a 12-month breakout.
    The near 20 percent LEU stock, unless largely eliminated or 
rendered unusable in a breakout, could be an important reserve in 
reducing the time to produce the first significant quantity of weapon-
grade uranium and/or rapidly producing a second significant quantity of 
weapon-grade uranium (WGU).
    The U.S. assessment is apparently that recovery of the near 20 
percent LEU from aluminum, its subsequent conversion to uranium 
hexafluoride, and further enrichment would take so long that this LEU 
could not contribute significantly to a breakout in 12 months, or at 
least not to the first significant quantity of weapon-grade uranium. 
However, recovery of the near 20 percent LEU can be straightforward and 
the U.S. evaluation requires greater scrutiny. In Iraq's crash program 
to a nuclear weapon in 1990-1991, it put in place a capability to 
recover about 33 kilograms (uranium mass) of safeguarded unirradiated 
and slightly irradiated highly enriched uranium (HEU) from research 
reactor fuel. Based on Iraqi declarations and IAEA Action Team 
evaluations, which we possess, Iraq covertly installed the necessary 
equipment at the Tuwaitha nuclear site in 4 months. It would have 
needed about a month to test the equipment with dummy fuel and another 
5 months to recover the HEU from the fuel. This effort was stopped at 
the point of testing dummy fuel elements by the Gulf War bombing 
campaign which started in January 1991. Because of its far greater 
experience with uranium conversion, Iran is likely able to recover 
unirradiated near 20 percent LEU at a similar or faster rate from TRR 
fuel elements than Iraq. If Iran were to break out, it would 
undoubtedly secretly install and test the recovery equipment prior to 
breakout. Such activities would be very difficult for the IAEA or 
intelligence agencies to detect. Thus, the Iraqi experience suggests 
that Iran could be recovering near 20 percent LEU from LEU/aluminum 
mixtures, scrap, and fresh TRR fuel soon after starting its breakout 
and recover tens of kilograms within several months. This recovered LEU 
could be converted quickly into hexafluoride form in facilities also 
prepared in secret prior to breakout.
    Iran may already be gaining experience in separating LEU from 
aluminum. In addition to making TRR fuel, Iran notified the IAEA on 
December 28, 2014, that it would start manufacturing miniature fuel 
plates for the Molybdenum, Iodine and Xenon Radioisotope Production 
(MIX) Facility, for the production of Molybdenum 99 in the TRR. As of 
May 13, 2015, the IAEA confirmed that one fuel plate containing a 
mixture of U3O8 enriched up to 20 percent uranium 235 and aluminum were 
at the MIX Facility after transfer from the Fuel Plate Fabrication 
Plant and was being used for R&D activities for the production of 
specific isotopes, namely molybdenum 99, xenon 133, and iodine 132. 
According to the IAEA reports, since July 24, 2014, Iran has used 0.084 
kg of near 20 percent uranium oxide for the purpose of producing 
molybdenum 99. As can be seen, the amounts of LEU used to make targets 
so far are very small. However, the processing of such targets after 
irradiation in the TRR can also provide experience in developing a 
capability to recover the LEU. Although the targets are processed to 
recover key isotopes, the processing provides experience in separating 
LEU from the aluminum.
    In summary, the amount of Iran's near 20 percent LEU, in any form, 
should be reduced as much as possible to ensure that breakout periods 
remain at least 12 months, whether discussing overt or covert routes to 
a nuclear weapon. It is a mistake to leave large inventories of near 20 
percent LEU in Iran in the form of scrap or in-process. The deal should 
require Iran to remove or blend down to natural uranium most of its 
near 20 percent LEU outside of TRR fuel. The obvious target is the 
expected 43 kg in oxide powder and the 130-134 kg in the form of scrap, 
waste, and in-process. These amounts total to 173-177 kg and represent 
roughly three quarters of Iran's stock of near 20 percent LEU. However, 
this step should be supplemented by irradiating any fresh TRR fuel. One 
method to do that is to irradiate all the TRR fuel, at least partially, 
to increase the complication of extracting the LEU from the fuel for 
use in a breakout.
Effect of 3.5 Percent LEU \9\
    Another consideration is that Iran may accumulate additional up to 
3.67 percent LEU over the limit of 300 kilograms LEU hexafluoride 
(equivalent). After the deal is implemented, Iran will produce 3.5 
percent LEU each month. How will this material be disposed of so that 
the limit is not exceeded? Based on past performance, with about 5,000 
IR-1 centrifuges enriching at Natanz, Iran will produce about 100 kg of 
3.5 percent LEU hexafluoride each month. In order to avoid potential 
monthly violations of the 300 kg provision, the P5+1 and Iran must 
agree on what to do with the monthly product; e.g., whether to ship out 
or dilute to natural uranium the newly produced LEU every month. The 
accumulation of a few hundred kilograms of 3.5 percent LEU over the 
limit will lower the breakout times to near or just below 12 month, 
assuming no availability of near 20 percent LEU. Accumulations of more 
than 500 kilograms of 3.5 percent LEU hexafluoride start to lower 
breakout times more significantly, particularly with access to even 
relatively small amounts of near 20 percent LEU hexafluoride, namely 
25-50 kg, or 17-34 kg LEU (uranium mass), which is only about 7-15 
percent of Iran's stock of near 20 percent LEU.
    The impact of large excess stocks of 3.5 percent LEU and the 
availability of residual stocks of near 20 percent LEU should also be 
considered. If Iran accumulates stocks of 3.5 percent LEU hexafluoride 
above 1,000 kilograms and can access relatively quickly only 50 
kilograms of near 20 percent LEU hexafluoride, it could reduce breakout 
times to less than 6 months.
Effect of Redeployed IR-2m Centrifuges
    A major gain in the April 2015 interim agreement is that Iran must 
dismantle its excess centrifuges and place them in monitored storage. 
For a time, negotiators considered leaving the centrifuges in place and 
disconnecting their piping. The latter option had the disadvantage of 
allowing a relatively rapid reinstallation of centrifuges, if Iran 
decided to breakout, with the result that it could lower breakout times 
below 12 months. Fortunately, this option was dropped.
    However, in the former, better option, reinstallation also needs to 
be evaluated. Beyond the general provision, few details are available 
about this dismantlement and storage arrangement. A question is whether 
Iran could redeploy a significant number of these centrifuges within 
several months of deciding to breakout. Armed with thousands more IR-1 
centrifuges, or 1,000 of the more powerful IR-2m centrifuges, Iran 
could lower breakout times well below 12 months. It is important for 
Congress to obtain answers to the following questions: Where will the 
dismantled IR-2m centrifuges be stored and under what conditions? How 
quickly does the administration assess that these IR-2m centrifuges 
could be brought back into operation at the Fuel Enrichment Plant or 
elsewhere? What is the basis for such an estimate? What would be the 
effect on the breakout timeline of the successful reestablishment of 
the 1,000 IR-2m centrifuges at Natanz or elsewhere during the first 6 
months of a breakout? Without answers to these questions, the 
information is not sufficient to allow us to analyze the possibility of 
significantly lowering breakout timelines via reinstallation of excess 
centrifuges, particularly IR-2m centrifuges. In evaluating a final 
deal, this issue needs to be carefully scrutinized.
Breakout Estimates in Years 10-13 and afterward
    There is little information in the Fact Sheet or elsewhere about 
the numbers and types of centrifuges the agreement allows Iran to 
install in from years 10 through 13. Based on discussions with 
negotiators, these values will be controlled by limitations on the 
numbers and types of centrifuges and on the separative work output. 
According to one negotiator, the goal is to allow a buildup in Iran's 
centrifuge capability that will reach an agreed breakout time of 6 
months in year 13. The centrifuge arrangements from years 10 through 13 
are said to be complex, particularly since Iran will undoubtedly want 
to deploy advanced centrifuges and will unlikely want to deploy IR-1 
centrifuges. A shift to deployment of advanced centrifuges complicates 
the analysis because so little is known about their capabilities and 
performance. There is scant independent information about Iran's 
advanced centrifuges, such as the type of information about IR-1 
centrifuges available from the IAEA. In any case, information about 
these centrifuge arrangements in years 10 through 13 is unavailable at 
this time. Breakout evaluations must await this information, although 
they may be far more uncertain than ones involving IR-1 centrifuges.
    The Fact Sheet mentions very few restrictions past year 13 of any 
deal. An important question is what will Iran's breakout time be at 
year 14 and 15 and afterward? There appears to be no limitations that 
would prevent Iran from reducing its breakout time significantly after 
year 13 of a deal. In fact, Iran could quickly develop breakout 
timelines in years 14 and 15 that would be measured in less than a few 
weeks.
(7) what challenges do you foresee in verifying iranian compliance with 
                        a prospective agreement?
    Verifying Iran's compliance with an agreement could be 
straightforward, but history suggests that it will not. Several 
challenges that could be faced include:

   Ensuring that sneak out to produce weapon-grade fissile 
        material is detectable quickly;
   Iran's historically poor track record on adherence to its 
        safeguards agreement and ongoing noncooperation with the IAEA 
        could reoccur during the deal, complicating verification and 
        the determination of either compliance or violations;
   Coping with incremental cheating on the provisions of the 
        deal, in particular getting Iran to backtrack or stop such 
        cheating;
   Guaranteeing that Iran's stock of LEU goes down to 300 kg 
        and stays there. There are many potential problems. Equipment 
        problems, whether real or faked, could delay blend down 
        operations. Iran could delay shipments overseas because it 
        cannot find buyers willing to pay Iran's price or use the LEU 
        to make fuel;
   Reducing Iran's stock of unirradiated near 20 percent LEU. 
        In addition to the breakout concerns discussed earlier, if this 
        LEU stock is not reduced significantly in size, it may be 
        difficult to prevent Iran from recovering near 20 percent LEU 
        from scrap for use in the Tehran Research Reactor. Iran may 
        argue that it does not have enough fuel to operate the reactor. 
        Moreover, if stopped from recovering this LEU from scrap, Iran 
        may press to enrich new near 20 percent LEU to fuel the TRR. To 
        head off this potential development, the agreement should 
        commit and facilitate Iran buying near 20 percent fuel from 
        abroad;
   Assuring a P5+1/Iran dispute resolution or violation 
        resolution mechanism functions quickly and adequately to 
        address problems. The P5+1/Iran mechanism may clash with the 
        IAEA's dispute resolution method, which typically involves 
        taking problems or noncompliance to the Board of Governors. 
        Iran may seek to exploit these differing dispute resolution 
        methods to its advantage;
   Ensuring prompt IAEA access to suspicious sites without 
        undue delays, assuming that the Iran will commit to IAEA access 
        of all sites;
   Iran seeking to weaken or reverse agreed upon transparency 
        arrangements;
   Ensuring that Iran is abiding by the rules of the 
        procurement channel. Moreover, it may be difficult to persuade 
        other states, such as China, to implement and enforce these 
        rules;
   Detecting and thwarting any unauthorized imports for a 
        covert Iranian nuclear program or to accumulate goods for use 
        in surging centrifuge production once the deal's provisions end 
        or Iran decides to walk away from the deal;
   Convincing other countries to enforce new or ongoing 
        controls and sanctions aimed at preventing Iran from making 
        unauthorized imports of goods;
   Unauthorized research and development, and experimentation 
        at declared or undeclared sites;
   Iranian military constituencies, or even civilian ones, not 
        treating the obligations in the deal as seriously as the Atomic 
        Energy Organization of Iran. These Iranian constituencies or 
        entities may not view the consequences the same way, and they 
        may be more willing to violate aspects of the deal in pursuit 
        of their own aims. This problem may arise in particular with 
        regard to the procurement channel but it could also occur if a 
        military entity seeks to undertake work useful for the 
        development of nuclear weapons;
   Maintaining implementation and verification of a deal as a 
        major U.S. priority; and
   Guarding against downplaying future violations of a long 
        term deal for the sake of generating or maintaining political 
        support for the deal.

----------------
Notes

    \1\ Albright et al., ``P5+1/Iran Framework: Needs Strengthening,'' 
ISIS Report, April 11, 2015.
    \2\ Iran may be reconsidering the option of sending LEU to Russia 
for fabrication into fuel for subsequent return to Iran for use in the 
Bushehr nuclear power reactor.
    \3\ David Albright and Serena Kelleher-Vergantini, ``The U.S. Fact 
Sheet's Missing Part: Iran's Near 20 Percent LEU, (Updated June 5, 2015 
with new IAEA data),'' ISIS Report, June 5, 2015.
    \4\ See for example, Albright, Paul Brannan, and Andrea Stricker, 
``The Physics Research Center and Iran's Parallel Military Nuclear 
Program,'' ISIS Report, February 23, 2012.
    \5\ U.S. State Department, ``Additional Sanctions Imposed by the 
Department of State Targeting Iranian Proliferators.'' Media Note, 
Office of the Spokesperson, Washington, DC, August 29, 2014. The State 
Department note states: ``SPND was established in February 2011 by the 
UN-sanctioned individual Mohsen Fakhrizadeh, who for many years has 
managed activities useful in the development of a nuclear explosive 
device. Fakhrizadeh led such efforts in the late 1990s or early 2000s, 
under the auspices of the AMAD Plan, the MODAFL subsidiary Section for 
Advanced Development Applications and Technologies (SADAT) and Malek 
Ashtar University of Technology (MUT). In February 2011, Fakhrizadeh 
left MUT to establish SPND. Fakhrizadeh was designated in UNSCR 1747 
(2007) and by the United States in July 2008 for his involvement in 
Iran's proscribed WMD activities. SPND took over some of the activities 
related to Iran's undeclared nuclear program that had previously been 
carried out by Iran's Physics Research Center, the AMAD Plan, MUT, and 
SADAT.''
    \6\ Personal communication with Olli Heinonen.
    \7\ More recent ISIS calculations that assume a more efficient 
average arrangement of the cascades lower our previous estimates 
somewhat compared to earlier ones. This reflects a view that Iran may 
keep under a deal its cascades that are the more efficient ones.
    \8\ For additional detail and sources see David Albright and Serena 
Kelleher-Vergantini, ``The U.S. Fact Sheet's Missing Part: Iran's Near 
20 Percent LEU, (Updated June 5, 2015 with new IAEA data),'' ISIS 
Report, June 5, 2015.
    \9\ For additional detail and sources see: Albright and Kelleher 
Vergantini, ``Iran's Stock of Less than Five Percent Low Enriched 
Uranium, June 2015 Update'' ISIS Report, June 2, 2015.

    The Chairman. Thank you very much.
    Ray.

 STATEMENT OF DR. RAY TAKEYH, SENIOR FELLOW FOR MIDDLE EASTERN 
     STUDIES, COUNCIL ON FOREIGN RELATIONS, WASHINGTON, DC

    Dr. Takeyh. Thank you, Chairman Corker, for inviting me 
back to the committee, and I come to you not just as a witness, 
but as a constituent of Senator Cardin, a longtime constituent.
    I would say that since the beginning of serious 
negotiations in 2013, Iran's basic redlines have remained 
fairly consistent. Upon inauguration of President Hassan 
Rouhani, Supreme Leader Ali Khamenei laid out his parameters 
for an acceptable deal. Those parameters were that Iran has the 
right to enrich; that enrichment right has to be acknowledged 
and, at some point, industrialized; that research and 
development would continue in advanced technologies; and no 
facility will shutter.
    In recent weeks, Ali Khamenei has added to these conditions 
by claiming that inspectors will have no right to have access 
to military facilities and scientists, and he has disputed the 
already short duration of the agreement of 10 years.
    The American position has undergone an impressive set of 
transitions. In December 2013, President Obama insisted, ``In 
terms of specifics, we know they do not need to have an 
underground fortified facility like Fordow in order to have a 
peaceful nuclear weapons program. They, certainly, do not need 
to have a heavy water reactor in Iraq in order to have a 
peaceful nuclear program. They do not need to have some 
advanced centrifuges that they currently possess in order to 
have a limited, peaceful nuclear program.''
    A careful reading of the Joint Plan of Action and the 
Lausanne framework reveals that none of these expectations have 
come to fruition. The underground Fordow facility will remain 
open and house 1,000 centrifuges. The Arak heavy water plant is 
to remain open, but will presumably undergo modifications 
whereby it produces less fuel. A vast portion of Iran's 
enrichment infrastructure will not be dismantled. Iran's 
expanding fleet of ballistic missiles, for which there is no 
function other than delivering a nuclear payload, will remain 
unaddressed. The issue of Iran's military experimentation with 
nuclear technology is unlikely to be resolved. The sanctions 
architecture will be attenuated, and snapping back is 
problematic.
    Thus far in the negotiating process, Iran has carefully 
advanced its objectives and sustained its mandates. Conversely, 
the United States has made a series of concessions that make 
the possibility of a good deal difficult at this point to 
envision. The question is what constitutes a good deal, and I 
will outline some brief parameters.
    Number one, I think we should restore the original 
principles of negotiations prior to 2014. The notion of 
national need should replace the 1-year breakout period.
    Prior to 2014, the basic U.S. position and the 5+1 position 
was that Iran's national needs should constitute the scope of 
its atomic infrastructure. In simplest terms, uranium is 
enriched to make fuel rods that then power reactors.
    Given the fact that Iran has no reliable capacity to make 
fuel rods or construct reactors, it was decided that they 
should have a modest enrichment program of a few hundred 
centrifuges. Such a program would offer Iran a face-saving 
measure of suggesting it is enriching uranium, but it would not 
necessarily be misused for military purposes.
    This sensible precaution was abandoned and replaced by the 
notion of a 1-year breakout, which is not static. President 
Obama has said in his NPR interview that by year 13, the 
breakout period will be zero. A zero breakout period is 
undetected weapon capability.
    Instead of a sunset clause, we should go back again to the 
pre-2014 position, namely that Iran cannot become a member of 
the NPT community in good standing unless it satisfies the 
international community that its program is strictly for 
peaceful purposes. This means certification by the IAEA and a 
vote at the Security Council, whereby the United States has the 
veto power. Thus, we would determine when Iran advances and 
expands its program and not some arbitrary time clock.
    Possible military dimensions have already been discussed. 
It should be resolved as a prelude to a final agreement. This 
issue deals with important topics such as undeclared 
procurement activities and work on triggering devices. These 
issues are indispensable for understanding the full scope of 
Iran's military experimentation with its nuclear program 
technologies.
    Anytime, anywhere inspection must be implemented. The 
Islamic Republic tends to view international law as a 
conspiracy and all evidence marshaled against it by the IAEA as 
manufactured and fraudulent. The regime's distain for global 
norms and views itself is unbound by legal strictures. The only 
possible means of ensuring compliance with such a regime is to 
grant inspectors unfettered access to all sites and scientists. 
Any agreement that falls short of that inspection modality will 
not be able to deal with a country with such a sordid history 
of concealment and deception.
    Iran's ballistic missiles, which are an important aspect of 
a nuclear weapons program, have to be part of an agreement. It 
was the Obama administration itself that insisted on inclusion 
of ballistic missiles. A U.N. Security Council Resolution 1929 
that passed in June 2010 is a redline that the administration 
has itself drawn, and it should not be allowed to abandon yet 
another one of its own prohibitions.
    Finally, I will say the success of any agreement hinges on 
whether it can permanently and reliably arrest momentum toward 
proliferation of dangerous technologies. At this point, there 
is no indication that the contemplated deal would achieve these 
objectives.
    Thank you.
    [The prepared statement of Dr. Takeyh follows:]

                    Prepared Statement of Ray Takeyh

    In the near future, the Obama administration is likely to transact 
a deficient nuclear agreement with Iran. The parameters of the accord 
that have already been publicized should give all cause for concern. 
The agreement is permissive in terms of the technologies that it 
allows. The sunset clause ensures that after a passage of time Iran can 
build an industrial-sized nuclear infrastructure. Its much-touted 
inspection regime relies on the leaky confines of the Nuclear Non-
Proliferation Treaty (NPT). During the process of negotiations, Iran 
has cleverly sustained its essential redlines while the United States 
has systematically abandoned the sensible prohibitions that have long 
guided its policy toward this important security challenge.
                           evolving positions
    Iran's nuclear position and its basic redlines have remained fairly 
consistent. Upon the inauguration of President Hassan Rouhani and the 
advent of serious negotiations between the United States and Iran, 
Supreme Leader Ali Khamenei outlined his parameters for an acceptable 
deal. Khamenei insisted that Iran's right to enrich had to be 
acknowledged and that its enrichment capacity had to be industrialized. 
``The issue of research and development should definitely receive 
attention,'' stressed the Supreme Leader. Nor was Khamenei prepared to 
close any facilities as he insisted on ``preserving organizations and 
sites that the enemy cannot destroy.'' In essence, Iran's position was 
that it will enrich uranium at an industrial scale, it will continued 
to develop cutting edge nuclear technologies, and that none of its 
installations would shutter.
    The American position has undergone a remarkable set of 
transitions. In December 2013, President Barack Obama insisted: ``in 
terms of specifics, we know that they don't need to have an 
underground, fortified facility like Fordow in order to have a peaceful 
nuclear program. They certainly don't need a heavy-water reactor in 
Arak in order to have a peaceful nuclear program. They don't need some 
of the advanced centrifuges that they currently possess in order to 
have a limited, peaceful nuclear program.''
    As late as March 2014, Secretary of State John Kerry similarly 
stressed, ``At Fordow, yes, if it's a secret and it's hidden and it's 
under a mountain and all of that, it raises questions about why would a 
peaceful program need that.'' During his tenure as the White House 
press secretary, Jay Carney, assured his audience that as ``part of a 
comprehensive solution, we will require that Iran dismantle a 
significant portion of its nuclear infrastructure related to uranium 
enrichment.''
    A careful reading of both the Joint Plan of Action and the Lausanne 
framework reveal that none of these expectations have come to fruition. 
The underground Fordow facility will remain open and house a thousand 
centrifuges. The Arak heavy-water plant is to remain in place, but will 
presumably undergo modifications whereby it produces less fuel. 
Moreover, a vast portion of Iran's enrichment infrastructure will not 
be dismantled. Iran's expanding fleet of ballistic missiles for which 
there is no purpose other than delivering a nuclear payload will remain 
unaddressed. The issue of Iran's military experimentation with nuclear 
technologies is unlikely to be resolved. The sanctions architecture 
will attenuate and the notion of snapping back sanctions is delusional. 
The agreement itself is term-limited and once it expires there will be 
no restrictions on Iran's nuclear program.
    In essence, during the negotiating process, Khamenei has carefully 
advanced his objectives and sustained his mandates. Conversely, the 
United States has made a series of concessions that make the 
possibility of reaching a good deal difficult to envision.
             principles that the united states relinquished
    In the coming weeks, there will be much debate about Iran's 
enrichment capacity, the nature of the inspection regime and the 
possibility of restoring America's coercive leverage. The proponents of 
the deal will insist that all their concessions were born out of 
pragmatism and that the final deal still imposes meaningful restraints 
on Iran's nuclear program. They will portray their critics as insisting 
on unrealizable terms. This debate should not lose sight of the fact 
that the final agreement contradicts principles that have underwritten 
long-standing U.S. policy.
National Needs
    Since the disclosure of Iran's illicit nuclear plants in 2002, the 
international community wrestled with the question of what type of 
civilian nuclear program Iran is entitled to. At that time, the United 
States contrived the notion of national needs as determining the scope 
of Iran's atomic infrastructure. In the simplest terms, uranium is 
enriched to make fuel rods that then power reactors. Given the fact 
that Iran does not have a reliable capacity to make fuel rods or 
reactors, it was decided it should have only a modest enrichment 
program comprised of few hundred centrifuges. Such a program would 
offer Iran a face-saving claim that it is enriching uranium while 
ensuring that its small program could not be misused for military 
purposes.
    It is precisely this important principle that the Obama 
administration abandoned in 2014 for sake of a 1-year breakout 
timeline. Suddenly, Iran could sustain its vast enrichment capacity so 
long as its breakout potential was delayed by 1 year. Even this 1-year 
breakout period is not static and will be impacted by Iran's 
installment of advanced centrifuges in the latter stages of the 
impending deal. As President Obama conceded recently, ``What is a more 
relevant fear would be that in year 13, 14, 15, they have advanced 
centrifuges that enrich uranium fairly rapidly, and at that point the 
breakout times would have shrunk almost down to zero.'' It is important 
to note that a zero-breakout period means that Iran's surge to the bomb 
would be undetectable.
Trust and Confidence of the International Community
    The second principle that was abandoned during the process of 
negotiations is the point at which Iran can rejoin the NPT community. 
As a signatory of the NPT Iran does have certain rights and privileges. 
However, given its history of concealment and fraud, there had to be a 
balance between its rights and its obligations. The position of the 
United States was that once Iran convinced the international community 
that its nuclear program was strictly for peaceful purposes, only then 
could it expand its capacity. For that to happen, the International 
Atomic Energy Agency (IAEA) had to certify that it is satisfied with 
Iran's compliance record and the United Nations Security Council had to 
vote to allow Iran to rejoin the NPT community. This was indeed a high 
bar.
    Once more, the Obama administration jettisoned this sensible 
precaution for the sake of a sunset clause. Under the impending 
agreement, after the expiration of the sunset clause Iran has the right 
to build up its nuclear program to whatever size it wishes. In essence, 
Iran can become like Japan, a nation whose massive nuclear program puts 
it inches away from a bomb. As a peaceful, democratic state, Japan can 
be trusted with such a capability. As a dangerous, revisionist regime, 
the Islamic Republic cannot be offered such forbearance.
    Since the advent of nuclear arms in the late 1940s, the policy of 
the United States--both Republican and Democratic administrations--has 
been to restrict the expansion of sensitive nuclear technologies, such 
as reprocessing plutonium and enriching uranium. The United States has 
worked aggressively to stop allies such as South Korea and Taiwan from 
obtaining such capabilities. At times, Washington had to strain its 
alliances in order to sustain its proliferation principles. One 
alliance that was damaged as the result of nuclear ambitions was 
America's ties to the Shah of Iran.
    It is the standard Islamic Republic talking point that the United 
States looked the other way and indeed assisted the Shah as he sought 
to develop a nuclear weapons capability. This nonsensical claim has 
been accepted as a truism by many U.S. policymakers and analysts. The 
historical record belies such claims. Successive U.S. administrations 
rejected the Shah's quest for completion of the fuel cycle and refused 
to given him access to sensitive nuclear technologies. The United 
States insisted that Shah forgo the capacity to either enrich uranium 
or reprocess plutonium. And these demands were made of a regime that 
was a reliable U.S. ally. The Obama administration has conceded to an 
adversarial theocracy bend on upending the regional order what previous 
U.S. administrations refused to grant to a strategic ally.
   what kind of islamic republic emerges after the agreement expire?
    The credibility of any nuclear agreement between the United States 
and Iran depends on the type of Islamic Republic that emerges after the 
sunset clause expires. Those favoring the accord hint that a more 
benign Iran is inevitable as temptations of commerce and benefits of 
global integration will empower pragmatic elite inclined to set aside 
the pursuit of the bomb. As with other hopes of Iranian moderation, the 
latest plea is likely to evaporate in the paradoxes of clerical 
politics. The most likely outcome of the deal is not just a more 
hawkish theocracy but one in command of an industrial-size nuclear 
infrastructure.
    Supreme Leader Khamenei's natural affinities are with the 
reactionary elements of his regime. As he contemplates his own 
succession, he will need to safeguard not just his republic but also 
its revolutionary values. For Khamenei and his cohort, the Islamic 
Republic is the custodian of a mandate from heaven and its task remains 
to press on with its Islamist mission. This, after all, is a revolution 
without borders. Khamenei is not interested in a prosperous state that 
has forfeited its ideological claims and takes its place in a region at 
ease with American power. He appreciates that the best way of ensuring 
the revolution is to entrust the state to his loyal disciples.
    In the aftermath of the fraudulent Presidential election of 2009, 
the Islamic Republic teetered on collapse. The system was suddenly 
faced with not just popular disaffection, but also elite fragmentation. 
In the meantime, Iran's nuclear truculence was resulting in 
debilitating sanctions and a severe economic crisis. As an astute 
student of history, Khamenei has carefully assessed the collapse of 
Soviet satraps in Eastern Europe and how prolonged financial stress 
undermined the foundations of those republics. The fortification of the 
regime required an arms control agreement, but one that preserved its 
nuclear apparatus while abrogating all essential sanctions. Khamenei is 
insistent on his redlines, stressing the need for an ``instant 
annulment of sanctions.'' And as far as intrusive monitoring is 
concerned, the supreme leader is similarly dismissive, ``One must 
absolutely not allow infiltration of the security and defense realm of 
the state under the pretext of inspections.''
    For now the moderates such as President Hassan Rouhani and his 
aides serve Khamenei's purpose. They are the attractive face of the 
Islamic Republic, seemingly pragmatic and always reasonable. They are 
in power to transact an arms control agreement and their utility will 
diminish, if not disappear, once the accord is reached. The cagey 
supreme leader must have known that his hardliners were unsuitable 
interlocutors for Western powers looking to come to terms with sensible 
Iranians. The concessions granted to Rouhani by the West would be 
unthinkable to reactionaries such as the former lead negotiator, Saeed 
Jalili. After an agreement is reached, however, Khamenei will need the 
help of the hardliners to protect his republic. Far from ushering the 
age of moderation, an agreement is likely to presage a sharp right-wing 
shift in Iran's domestic politics.
    Once the sunset clause expires and Iran gets to the edges of 
nuclear arms, will its hawkish rulers choose to restrain their atomic 
appetite? The lessons of North Korea are indeed instructive. It is 
beyond doubt that the possession of nuclear arms has contributed to the 
prolongation of the Kim dynasty. Every time a dear leader dies, the 
entire international community hopes for a smooth transition to another 
dear leader for sake of maintaining central control of North Korea's 
nuclear arsenal. The deliveries of fuel and food, which are the 
lifeblood of the hermitic republic, persist in the hope of ensuring 
stability.
    Iran can count on similar forbearance even if it just limited 
itself to becoming a threshold nuclear state. The great powers are as 
likely to be concerned about its longevity and the disposition of its 
nuclear network as they are about North Korea's. Any democratic 
opposition will likely be greeted with caution if not indifference. The 
Islamic Republic will become too dangerous to fail.
                 parameters of an acceptable agreement
    As the negotiations unfold, it is important to insist on a number 
of points to assure that the agreement will be an advantageous one for 
the United States and the international community:

    1. Restore the original principles that have long guided U.S. 
policy. This means that the scope of Iran's program has to be defined 
by national needs and that the sunset clause has to be replaced with 
the notion of Iran satisfying the international community that its 
program is strictly for peaceful purposes before it becomes a member of 
the NPT in good standing.
    2. The Possible Military Dimensions (PMD) of the program must be 
categorically resolved as a prelude to a final agreement. This issue 
deals with important topics such as undeclared procurement activities 
and work on triggering devices. These issues are indispensable for 
understanding the full scope of Iran's military experimentation with 
nuclear technologies.
    3. ``Anywhere, Anytime'' inspections must be implemented. The 
Islamic Republic tends to view international law as a conspiracy and 
all the evidence marshalled against it by the IAEA as manufactured and 
fraudulent. It is a regime that disdains global norms and views itself 
as unbound by legal strictures. The only plausible means of ensuring 
compliance with such a regime is to grant inspectors unfettered access 
to all sites and scientists. Any agreement that falls short of such 
inspection modality will not be able to deal with a country with such a 
sordid history of concealment and deception.
    4. Iran's ballistic missiles, which are an important aspect of its 
nuclear weapons program, have to be part of the agreement. As 
mentioned, these missiles have no function other than delivery of a 
nuclear payload. It was the Obama administration itself that insisted 
on the inclusion of ballistic missiles in the U.N. Security Council 
Resolution 1929 that it crafted in June 2010. It is the redline that 
the administration itself drew and it should not be allowed to abandon 
yet another one its own prohibitions.
    The success of any arms control agreement hinges on whether it can 
permanently arrest the momentum toward proliferation of dangerous 
technologies. It may also be hoped that such an accord will inject a 
measure of responsibility in impetuous leaders and perhaps empower 
those prone to accede to international mandates. There is no indication 
that the contemplated deal with Iran will achieve any of these 
objectives. The impending agreement, whose duration is time-limited and 
sets the stage for the industrialization of Iran's enrichment capacity, 
places Tehran inches away from the bomb. Paradoxically such a state may 
yet be governed by hardline actors nursing their own hegemonic regional 
designs.

    The Chairman. Thank you.
    Jim.

  STATEMENT OF DR. JIM WALSH, RESEARCH ASSOCIATE, SECURITIES 
    STUDIES PROGRAM, MASSACHUSETTS INSTITUTE OF TECHNOLOGY, 
                         CAMBRIDGE, MA

    Dr. Walsh. Mr. Chairman, Mr. Ranking Member, members of the 
committee, it is an honor to be with you today and to be 
sitting next to these accomplished gentlemen and friends to 
discuss a possible Iran agreement.
    Absent congressional leadership, we would not be where we 
are today in the negotiation. And absent congressional 
leadership in the future, we will not be where we need to be.
    Let me begin with the obvious. We do not have a final 
agreement, so I cannot really judge that. And as negotiators 
often say, nothing is agreed until everything is agreed. But I 
am prepared to keep an open mind.
    Now, there has been all sorts of speculation about 
potential problems, but I think we should wait until we 
actually have the agreement to judge that. And I think it is 
worth remembering that at every junction so far, American 
negotiators have beat expectations.
    The Joint Plan of Action I think was stronger than people 
anticipated. It got our number one nonproliferation concern at 
the time, which was 20 percent enriched uranium, plus expanded 
verification that many did not expect.
    The framework announced in April, people thought that was 
going to be a vague piece of paper, one paragraph, two 
paragraphs. It turned out to be much more detailed and have 
many more provisions than people expected. And even critics and 
skeptics of the process had to admit that that was a pretty 
impressive result.
    My summary judgment is that inspections, PMDs, and breakout 
are all issues that policymakers will want to consider 
carefully. I judge that the risk posed by these challenges are 
real but manageable and not in excess of what similar 
agreements have been successfully able to navigate.
    I also judge that an agreement is likely to bolster 
nonproliferation, the cause of nonproliferation, both in the 
region and globally.
    I will briefly touch on a few of these points.
    Let me begin with criteria for evaluating the future 
agreement. First, a bit of context.
    As contemporary scholars of nuclear studies have repeatedly 
pointed out, the historical record of nonproliferation is a 
surprising story of success. Dark predictions of nuclear spread 
did not come true. We do not live in a world of dozens of 
nuclear weapons, as had been predicted. In fact, the rate and 
pace of proliferation has steadily declined since the 1960s, 
with fewer and fewer countries joining the nuclear weapons club 
in each ensuing decade.
    Of course, not all of the news is good--North Korea, A.Q. 
Khan. But the unambiguous evidence to date suggests that it is 
possible to prevent and reverse proliferation.
    The data also suggests that negotiated agreements are a 
powerful tool for achieving nonproliferation objectives. In my 
written testimony, I outline several criteria policymakers 
might use to evaluate an agreement. Let me touch on a few.
    Is an agreement sustainable? Using broad, simple measures, 
how does an agreement compare with the status quo? For example, 
under the JPOA, Secretary Amano indicated that inspections in 
Iran would double. How does the agreement compare with other 
successful and unsuccessful nuclear agreements? How does the 
agreement compare with other alternatives for dealing with 
Iran's nuclear program?
    And finally, assessment should avoid making the perfect the 
enemy of the good. In public policy, there are always risks, 
risks from action, risks from inaction. If perfect were the 
standard, we would have no NPT, we would have no arms control 
agreements with the Soviet Union, we would have no nuclear deal 
with Libya, all of which have advanced American national 
security. As we have seen, good enough can produce great 
results.
    Now, as to the challenge of verification, it makes sense to 
step back and put it in some historical context. Verification 
has grown progressively stronger over time. This is true 
legally and institutionally, and also with respect to the 
science and technologies available for verification. I think 
the current conditions are favorable for a verification regime. 
I could go into that in some detail.
    But remember, Iran is the most watched country in the 
world, a fact unlikely to change anytime soon. Many, including 
Iranian opposition groups, will be looking under every haystack 
for the first signs of noncompliance on possible military 
dimensions. On possible military dimensions, let me be clear, 
no comprehensive agreement with Iran is possible without 
resolving these concerns.
    Let me go on to say that perfect knowledge is both unlikely 
and unnecessary. I have personally studied the nuclear weapon 
efforts of more than a dozen countries, and no one ever knows 
everything, especially about a program that is years old.
    The objective should be sufficient information about Iran's 
past activities such that an agreement can be effectively 
verified. The P5+1 does not need to know everything before it 
can do anything, and the truth is we know a great deal about 
Iran's program.
    As regards proliferation impacts, an agreement that 
prevents Iran from acquiring weapons will represent a 
significant win for the nonproliferation regime. A successful 
agreement sends the message that violating the NPT carries 
significant cost. But if a country abandons its nuclear 
ambitions, it can avoid those costs.
    It also appears an agreement will break new ground with 
respect to safeguards and verification. Now some analysts have 
expressed concern that a residual enrichment capability will 
cause proliferation. I do not think that is true.
    First, in 70 years of nuclear history, there is not a 
single case of proliferation caused by safeguarded enrichment 
programs. If limited enrichment infrastructure was viewed as a 
great proliferation tripping threat, then why have countries in 
the region done nothing for 10 years? Iran has had centrifuges 
since 2003. And frankly, the set of countries discussed--Saudi 
Arabia, Turkey, and Egypt, particularly Egypt, which I have 
spent years, decades studying--appear far from a weapons 
option.
    In conclusion, I cannot render a final judgment until 
seeing the provisions of an agreement. But if an agreement is 
concluded along the lines of the framework described in April, 
this may well constitute one of the strongest multilateral 
nonproliferation agreements ever negotiated.
    It is a great honor to be before this august body. If I can 
be of service in the future, I stand ready to do so.
    Thank you very much.
    [The prepared statement of Dr. Walsh follows:]

                  Prepared Statement of Dr. Jim Walsh

Mr. Chairman, Mr. Ranking Member, and members of the committee, it is 
an honor to be with you today to discuss a possible Iran nuclear 
agreement.\1\ I sit here with this distinguished panel, whose members I 
have known for many years, and whose work I have admired. I want to 
personally thank you for your efforts to address the Iranian nuclear 
issue. I can say with confidence that sustained congressional 
leadership is a key reason why we have a negotiation in the first 
place, and why we may yet have a long-term agreement on Iran's program. 
Absent congressional leadership, we would not be here today, and absent 
congressional leadership in the future we will not be where we need to 
be.
    I come to this topic as a scholar of nuclear weapons decisionmaking 
and someone who has provided assessments to Republican and Democratic 
Presidents, as well as to Republican and Democratic Members of 
Congress, as they have wrestled with proliferation challenges. As 
regards Iran in particular, I have studied and written about its 
nuclear program for more than 15 years. I have been to Iran many times 
and have spent hundreds of hours in meetings with Iranian officials, 
including three Iranian Presidents, discussing nuclear and regional 
issues. Much of my work has been with a group of colleagues associated 
with the Iran Project, and over the years we have produced a number of 
reports that have been signed by more than 40 of America's most senior, 
retired military, diplomatic, and national security officials, 
including Gen. Anthony Zinni, Brent Scowcroft, Michael Hayden, and Tom 
Pickering.\2\ Of course, my comments today are mine alone.
    In my testimony, I want to directly address the set of questions 
you have put to me. My answers are organized around four topics:

          (1) The appropriate criteria for evaluating a future 
        agreement;
          (2) The minimum requirements that any agreement should meet;
          (3) The challenge of verification, including inspections, 
        Possible Military Dimensions (PMDs) issues, and breakout time; 
        and
          (4) The impact of an agreement on nonproliferation in the 
        region, and more generally.

    My summary judgment is inspections, PMDs, and breakout are all 
issues that policymakers will want to carefully consider. For the 
reasons described below, I judge that the risks posed by these 
challenges are real but manageable and not in excess of what similar 
agreements with similar kinds of countries have been able to 
successfully navigate. I also judge that an agreement is likely to 
bolster the cause of nonproliferation, both in the region and globally.
    i. criteria for evaluating a future nuclear agreement with iran
    Selecting the appropriate criteria for assessing an agreement 
requires that one step back and be clear about the intended objective 
and the context in which an agreement will operate, both as it relates 
to Iran in particular and to nonproliferation more generally.
I.1. Objective
    The simplest and most sensible objective is to prevent Iran from 
acquiring nuclear weapons, whether by indigenous manufacture or via the 
transfer of material and equipment from third parties. This includes 
both uranium- and plutonium-based nuclear weapons.
I.2. Context
    Assessment is more than simply listing the things that could go 
wrong or right with an agreement. In theory, lots of things can happen, 
but in practice few of those possibilities come true. Experience and 
data enable analysts to distinguish between what is more likely and 
what is unlikely. This, in turn, makes it possible for policymakers to 
weigh costs, benefits, and tradeoffs.
    In this case, the context is defined, in part, by Iran's past and 
present nuclear behavior. The most authoritative guides to Iran's 
nuclear program are the International Atomic Energy Agency (IAEA) 
reports and the Director of National Intelligence's (DNI) testimony and 
statements. According to the DNI, Iran had a structured nuclear weapons 
program that began in the late 1990s and was halted in 2003. In 2012, 
the DNI reported that: ``Iran has the . . . capacity to eventually 
produce nuclear weapons, making the central issue its political will to 
do so. . . . We assess Iran is keeping open the option to develop 
nuclear weapons, . . . should it choose to do so. We do not know, 
however, if Iran will eventually decide to build nuclear weapons.'' \3\
    He goes on to say that Iran's nuclear choices will reflect a cost-
benefit approach.
    Each of these findings has important implications for a nuclear 
agreement with Iran. The fact that the Islamic Republic once had an 
illicit nuclear program reinforces the possibility that it might again 
consider that option and underlines the importance of verification.
    The fact that Iran possesses a basic nuclear capability, and that 
political will, not technical capacity, will determine the nuclear 
endgame suggests that any agreement will need buy-in from Iran, if it 
is to be successful. Iran knows how to build a centrifuge, and neither 
sanctions nor military strikes can change that. In the long-term, the 
best way to insure than Iran does not acquire nuclear weapons is for 
Iran to embrace its nonnuclear posture.
    Perhaps most importantly, the DNI has assessed that Iran has not 
yet made a decision to pursue nuclear weapons and may or may not make 
such a decision in the future. This would imply that the moment is ripe 
for an agreement that would lock Iran into a political decision and a 
policy path that takes it down a nonnuclear road.
    Selecting appropriate criteria for assessment should also be 
informed by the broader nonproliferation context. Iran is not the first 
country to violate its NPT obligations. It is not the first country to 
have an enrichment program. It will not be the first country to enter 
into a nuclear agreement, if there is one. The United States and the 
IAEA have decades of experience with preventing and reversing 
proliferation. That experience can help policymakers make informed 
determinations of risk.
    As contemporary scholars of nuclear studies have repeatedly pointed 
out, the historical record for nonproliferation is a surprising story 
of success.\4\ Dark predictions of nuclear spread did not come true; we 
do not live in a world of dozens of nuclear weapons states. In fact, 
the rate or pace of proliferation has steadily declined since the 
1960s, with fewer and fewer countries joining the nuclear weapons club 
each decade. The pool of potential proliferators is the smallest it has 
ever been, and since the end of the cold war, more countries have given 
up their weapons assets than joined the nuclear club. In short, 
nonproliferation is one of America's greatest policy successes. 
Congress can take a major share of credit for that outcome, from the 
efforts of Senator McMahon and later Senator Pastore and on through the 
work of this committee today.
    Of course, not all the news is good. North Korea and the A.Q Kahn 
network are reminders that there is still difficult work to be done, 
and that success requires continued effort. The unambiguous evidence to 
date suggests, however, that it is possible to prevent and even reverse 
proliferation.\5\
    The data also suggests that negotiated agreements are a powerful 
tool for achieving nonproliferation objectives.\6\ There is scholarly 
debate about the causes of America's nonproliferation success, and one 
should assume that a variety of factors contribute, but my own research 
suggests that, contrary to my expectations, nonproliferation agreements 
can have a profound effect. From the Nuclear Nonproliferation Treaty to 
the Libya nuclear agreement, negotiated agreements are among the most 
important tools governments have for preventing and reversing 
proliferation.
    In summary, the selection of appropriate criteria for an agreement 
should be informed by Iran's past cheating, the fact that Iran already 
possesses a basic nuclear capability, the opportunity presented by the 
absence of an Iranian decision to pursue nuclear weapons, and the 
success of past nonproliferation efforts.
I.3. Evaluation Criteria
    Given the objective, what we know about Iran in particular, and 
what we know about the track record of nonproliferation agreements in 
general, it is possible to outline several criteria that policymakers 
can use to evaluate a nuclear agreement with Iran.
    These criteria take the form of both questions and principles.
            A. Does an agreement substantially advance the objective of 
                    preventing Iran from acquiring a nuclear weapon?
    This is the most important criterion, though others are also 
important. No agreement can be perfect, and there is no such thing as 
zero risk, but agreements can dramatically reduce the risks of 
proliferation.
            B. Is the agreement sustainable?
    It is not enough to simply get an agreement. If a good agreement 
immediately falls apart, it is a bad agreement. Sustainability requires 
that all sides follow through on their commitments. It means minimizing 
the reasons why an agreement might fail (e.g., cheating) and maximizing 
the reasons an agreement will succeed (e.g., all parties see timely 
benefits). Most of the discussion so far has focused on minimizing the 
causes for failure, and indeed even more narrowly on breakout. But 
there are many ways agreements can fail (failure to launch, 
disagreements over the meaning of terms, etc.), and prudent 
policymakers should be attentive to all of them.
    What has been completely ignored is the other half of the equation: 
maximizing causes for success. Coercion and threats alone will not be 
sufficient. If Iran or the other parties feel that they are not getting 
anything out of the agreement, it will collapse. There has to be buy-
in. It is again worth noting the DNI's assessment. Whether Iran 
acquires a nuclear weapon or not depends, not on technical issues, but 
on its political will to do so. It has not yet decided to go for the 
bomb, so this agreement provides a chance to put Iran on a path, where 
it never makes that political decision. For that to work, the agreement 
must produce benefits for Iran. It is these benefits that will create 
new political incentives, new political winners and losers within Iran, 
and a consolidation of its nonnuclear status.
            C. Using simple, broad measures, how does an agreement 
                    compare to the status quo?
    One quick and dirty way to get a general picture of an agreement is 
to ask how an agreement compares with the period before the agreement. 
The metric most commonly invoked in this regard has been breakout time, 
but there are other important measures as well. A simple one is the 
number of IAEA inspectors/inspections/inspection hours deployed to 
Iran. Secretary Amano suggested after the JPOA that the IAEA would have 
to double the number of inspectors in Iran. A comprehensive agreement 
could require that IAEA again increase the number of inspectors to 
support an enhanced level of verification. A third metric is the 
relative transparency achieved by the verification measures. Does the 
agreement expand the number of sites and activities subject to 
inspection, the amount of data being gathered for verification, the 
kinds of data being collected for verification, and/or the degree to 
which different kinds of information are combined for the purpose of 
verification?
            D. How does the agreement compare with other successful 
                    (and unsuccessful) nuclear agreements?
    Are its provisions stronger or weaker than previous agreements? 
What provisions does an agreement have that are different from previous 
agreements? Are there elements of past agreements that are missing from 
this agreement?
            E. How does an agreement compare to the other alternatives 
                    for dealing with Iran's nuclear program?
    The basic alternatives include doing nothing, imposing new 
sanctions, use of military force, and walking away from the 
negotiations with the hope that Iran will return to the bargaining 
table to make new concessions. Analysts will debate the merits of these 
alternatives, but the point is that no agreement can be evaluated by 
itself, without reference to the costs and benefits of the other 
courses of action.
            F. Avoid myopically focusing on any single number.
    The history of nonproliferation and arms control agreements is 
littered with domestic debates that devolved into fights over a single 
number. During the cold war, it was often the number of launchers. For 
the Iran negotiations, it has typically been the number of centrifuges 
or breakout time. This is not to suggest that launchers, centrifuges, 
and breakout are unimportant, but they are each one piece of a larger 
constellation of issues. Myopically focusing on one number rarely tells 
us anything useful about an agreement. Doing so strips away other 
important metrics and hides from discussion the important political 
factors that are more likely to determine the ultimate outcome. Again, 
as the DNI has said, Iran's nuclear future is essentially a political 
question, and so ignoring the political variables and instead focusing 
on a narrow technical issue is likely to yield a flawed evaluation.
            G. Adopt a ``whole of agreement'' approach.
    A rigorous evaluation would not only avoid a myopic focus on a 
single number, it would affirmatively seek to assess the agreement as 
an interconnected whole. There are good technical reasons for an 
integrated approach. Virtually every aspect of the agreement is related 
to other parts of the agreement. Looking at the number of centrifuges 
is perfectly reasonable, but it does not tell you much unless you also 
know the type of centrifuges that will be allowed, how the centrifuges 
will be operated, the final form of enriched material, and so on. 
Members of Congress should resist the strong and natural temptation to 
cherry pick or focus on one aspect of the agreement, and considering it 
apart from the rest of the agreement.
            H. Assessment should avoid making perfect the enemy of the 
                    good.
    There is no such thing as a perfect agreement, free of risk. In 
public policy there are always risks--risks from action, risks from 
inaction. But as history has repeatedly demonstrated, an agreement that 
greatly advances nonproliferation and U.S. national security does not 
have to be perfect. If perfect were the standard, we would have no NPT, 
no arms control agreements with the Soviet Union, no nuclear deal with 
Libya, no Proliferation Security Initiative, and the like--all of which 
have advanced American national security.
    The Nuclear Nonproliferation Treaty, arguably the single most 
important and effective nonproliferation tool ever devised, has 
numerous flaws. It has no enforcement clause; it provided for nuclear 
testing (for peaceful purposes); it did nothing to limit the fuel cycle 
or nuclear material. Safeguards arrangements in 1970 were a pale, weak 
cousin to what we have today. Had the NPT been up for consideration 
today rather than 45 years ago, it might have been rejected for its 
flaws. And doing so would have been a gigantic error of enormous 
consequence. The NPT, like all nonproliferation and arms control 
agreements, was not perfect and did not eliminate all risk, but it was 
spectacularly successful. It helped prevent the cascade of 
proliferation that virtually every government and academic analyst had 
predicted in the years prior to its passage.
    In today's discussions on Iran, advocates of perfection are 
everywhere. Some critics want the nuclear agreement to include 
important but nevertheless unrelated issues such as terrorism and human 
rights--a burden that no effective nonproliferation agreement has 
previously been required to meet.
    Others will accept nothing less that the dismantlement of Iran's 
nuclear program and want to ``prevent'' Iran from having a nuclear 
weapons capability. Setting aside the fact that the DNI assesses that 
Iran already has that capability, and the fact dismantlement is a 
political impossibility, this approach would be disastrous. Eliminating 
facilities would not eliminate Iran's knowledge of how to build a 
centrifuge. Absent facilities to inspect, the IAEA would have no 
justification for inspections and monitoring. Dismantlement would mean 
that thousands of nuclear scientists and engineers would suddenly be 
out of work and thus available to other countries with nuclear 
ambitions or for an Iranian clandestine program--one that would then be 
more difficult to detect as inspections declined.
    The dangers of insisting on the ``perfect'' extend beyond the issue 
of dismantlement. On verification, PMDs, and other issues some analysts 
have advocated for nothing less than perfect, zero risk outcomes. Doing 
so increases the danger that there will be no agreement, and that Iran 
will be left unconstrained to pursue whatever nuclear ambitions it has 
or may have in the future.
I.4. Summary
    Evaluating an agreement is not about listing all the things that 
could go wrong (or right) with an agreement. All actions carry risk, 
including not acting at all. The task for policymakers is to determine 
which risks are more likely, find ways to minimize those risks, and 
weigh tradeoffs between risks and actions intended to minimize them. As 
we have seen with the NPT and other nonproliferation agreements, ``good 
enough'' can produce great outcomes.
                        ii. minimum requirements
    Any final agreement will take the form of a highly complex, 
interconnected set of technical and political obligations. As suggested 
above, requirements in one part of the agreement will likely have 
implications for other parts of the agreement. And since we do not yet 
have a final agreement, it is not yet possible to make complete and 
specific judgments about what an agreement should contain. Still, one 
can offer some examples as well as some general principles.
    It seems to me that any agreement would have to include the 
following elements: \7\

          1. Adherence to what might be called Additional Protocol 
        ``Plus,'' that is, Iran would implement the requirements of the 
        Additional Protocol but for some period of time go beyond the 
        Additional Protocol in terms of the level of transparency 
        provided;
          2. Adherence to the revised Code 3.1 of the Subsidiary 
        Arrangements to its safeguards agreement;
          3. Changing the design for the Arak reactor;
          4. No reprocessing;
          5. Limits on the level of enrichment;
          6. Limits of the number of centrifuges;
          7. Limits on the types of centrifuges that operate;
          8. Limits on the size of the material stockpile;
          9. Limits on the composition of the material stockpile;
          10. Iran must resolve all outstanding issues with the IAEA, 
        and the agency must certify that it is satisfied with the 
        results of its inquiry;
          11. Prompt but reciprocally proportioned sanctions relief;
          12. A process for the timely investigation of alleged 
        violations; and
          13. Provision for the reintroduction of sanctions following a 
        material breach of the agreement by Iran.
                    iii. challenges to verification
III.1. Verification in Context
    Verification will be central to any agreement, and three challenges 
in particular have received attention: inspections, PMDs, and breakout 
time.
    Before considering each, it makes sense to step back and put 
verification in a broader historical context.
    III.1.A. The United States and the international community have 
decades of experience with nuclear verification. The prospect of an 
agreement with Iran is not the first time policymakers have had to 
address questions about breakout and sneak out. As with all policy 
instruments, there is no perfection, but past verification 
instrumentalities--ones not nearly as robust as those available today--
have proven in practice to be highly effective tools for 
nonproliferation.
    III.1.B. Verification has grown progressively stronger over time. 
This is true legally and institutionally, as the mandate for 
international safeguards and inspections has expanded and become more 
intrusive over time. (It would be inconceivable to someone at IAEA in 
1970 that an inspector could go to military sites.) Progress has also 
been made operationally. The science and technologies available for 
verification today are far more powerful than were available in the 
past. The combination of strong international data collection and 
advanced national technical means represents a new era in verification.
    III.1.C. According to U.S. Government assessments, Iran has no 
structured nuclear weapons program, has not made the decision to build 
nuclear weapons, operates no clandestine nuclear facilities, and will 
now open itself to the most intrusive multilateral verification 
arrangement ever negotiated. Those are favorable conditions for a 
verification regime.
    III.1.D. Verification will be enhanced by the fact that Iran is 
probably the most watched country in the world--a fact unlikely to 
change any time soon. The U.S., Russia, France, Britain, Germany, 
Israel, Saudi Arabia (and the other Gulf States) all have their eyes on 
Iran. Many, including Iranian opposition groups, will be looking under 
every haystack and in every corner for the first signs of 
noncompliance.
III.2. Inspection
    Inspection is a critical piece of the verification architecture. It 
is not the only piece,\8\ but any IAEA inspection regime has to provide 
inspectors with a mandate sufficient to accomplish their mission. That 
mission or objective is the timely notice of possible noncompliance 
with the agreement.
    Achieving the objective of timely notice does not require that IAEA 
have instant or all encompassing knowledge of everything that Iran 
does. Rather it requires the ability to collect information on 
potential violations such that the United States and the international 
community can take actions to end and reverse noncompliance, before 
Iran is able to acquire a nuclear weapon. Meeting that requirement does 
not require that inspectors take up residence at all of Iran's nuclear 
facilities. Instead, it requires, as Mark Fitzpatrick of Britain's 
International Institute for Strategic Studies has suggested, ``access 
where needed, when needed.'' \9\
    One reason the Additional Protocol is a minimum requirement for any 
agreement is that it already provides the legal authority for the 
agency to go to any facility about which it has cause for concern. Of 
course, inspectors cannot simply run around the country visiting any 
sensitive site they want for no reason. No country would accept that 
and in any case, it would be counterproductive.
    The Additional Protocol, with its concepts of complementary and 
managed access--together with all the other types of information the 
agency collects, and augmented by whatever new arrangements are agreed 
to--will provide the IAEA, the U.S., and the international community 
with information and insight into Iran's nuclear program at a level 
never previously achieved.
III.3. Possible Military Dimensions
    Unresolved questions about Iran's nuclear weapons program in the 
late 1990s and early 2000s prevent the IAEA from closing Iran's nuclear 
file. The core outstanding issues involve Iran's experiments with 
neutron transport and high explosives. No comprehensive agreement with 
Iran is possible without Iran resolving these concerns with the agency.
    Since November 2013, the agency and Iran have made progress on part 
of the PMD portfolio and many of the other items in the Framework for 
Cooperation, the plan of action negotiated between IAEA and Iran. Of 
the 18 practical measures Iran is obliged to carry out under the 
Framework, Iran has carried out 16, but the 2 that remain concern PMD 
and are the most sensitive. The IAEA also invited Iran to propose 
additional practical measures to address all resulting questions.\10\
    My guess is that these will be satisfactorily resolved but not 
before a comprehensive agreement has been reached in principle. From a 
bargaining perspective, it does not make sense for Iran to settle these 
awkward issues absent a comprehensive agreement.
    Recently there has been some debate about what is required for the 
PMD file to be closed. Some have argued that the agency needs to know 
virtually everything about the past program and talk to all of its 
personnel in order to establish a ``baseline'' for verification.
    Perfect knowledge is both unlikely and unnecessary. Even if one 
could interview every Iranian nuclear official or scientist, it is 
improbable they would be forthcoming. Some of the information that 
dates back more than a decade may simply be out of date or irrelevant 
or irretrievable (e.g., having gone to the grave with a particular 
official). I have personally studied the nuclear weapons efforts of 
more than a dozen countries, and one never knows everything, especially 
about programs that occurred years ago.
    The objective should be sufficient information about Iran's past 
nuclear activities, such that an agreement can be effectively verified. 
More information is almost always preferred, but it is important to 
distinguish what is necessary from what is useful.
    One should also weigh the relative value of any one piece of 
information with information collected from other sources. Information 
collected by IAEA, the U.N. Panel of Experts, the U.S. Treasury, 
national intelligence, and other sources provide a detailed picture of 
Iran's program, one that has enabled the sanctioning of individuals, 
government organizations, and private concerns involved in Iran's 
nuclear program.
    The IAEA has considerable experience with these kinds of 
investigations. Iran is not the first country to have its nuclear 
program investigated. South Korea, Egypt, and Taiwan have been 
scrutinized for illicit or undeclared research activities.\11\ In South 
Africa, Ukraine, Kazakhstan, and Belarus, the IAEA had to verify the 
exclusively peaceful nature of nuclear programs in countries that had 
once possessed nuclear weapons or inherited weapons assets. In Libya, 
the international community did the same in circumstances where the 
country gave up its program voluntarily through negotiation and in Iraq 
with a country where the process was involuntary. Given the agency's 
experience and expertise, it is in a strong position to assess what 
information is required to close Iran's file.
    In summary, the P5+1 does not need to know everything before it can 
do anything, and the truth is that we already know a great deal about 
Iran's program. The IAEA should be left to its job. If they are unable 
to close Iran's file, because Iran lacks the political will to take the 
necessary steps, then there will be no agreement.
III.4. Breakout Time
    The issue of breakout time, the time required for a country to 
produce one bomb's worth of material, has been a central theme in 
discussions about a nuclear agreement for some time. It is a 
traditional concern, being an issue requiring consideration for most 
nonproliferation and arms control agreements, and it makes sense--up to 
a point--to extend breakout time as far as reasonably possible.
    Nevertheless, I do have concerns about the use of the concept in 
recent discussions. As the members of the executive branch have readily 
admitted, the definition of breakout time is flawed. It does not 
include the time needed to take a lump of fissile material and fashion 
it into a useable, reliable nuclear weapon. The DNI and others in the 
U.S. Government and in the Israeli atomic and military establishments 
have suggested that this would require an additional year or more.\12\
    It also has to be said that no country in the history of the 
nuclear age has broken out in order to build one bomb, a notion that 
does not actually make a lot of sense. Two bombs worth of material 
would be a little more realistic, though a deeply conservative 
estimate, and that alone would double the breakout time calculations.
    And while every policymaker who evaluates a nonproliferation or 
arms control agreement should take seriously the possibility of 
successful breakout, it is worth keeping in mind that it is quite rare, 
with North Korea being really the only example. That does not mean that 
one should ignore the risk--far from it. But neither should one 
exaggerate the risk. Nor should policymakers focus on breakout to the 
exclusion of other risks to an agreement.
    A final concern about the breakout discussion is that it appears to 
be a game of moving the goalposts. When Prime Minister Netanyahu gave 
his famous speech at the U.N. General Assembly in 2012, he argued that 
the redline should be: ``Before Iran gets to a point where it's a few 
months away or a few weeks away from amassing enough enriched uranium 
to make a nuclear weapon.'' \13\
    Later, when discussing a prospective nuclear agreement, Secretary 
of State Kerry referred to a 6-month breakout time, significantly 
beyond the Prime Minister's ``few months or weeks.'' Critics shifted 
their stance and insisted that nothing less than a year would do. Then, 
when the framework for a comprehensive agreement was announced in 
April, and it included 1-year of breakout time, opponents shifted yet 
again, saying that a year was insufficient. One imagines that if a new 
comprehensive agreement in announced in the coming weeks, and it 
promises a year and a half of breakout time, opponents will say that 
only 2 years will do. And again, none of these estimates include the 
additional year plus it would take to weaponize the fissile material.
    Again, the broader context suggests that the near- and medium-term 
risks are low. Breakout is exceedingly rare. The DNI has said that even 
under the standards of the JPOA, ``Iran would not be able to divert 
safeguarded material and produce enough WGU [weapons-grade uranium] for 
a weapon before such activity would be discovered.'' \14\ And again, 
the DNI has assessed that Iran has not made the decision to acquire 
nuclear weapons.
    And it is worth underlining again that preventing breakout depends 
not only on the deterrence that comes from verification and timely 
notice, but fundamentally and for the long term, from Iran buying in--
seeing that the benefits of nuclear abstention are greater than the 
benefits of nuclear weapons, and locking in that political commitment 
for decades to come.\15\
III.5. Concerns Going Forward
    Inspections, PMDs, and breakout are all verification issues that 
policymakers will want to carefully consider. For the reasons described 
above, I judge that the risks posed by these challenges are real but 
manageable, and not in excess of what similar agreements with similar 
kinds of countries have been able to successfully navigate.
    Nevertheless, I do have two concerns going forward.
    First, verification could be more challenging in the out years of 
the agreement if Iran decides to vastly expand its nuclear 
infrastructure. It is simply a fact of nuclear life that the bigger the 
nuclear enterprise the more difficult it is to assure that small 
amounts of material have not been diverted.
    That does not mean, axiomatically, that verification will be 
insufficient or that Iran will cheat, but it is something policymakers 
will want to be attentive to. For example, it would be to everyone's 
interest, particularly Iran's, if Tehran takes its resources and 
invests them in natural gas production rather than a large nuclear 
infrastructure. Polices might be pursued that encourages that choice. A 
future administration should also consider developing and negotiating a 
follow-on agreement with Iran, one whose verification regime will be 
best suited to the size of Iran's program some 20 years out.
    Second, the IAEA has to have the financial and technical support to 
carry out its expanded mandate. More inspectors, more inspections, more 
analysts to follow procurement or open sources, the deployment of new 
technologies--this all costs money. The director of the IAEA estimated 
that the JPOA would require the agency to double its number of 
inspectors. The agency's 2014 costs to its extrabudgetary account 
increased by a third (\1/3\) in 1 year just to cover the cost of new 
verification in Iran. A dollar for an IAEA inspection is a dollar well 
spent, and the U.S. Congress, keeper of the purse, should take a 
leadership role in providing IAEA with the resources it needs to not 
only implement today's safeguards but to develop and deploy advances in 
safeguards technology and methodology.
   iv. an agreement's impact on global and regional nonproliferation
    A comprehensive agreement that prevents Iran from acquiring nuclear 
weapons will represent a significant win for the nonproliferation 
regime and will have positive nonproliferation effects in the region. 
The alternative, an Iran with an unconstrained nuclear program, would 
have a contrary effect, adding unwanted pressure on the 
nonproliferation regime.
    A successful agreement sends the message that violating the NPT 
carries significant costs, but that if a country abandons its nuclear 
ambitions, it can avoid those costs. Often analysts focus on the first 
message (imposing costs) and forget the second, which is a mistake. The 
history of the nuclear age includes dozens of countries that started 
down the path to nuclear weapons but that stopped and reversed course. 
If countries, having decided to purse nuclear weapons, believe that 
there is no off-ramp or alternative, then they will conclude that they 
have no choice but to continue down that path toward nuclear weapons.
    In addition, it appears that this agreement will break new ground 
with respect to safeguards and verification. As new precedents, they 
offer the possibility of more widespread adoption and becoming a 
standard feature of the nonproliferation regime.
    A nuclear agreement might also add modest momentum to international 
efforts to establish a Weapons of Mass Destruction Free Zone in the 
Middle East.
    Some analysts have expressed the concern that a nuclear agreement 
that leaves Iran with any centrifuges will spur countries in the region 
to develop their own enrichment capabilities and following that, 
nuclear weapons.
    This outcome appears unlikely for several reasons.
    First, in 70 years of nuclear history, there is not a single case 
of proliferation caused by a safeguarded enrichment program. There have 
been 10 nuclear weapons states. Some weapons programs began in response 
to another country's nuclear weapons program, others not until nuclear 
tests, but none to a safeguarded enrichment program. Governments tend 
to be reactive by nature--not proactive--and nuclear weapons are not a 
small undertaking. Nonnuclear weapons states that have safeguarded 
enrichment programs, like Japan and Brazil, have not caused neighboring 
countries to acquire nuclear weapons.
    Second, if a limited enrichment infrastructure was viewed as a 
grave, proliferation-tripping threat, then why have the countries in 
the region failed to do anything for the last 10 years. Iran has had 
centrifuges since 2003, but Saudi Arabia and others have done virtually 
nothing. It is difficult to believe that after curtailing its 
centrifuge program and submitting to new and rigorous verification, the 
governments in the region would then decide to respond.
    Third, the set of countries cited as potential proliferation 
threats--Saudi Arabia, Turkey, and Egypt--appear far from a nuclear 
weapons option.\16\ There are many reasons for this conclusion, not 
least being that since the Iran-Iraq war, many countries have come to 
believe that a strong military alliance with the United States is their 
preferred route to security. A bomb program would put that directly at 
risk.
                         v. concluding thoughts
    A nuclear agreement with Iran, should it be concluded, could 
represent a pivotal moment for American nonproliferation policy, if not 
for the nuclear age. There are risks, as there are risks with inaction 
and with other policy alternatives. I cannot render a final judgment 
until seeing the provisions of the final agreement, but if an agreement 
is concluded along the lines of the framework described in April, this 
may well constitute one of the strongest multilateral nonproliferation 
agreements ever negotiated.
    Even is that is true, however, it will mark the beginning, not the 
end. The real task ahead is locking Iran into a nonnuclear future such 
that it never again makes the decision to pursue nuclear weapons. That 
task will require the energetic efforts of both the executive branch 
and the U.S. Congress, and not least the Foreign Relations Committee.
    It has been a great honor to appear before this august body. If I 
can be of service in the future, I stand ready to do so.
    Thank you.

----------------
Notes

    \1\ I would like to thank the many people who helped with my 
testimony, including Angela Nichols, Angela Canterbury, Ed Levine, 
Michelle Lee, Tim MacDonald, Jen Greenleaf, and Tom Collina, to name a 
few.
    \2\ See, for example, ``Weighing Concerns and Assurances about a 
Nuclear Agreement with Iran: A Briefing Book,'' New York: The Iran 
Project, June, 2015; ``Weighing the Costs and Benefits of Military 
Action Against Iran,'' New York: The Iran Project, September, 2012.
    \3\ James R. Clapper, ``Unclassified Statement for the Record on 
the Worldwide Threat Assessment of the U.S. Intelligence Community for 
the Senate Select Committee on Intelligence,'' Office of the Director 
of National Intelligence, January 31, 2012, p 6.
    \4\ On the surprising success of nonproliferation efforts, see 
Mitchell Reiss, ``Without the Bomb: The Politics of Nuclear Non-
proliferation,'' (New York: Columbia University Press, 1988); Mitchell 
Reiss, ``Bridled Ambition: Why Countries Constrain Their Nuclear 
Capabilities,'' (Washington: Woodrow Wilson Center Press/Johns Hopkins 
University Press, 1995); Jim Walsh, ``Bombs Unbuilt: Power, Ideas, and 
Institutions in International Politics,'' (Cambridge, MA; MIT Doctoral 
Dissertation, May, 2000; Robert J. Einhorn, Mitchell B. Reiss, and Kurt 
M. Campbell, eds., ``The Nuclear Tipping Point: Why States Reconsider 
Their Nuclear Choices,'' (Washington, DC : Brookings Institution Press, 
2004).
    \5\ Some 30 countries started down the path to nuclear weapons and 
reversed course. In some cases the pursuit was exploratory; in other 
cases it involved full-blown weapons programs. Countries that 
considered nuclear weapons acquisition include Taiwan, South Korea, 
Egypt, Libya, Iraq, Iran, Germany, Italy, Japan, Yugoslavia, Romania, 
Brazil, Argentina, Sweden, Switzerland, Australia, Canada, Indonesia, 
and Spain, among others.
    \6\ On the effectiveness of nonproliferation agreements, see 
Matthew Fuhrmann and Yonatan Lupu, ``Do Arms Control Treaties Work? 
Domestic Politics and the Constraining Power of the Nuclear 
Nonproliferation Treaty,'' January 7, 2015 [Working Paper.]; Jim Walsh, 
``Learning From Past Success: The NPT and the Future of 
Nonproliferation,'' Paper no. 41, Oslo: Weapons of Mass Destruction 
Commission, 2006. Contrary to popular understanding, the rate of 
proliferation peaked in the 1960s and has declined in every ensuing 
decade.
    \7\ This list is intended as illustrative, not all-inclusive.
    \8\ IAEA also has a variety of other, important tools, including 
material accountancy, open source analysis, environmental sampling, and 
the like.
    \9\ Mark Fitzpatrick, ``Inspecting Iran Anywhere, But Not 
Anytime,'' IISS, June 16, 2015.
    \10\ IAEA, SIR (Safeguards Implementations Report) 2014, GOV/2015/
30, p. 7.
    \11\ See, for example, IAEA Press Office, ``IAEA Board Concludes 
Consideration of Safeguards in South Korea,'' November, 2004; Paul 
Kerr, ``EA Investigating Egypt and Taiwan,'' Arms Control Today, 
January 1, 2005.
    \12\ Paul Kerr, ``Iran's Nuclear Program: Status,'' Congressional 
Research Service, 7-5700, October 7, 2012.
    \13\ http://www.algemeiner.com/2012/09/27/full-transcript-prime-
minister-netanyahu-speech-to-united-nations-general-assembly-2012-
video/.
    \14\ Paul Kerr, ``Iran's Nuclear Program: Status,'' Congressional 
Research Service, 7-5700, October 7, 2012.
    \15\ Efraim Halevy, ``Obama Was Right, Iran Capitulated,'' May 6, 
2015.
    \16\ On Turkey see, Mark Hibbs, ``The IAEA's Conclusion About 
Turkey,'' Arms Control Wonk, April 16, 2015. On Saudi Arabia, see Colin 
H. Kahl, Melissa G. Dalton, and Matthew Irvine, ``Atomic Kingdom: If 
Iran Builds the Bomb, Will Saudi Arabia Be Next?'', Center for New 
American Security, February 2013; Zachary Keck, ``Why Pakistan Won't 
Sell Saudi the Bomb,'' National Interest, November 18, 2013. On Egypt, 
see Dina Esfandiary and Ariane Tabatabai, ``Why Nuclear Dominoes Won't 
Fall in the Middle East,'' Bulletin of Atomic Scientists; Jessica C. 
Varnum, ``Middle East Nuclear Race More Rhetoric Than Reality,'' World 
Politics Review, May 14, 201; Jim Walsh, ``Egypt's Nuclear Future: 
Proliferation or Restraint?'', In ``Forecasting Proliferation,'' 
William Potter, ed, Palo Alto: Stanford University Press, 2010.

    The Chairman. Thank you. Thank you all three for your 
testimony.
    We have had six briefings. In many of those, I have 
deferred asking questions until other members have had the 
opportunity to do so. I am just going to ask one and then move 
on, so everyone else has an opportunity to weigh in.
    But, succinctly, could each of you, especially because 
Secretary Kerry has mentioned that we do not want to upset 
Iran's national pride by causing them to have to deal with PMD 
because we already know everything, which we all know we do 
not, but could you all express succinctly to each of the 
members here why the PMD issue on the front end is so important 
to all of us who want to make sure that we have a strong 
agreement?
    Mr. Albright. I think one of the most important parts of 
dealing with this, at least in a concrete manner, I mean you 
cannot do everything that the IAEA wants to prior to lifting of 
sanctions, because a PMD investigation could go on for years, 
but you need to do enough so that the IAEA maintains its 
credibility. I mean, there is a real risk that if this is not 
settled satisfactorily that the main verification entity will 
have suffered a serious blow to its credibility, and that will 
call into question the verifiability.
    What I am saying now is what I hear from negotiators. I 
have heard it from three different teams or negotiators from 
three different countries that this is taken very seriously.
    But I will say Secretary of State Kerry's statement last 
week muddied this issue. The administration, I know, has tried 
to go around and say their position has not changed on PMD. 
They want concrete progress.
    But listening to what he said, it has raised questions of 
whether the United States is going to stick to its commitment 
to ensure concrete progress and make sure that Iran 
demonstrates cooperation with the IAEA and the IAEA can report 
that there is progress made before the lifting of key economic 
or financial sanctions.
    The Chairman. Thank you.
    Ray.
    Dr. Takeyh. I think I largely agree with David. The first 
and IAEA-EU work plan regarding the previous military activity 
was negotiated in 2006 with Ali Larijani and has remained 
unfulfilled since. There are 12 areas which IAEA would like to 
have answers on, and none of those have been completed in the 
intervening decade.
    So this is the issue that has been long deliberated and 
long found unsatisfactory.
    Also, there are some issues such as weaponization design, 
which is basically four guys in a room. I do not think we can 
determine that activity has stopped without having access to 
designs and other such information. So some of these 
weaponization activities may, in fact, be ongoing, because they 
are extremely difficult to detect and impossible to justify 
moving forward without actually having access to some of those 
depositories and scientists and so forth that are 
indispensable.
    Second of all, Iran is in violation of the safeguard 
agreement today. It is not letting inspectors into Parchin. It 
has done much to cleanse it, to the dissatisfaction of Director 
General Amano.
    So as it is negotiating a future verification plan, it is 
in violation of its current verification plan.
    The Chairman. Jim, do you want to add to that?
    Dr. Walsh. First, Mr. Chairman, I am obliged to say that I 
will be visiting the Volunteer State next week with my new 
bride, and we will be going to the great town of Mascot right 
outside of Knoxville. They are all watching online, I think, as 
we carry on, so please do not embarrass me. That is my 
fundamental question here, since I just got married.
    The Chairman. Very good. Just like when you bring children 
here with you, we try not to embarrass you.
    Dr. Walsh. I appreciate that. I will keep that in mind.
    Let me say that I agree with David, that there has to be 
some standard here. You are not going to be able to find 
everything. Even the Iranians probably cannot find out 
everything that happened 15 years ago. That is the nature of 
these things. But you have to find that which is relevant to 
going forward.
    Let me be clear about my view. Unless IAEA is satisfied, I 
will not be satisfied. I have confidence in the agency. They 
have a lot of experience with this problem, as I say in my 
testimony, having done it with several different countries, 
weapons shenanigans.
    And I would respectfully disagree with my friend Ray. There 
has been progress here. The progress has been slow, but it 
started in 2013, sort of coinciding with the Joint Plan of 
Action. There is still a long way to go, but I think the focus 
has to be, what is it that we need to know about the program 
that is relevant to the future? Not everything. I think IAEA is 
more than capable of being able to assess that.
    The Chairman. I am going to reserve the rest of my time for 
interjections.
    We will turn to our ranking member.
    Senator Cardin. Well, let me thank all three of our 
witnesses.
    I, certainly, as I indicated in my opening statement, plan 
to keep an open mind until we get the agreement and all of the 
attachments to that agreement. And there is good reason for 
that, not just so that we see what is there, but also because 
there have been conflicting accounts of the interpretation of 
the framework by Iran and the P5-plus-1. There have been 
different negotiating positions.
    For example, we have been told over and over again, there 
will not be sanction relief until there is compliance with the 
agreement. Iran has said that their position is immediate 
sanction relief. We will find out, if there is an agreement, 
what relief there is. Rather than speculate, let us see what 
the agreement says.
    There has been a difference on the military dimension, the 
PMD. We have been assured that we understand the covert risk 
factors and that will be cut off. Therefore, the military 
access will be absolutely critical. That is what the P5-plus-1 
have been saying. Iran says no to that. Once again, the 
agreement will tell us what, in fact, it does.
    So I do not think we can reach judgment until we see the 
agreement.
    But as I said at yesterday's hearing, we want to drill down 
on the vulnerable parts or the most challenging parts of the 
framework, so that we are prepared to be able to evaluate that.
    So my question to you is a similar question I asked the 
panel yesterday. We know the framework. You saw it. It has been 
out there. It has been written. You have seen some of the 
interpretations given. What gives you the greatest concern in 
the framework, as to the United States being able to achieve 
its objective of preventing Iran from becoming a nuclear weapon 
state if, in fact, an agreement is entered into under that 
framework? What is your greatest concern?
    I would like you to limit it to one, if you could.
    Mr. Albright. Well, it is hard.
    Senator Cardin. We all have to set priorities in life.
    Mr. Albright. I think making sure the breakout is 
consistently obtained I think is very important. There are a 
lot of moving pieces, and it has been a very hard negotiation, 
and I think some things have slipped.
    I think verification, I think the administration is highly 
committed to intrusive verification, but I think achieving that 
is very difficult. And I do not think the Lausanne deal dealt 
with it at all. It just was not resolved in any meaningful way.
    When they talk about watching the uranium supply chain, 
from a verification point of view, that is interesting and 
important but hardly critical. And so many of the basic 
verification issues were not resolved.
    Senator Cardin. Thank you.
    Dr. Takeyh. I would say that one of the unusual aspects of 
this agreement is that it has a sunset clause of 10 years when 
all of the restrictions evaporate. At that time, Iran can 
embark on having an industrial-sized nuclear program similar to 
that of Japan's.
    And when it gets to that level of industrialization, then I 
think there is no inspection modality that can ensure that its 
nuclear resources will not be misused for military purposes.
    As far as I know, this is the only agreement that is 
sunsetted, the only final agreement that is sunset. Salt I had 
a 15-year sunset clause, but the idea was that it would be 
replaced by SALT II. This is the only agreement that I can 
think of that actually stabilizes the file and then envisions a 
vast increase in the capacity of the country at some later 
point.
    There is not a single Iranian official from whatever 
political tendency that suggests it will not embark on an 
industrial-sized nuclear program upon expiration of the sunset 
clause, and they even dispute the duration of the sunset 
clause.
    Senator Cardin. Thank you.
    Dr. Walsh. I would say, quickly, resources for enforcement 
and sustainability. I do not disagree with my colleagues. I 
disagree with some of the things, but in large measure, I do 
not disagree. But I would point to these other things.
    IAEA has had to double the number of inspectors in Iran, 
had its budget increased by a third just to deal with Iran. If 
the comprehensive agreement comes to pass, it is probably going 
to double that again. Who is going to pay for it? It is great 
to announce things, but someone has to come up with the dollars 
to make this a real deal.
    And then sustainability, and that is for both sides. If 
either side feels like this deal is not working for them, as a 
sovereign state, they are going to pull out. So the United 
States has to get satisfaction and Iran has to get prompt 
sanctions relief, certainly not all sanctions relief, but it 
has to get something that gives sustenance and sustainability 
to this process or it will fall apart.
    Senator Cardin. Thank you.
    Mr. Chairman, my own views have changed on this over this 
past month. I think I probably started this month solely 
focused on the framework on inspections and verification as 
being the most challenging part. Maybe it is because a 
Marylander responded to me, but I am starting to believe the 
time issues could be the most challenging moving forward, 
because technology is going to change over the next 10 to 15 
years. And, yes, Iran does have certain obligations of 
nonproliferation that have no time limits at all on it, and 
inspection issues would have no limits as to the inspection 
regimes. But I do think there is a challenge, and I know that 
our chairman has been asking for further clarification on 
Iran's civil and nuclear game plan, which is a document that we 
must have in reviewing this.
    But the inspection verification regime is challenging under 
the framework. There is no question about it. Technology can 
help us deal with some of that. Intelligence can also help us 
deal with some of this. But I think as we look at permanently 
preventing Iran from becoming a nuclear weapons state, we need 
to have an understanding as to how the different time period 
transitions take place and the other protections that are in 
place against Iran and whether that is going to be adequate 
enough to prevent Iran from becoming a nuclear weapons state.
    Those are some of the issues I am going to be looking at, 
assuming we get an agreement. But I think these hearings have 
been extremely helpful.
    The Chairman. Thank you.
    Senator Flake. Thank you, Mr. Chairman, for convening all 
of these hearings. It has been very helpful.
    And I, too, have an open mind on this. I supported the 
negotiations. I think they are important to go through.
    I believe that the only reason Iran is at the table is 
because the sanctions have bitten pretty hard, and those 
sanctions have bitten pretty hard because they are multilateral 
and our coalition partners have been with us. Certainly, the 
P5+1 group is important to keep together.
    In the context of whether or not we judge this is a good 
deal in the end, it is not just is this a good deal overall. It 
is, what is the alternative? I would love to have some 
discussion there.
    If we turn this deal down, if our partners stay with us, 
and we maintain the current sanctions regime or even toughen 
it, would that prohibit Iran from moving ahead, if they are 
really determined to do so? It seems, over the past 10 years, 
they have moved from a situation where in 2003 they had very 
little capability to now a 2-month breakout period.
    Mr. Albright, do you want to discuss that a bit? If this 
does not go through, even if we maintain the current sanctions, 
what is the likelihood of Iran pushing through?
    Mr. Albright. I think you, certainly, want a deal. I think 
that is the best outcome.
    I agree with Jim that negotiated deals can really make a 
difference.
    Senator Flake. I am sorry, they are we? You say that we 
want deal? They want a deal?
    Mr. Albright. Let me just say I. I think a deal is good. I 
had an organization so I use ``we'' too frequently, so forgive 
me for that.
    I believe it is not as dire as some have predicted, if 
there is no deal. I think the United States has to consider 
walking away, if its redlines or its basic goals are not met.
    I think what would happen is more pressure would be brought 
to bear on Iran. I think Iran would respond by increasing its 
program. And I think the United States would have to try to 
work to try to win at escalation.
    But I do not see that war is inevitable. I do not see this 
as a stark choice between a deal and war. I think that is kind 
of a Washingtonian game that is played in order to try to 
intimidate people.
    I think some of the members of your committees have been 
called warmongers. I think that is part of that same game.
    I think realistically what would happen is that the United 
States would move to increase pressure with its allies, and 
China and Russia would have to be kind of brought along. It 
will be tough, but I think the idea would be to increase 
pressure and see if you could get back to negotiations on a 
better basis.
    Senator Flake. Mr. Takeyh.
    Dr. Takeyh. As everyone has noticed, Ali Khamenei gave a 
speech, I believe it was 2 days ago. Some aspects of the speech 
have been highlighted. Some have not.
    In his speech, he said something very interesting that 
everyone should listen to. He says, and I quote, it is a rough 
translation, ``I may have said this before,'' which is not true 
actually, ``that in the movement of nuclear enrichment, the 
important and hard part is moving from 3 percent to 4 percent 
to 20 percent. It is very easy to move from 20 percent to 90 
percent. When a person reaches 20 percent, the next stages are 
very easy.''
    Ninety percent is weapons grade uranium. It is the first 
time that I have heard him, and I have read every one of his 
speeches. I am not trying to show off because they are in 
English. They translate them. This is the first time that he 
has looked at his enrichment program within the context of 
weaponization and weapons grade uranium.
    Now, something to improve the agreement as it goes forward, 
because as we mentioned here, we do not have an agreement, on 
the sunset clause, one of the things that we should do 
potentially is go back and suggest that after 10 years, the 5+1 
and Iran get to vote on whether to extend those restrictions 
for another 10 years.
    There is a precedent for that. It is called the NPT. After 
25 years, all the members of the NPT voted to extend its 
restrictions. So there should be measure and mechanism for 
extension of the timeline.
    If you look at this agreement, the restrictions that it has 
on the plutonium are actually quite sound because they are 
permanent in nature. It tends to be more permanent and 
intrusive on the plutonium route than it is on the enrichment. 
Enrichment has always been the most important Iranian path 
forward.
    Finally, I agree with what David and Jim have said. There 
is no tolerable outcome to this than a negotiated settlement, 
which is why we should be very careful about the type of 
settlement we negotiate.
    Senator Flake. Mr. Walsh.
    Dr. Walsh. Senator Flake, I think a lot of different things 
could happen, and the question is, which are more likely?
    Now some of the evidence for what to expect we have in 
history. In 2005, those negotiations broke down, and Iran went 
from 164 centrifuges to 19,000 centrifuges. And it went from 3 
percent enrichment to 20 percent enrichment.
    So a lot of it depends on how the thing breaks down. If it 
breaks down and Iran is blamed, that is one scenario. If it 
breaks down because people perceive the United States has been 
the obstacle, that is another scenario.
    But I am guessing that if the thing breaks down, Congress 
is going to move to impose sanctions, which is totally 
understandable, and I would support that. But the enemy gets a 
vote. So when it breaks down and you impose sanctions, they are 
going to respond, which has been the game back and forth, each 
side shoveling and digging deeper. I, certainly, hope that we 
avoid that.
    I do not think war is inevitable, but I think the use of 
military force, the probability of that does increase, right? I 
mean, we have people calling for bombing today, in the middle 
of a negotiation. Certainly, those voices will grow louder if 
Iran pulls out and we go back to trying to beat each other with 
sticks.
    So I do not think it is a guarantee, but I think we should 
be aware that it is among the possibilities.
    Senator Flake. Thank you, Mr. Chairman.
    The Chairman. Senator Kaine.
    Senator Kaine. Thank you, Mr. Chairman.
    Thank you to both of you for doing these hearings. I think 
they have been very, very valuable. Obviously, when we embraced 
in the committee and in Congress the Corker-Menendez-Cardin 
review process, the important thing is to not prejudge. We 
actually have a path where we can procedurally dig in and then 
judge a deal, so we need not prejudge based upon hearing one 
statement or the reporting of one particular item.
    But because the timeline we will be on will be an 
aggressive one, these hearings will help us get our own mental 
centrifuges turning, so that we will be able to address the 
issues with the depth that they need. I appreciate the fact 
that we have had these hearings.
    I have been asking witnesses this question during the 
hearings, and I would be curious as to your views: Has the 
period under the JPOA since November 2013 been better than the 
status quo ante?
    Mr. Albright. I think it has been better. It froze many 
things. It did not freeze everything. There has been growth in 
the program, the stock of low enriched uranium 3.5 percent has 
gone up. Centrifuge R&D has advanced. There have been some 
problems and questions of compliance by Iran. But overall, I 
think it has been a positive development and provided time to 
negotiate a long-term deal.
    Dr. Takeyh. I will just say one thing. JPOA has two 
particular components, the restrictions that David talked about 
and the salutary nature of those restrictions. But those 
restrictions were purchased by two concessions that the United 
States made. Number one, acknowledging Iran's right to enrich 
and accepting that that enrichment capacity will at some point 
be industrialized.
    Since the advent of atomic weapons, it has been the United 
States policy across 70 years that we are against proliferation 
of sensitive nuclear technology. Sensitive nuclear technologies 
are identified as reprocessing plutonium and enriching uranium. 
As a pathway to restricting proliferation of technologies in 
the 1960s after China detonated, we established the 
multilateral framework called the NPT.
    After India detonated in 1974, we established the nuclear 
supplier group, an attempt to restrict other countries having 
indigenous fuel cycles. When the Shah of Iran tried to have an 
indigenous fuel cycle by enriching uranium, the Ford, Carter, 
and Nixon administration before that prohibited him from doing 
so. That is why he went to the French.
    So it has been a steady American policy that we are 
against----
    Senator Kaine. No, I understood all that before you 
answered the question. I want to make sure I understand your 
answer.
    I think your answer is that between November 2013 and now, 
existing under the JPOA has had some positive effects but you 
are predicting that down the road there could be an 
industrialization of this program at some point in the future, 
because of a concession that was made as part of the JPOA?
    Dr. Takeyh. I am not predicting it. Every Iranian official 
is saying it.
    Senator Kaine. But we have not seen it today. You are 
saying that this is something you think will happen at some 
indeterminate time in the future.
    My question was, from November 2013 to today, have what we 
seen under the JPOA been better than the status quo ante? And I 
think your answer is to today, yes, but down the road, there 
may be some----
    Dr. Takeyh. Well, I think my answer is, on the specific 
operation of the entire program, there have been some 
restrictions and restraints built in which have been useful. In 
terms of the purchase price of those restrictions, namely 
acknowledgment of enrichment capacity and acknowledgment of 
industrialization----
    Senator Kaine. Those could lead, down the road, to some 
significant----
    Dr. Takeyh. Those are titanic concessions in the history of 
the United States.
    Senator Kaine. Dr. Walsh.
    Dr. Walsh. I do not think this is a hard question.
    Senator Kaine. I do not either. I do not think Prime 
Minister Netanyahu thinks it is a hard question.
    Dr. Walsh. Remember, it was the Prime Minister who said 
this was the worst deal in history and invokes Chamberlain and 
the sky was going to fall, and now it is Israel that wants to 
see the JPOA extended.
    I think we got our number one nonproliferation issue, 20 
percent. Did they get their number one sanction relief issue? 
No, they did not.
    Senator Kaine. Well, let me just say, I met with the Prime 
Minister in his office in February 2014, and he said the 
negotiation was a historic mistake. And when we met with him 
again in January 2015, not only the Prime Minister but others, 
they grudgingly acknowledged that, well, maybe JPOA was not 
such a bad idea. Now, they had huge concerns about future 
developments of the kind that Dr. Takeyh mentioned, and I think 
we have concerns about as well.
    The reason I ask that question is to set up my next 
question. I am following up on some things that Senator Flake 
asked about. I also do not believe that the options are a deal 
that we think is a great deal or war. I think that is a false 
choice. There is just some Washington rhetoric in that, and 
people are trying to negotiate using that. I do not think those 
are the options.
    One option is if there is not a deal, I do think the risk 
of military action increases. I do think that is the case. But 
one option is both sides go back to their corners. We increase 
the pressure of sanctions, and Iran makes their own decision. 
The enemy gets a veto. They can do what they want.
    But another option that I have heard discussed, and the 
Israelis put it on the table when I spoke with them in January, 
is continuing to live under the JPOA for some period of time. 
For example, if there are terms that either they will not 
accept or we will not accept, for example, if we cannot inspect 
military facilities, we would say, well, no, that is not an 
acceptable deal.
    Is that a realistic option? We might think it is an 
acceptable one. But I do not know, from the Iranian standpoint, 
is that a realistic option that until we find a deal, we could 
continue to live under the terms of the JPOA with the provision 
of modest release of escrowed funds in exchange for Iran 
continuing to operate under the restraints that have been 
generally viewed as salutatory, at least at the present?
    Mr. Albright. I think it is workable. I mean, it is not 
desirable, but from the United States point of view, what I 
have always heard is there is worry about the covert side, that 
the Joint Plan of Action really does nothing on the whole 
question of undeclared activities. So you have to worry about 
that.
    Senator Kaine. So that would be a weakness.
    Mr. Albright. And genuine worry about whether U.S. 
intelligence can catch something. They have been pretty good 
with Iran, but they do not know everything by any means.
    Can I add one thing on the previous question? I think one 
of the important things Congress can do is to clearly state 
that Iran does not have a right to enrich. I think the 
administration agrees with that. I have heard Wendy Sherman 
testify to that, I think in front of this committee, that there 
is no right to enrich under the NPT, and we should not give 
that up.
    We should also recognize that this new norm that has been 
established of countries violating agreements, being able to 
enrich even when they do not need it. And that is one of the 
things that the Lausanne deal shows. Iran has zero need for 
enrichment, yet it gets to enrich in a region of tension after 
violating all kinds of agreements.
    So I think it is a very dangerous norm, and I know 
negotiators are aware of that. But I think that there is a need 
to think through that and what it could mean in terms of others 
deciding to do the same thing, and the United States being in a 
weakened position to stop it.
    Dr. Walsh. May I briefly respond?
    Senator Kaine. Mr. Chairman, is that okay?
    The Chairman. Sure.
    Dr. Walsh. I would say it is a theoretical possibility that 
would be a lot better than some of the other alternatives. I 
wonder if it is a political possibility. I wonder if Congress 
would be willing to go along with that.
    I wonder if Rouhani would be willing to go along with that 
because each day he grows weaker as critics say, look, he gave 
in, he sold the store. At some point, he may feel compelled to 
withdraw rather than continue to take that sort of heat, 
because he will be caught in a no person's land.
    On right to enrich, the JPOA does not say that Iran has a 
right to enrich.
    And as far as Iran's future plans, they have said that they 
plan to expand. I do not take a lot of Iranian statements at 
face value. They said that they are going to build 12 nuclear 
power plants 10 years ago. They have not done it. Lots of 
countries in the region make grand plans. I think we have to 
plan for that as a possibility, but I do not think it is a 
guarantee that that is what is going to happen.
    I think actually causing them to pause may take some air 
out of the balloon.
    Dr. Takeyh. If I could say one thing, JPOA acknowledges the 
practice of enrichment, if it does not acknowledge the 
principles. If that makes you feel better, then that makes you 
feel better.
    So the United States does not acknowledge it has a right to 
enrich. That is not what we do. But in JPOA, we respected 
Iran's continued enrichment activities irrespective of 
violations of Security Council resolutions.
    Number one, whether they industrialize or not, that is what 
they say they are going to do. Everybody, if you show me one 
single Iranian official that says we are not going to 
industrialize, I would like to see who that is.
    Now, you can say they are all lying. And if that makes you 
feel better----
    Senator Kaine. You are making a strawman argument. I did 
not say that. I asked you a simple question, and you were 
asking my question and another one. That is great, but it just 
was not the question I was asking.
    And I am not maintaining that they are not going to 
industrialize.
    The Chairman. If I could, I will briefly interject.
    There is this document, and the political agreement that 
came out on April 2 referred to it. It is the Iranian nuclear 
development program.
    I think once we read it, my sense is, and I could be wrong, 
I think it will acknowledge, in fact, what Ray is saying. And 
that is that they are going to industrialize, and it lays out 
the pathway toward doing that.
    So I believe that to be correct today.
    Senator Kaine. But I was not challenging that. I was 
asking----
    The Chairman. But I will say that I did feel like it was 
glossed over to a degree.
    I think it is acknowledged that after year 10, they are 
geometrically going to be adding centrifuges. I think that is 
what led to the President's comment on NPR that, in year 13, 
there would be zero breakout.
    Jim, you are the optimist.
    Dr. Walsh. I am just skeptical. I studied the Middle East a 
long time, and I have had a lot of countries come out and say 
they planned to build nuclear infrastructures and nothing ever 
happens.
    The Chairman. No, they have built infrastructure.
    Dr. Walsh. And the Iranians have done more than their 
compatriots. But they have also said that they were going to do 
a lot of things they did not do in this nuclear arena.
    So, yes, a prudent policymaker should plan for that, that 
that might happen. But I would not say it is a guarantee. Ten 
years, 15 years is a lifetime in a nuclear weapons program 
where a lot of things can happen.
    The Chairman. Ten years is not a lifetime in a country with 
a 5,000-year history. I would say they have gone through a 
whole lot of pain if they are not planning to do that. It is 
not a rational process. So you would think that they are 
probably going to industrialize, especially I think when we 
read this document, which lays out what their program will be.
    I would just say one more thing. I am not understanding the 
right to enrich piece, stating it versus the practical: We are 
saying they have the right to enrich. We are, by virtue of the 
actions of the JPOA, and, certainly, what this agreement is 
going to say: They are going to be enriching uranium, are they 
not?
    Mr. Albright. Yes, I am the one who has argued for it. I 
think I understand the difference. But I think it is important 
for the United States to not concede on this, because if there 
is going to be industrial development in Iran, it has no 
practical need. There is no practical need for them to enrich 
uranium.
    I think we need to strengthen our hand to oppose it and to 
say upfront that any movement in that direction is a violation 
of the intention of what is intended for this deal. It is not 
going to be in the deal. I wish it would be in the deal.
    But I think we need to strengthen our hand in order to 
fight that development, which I do not think will be needed at 
all and could pose the basis for Iran getting nuclear weapons.
    Let me just add one thing. I think it is even worse. I 
mean, this was a very big disappointment to me in the Lausanne 
agreement. The prohibition on making 20 percent disappears in 
year 15, and I was told by people in the negotiations that Iran 
said we intend to go above 3.67 percent. So we are back to 
where we were but with many more centrifuges, more advanced 
ones.
    So I think it is incumbent upon us to head off that future 
and not to accept it. I would argue to strengthen our hand to 
make those arguments.
    The Chairman. Thank you.
    Senator Perdue.
    Senator Perdue. Thank you, Mr. Chairman.
    Dr. Walsh, as a freshman Senator, I can tell you one thing. 
Just relax. You are an amateur. You will never compete for the 
world record of forgetting to turn on your mike. [Laughter.]
    Dr. Walsh. Thank you. Makes me feel much better.
    Senator Perdue. The second thing is, I agree with you and 
the ranking member and Senator Flake, Senator Kaine, and others 
have said this. I have an open mind to this negotiation.
    We do not know what we do not know yet. It has not been 
fully released. It is not finalized, and so forth.
    But I do not think, and I think Senator Kaine hit on this, 
these hearings have been very helpful for us to get our heads 
wrapped around, or a mental centrifuge as you say--I like that 
and have not heard that before--to think about this in terms of 
what we feel like are the minimum requirements.
    I am impressed with the testimony today. Very impressed. We 
were told just yesterday that there are two ways that Iran is 
going to potentially develop a nuclear weapons capability. One 
is through just waiting us out through a 10-year deal, as we 
just we were discussing. And the second is through a covert 
exercise.
    So we have inspections and verification to enforce the 
rules of negotiation, whatever it turns out to be. So we all 
know we have to have a verification regime.
    The second is intelligence. We heard yesterday that we do 
not have a high confidence level right now that our 
intelligence capability is such that it can actually deter 
that. We have evidence of that. I mean, Fordow was created and 
in operation for years before we discovered what they were 
doing there.
    We also know that today Iran is in violation of the current 
inspection regime. We just discussed that. I want to talk about 
the State Department but before I do that, just this weekend on 
Sunday, Iran's Parliament approved the outlines of a bill--this 
is formal now; this is not just a comment by the Ayatollah--to 
ban inspections on military sites and require the lifting of 
all sanctions under any nuclear deal. This passed 199-14. I 
have two questions. I want to know who the 14 people are. 
[Laughter.]
    Exactly. Who are those 14? I would like to recruit them to 
the Republican side.
    But in all seriousness, in backing that up, the Ayatollah 
made a speech just Sunday on Iranian state television to demand 
that sanctions be lifted before Iran dismantles any of its 
nuclear infrastructure.
    Combine that with the evidence that we now have. We have a 
report.
    And the other thing that is coming out of this is that this 
is not a static situation. It is a dynamic situation. If we 
really want to achieve the goal of not allowing Iran to become 
a nuclear weapon state, not now and not in 10 years, not ever, 
then this has to be an ongoing thing past 10 years. It has to 
be a dynamic situation of inspection, verification, and 
intelligence efforts to make sure that they do not do this.
    So one of the things that we have to rely on as the Senate 
are reports back to us. I think this agreement right now, the 
bill, the Corker-Menendez-Cardin bill, has in there that the 
State Department reports back to us I think every 6 months.
    And yet we have a GAO report here just released in May 2015 
and its nonproliferation, the State Department should minimize 
reporting delays that may affect sanctions on trade with Iran 
and North Korea and Syria. So they are not just talking about 
Iran.
    In the reports that they have been providing to us over the 
last 6 years, they average 22 to 36 months delays in an 
environment where we are all in agreement that 36 months can be 
a lifetime.
    I am very concerned about our ability to keep up with what 
we are learning as a government with regard to Iran.
    Dr. Takeyh, would you respond to that and give me your 
observations? I would like all of you to give me a brief 
response to this trust that we are now having. The State 
Department is basically saying in the GAO report that there are 
certain things like political concerns and other delays that 
might delay the process in notifying Congress. But I personally 
find that unacceptable, as does the GAO.
    I would love your response to this idea of an ongoing 
involvement in this and the dependency we have on any State 
Department, whether it be this administration's or any to keep 
us involved.
    Dr. Takeyh. I would say, in terms of any arms-control 
agreement, there are two aspects of it. There is verification, 
and people have talked about verification. But there is also 
enforcement. Verification is a burglar system. It tells you 
there is a burglar in your house. The question is what you do 
about it.
    Historically, arms control agreements have been difficult 
to enforce. I mean, as this committee knows, the Russian 
Federation has been in violation of the IMF agreement for how 
many years? Historically, that is not unusual, by the way. The 
international community becomes invested in the agreement.
    There are two types of violations that arms-control 
specialists talk about, and Jim and David can talk about this 
more authoritatively. One is simple irregularities and small-
scale violations, which they tend to resolve through 
adjudication. This arms-control agreement will have what every 
other one has, a verification and compliance committee.
    The second is material breach, so when do you say we have 
to get out of this. It almost never gets to material breach 
because there so many international actors invested in 
perpetuation of the agreement. And the argument at that time 
will be, if you walk away from this agreement, they are going 
to go from 200 centrifuges to 25,000 centrifuges.
    It is an unfortunate talking point. The first time I heard 
it was in 2007 in Shahbaz Sharif's office. He told me that. 
That is the first time I heard it. We should not appropriate 
that, because they paid a heavy price for that.
    Finally, I would say that this agreement can be measurably 
improved if they address the issue of the sunset clause. I have 
never seen anybody defend a sunset clause. Mr. Walsh, not 
Senator Kaine, my dear friend Mr. Walsh, did not actually 
defend the sunset clause. He said that they are not going to do 
it, afterward.
    So I would say there are things you can do to improve the 
agreement. But actually enforcing an arms-control agreement, we 
have about 50 years of experience with this. It is very 
difficult to do. Remobilization of the international community, 
reconstituting any kind of sanctions regime, establishing a 
military deterrent, I think that is--this agreement should not 
be violated.
    And Iranian violations always tend to be incremental and 
never egregious, so a series of cascades of violations could 
actually lead them to increase their capacity without 
significant punitive measures.
    Finally, I say this, if you look at the Islamic Republic's 
foreign policy for the last 35 years, they have what we 
sometimes call a crisis approach. They push, they push, they 
push, they push, and they retreat. The idea is that as you 
push, once you retreat, you still have derived some dividends.
    So that is how they kind of approach their foreign 
relations. And if that is how they approach their nuclear 
program, then it does not auger well for its longevity, much 
less its viability.
    Senator Perdue. Thank you, Mr. Chairman.
    The Chairman. Thank you very much.
    Senator Menendez.
    Senator Menendez. Thank you, Mr. Chairman. This is a very 
important hearing.
    I want to follow up on a series of things, and so I am 
going to ask you to cooperate with me in terms of how much I 
want to get in here.
    Let me start off with you, including my dear friend from 
Virginia's very often refrain that, ``aren't we better off 
under JPOA?'' I think there is a follow-on question to that, 
and I want to ask that in a moment.
    I want to read from something you said, Mr. Albright. I 
just want to make sure you have not changed your mind on it. 
You are referencing the question of the nuclear fuel that was 
increased by 20 percent, and you went on to say, ``Based on the 
IAEA's reporting to member states, the problems in making 
enriched uranium oxide were apparent by the fall of 2014. But 
the administration decided not to make a major issue about the 
lack of oxide production.'' You go on to say, ``Concluding that 
Iran has met the Joint Plan of Action condition to convert to 
oxide newly enriched up to 5 percent, is incorrect. In this 
case, the potential violation refers to Iran not producing the 
enriched oxide at the end of the initial 6-month period of the 
Joint Plan of Action and again after its first extension. The 
choosing of a weaker condition, which must be met, cannot be a 
good precedent for interpreting more important provisions in a 
final deal. Moreover, it tends to confirm the view of critics 
that future violations of a long-term deal will be downplayed 
for the sake of generating or maintaining support for the 
deal.'' And finally, it says the administration relied on a 
technical remedy that Iran has not demonstrated it could carry 
out.
    Is that still your view?
    Mr. Albright. It is.
    Senator Menendez. So we basically have a violation of the 
agreement. For some of us, it is not insignificant. It seems to 
get explained away, and it sets a dangerous precedent, from my 
perspective, of what we are looking at as we try to build 
confidence in whatever final agreement that takes place.
    And when we are relying on technical remedies that Iran has 
not been able to show can be successfully used in order to meet 
the verification and the reductions that we want, we are in 
trouble.
    Let me ask you something else. With reference to the 
possible military dimensions, you said, ``Whenever confronted 
with Iranian intransigence, they fold. It is going to be hard 
for a lot of people to support this deal if they give in on 
past military dimensions. Addressing the IAEA's concerns about 
the military dimensions of Iran's nuclear program is 
fundamental to any long-term agreement. An agreement that 
sidesteps the military issues would risk being unverifiable. 
Moreover, the world would not be so concerned if Iran had never 
conducted weaponization activities aimed at building a nuclear 
weapon.''
    Is that still your view?
    Mr. Albright. The part on the fold, I said that right after 
Secretary Kerry had made his comment. The administration came 
to me subsequently and said that they had not changed their 
position, but the rest----
    Senator Menendez. We are trying to figure out what the 
position is.
    Mr. Albright. The rest of what I said I agree with.
    Senator Menendez. Someone else, the former deputy director 
general of the IAEA, Olli Heinonen, said: ``Without addressing 
those questions, the possible military dimensions, that the 
IAEA Secretariat would not be able to come to a conclusion that 
all nuclear material in Iran is in peaceful use, which is 
essential in building confidence in the international community 
over Iran's nuclear program. A comprehensive deal can only be 
reached if uncertainties over Iran's military nuclear 
capability are credibly addressed. This should be an 
unambiguous condition to achieving a final accord that is 
meaningful in safeguard terms.''
    Now, this was the number two at the institution on which we 
are overwhelmingly relying, if we have an agreement to largely 
do the verification and the ultimate determination on the 
question of possible military dimensions.
    Dr. Takeyh, is that something you would agree with? His 
assertion?
    Dr. Takeyh. As I mentioned, in my testimony, Senator 
Menendez, I think the resolution of the PMD issue is 
indispensable to the viability and credibility of this 
agreement.
    Senator Menendez. Now, let me ask you something. I was 
taken aback when I read in the interim framework agreement 
that, as it relates to Iran, they would implement the modified 
code 3.1 to its existing IAEA safeguard agreement, in essence, 
the additional protocol. However, as with the additional 
protocol, Iran may only be required to abide by, as opposed to 
ratifying, the additional protocol.
    To me, that is problematic, since Iran is the only NPT 
signatory to have suspended these measures in the past. Should 
we accept an agreement in which Iran is not required to ratify 
the modified code of the additional protocol?
    Mr. Albright. I thought they would be required to ratify 
it.
    Senator Menendez. That is what we thought. But if you read, 
so far, it says that they will abide by it.
    So, should a final agreement not say that they must ratify 
it?
    Mr. Albright. I would think ratify. That needs to be 
checked. That is a good question.
    Senator Menendez. What about you, Dr. Takeyh?
    Dr. Takeyh. My understanding is that one of the deputy 
negotiators has said that compliance to additional protocols, I 
think he was talking about that, 3.1 as a conjunction of that, 
would only come about if there is ratification. If there is no 
ratification then I guess they go back to the fallback position 
of adherence pending ratification.
    Now, I do not have a whip count in the Iranian parliament. 
I cannot tell you if they are going to ratify it or not. But 
the full compliance would have to be with ratification.
    Senator Menendez. And compliance for us should mean 
ratification as well, should it not?
    Mr. Albright. Yes.
    Dr. Takeyh. Yes.
    Senator Menendez. Now, let me go to my esteemed colleague's 
question. He asked a good question, are we better off now with 
JPOA than we were.
    The question for me is, what are we going to be better off 
with in the long term? And in that respect, I look at a letter 
that was just released by five former members of President 
Obama's inner circle of Iran advisers, who wrote to him and 
they said, ``Precisely because Iran will be left as a nuclear 
threshold state and has clearly preserved the option of 
becoming a nuclear weapon state, the United States must go on 
record now, that it is committed to using all means necessary, 
including military force, to prevent this.''
    Is it not essential for us to be able to make it clear that 
even after the expiration of the agreement with Iran that we 
would not permit it to possess enough nuclear fuel to make a 
single weapon?
    Mr. Albright. I think it is very important. I mean, the 
JPOA, there is a clause in there that the nuclear program 
should be judged as under criteria of practical need. I think 
it has been lost in this whole negotiation, but I think it is 
fundamental.
    Iran does not need a centrifuge program. It does not need 
it today. It is very unlikely to need it 15 years from now. If 
it can demonstrate that it needs it, then okay. But if not, 
then that program should not be accepted, and the United States 
should be clear that it should not be accepted.
    Senator Menendez. Mr. Chairman, can I have one final 
question?
    The Chairman. Of course.
    Senator Menendez. So this is what I am concerned about, is 
where we are headed on all of these elements, as to any final 
agreement. And then we can make that judgment, are we truly 
better off?
    I probably would not dispute with my colleague that, in the 
interim, to the extent that we have stopped forward progress, 
we are better off. It has bought us time. But by the same 
token, what is the long term?
    Several witnesses have come before the committee and 
basically said, look, we are not solving the problem, we are 
delaying the problem, at the end of the day. That is 
aspirational, that the regime is going to change its mind over 
the next decade and move in a totally different direction.
    My last concern, in January 2014, the U.S. Government 
Defense Science Board issued a remarkably frank report entitled 
``Assessment of Nuclear Monitoring and Verification 
Technologies.'' Their conclusion was pretty shocking to me.
    They concluded that the U.S. Government tools are either 
inadequate or, more often, do not exist for a list of current 
challenges that read like the challenges that will be posed by 
an agreement with Iran.
    I do not know if you have had the opportunity to read that 
report, but is it your professional experience that we have a 
capacity, now, to deal with all of the elements of what is 
envisioned in an Iran agreement, to make sure?
    Mr. Albright. I think there are always limitations in 
intelligence. If you look at many proliferation cases, you 
cannot just depend on intelligence for timely detection. That 
is, in fact, why people in this country, around the world, 
invest so much in the IAEA. In a sense, they are the boots on 
the ground, and you want to empower them to get the information 
that can then detect a violation. They have proven that ability 
over and over again.
    I think in this deal, they are critical. Certainly, they 
work synergistically with member state intelligence agencies, 
and the intelligence agencies benefit tremendously from the 
results of the IAEA.
    But I think you cannot depend on intelligence to verify 
this deal. I mean, I think the U.S. intelligences has done a 
remarkably good job in discovering secret programs in Iran. I 
think the IAEA was able to use that information gained in some 
cases from Iranian defector groups in order to, on the ground, 
press Iran really hard to reveal secret activities and in that 
sense stop them where the intelligence information was 
incomplete but had no power really to stop the Iranian movement 
forward on their nuclear program. But the IAEA confronting them 
on one lie after another in a 2003 was a very powerful tool.
    So you do need them fully empowered verifying this deal.
    Senator Menendez. Thank you.
    Mr. Chairman, I do not know if we are going to have any 
more briefings along the way, but I would commend to your 
attention this Defense Science Board report; it is about a year 
old. Maybe a lot has changed in a year, but if you read the 
report, it leaves you with real concerns about what our 
abilities are to do a lot of what we are expecting in any 
framework agreement.
    Thank you for the courtesy.
    The Chairman. Thank you. And thanks for your very good 
questions and, certainly, years of focus on Iran's nuclear 
program.
    Just to close out, I think there may be some additional 
questions. We have had some interesting briefings, and they 
have been incredibly well attended, especially the private 
ones. The discussion has been pretty fascinating.
    But if you look at where we are--we will see when this is 
all over. Ray you said some things today that probably cannot 
happen because we have already gone beyond. You talked about 
some of the qualities of an agreement that should be included, 
but I think we have sort of moved beyond those.
    In essence, it looks like we could have a 10-year agreement 
where during that 10 years Iran can continue to do the research 
and development they wish on centrifuges. I want to get back to 
that in just a second.
    They also have the ability to continue to develop their 
already well sophisticated ballistic missile program. And then 
after that 10-year period, it appears, based on what we know 
today, it appears that it is likely that their whole program 
will hugely progress.
    So we are going to be faced with a qualitative decision 
about whether a 10-year pause is worth giving up probably 20-
years-worth of sanctions that have been put in place. That is 
going to be an interesting decision, I think, for most to make.
    Is it your sense that within Iran the thinking among the 
people that matter within the country do view this as simply a 
10-year pause, and to quote one Senator, these were private 
meetings, that instead of a very poor country achieving nuclear 
weapons capability, we will now allow a very rich country to do 
that, because we have will have alleviated all of our 
sanctions, possibly, in the next 10 years. So you have a 
country whose economy is growing, $150 billion in relief will 
have taken place. They are exporting the extra 40 percent that 
has been diminished relative to their oil.
    Is it your sense within the country that they do see this 
as simply a 10-year pause, and that they really are getting 
everything that they wish? And 10 years is not a long period 
for a country like Iran, and they are going to be sitting in a 
place that virtually assures them being a threshold country.
    Mr. Albright. Ray, you go first. I have some comments.
    Dr. Walsh. Mr. Chairman, what I would like to do is 
respectively offer an alternative view.
    I know this committee is steeped in the details of this 
agreement, but folks watching on TV or online might not fully 
understand that the agreement entails restrictions that are 
indefinite in some cases. Ray referred to the fact that if you 
redesign the reactor, you cannot go in after it is hot and 
change it. Shipping out the spent fuel. The additional protocol 
I believe will be in perpetuity. The NPT obligations continue 
in perpetuity. The subsidiary code 3.1 continues in perpetuity. 
Access to mines for 30 years. Other things for 20 years.
    It is true that some of the important restrictions are only 
10 or 15 years, and 10 years is not a long time in Iranian 
history. But it is a long time for a nuclear program. That is 
the difference.
    Often in these programs, the more you stretch them out, the 
likelier they are to die. And I say as a summary thing here, 
the DNI tells us that Iran has a nuclear weapons capability. 
You cannot bomb the knowledge of how to build a centrifuge out 
of their heads. That horse has left the barn. That is the 
situation we deal with.
    The DNI has also said that they have not yet made a 
decision to pursue nuclear weapons. It seems if they have the 
capability and they have not decided that now is the time to 
lock them into a road where they become like the other 30 
states that started down the path toward nuclear weapons, 
stopped and reversed course, part of this incredible record of 
success that I refer to. Now is the time to do that to put them 
on a path, rather than the alternative, which is more 
centrifuges, the hardliners are emboldened. That is a path 
toward nuclear, in my view.
    The Chairman. Thank you.
    Mr. Albright. Let me make a comment. I think 10 years, to 
me, is not long enough. I mean, in engineering, it may be a 
generation, but you can pass down the knowledge in that. Twenty 
years would have been much better.
    Iran also made a decision. I think you see this in what 
Salehi brought to the negotiations, that they were willing to 
sacrifice the IR1s, but they were not willing to sacrifice 
their work on advanced centrifuges. They paused the work on the 
IR2M and the IR4, but they were going to continue working on 
the better machines. And they are incrementally better.
    The Chairman. The IR6 and the IR8, generations after that.
    Mr. Albright. That is right. So one of the concerns I have 
is what if they succeed with those machines. I know in the 
discussions by the U.S. administration, and I have heard it 
from another country, they have kind of downplayed it. They 
will not get these machines to work. But what if they are?
    What you would have is not a crazy scream by Iran to say, 
look, we started with these IR1s. We built zillions of them. 
They worked very poorly. Incredibly expensive. We are now 
retrenching to build much better machines and be able to deploy 
those after this 10-year period.
    So I think it is worrisome. That is all I can say. And if 
Iran fails, great, from our point of view. But if it succeeds, 
then I think we have a real problem.
    The Chairman. Ray.
    Dr. Takeyh. I will just a few things. If you come up 
thinking about the political discourse and political landscapes 
in the Islamic Republic's elite sectors today, and you see this 
since 2011, the primary priority of the state today is 
projection of power in the Middle East.
    Khomeini today is the most successful imperialist in the 
history of modern Iran. The Shaw never had control of the Iraqi 
state and the deep state, that sort of influence.
    He never was a material player in Syria. As a matter of 
fact, the Assad regime was resistant to him. Khomeini is 
probably the most important external actor in Syria.
    Previous Iranian regimes were never main players in 
Lebanon. Through Hezbollah, Iran has the ability to manipulate 
Lebanese politics as well as a lethal militia it can deploy in 
various war fronts.
    And, of course, in the Persian Gulf, the battered alliances 
of the United States make that particular subregion a bit more 
susceptible to Iranian subversion.
    Imperialism is financially costly. The economy of 2013 
could not have sustained the imperial surge that Iran has 
embarked upon. So in terms of national priority, whether 
expansion of the nuclear capacity or projection of influence in 
corners of the Middle East where Iran had never had any power, 
I think outweighs the latter.
    So right now the priority of the state is threefold. Number 
one, consolidation of the regime at home, in light of the 2009 
Green Revolution, which I think continues to haunt the Islamic 
Republic. Number two, consolidate and make the economy more 
resilient to be able to sustain this vast imperial surge, which 
gives Iran a measure of expansionist influence unprecedented in 
500 years of Iranian history.
    The Chairman. And this agreement, certainly----
    Dr. Takeyh. This agreement enables both consolidation of 
power at home, the imperial surge in the region, as well as 
establishes a pathway for industrialization upon which they can 
decide whether they have a nuclear weapon or not.
    The Chairman. So if I could paraphrase, it allows them to 
meet their shorter term goals of consolidation.
    Dr. Takeyh. It allows them to exploit remarkable 
opportunities they have in the region.
    The Chairman. And still reach their longer term goals of 
being a nuclear threshold country within a short amount of 
time.
    Dr. Takeyh. Yes, that is right.
    The Chairman. If I could, I know that Senator Coons has 
just come in, and I, certainly, want to give him time for 
questioning.
    There was a letter by a distinguished group of people 
yesterday that was released, people on both sides of the aisle 
that have served under the administration and obviously served 
under others. They are, certainly, people that I think are 
respected in our country.
    They mentioned five issues that need to be addressed, 
certainly, in these closing days. The monitoring and 
verification piece, which we spent a great deal of time talking 
about here and exploring; the possible military dimensions, 
which today we discussed fairly thoroughly; and advanced 
centrifuges. Again apparently there still may be room to limit 
the amount of advanced centrifuge research and development that 
takes place. We have not seen that, but maybe that is an area 
that is open. Sanctions relief, obviously ensuring that 
sanctions relief does not occur until they have actually done 
the things that need to be done to provide that.
    But the consequences of violations is something that as we 
move into potentially dealing with an agreement, I would just 
say to members on both sides of the aisle, maybe that is 
something that if an agreement is reached, Congress needs to 
speak with strong support toward real consequences.
    We had a very controversial briefing. One of our witnesses 
suggested going ahead and authorizing the use of military force 
in the event they violate. Obviously, as you can imagine, there 
was a lot of debate around that issue. I am not necessarily 
suggesting that that is the right consequence today. I am just 
saying, that debate, I think, should be a part of whatever we 
do, should an agreement be reached. But I'm obviously very 
concerned.
    With that, Senator Coons.
    Senator Coons. Thank you very much, Mr. Chairman. Thank you 
for the many hearings and briefings that you and Ranking Member 
Cardin have convened and led us through. I think this is 
critical for the Foreign Relations Committee, its members, and 
the rest of the Senate, to be well-informed, particularly in 
these last days or weeks, in the conclusion of a possible P5+1 
agreement with Iran.
    I will take up where you were just leading this bipartisan 
letter that raises five key issues. There are two I will talk 
about, consequences of violations and the possibility of a 
future breakout of the role of centrifuge R&D, and see if we 
can get some more insight from our terrific panel.
    If I could, Mr. Albright, on snapback sanctions, there is 
reported possibly an agreement between the P5+1, in terms of 
the mechanism by which sanctions would be reinstated if Iran 
violates a final agreement, should one be reached, and exactly 
how a dispute resolution panel would work and how it would be 
composed and so forth has been discussed in the press. I would 
just be interested in your assessment of the strength or 
weakness of that proposed mechanism, and any suggestions you 
might have for improving it, and what other ways you think we 
might bolster our leverage to pressure Iran in the event of 
future noncompliance with a potential agreement.
    Mr. Albright. I am by no means an expert on sanctions. My 
own view, and I have heard this from people who are experts in 
other countries' negotiation teams, the snapback is pretty good 
as a deterrent, but if it actually is invoked, it is not very 
likely it will significantly affect Iran's behavior.
    So you do not really have a mechanism to enforce. And the 
lack of that, not to throw it back at you, I think is a major 
challenge for Congress to think through what happens if there 
are material breaches.
    I can understand. I guess going to a military option is an 
attempt to short circuit that issue. I do not think it is 
sufficient, by any means, to throw out the last resort as your 
only resort, or throw it out on the table, not to get rid of 
it.
    But I think it needs to be thought through. I do not have 
any good suggestions, I must confess. I think one of the areas 
to also worry about is how they are going to take away the U.N. 
Security Council sanctions and then bring back a lot of them, 
and then how do you then snap that back? Maybe there is an easy 
mechanism to do it, but I think it does need to be thought 
through.
    The other thing is that with Iran, the way it has been 
played out the last many years, with the exception of Fordow, 
they have tended to go with small violations. And there is no 
mechanism other than the political mechanism of the United 
States going to Iran and saying stop that is really on the 
table. And I think that also has to be thought through, because 
sometimes we know it works. On the IR5, the United States went 
to Iran and said knock it off, and they did.
    But on the PMD, everyone has gone to Iran outside of Iran 
and said knock it off. And they have simply ignored it.
    So I think that again also has to be one issue that is 
thought through.
    Senator Coons. Mr. Albright, on this point, if I might, I 
agree with you that a lack of clarity on exactly how U.N. 
sanctions would be restored in a way that would not allow a 
veto by one of the primary U.N. Security Council members as a 
future barrier is one of the, I think, key unresolved questions 
about snapback for the U.N. sanctions. It is my hope that the 
mechanism adopted, if this all takes place, by the U.N. 
Security Council in a replacement resolution would allow for a 
more streamlined consideration of that.
    And I would agree, we have a wide menu of sanctions, both 
U.S. and multilateral and U.N., that need to be clearly 
articulated and put in place in a gradual way that gives us a 
series of responses. But if there is a determination by the 
Iranians to break out or sneak out, having those snapback 
sanctions may not be sufficient deterrent.
    Let us get to the future breakout for the few minutes I 
have left. There are competing assertions in the press and the 
public by advocacy groups and the administration.
    One assertion is that this agreement, should it come to 
pass, will leave Iran with a zero breakout time when roughly 15 
years expires, and that they will get to a place where it will 
be virtually impossible to detect the breakout, in large part 
because there are projections about future centrifuge R&D and 
the potential strength and speed and capacity of their 
centrifuges 10 to 15 years from now.
    The counternarrative that is being offered by the 
administration and others in support of this agreement say the 
continuous inspection of their centrifuge production facilities 
and uranium mines and mills for 25 years, and the additional 
protocol, which it is presumed Iran will adhere to, will 
provide the international community with plenty of warning of a 
breakout attempt beyond the 15 years.
    Please, if all three of you would just comment on these 
contradictory explanations and what the breakout time in your 
view would be if Iran installed more advanced centrifuges after 
15 years, and what kind of restrictions would the additional 
protocol provide, and the ongoing ability to monitor mines and 
mills provide, because many have proffered the possibility that 
what Iran will do is seek the gradual accumulation of ambiguous 
evasions. I think that is a particularly powerful phrase. Not 
just direct assault breakout, but a whole series of accumulated 
attempts at ambiguous evasions. And particularly in the area of 
centrifuge R&D, it is a concern that that might then lead to a 
quick breakout capability.
    So if all three of you would talk about these competing 
narratives about what happens in years 10 to 15, and then 15 
and beyond.
    Mr. Albright, if you would start us off?
    Mr. Albright. We did just a quick model. It is very hard to 
work that far in advance, but we looked at Fordow where if they 
did deploy advanced centrifuges like the IR6, the IR8, that in 
Fordow itself, you would have the ability to break out, 
probably within a week at year 15 or 16.
    It would depend also on producing 20 percent enriched 
uranium. So we took the Iranian statements at face value and 
assumed they would. So you could have a situation there where 
breakout could happen.
    And the verification is going to be better, there is no 
doubt about it. But the thing that you worry about in this 
particular scenario is that they just do not let the inspectors 
in, or they cripple the remote monitoring. And people are 
scratching their head about what is taking place.
    And if they can break out in a few days, in a week, they 
can make, one, two, three bombs worth of material in a month. 
So you worry that they will interfere in the inspection effort 
and disrupt it while they try to break out so you want to look 
at that.
    On the sneak out, you worry that Iran may weaken the 
conditions over time, that some of these mechanisms may be 
undermined, just the way you put it. It was an elegant way to 
put it. And the advanced centrifuges allow for the building of 
smaller facilities that may not be detected.
    So again, these are projecting in the future. The purpose 
of these exercises is to come up with a strategy now that can 
deal with these, and I think we have to be very clearheaded and 
look at the strategy or scenarios that are the most threatening 
to us and then make sure that the deal or what Congress or 
others do to implement the deal deals with these things.
    Senator Coons. Thank you, Mr. Albright.
    Mr. Chairman, do you mind if we have the rest of the panel 
answer the question?
    The Chairman. No, as matter of fact, what I might do, to 
interject just one moment, our committee, first of all, has had 
some outstanding hearings. I am going to step out, and I am 
going to let you guys finish up.
    We have passed multiple pieces of legislation on a 19-0 
vote, so there is huge trust on this committee, and I am going 
to turn it over to Chairman Kaine in just a second. I know he 
will handle the closeout well.
    But without objection, I would like for the record to 
remain open through the close of business Monday and would hope 
that unless you are traveling to Tennessee you will answer the 
questions promptly.
    I just want to say that I think this has been an excellent 
way to close a month of tremendous due diligence by the 
committee. I hope you all will stay and ask questions as long 
as you wish.
    I would like permission, without objection, to enter in the 
letter that you are referring to and that Senator Menendez 
referred to by members of the Washington Institute and others 
who have raised questions.

[Editor's note.--The article mentioned above can be found in 
the ``Additional Material Submitted for the Record'' section at 
the end of this hearing.]

    The Chairman. I think one of the functions of passing the 
Iran Review Act, there were two functions. One that gives a 
seat back at the table, which we had given away by granting the 
President national security waivers. But importantly to be able 
to ask the kind of questions that we are asking now to 
hopefully shape the negotiations and hopefully raise concerns 
that can be alleviated by stronger negotiations.
    So it is my own hope, obviously, that we end up with a very 
strong agreement. I think most people here want to see that 
happen. Obviously, I have a lot of concerns, and there are some 
remaining issues that I hope we will hold firm on.
    And just for the record, I believe we would be so much 
better off because JPOA has been what it is. We would be so 
much better off if we just continued to negotiate and not rush 
to some artificial deadline on June 30 and try to shortcut some 
of these very, very important issues.
    But we thank you very much, not only for your input today 
but throughout the course of this whole discussion. I will 
enter this into the record.
    I am sorry to give a pause to your answers. And with that, 
I am out of here. Chairman Kaine is in charge.
    Senator Coons. Thank you, Chairman Corker.
    And I agree that the purpose of that strong bipartisan vote 
and enactment by Congress was to ensure that Congress has the 
opportunity to weigh in, to shape the negotiations, and to set 
up the structure for ongoing oversight and engagement in the 
event there is an agreement. And the purpose of hearings such 
as this is for us to get better and better information about 
some very technical areas, like centrifuge R&D or future 
inspections, and to think through some things that are not 
comfortable to think about, which are scenarios in which this 
all might be unsuccessful in the long term.
    Dr. Takeyh.
    Dr. Takeyh. I will just say a little to complement what 
David said, and Jim can also talk about the technical aspect of 
this far more superiorly than I can.
    I would say that one of the Iranian negotiators--and when 
Iranian negotiators go home, they tend to be very talkative 
about what happened. They tend to do TV interviews, university 
symposiums. When he was asked about the issue of advancement of 
the Iranian nuclear program, he said, look, the Atomic Energy 
Organization told us that they need 8 years to develop the most 
advanced centrifuges that we need and, therefore, we are trying 
to get an agreement that conforms with that timeline.
    So he essentially was saying the sunset clause has to 
conform with the R&D requirements that were reported by the 
Atomic Energy Organization. Of course, at that time when Iran 
becomes a more industrial-sized nuclear power, it is very 
difficult to detect systematic diversions of resources and 
establishment--as David said, small installations operating 
high-velocity centrifuges is very difficult to detect. So 
industrialization of the program makes the verification regime 
challenges more acute if not impossible.
    Second, I just want to say one thing briefly about the 
snapback measures that you suggested. This agreement, as you 
noted, will have a dispute verification committee that will 
essentially hear out the disputes, and then they will go to the 
Security Council.
    The Security Council is not a country. It cannot impose 
economic sanctions. It can recommend and establish the legal 
predicate for national measures. At that time, U.S. Treasury 
and other representatives have to go to the Europeans, so that 
the current sanctions regime may not be able to come back. I 
think it will be very difficult to get the Europeans to 
reconstitute the oil embargo unless there is a real breakout 
for the Iranians. So I think Italians are waiting to go back 
and resume oil purchases because of the economy. I think the 
current sanctions architecture is not going to be snapped back.
    Once the U.N. Security Council advises its member states to 
restrict their trade, then you have to go back to South Koreans 
and the Japanese and the Indians and that whole elaborate 
effort that we have seen for the past several years.
    In terms of the fact that this agreement, as I mentioned, 
the sunset clause makes it disturbing, but I yield to Jim for 
additional technical explanation of your question.
    Senator Coons. Thank you.
    Dr. Walsh.
    Dr. Walsh. I do have some concerns about breakout in the 
out-years, if, in fact, they build a very large infrastructure 
because the larger it is, it introduces some complications.
    But let me back up for a moment. Again, this committee 
knows these details backward and forward, but I am not sure the 
watching public does. Let us be clear about what breakout is. 
Breakout is the time it takes to produce one bombs worth of 
material. And so far, there is no country in the history of the 
nuclear age that has broken out with the purpose of developing 
one bomb. You test it and then you do not have any material 
left over.
    It does not include the time for weaponization. Unless you 
are going to take that softball and throw it at someone, you 
have to make it into a weapon. And both the DNI, Secretary 
Panetta and my friends in the Israeli Atomic Energy Agency, all 
say they expect that will take at least a year.
    So breakout time actually does not measure the time it 
takes to get to a weapon. It measures the time you have to 
produce one softball of highly enriched uranium or plutonium. 
And breakout is incredibly rare, right? It will require a 
change in Iranian policy.
    The DNI says Iran has not decided to pursue a nuclear 
weapon, so they would have to change the policy they currently 
have in order to do that.
    Now, especially in the absence of details, it is easy to 
think of things that could go wrong, or think of things that 
could be better, right? I would like total information on 
everything in the world, but that is not what this is about.
    As I said in my testimony, the decision criteria are, does 
it advance our objective in preventing Iran from acquiring a 
nuclear weapon? Is it better than the alternatives? How does it 
compare to other agreements?
    This is, according to a former head of Mossad, a historic 
agreement. I view it as being the strongest multilateral 
nonproliferation agreement yet negotiated. And again, the track 
record here is really, really great.
    Now, are there risks? Of course, there are risks. But there 
are risks to inaction, and there are risks to sanctions, and 
there are risks to other actions. But when you compare this to 
the alternatives and compare it to other agreements that have 
been successful, the NPT, for example, deeply flawed but 
overwhelmingly successful.
    So I think yes, the charge of the committee should be to go 
through in fine detail and try to specify what the problem is 
and try to fix them. We also need to step back and have a 
bigger picture here when we try to evaluate where we are going.
    As I say, the Israeli military and intelligence people, 
distinct from the political people, have a very positive view 
of this. And, in fact, in public statements, the Israeli 
military is saying that they see their threat levels declining 
in coming years, and they are including Iran in that 
assessment. So that would seem to speak to the fact that this 
is an agreement that will have positive effects for Israel 
national security.
    Let me say in closing, with respect to the letter and I 
read the letter, it reminds me of that problem you have when 
the headline says one thing and the article says something 
else. This is a letter that has more bark than bite.
    As I read that letter, I agree with 90 percent of it. I 
think the sections on verification are completely consistent 
with my testimony. I agree completely with that. And on the 
possible military dimensions, I will remind you that yesterday 
you had testimony from Graham Allison, who is a signatory of 
that letter and who supports the agreement and said positive 
things about a potential agreement.
    So I think when you get down to the meat of it in the 
details, the letter is helpful, but it mostly offers criteria 
that most of us would agree with that feel that we can achieve.
    Senator Coons. Can I ask one more question, Chairman Kaine?
    Mr. Albright. Can I say something? I would like to disagree 
with some of the things Jim said.
    One is, breakout is used in the negotiations as criteria to 
limit Iran's program. It has nothing to do with whether in a 
breakout Iran would be producing just one weapon. I mean, why 
would Iran break out? If they are going to break out, you would 
expect that they would be planning to build many weapons, but 
you want to stop the first one and stop the infrastructure that 
gives them the ability to not only make the first, but also the 
second.
    So I do not know what to call it, it is a misunderstanding 
of what the use of breakout is, and I think I need to respond 
to that.
    Also, there are many people who do not think it would take 
Iran at least a year to build a nuclear explosive device. In 
the IAEA deliberations internally, they said that Iran knows 
enough based on their assessment to build a crude fission 
weapon. They assess they did not know enough to build a 
deliverable system by a missile, like the Shaheen-3, but they 
were working on it. And when they would succeed is a question 
of time.
    But in terms of building a crude explosive device, I think 
some people think it could be--Israel, too--think it could be 
done within a few to several months.
    Again, it is not going to be delivered by a missile. It 
could be tested underground. It could be used in a crude 
delivery system. But I think we have to be clear that Iran can 
do these things, according to IA assessments and Israeli 
assessments. I would assume some of these are shared in the 
United States. It is not that hard to do it.
    And we also have to understand that if they get this 25, we 
use 25 kg of weapon grade uranium in our calculations, if they 
get that, we do not really know where they will take it. We do 
not know how to respond. We do not know if it is a couple 
months or a year before they have a weapon.
    And so if you going to design a verification regime, design 
a deal, you have to go with what you can affect. That is why 
breakout always looks at how much weapon grade material is 
needed for a bomb, because those facilities, in essence, in the 
worst case, can be bombed. Once the weapon grade uranium leaves 
those facilities and, in essence, is produced, you do not know 
what to bomb.
    Again, I am saying this because I disagree with some of the 
things Jim is saying. I think in the public debate, 
particularly, not within the governments, but within the public 
debate, I think there has been real misunderstanding about how 
breakout is used and what it what it means.
    Senator Coons. Thank you, Mr. Albright.
    If I might, back to Dr. Walsh, on centrifuge R&D, I think 
many of us have a fairly clear grasp of what the 1-year 
breakout time means. And I would agree with you that the 
broader watching public may misunderstand it as the ability to 
go from the accumulation of fissile material to the development 
of a deliverable, functioning, advanced nuclear weapon. And 
those are easily conflated and should not be.
    But one of the core issues we are being asked to consider 
is whether or not the structure of the agreement as proposed 
leaves Iran with too much freedom to develop advanced 
centrifuges, and whether it is technically possible in a decade 
to develop centrifuges that are an order or two orders of 
magnitude more effective operationally than their best current 
models.
    Some experts suggest that that is just not feasible, that 
the barriers to their testing them in cascade, the barriers to 
them actually knowing how they work, are fairly significant in 
this agreement, that the monitoring provisions are fairly 
significant, and that even the most advanced engineering and 
industrial societies, ours included, have found centrifuges 
tricky things to modernize significantly.
    Others argue that that is not the case, that this is widely 
distributed knowledge, that the engineering challenges of 
decades ago have now largely been transcended, and that they 
may, in fact, in the intervening decade, be able to make 
dramatic orders of magnitude advances.
    Where do you come down on this? What advice would you have 
for us on this as yet unresolved component?
    Dr. Walsh. I think I come down somewhere in the middle. I 
do not think it is as easy as some might portray it.
    I am reminded of the fact that Iran has made a series of 
announcements over the years that it was just about to 
introduce an advanced centrifuge 5, 6, 7, 8, and all these 
great advances that were all press releases and had nothing to 
show for it years after the fact. So I think it is a technical 
challenge.
    I am reminded of the fact that the 18,000 of the 19,000 are 
still Pakistani first order centrifuges.
    So that would seem to indicate that their progress has not 
been as great as one might imagine. But I think it is worthy of 
concern because it is true that, if they could build an 
advanced centrifuge, it would increase the efficiency and 
reduce the breakout time. I think that is right.
    I think it is a tough issue, though, because as the United 
States has certainly insisted in its arms control agreements, 
most agreements provide for research and development, most 
nonproliferation and arms control. You stop the thing itself, 
but you allow countries to R&D. But it is very hard to police, 
in any case.
    But I think it is worth looking at it in the out-years. But 
I do not think it is going to be easy, nor will it be quick for 
them to do that.
    If I can bring it back to a final point here, part of what 
this process is about is trying to consolidate the Iranian 
decision not to pursue a nuclear weapon. If a country is 
determined to get a nuclear weapon, it does not matter what 
agreement you have. Pakistan said it would eat grass. North 
Korea, I do not know what its GDP is, but it was able to build 
a nuclear weapon because of its political priority, political 
commitment.
    That is the difference between being a nuclear weapon state 
and a nonnuclear weapon states, when it comes to a technology 
that is 70 years old.
    So while we focus on the technical and that is important, 
we want to build as good of an architecture as we can, we need 
to focus on the core issue. The core issue is political. As the 
DNI says, Iran's nuclear future is a political decision, not a 
technical one, because they know how to build a centrifuge, 
whether it is an IR1 or an IR9.
    So if we are going to live in a future without a nuclear 
weapons Iran, which we all want, then we need to have an 
agreement that puts Iran on a political track where they never 
revisit that decision, that keeps them in the decision they 
have made right now, which is not to pursue a nuclear weapon. 
That is really what this is about.
    Senator Coons. I appreciate the frame you put on it. I 
appreciate the chairman's indulgence in time.
    I do think that in order for us to have a reasonable 
assessment of what level of risk we are taking, having more 
thorough, more broad knowledge of the prior military 
dimensions, access to scientists interviews that allow the 
international community to assess how far they got when they 
were pursuing actively a nuclear weapon, and what the contours 
are of their potential program, are critical. Having an 
inspection regime that allows for ready access to suspect 
sites, having some real limits on centrifuge R&D, having a 
capacity to return to sanctions in a multilateral and muscular 
way relatively promptly, and having real consequences for 
violations, are all important parts of the architecture of an 
agreement. And I know we will all be watching this very 
closely.
    Thank you, gentlemen, for your testimony today.
    Senator Kaine [presiding]. And I would like to thank the 
witnesses as well.
    Your testimony today, you have given us a number of 
important thoughts about the way to analyze a deal, if there 
should be one. You have given us some important thoughts about 
alternatives, if there is not a deal. And you have also given 
us some important thoughts about if there is a deal that is 
accepted, what are some additional steps that Congress might be 
able to take on the enforcement or consequences side. Those are 
all important.
    Just to remind you, if members want to submit questions for 
the record by the close of business Monday, we would ask that 
you try to respond to those promptly.
    The last thing I will just put on the record, there was a 
colloquy between the witnesses and Senator Menendez around this 
issue of whether the additional protocol around succession of 
that that was announced in the framework on April 2, is 
something that has to be ratified by the Iranian parliament or 
is there just going to be a claim that we will abide by that. I 
think that is a very important question.
    There was testimony before this committee in January by 
Tony Blinken that such a provision would require under Iranian 
law the Iranian Parliament to ratify it.
    That was something that was mentioned and that became 
important as we debated the role of the Corker review bill. If 
the Iranian Parliament has to ratify the deal, then so should 
Congress. So that has been a claim that has been made often.
    I think to the extent that these hearings are being 
observed by folks within the administration and even folks 
connected to the negotiators, that notion that the accession to 
the additional protocol, which in the April 2 framework was a 
permanent accession, it was not to run out after 20 years or 30 
years, would have to be ratified by the parliament. That is 
something that we are going to be looking at very, very 
carefully. And if they back away from ratify and just say, oh, 
do not worry, we will abide by it, that would be a weaker 
agreement, I think according to the entire committee.
    So that colloquy surfaced an issue that could be an 
important one.
    I thank you again for the testimony.
    With that, the hearing is adjourned.
    [Whereupon, at 12:20 p.m., the hearing was adjourned.]
                              ----------                              


              Additional Material Submitted for the Record

[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]


                     IRAN NUCLEAR AGREEMENT REVIEW

                              ----------                              


                        THURSDAY, JULY 23, 2015

                                       U.S. Senate,
                            Committee on Foreign Relations,
                                                    Washington, DC.
    The committee met, pursuant to notice, at 10:09 a.m., in 
room SD-G50, Dirksen Senate Office Building, Hon. Bob Corker 
(chairman of the committee) presiding.
    Present: Senators Corker, Risch, Rubio, Johnson, Flake, 
Gardner, Perdue, Isakson, Paul, Barrasso, Cardin, Boxer, 
Menendez, Shaheen, Coons, Udall, Murphy, Kaine, and Markey.

             OPENING STATEMENT OF HON. BOB CORKER, 
                  U.S. SENATOR FROM TENNESSEE

    The Chairman. The Foreign Relations Committee will come to 
order. I want to thank the witnesses for being here today, and 
we look forward to a fulsome hearing.
    I want to thank all of those also who are in attendance. I 
know there was a little bit of an outbreak prior to us 
convening. We thank you for being here. Now that the meeting is 
in order outbursts of any kind are unwarranted. We do hope that 
you will respect the democratic process that is taking place 
here. So, again, we thank you for being here. We also thank you 
for your courtesy as we move ahead.
    I know the witnesses have agreed to be here as long as we 
wish, so we will start with 7-minute questions. I do know, 
based on last night's presentation, there is sometimes a 
tendency for witnesses to want to interject. And what I would 
say is obviously we conduct our meetings with a lot of respect 
and courtesy, and I would just ask the witnesses, if they would 
respond directly to the questions from Senators on both sides 
of the aisle as if they ask it--when you ask it directly to a 
witness, get them to respond. If someone else wants to 
interject, they can indicate they want to do so, but Senators 
should feel free to say, no, I just wanted that witness and 
move on to the next to make sure that we do not end up in a 
somewhat filibustered situation and we are able to get our 
questions answered.
    I want to start by thanking our committee. We would not be 
here today, we would not have the information that we have 
today, if we had not passed the Iran Nuclear Agreement Review 
Act. This would not be taking place. I think the American 
people now understand what this debate was all about.
    When Congress put in place sanctions to bring Iran 
successfully to the table as we did, we granted the executive 
branch something called a national security waiver. And what 
that meant was the executive branch had the ability to waive 
our congressionally mandated sanctions, to suspend them until 
such a time as we permanently waive them down the road.
    And as you know, unfortunately over the objections of 
Senator Cardin and myself, unfortunately the executive branch 
went directly to the United Nations this Monday morning, 
something that certainly was not in the spirit of this but this 
is what was always intended. And I do want to say that while 
Secretary Kerry has often said, well, Congress will have the 
ability to weigh in at some point in time prior to this law 
being passed and causing this hearing to happen today, we now 
read the agreement and realize that what he meant was 8 years 
from now we would have the opportunity to weigh in because that 
is what is stated in the agreement.
    So I want to thank everybody, all 19 members, for coming 
together unanimously making that happen, and giving us a role. 
It is a heavy lift as we know, but a role that did not exist 
prior to that bill passing.
    I have to say we had a briefing last night-- and I left 
there--as I talked to Members on both sides of the aisle--
fairly depressed after last night's presentation. With every 
detail of the deal that was laid out, our witnesses 
successfully batted them away with the hyperbole that it is 
either this deal or war. And, therefore, we were never able to 
appropriately question or get into any of the details because 
every time we did, it was either this deal or war. So I believe 
that to be hyperbole.
    I know the Secretary last night pulled out a letter that 
was written in 2008 by the prior administration. I do not know 
if he will refer to that today. But as I thought about it lying 
in bed last night, I realized that what he was really pointing 
out with that letter is unless we give Iran what they want, 
``X,'' will happen. I mean, that is what really that letter was 
used for last night. So let me just walk through that.
    We have been through an incredible journey. We began 20 
months or so ago with a country that was a rogue nation that 
had a boot on its neck, and our goal was to dismantle their 
program. We have ended up in a situation where the deal that is 
on the table basically codifies the industrialization of their 
nuclear program. It is an amazing, amazing transition that has 
occurred. And yet everyone here, not a person in this room, 
including our witnesses, everyone here knows there is not one 
practical need for the program that they are billing. Not one. 
Not one. We have not had a single scientist, and not a single 
witness can lay out any reasoning, not a single reason, for 
Iran to be developing this program from the standpoint of what 
it means to them from a civil standing. Not one.
    Nine months after this agreement goes into effect, we 
realize that after Monday's U.N. adoption, unless Congress 
intervenes, in 90 days this will be implemented. And then 6 
months after that and a total of 9 months from now, all of the 
sanctions that exist against Iran will be lifted. Incredible. 
Now, there will be a few remaining sanctions, but the big ones 
that matter will be lifted. So they will have access to 
billions and billions of dollars. Their economy will be 
growing. They will be shipping oil around the world. It is an 
amazing thing.
    And so, what happens--I think all of us figured this out as 
we went through the deal--right now we have some leverage, but 
9 months from now the leverage shifts to them because we have a 
sanctions snapback. What they have, if we ever try to apply 
that, is what is called a ``nuclear snapback.'' The way the 
deal is structured, they can immediately just begin. They can 
say, well, if you add sanctions we are out of the deal. They 
can immediately snap back. So the leverage shifts to them.
    The PMD, the possible military dimensions--I think most of 
us call it the previous military dimensions because we know 
they were involved in that--basically that has no bearing--no 
bearing--per the agreement. And I know our witnesses will say, 
well, if they do not deal with this properly, we will not 
implement. But according to the agreement, it has no bearing 
whatsoever on whether the sanctions are removed or not. And yet 
that was such an important piece for everyone to know.
    Anytime, anywhere inspections. Last night we had witnesses 
saying, I never said that. It has been a part of our mantra 
from day one. It has been a part of their mantra from day one, 
anywhere, anytime inspections. Now we have a process that they 
are declaring is 24 days, but we all know that is not right. 
The 24 days begins after, by the way, the IAEA has found 
violations that they are concerned about, and then you give 
Iran time to respond to that. And then by the time it kicks in, 
there is a 24-day process, but it could be months.
    And as we know, in laboratories when you are developing a 
nuclear warhead that is about this big, it is very easy to 
cover things up like that. And all the focus has been on 
finding uranium. There are other aspects of this that are very 
difficult to find.
    I know they have said this is the most comprehensive 
inspection regime that we have ever had. That is not true. That 
is not true. I have talked to Secretaries of State and others. 
We had a far more comprehensive and rapid inspection program in 
Iraq. Far more. And that certainly did not serve us 
particularly well.
    Ben and I have written a letter asking for additional 
materials that we do not now have. One of the items we do not 
have is regarding the agreement between Iran and the IAEA. And 
my sense is that we are never going to get that letter, so the 
inspection entity that we are relying upon to find out whether 
Iran is cheating, we are not even going to have access to that 
agreement.
    But let me just say this. We do know one of the 
characteristics is very interesting. We have a professional 
athlete in Chattanooga that spends about a month there. He is 
incredibly a role model. He has got incredible integrity. He is 
a role model to the world. And I was talking to him a couple of 
weeks ago about the program that professional athletes go 
through for drug testing. It is incredible. That is anytime, 
anywhere. There are qualities to this that unfortunately I am 
told I cannot get into. But there are qualities to this program 
that would not be unlike causing athletes to just mail in their 
own urine specimens in the mail and us believing that it came 
from them.
    So, look, I have got some questions. I want to talk a 
little bit about who we are dealing with here. Most of us have 
been to Iraq many times, and I will never forget visiting 
General Odierno in Baghdad. And every time we visit General 
Odierno in Baghdad, he has on his coffee table the IFPs that 
were used to maim and kill Americans. They were laying out. 
They were made, the IEDs. They were laying on the coffee table, 
every single one of them made by Iran.
    Once we develop the technology, by the way, to counter 
that, what they did next was develop something called an EFP, 
explosively formed penetrator. Now, what they do is they have 
an explosion that heats up copper to go through a piece of 
machinery to maim and dismember Americans. This was all Iran, 
every single bit of it.
    We have all been out to Walter Reed, and we visited these 
incredible heroes that have lost in some cases two arms and a 
leg, in some cases two legs and two arms. We see them all over 
the country. They are living with this today. This is the 
country that we are dealing with, a country that created some 
of the most disturbing types and methods of maiming Americans 
that have ever been seen. They tried to kill an ambassador here 
in Washington, DC, not long ago. I mean, we know that.
    The other day, Ben and I went over with others to see 
something the Holocaust Museum had put together. A young man 
named Caesar had taken photographs of the Syrian prisons, 
Syrian prisons, which, by the way, Iran supports. Bashar al-
Assad would not even be in office today if it were not for 
Iran.
    We went over and envisioned the torture that is happening, 
that has been photographed and chronicled. Many of you have 
seen it on the Internet. It is an amazing thing. It is 
happening right now, by the way, as we sit here. Some people 
might say, well, that was Iraq, and I do not know, should we 
have been there or not. This is happening this very second with 
the support of Iran. Do you understand that? People's genitals 
right now are being amputated. People are being electrocuted. 
This is happening this very second in a prison in Iran--I mean, 
in Syria that Iran is supporting. Some would say we have not 
done as much as we could to stop it because of these 
negotiations.
    When I was in college, I was not a particularly good 
student. The first part of college I was in sports. The latter 
part I was interested in working. I learned one thing. I 
learned about the critical path method, and I ended up building 
buildings all over our country. And I learned that you start 
with something like this and you lay out a vision, and you 
build it out. And you begin with the end in mind, and you put 
first things first. It is sort of the critical path.
    And what I have seen our Secretary do is--I know he is has 
a developed a tremendous warmth with Iran's Foreign Minister, 
Zarif, and he talks about it often. But what I think you have 
actually done in these negotiations is codify a perfectly 
aligned pathway for Iran to get a nuclear weapon just by 
abiding by this agreement. I look at the things that they need 
to do, the way it is laid out, and I do not think you could 
more perfectly lay it out.
    From my perspective, Mr. Secretary, I am sorry. Not unlike 
a hotel guest that leaves only with a hotel bathrobe on his 
back, I believe you have been fleeced. In the process of being 
fleeced, what you have really done here is you have turned Iran 
from being a pariah to now Congress--Congress--being a pariah.
    A few weeks ago you were saying that no deal--no way--is 
better than a bad deal. And I know that there is no way that 
you could have possibly been thinking about war a few weeks 
ago. No way. And yet what you say to us now and you said it 
over and over yesterday--and I have seen you say it over and 
over on television--is that if somehow Congress were to turn 
this down, the only option is war. Whereas a few weeks ago for 
you--for you to have turned it down--the only option is not 
war. I do not think you can have it both ways.
    Let me just say this. If Congress were to say these 
sanctions cannot be lifted, it would not be any different than 
the snapback that we now have where in essence the United 
States, on its own, can implement snapback. But my guess is the 
other countries, as you have stated before, would not come 
along. So we have got to decide which way that it is.
    I know you speak with a degree of disdain about our 
regional partners when you describe their reaction to this 
deal. But one of the things we have to remember is that if we 
had actually dealt with dismantling their nuclear program, they 
would not be responding in the way that they have. But not only 
has this not occurred, we are lifting the ballistic missile 
embargo in 8 years. I have no idea how that even entered into 
the equation, but it did at the end. We are lifting the 
conventional weapons embargo in 5 years, and in a very acute 
way with hortatory language in the agreement. Unbelievably, we 
are immediately lifting the ballistic missile testing programs. 
We are lifting that ban.
    So I would have to say that based on my reading, I believe 
that you have crossed a new threshold in U.S. foreign policy 
where now it is the policy of the United States to enable a 
state sponsor of terror to obtain a sophisticated industrial 
nuclear development program that has, as we know, only one real 
practical need.
    That is what you are here today to ask us to support. I 
look forward to your testimony and the appropriate questions 
afterward.
    Senator Cardin.

         OPENING STATEMENT OF HON. BENJAMIN L. CARDIN, 
                   U.S. SENATOR FROM MARYLAND

    Senator Cardin. Well, first, Mr. Chairman, thank you very 
much for convening this hearing. I want to thank Secretary 
Kerry, Secretary Moniz, and Secretary Lew, and your entire 
negotiating team--Wendy Sherman and many others--who have 
devoted the last 2 years to negotiating with Iran. And we thank 
you very much for your dedicated service, your hard work, and 
your service to America.
    The Iranian Nuclear Agreement Review Act that Senator 
Corker referred to earlier was an effort by Members of Congress 
to set up the appropriate review for a potential deal with 
Iran. We are extremely pleased that after very difficult 
negotiations, we were able to get a unanimous vote of this 
committee, get the support of the White House and pass the 
bill.
    And we believe we accomplished two major objectives in 
passing that statute. First, of course, we set up the 
appropriate review for Congress. It allows us to take action if 
we wish. It recognizes the fact that the sanction regime was 
passed by Congress, and that we have a role to play in regards 
to implementing any agreement as we now see in the JCPOA. So it 
sets up an orderly process, and this hearing is part of that 
process.
    It took you 2 years to negotiate this agreement. It took 
you 2 months in Vienna to get to the final details. We are on 
day 4 of our 60-day review. I have not reached a conclusion, 
and I would hope that most members would want to get all the 
information and allow those who are directly involved to make 
their case.
    We have hearings set up next week and the following week, 
and we will hear from outside experts. Many of us have taken 
advantage of that opportunity in the past, and I would hope 
that we will all use that opportunity before drawing a 
conclusion. This is a very important agreement from the point 
of view of U.S. foreign policy. Iran and that region is 
critically important to the United States security.
    But there is a second objective to the Iran Nuclear Review 
Act, and that was to concentrate all of our efforts on the bad 
guy, Iran, and speak with unity as much as we could so that our 
negotiators could concentrate on Vienna and not on Washington 
and get the very best possible agreement. And I just want to 
tell you, Mr. Chairman, I looked at the framework that was 
agreed to in April, and looking at the final agreements that we 
have gotten today, our negotiators got an awful lot, 
particularly on the nuclear front, which is beyond my 
expertise. There were many rumors during these last couple of 
months as to what was going to be in this agreement and how it 
was going to be weakened from the April framework that, in 
fact, have been strengthened since the April framework. So I 
just want to applaud our negotiators for taking the strength of 
our unity and turning it into results in Vienna. And we will be 
talking a little bit about that as we go forward.
    The objective of an Iranian nuclear agreement is to prevent 
Iran from ever becoming a nuclear weapon state. That is our 
simple objective. We know who we are dealing with. This is a 
state sponsor of terrorism. This is a country that abuses human 
rights. We know all that. But we are trying to prevent Iran 
from becoming a nuclear weapon power because we know that is a 
game changer in the region. That is the objective of this 
agreement.
    And that is the standard that we have to use when 
evaluating this agreement, because there is no trust with Iran. 
The Supreme Leader, on Friday after the agreements were entered 
into, said ``we will trample upon America.'' We do not trust 
Iran, but we have got to leave emotion out of this. We have got 
to look at the agreements, and we have got to determine whether 
this agreement will put us on a path that makes it less likely 
or more likely that Iran will become a nuclear weapon power. 
That has got to be the test that we use.
    So, Mr. Chairman, I have many questions that I hope we will 
get answers today. I hope those answers will provoke a debate 
among us in Congress and the American people and help us make 
the right decisions. Since there is no trust, the inspection 
enforcement regime is particularly important. We need to 
understand how it works.
    Do we have sufficient time to discover if Iran is violating 
the terms of this agreement in order to take effective action 
to prevent Iran from becoming a nuclear weapon power? That is a 
question that we need to understand. We need to know the 
breakout times. We need to know what happens after certain time 
limits conclude. Do we have sufficient opportunity to prevent 
Iran from ever becoming a nuclear weapon state, the commitment 
that they make under this agreement? Are the inspections robust 
enough to deter Iran from cheating, and if they do, will we 
discover and be able to take action?
    Mr. Chairman, you raised the 24-day window. I think all of 
us recognize there is going to be a protocol for inspection. 
That does not get us by surprise. But we need to know whether 
the 24-day delay, knowing what Iran is likely to do, will 
compromise our ability to have effective inspections? And I 
hope our witnesses will deal with that today because that is a 
matter of major concern. We need to know the answer to that.
    Have we cut off all pathways for Iran to obtain a nuclear 
weapon, particularly covert military use operations? We know 
that is a major concern. That is why the PMD is particularly 
important. The chairman mentioned the PMD and the work of the 
IAEA--the IAEA are our inspectors, our international 
inspectors. They have great credibility in this area, but we 
would want to know whether they have the capacity to do what we 
are asking them to do. Will they have the access that we need 
because we do need to know about their prior military dimension 
in order to be able to go forward and make sure that we can 
contain any opportunity they may use for covert activities? 
Will we discover it and be able to take action?
    These are questions that we are going to ask. We have read 
the agreement, and we still have questions, and we hope we will 
get answers as to whether this agreement effectively prevents 
Iran from using covert activities to develop a nuclear weapon.
    Will this agreement provide us, the IAEA, with sufficient 
access to the people, places, and documents so that we know 
their prior military dimension? Are the snapback provisions for 
reimposing sanctions adequate if Iran violates this agreement? 
That is an issue that I hope we will have a chance to talk 
about. At the end of the time limits in the agreement, Iran 
will have the capacity to expand, as the chairman rightly 
pointed out, to an industrial capacity. They can get there in 
nuclear enrichment, in uranium enrichment. That they can do.
    Do we have sufficient capacity, knowing their commitments 
for nonproliferation, knowing the requirements of the 
additional protocols, to prevent Iran from becoming a nuclear 
power? Do we have enough break-out time and sufficient tools to 
prevent Iran from becoming a nuclear weapon power should they 
try to become one after the time limits lift? These are 
questions that we need to have the answers to before we can 
make our judgments.
    There are other areas. I want to be reassured that the 
United States still has the flexibility to impose nonnuclear 
sanctions on Iran for its support of terrorism, human rights 
abuses, and in response to its ballistic missile program. No 
one expects Iran's bad behavior to change on implementation 
day. We know who we are dealing with. Will we be able to use 
the powers we have used in the past and build upon them to take 
action against Iran, particularly since they will have 
additional resources? Can we do that? And can Congress work 
with the administration to strengthen those tools without 
violating the JCPOA?
    I want to know how the administration is updating its 
regional deterrence strategy against nefarious and 
destabilizing Iranian activities, and how we are going to work 
with our partners to build up their capacity to counter Iran, 
especially Israel. The chairman mentioned the lifting of the 
international arms embargo. That is of great concern as to what 
impact it will have on our regional partners. How will it 
impact an arms race in that region of the world? These are 
questions that we need to get the best information we can in 
making our decisions.
    And lastly, let me mention this because I think it is 
critically important. What are our options if the United States 
walks away from this? How will we be received internationally? 
Will we be able to maintain effective enforcement of sanctions 
with our international partners, and will Iran come back to a 
negotiating table with a country that has walked away from an 
agreement? These are questions that we need to understand. We 
need to know that the options are right do--we go forward or 
not, and what are the consequences if we do not go forward?
    So, Mr. Chairman, we have a full plate, and I look forward 
to hearing from our witnesses. And I hope that the members of 
this committee will use the information that we get today to 
debate the issue, take the time that we have, and do what is 
right for the American people, and ultimately make the decision 
that we think is best to prevent Iran from becoming a nuclear 
weapon power.
    The Chairman. Thank you, Senator. I appreciate so much the 
way we have worked together on so many issues and the entire 
committee.
    With that, I know that our witnesses here today need no 
introduction. They are well known not only here, but around the 
world. In spite of our policy differences, I think each of us 
deeply appreciate the witnesses that make up this panel. There 
may not be policy differences in some cases, but we deeply 
appreciate the tremendous effort that you put out on behalf of 
our country. We thank you for being here today. And we thank 
you for being willing to be here today as long it takes for 
everybody to get their answers.
    And with that, I would like to introduce collectively 
Secretary John Kerry, who used to serve with us and sit on this 
side of the dais; Secretary Ernie Moniz, who has been 
incredibly helpful to all of us in understanding the technical 
aspects of the deal, and someone that I think we all appreciate 
deeply; Secretary Lew, who has served in multiple positions 
here, has been certainly affirmed by this committee several 
times. We thank you all for your great service to our Nation in 
spite of some of the concerns that we have here today.
    I think you all understand the drill. Take five minutes or 
so to explain. As I have looked at your testimony, I know it is 
very brief. Just to warn people in advance, I am going to defer 
my questions, Ben, and move to you immediately thereafter, and 
use my time to interject as things move along.
    So with that, Secretary Kerry.

   STATEMENT OF HON. JOHN F. KERRY, SECRETARY OF STATE, U.S. 
              DEPARTMENT OF STATE, WASHINGTON, DC

    Secretary Kerry. Well, thank you, Mr. Chairman, Ranking 
Member Cardin, members of the committee, and friends, and 
former colleagues. We really do appreciate the chance to 
discuss with you the comprehensive plan that we and our P5+1 
partners have developed with Iran regarding the future of its 
nuclear program.
    And let me emphasize to everybody here, this is not just 
the United States of America. These are other nuclear powers: 
France, the United Kingdom, Russia, China. They have a pretty 
good understanding of this field and of the challenges, and I 
appreciate the way in which they and Germany, which was the 
plus-one, all came together, all contributed, all were part of 
this debate.
    So you are not just looking at what this table negotiated. 
You are looking at what the international community, the P5+1 
under the auspices of the U.N. negotiated. And they are not 
dumb. They are experts, every one of them, in nuclear 
technology, in ratification, in verification. They are smart 
people who have spent a lifetime at this. And they have signed 
off on this agreement.
    Now, I am joined by two Cabinet Secretaries whose help was 
absolutely invaluable in reaching this deal, and I thank all of 
you for the role that Congress played. I was privileged to be 
the chairman of this committee when we passed the Iran 
sanctions effort, and we all remember the debate. We passed it 
unanimously, and it played a very significant role in bringing 
Iran to the table and in helping to make clear that we needed 
to bring about a serious and productive negotiation with Iran.
    From the day that those talks began, we were crystal clear 
that we would not accept anything less than a good deal--and we 
defined it up front as a deal that closed off the four pathways 
to a bomb, the uranium pathways, the one plutonium pathway, and 
the covert pathway. So we set our standard, and we believe we 
have achieved that standard. After almost 2 years of very 
intensive talks, the facts are also crystal clear: that the 
plan that was announced last week in Vienna is, in fact, a deal 
that does shut off those pathways, and provides us with 
guarantees for the lifetime of the NPT that we will know what 
they are doing.
    Now, the chairman mentioned in his opening comments some 
phrase about unless we give Iran what they want. Folks, they 
already have what they want. They got it 10 years ago or more. 
They already have conquered the fuel cycle. When we began our 
negotiations, Iran had enough fissile material for 10 to 12 
bombs. They had 19,000 centrifuges, up from the 163 that they 
had back in 2003 when the prior administration was engaged with 
them on this very topic.
    So this is not a question of giving them what they want. It 
is a question of how do you hold their program back, how do you 
dismantle their weapons program, not their whole program. Let 
us understand what was really on the table here.
    We set out to dismantle their ability to be able to build a 
nuclear weapon, and we have achieved that. Nobody has ever 
talked about actually dismantling their entire program because 
when that was being talked about, that is when they went from 
163 centrifuges to 19,000. Everybody here at this dais knows 
what the options are for actually stopping that. It is called 
military action because they are not going to stop it 
otherwise. They have already proven that. They proved it during 
all those years.
    So under the terms of this agreement, Iran has agreed now 
to remove 98 percent of its stockpile voluntarily. They are 
going to destroy 98 percent of their stockpile of enriched 
uranium. They are going to dismantle two-thirds of their 
installed centrifuges, and they are going to take out the 
existing core of an existing heavy-water reactor and fill it 
with concrete.
    Iran has agreed to refrain from producing or acquiring 
highly enriched uranium and weapons-grade plutonium for at 
least 15 years. And if they begin to do that, Ernie Moniz will 
tell you we will know it immediately.
    Iran has also agreed to accept the Additional Protocol, and 
the Additional Protocol is an outgrowth of the failure of the 
North Korea experience, which put in additional access 
requirements precisely so that we do know what Iran is doing. 
And they have to ratify it before the U.N. sanctions are 
lifted. At the end of this process, they have to have 
ratified--they have to have passed it. They have agreed to live 
by it from day one. They are going to live by the Additional 
Protocol. In addition, there are additional transparency 
measures that we can go into in the course of this hearing.
    Now, if Iran fails to comply, we will know it, and we will 
know it quickly, and we will be able to respond accordingly by 
reinstating sanctions all the way up to the most Draconian 
options that we have today. None of them are off the table at 
any point in time.
    So many of the measures that are in this agreement are 
there for not just for 10 years, not just for 15 years, not 
just for 20 years, not just for 25 years--of which there are 
measures for each of those periods of time--but they are for 
life, forever, as long as Iran is in the NPT. By the way, North 
Korea pulled out of the NPT. Iran has not pulled out of the 
NPT.
    Remember that, 2 years ago, when our negotiations began, we 
faced an Iran that was enriching uranium up to 20 percent at a 
facility that was secret and buried underground. And they were 
rapidly stockpiling enriched uranium and had installed nearly 
20,000 nuclear centrifuges. They were building a heavy-water 
reactor that could produce weapons-grade plutonium at the rate 
of enough to produce one or two bombs a year. And experts 
assessed that the breakout time--the interval required to rush 
to be able to produce enough fissile material for one nuclear 
weapon--was about 2 to 3 months.
    If this deal is rejected, we return immediately to this 
reality, except that the diplomatic support that we have built 
with all these other countries, that we have accumulated, would 
disappear overnight.
    Now, let me underscore, the alternative to the deal that we 
have reached is not what I have seen some ads on TV suggesting 
disingenuously. It is not a ``better deal,'' some sort of 
unicorn arrangement involving Iran's complete capitulation. 
That is a fantasy, plain and simple. And our own intelligence 
community will tell you that. Every single agency of our 
intelligence community will reinforce that to you.
    The choice we face is between an agreement that will ensure 
Iran's nuclear program is limited, rigorously scrutinized, and 
wholly peaceful, or no deal at all. That is the choice. The 
fact is that there are 189 nations that live by the NPT. Five 
of them are, as we know, the main nuclear powers of the U.N., 
and 184 of them are non-nuclear-weapons states in power. But 
they live by it. And we have lived by what the IAEA does with 
respect to ensuring the surety of what all of those 184 nations 
are doing, including 12 that enrich.
    Now, if the U.S. Congress moves to unilaterally reject what 
was agreed to in Vienna, the result will be the United States 
of America walking away from every one of the restrictions that 
we have achieved. And a great big green light for Iran to 
double the pace of its uranium enrichment, proceed full speed 
ahead with the heavy-water reactor, install new and more 
efficient centrifuges, and do it all without the unprecedented 
inspection and transparency measures that we have secured. 
Everything that we have prevented will then start taking place, 
and all the voluntary roll backs of their program will be 
undone.
    Moreover, if the United States--after laboriously 
negotiating this multilateral agreement with five other 
partners--were to walk away from those partners, we are on our 
own. Our partners will not walk away with us. Instead they will 
walk away from the tough multilateral sanctions regime that 
they have helped to put in place, and we will have squandered 
the best chance we have to solve this problem through peaceful 
means.
    Now, make no mistake. President Obama has made it crystal 
clear that we will never accept a nuclear-armed Iran. He is the 
only President who has developed a weapon capable of 
guaranteeing that, and he has not only developed it, he has 
deployed it. But the fact is that Iran now has--we all do not 
like it, but whether we like it or not, Iran has developed 
experience with a nuclear fuel cycle. They have developed the 
ability to produce the fissile material for a bomb, and we 
cannot bomb that knowledge away, nor can we sanction the 
knowledge away.
    Remember, sanctions did not stop Iran's nuclear program 
from growing steadily, to the point that it had accumulated 
enough fissile material to produce those 10 nuclear weapons. By 
the way, they did not choose to produce them. Unlike North 
Korea, which created a nuclear weapon, and exploded one, and 
pulled out of the NPT, Iran has done none of that.
    The truth is that the Vienna plan will provide a stronger, 
more comprehensive, and more lasting means of limiting Iran's 
nuclear program than any alternative that has been spoken of. 
And to those who are thinking about opposing the deal because 
of what might happen in year 15, or 16, or 20, remember if we 
walk away, year 15 or 16 or 20 starts tomorrow, and without any 
of the long-term verification or transparency safeguards that 
we have put in place.
    Now, over the past week I have spoken at length about what 
exactly this deal is. I also want to make clear what this deal 
was never intended to be. First of all, as the chief 
negotiator, I can tell you I never uttered the words 
``anywhere, any time,'' nor was it ever part of the discussion 
that we had with the Iranians.
    This plan was designed to address the nuclear issue alone, 
because we knew that if we got caught up with all the other 
issues, we would never get where we needed to stop the nuclear 
program. It would be rope-a-dope, staying there forever, 
negotiating one aspect or another. And the highest priority of 
President Obama was to make sure that Iran could not get a 
nuclear weapon, so we were disciplined in that.
    We did not set out, even though we do not like it, and I 
have extensive plans that I will lay out to you if you want 
them about how we are going to push back against Iran's other 
activities, against terrorism, its support, its contributions 
to sectarian violence in the Middle East and other things. All 
of those are unacceptable. They are as unacceptable to us as 
they are to you. But I have got news for you. Pushing back 
against an Iran with a nuclear weapon is very different from 
pushing back against an Iran without one. And we are 
guaranteeing they will not have one.
    So we are working very closely with the Gulf States. Just 
today in Saudi Arabia--Ash Carter was there yesterday--the 
Foreign Minister said that the nuclear deal appears to have all 
of the provisions necessary to curtail Iran's ability to obtain 
a nuclear weapon. That is Saudi Arabia. The Emiratis are 
supportive. The foreign minister of Iran is going to be in the 
United Arab Emirates this weekend.
    So I would suggest respectfully that we are going to 
continue to press Iran for information about the missing 
American and for the immediate release of Americans who have 
been unjustly held. And there is not a challenge in the entire 
region that we will not push back against if Iran is involved 
in it. But I will tell you, none of those challenges will be 
resolved if Iran gets a nuclear weapon.
    So the outcome cannot be guaranteed by sanctions alone. I 
wish it could, but it cannot be. And by the way, it also cannot 
be guaranteed by military action alone. Our own military tells 
us that. The only viable option here is a comprehensive 
diplomatic resolution of the type that was reached in Vienna, 
and that deal, we believe--and we believe we will show you 
today and in the days ahead--will make our country and our 
allies safer.
    It will ensure that Iran's nuclear program remains under 
intense scrutiny forever, and we will know what they are doing. 
And it will ensure that the world community is united in 
ensuring that Iran's nuclear activities are and remain wholly 
peaceful even as we also stay united in pushing back against 
its other activities in the region which we object to.
    We believe this is a good deal for the world, a good deal 
for America, a good deal for our allies and friends in the 
region. And we think it does deserve your support.
    [The prepared statement of Secretary Kerry follows:]

         Prepared Statement of Secretary of State John F. Kerry

    Chairman Corker, Ranking Member Cardin, members of the committee, 
friends and former colleagues--I appreciate the chance to discuss with 
you the comprehensive plan that we and our P5+1 partners have developed 
with Iran regarding the future of its nuclear program.
    I am joined by the two Cabinet Secretaries whose help was 
invaluable in reaching this deal--Treasury Secretary Jack Lew and 
Energy Secretary Ernie Moniz.
    I want to thank all of you for the role that Congress has played in 
getting us to this point and particularly for this committee's hard 
work in enacting sanctions that achieved their purpose--by bringing 
about serious, productive negotiations with Iran.
    From the day those talks began, we were crystal clear that we would 
not accept anything less than a good deal--a deal that shuts off all of 
Iran's pathways toward fissile material for a nuclear weapon and 
resolves the international community's concerns about Iran's nuclear 
program.
    After 18 months of intense talks, the facts are also crystal clear: 
the plan announced last week in Vienna is the good deal we have sought.
    Under its terms, Iran must get rid of 98 percent of its stockpile 
of enriched uranium, two-thirds of its installed centrifuges, and the 
existing core of its heavy-water reactor.
    Iran will be barred from producing or acquiring both highly 
enriched uranium and weapons-grade plutonium for at least the next 15 
years.
    Iran will be subject to the most comprehensive and intrusive 
verification and transparency measures ever negotiated--so that if Iran 
cheats, we will know it quickly and be able to respond accordingly. And 
many of these measures will be in place not just for 10 or 15 or 20 
years, but for the lifetime of Iran's nuclear program, which will 
enable us to verifiably ensure it remains exclusively peaceful.
    Remember that, 2 years ago, when our negotiations began, we faced 
an Iran that was enriching uranium up to 20 percent at a facility built 
in secret and buried in a mountain; was rapidly stockpiling enriched 
uranium; had installed nearly 20,000 nuclear centrifuges; and was 
building a heavy-water reactor that could produce weapons-grade 
plutonium at a rate of one to two bombs per year. Experts tabbed Iran's 
so-called breakout time--the interval required for it to have enough 
fissile material for a bomb--at 2 to 3 months.
    This is the reality we would return to if this deal is rejected--
except that the diplomatic support we have been steadily accumulating 
in recent years would disappear overnight.
    Let me underscore--the alternative to the deal we have reached is 
not a better deal--some sort of unicorn arrangement involving Iran's 
complete capitulation. That's a fantasy--plain and simple.
    The choice we face is between a deal that will ensure Iran's 
nuclear program is limited, rigorously scrutinized, and wholly 
peaceful--or no deal at all.
    If we walk away from what was agreed in Vienna, we will be walking 
away from every one of the restrictions we have negotiated, and giving 
Iran the green light to double the pace of its uranium enrichment; 
proceed full speed ahead with a heavy-water reactor; install new and 
more efficient centrifuges; and do it all without the unprecedented 
inspection and transparency measures we've secured.
    If we walk away, our partners will not walk away with us. Instead, 
they will walk away from the tough multilateral sanctions regime they 
helped us to put in place. We will be left to go it alone and whatever 
limited economic pressure from sanctions would remain would certainly 
not compel Tehran to negotiate or to make any deeper concessions.They 
would instead push the program ahead potentially forcing military 
conflict. And we will have squandered the best chance we have to solve 
this problem through peaceful means.
    Make no mistake: we will never accept a nuclear-armed Iran. But the 
fact is that Iran has extensive experience with nuclear fuel cycle 
technology. We cannot bomb that knowledge away. Nor can we sanction 
that knowledge away. Remember that sanctions did not stop Iran's 
nuclear program from growing steadily, to the point it had accumulated 
enough low-enriched uranium that, if further enriched, could be used to 
produce about 10 nuclear bombs.
    The truth is that the Vienna plan will provide a stronger, more 
comprehensive, and more lasting means of limiting Iran's nuclear 
program than any realistic alternative.
    And to those who are thinking about opposing the deal because of 
what might happen in year 15 or 16--remember that, if we walk away, 
year 15 starts tomorrow--and without any of the long-term verification 
or transparency safeguards that we have put in place to ensure that we 
prevent Iran from acquiring a nuclear weapon.
    Over the past week, I have spoken at length about what, exactly, 
this deal is. But I also want to make clear what this deal was never 
expected or intended to be.
    This plan was designed to address the nuclear issue alone, not to 
reform Iran's regime, or end its support for terrorism, or its 
contributions to sectarian violence in the Middle East. Those are all 
issues about which we remain deeply concerned and will continue to take 
real steps, which is why we are upholding our unprecedented levels of 
security cooperation with Israel; why we are working so closely with 
the Gulf States and continue to maintain a robust military presence in 
the region and countering Iran's destabilizing activities; why we will 
keep striving to prevent terrorist groups--including Hamas and 
Hezbollah--from acquiring weapons; and why U.S. sanctions related to 
human rights, terrorism, and ballistic missiles will remain in place. 
It is also why we will continue to press Iran for information about the 
missing and for the immediate release of Americans who have been 
unjustly detained.
    The fact is, there is not a challenge in the entire region that 
would not become much worse if Iran had a nuclear weapon--and that is 
exactly why this deal is so important. Its provisions will help us to 
address the full range of regional challenges without the looming 
threat of a nuclear-armed Iran.
    That outcome cannot be guaranteed either by sanctions alone or--on 
an enduring basis--by military action. The only viable option is a 
comprehensive diplomatic resolution of the type reached in Vienna. That 
deal will make our country and our allies safer. It will ensure that 
Iran's nuclear program remains under intense scrutiny. And it will 
ensure that the world community is united in ensuring that Iran's 
nuclear activities are and remain wholly peaceful. It is a good deal 
for the world--a good deal for America--and it richly deserves your 
support. Thank you.

    The Chairman. Thank you.
    Secretary Moniz.

   STATEMENT OF HON. ERNEST MONIZ, SECRETARY OF ENERGY, U.S. 
              DEPARTMENT OF ENERGY, WASHINGTON, DC

    Secretary Moniz. Thank you, Mr. Chairman, Ranking Member 
Cardin, and members of the committee. I do appreciate the 
opportunity to come here to discuss the JCPOA reached between 
the E-3/EU+3, and Iran. The agreement prevents Iran from 
getting a nuclear weapon, provides strong verification measures 
that give us time to respond if Iran chose to violate the 
terms, and fundamentally takes none of our options off the 
table.
    I want to stress that America's leading nuclear experts at 
the Department of Energy and our National Laboratories were 
involved throughout these negotiations. Argonne, Livermore, Los 
Alamos, Oak Ridge, Pacific Northwest, Sandia, Savannah River, 
the Y-12 National Security Complex, and the Kansas City plant 
all played important roles.
    These nuclear experts were essential to evaluating and 
developing technical proposals in support of the U.S. 
delegation. As a result of their work, I am confident that the 
technical underpinnings of this deal are solid, and the 
Department of Energy stands ready to assist in the 
implementation.
    The deal meets the President's objectives: verification 
that the Iranian nuclear program is exclusively peaceful and 
sufficient lead time to respond if it proves otherwise. The 
JCPOA will extend for at least 10 years the time it would take 
for Iran to produce just the fissile material for a first 
nuclear explosive to at least 1 year--from the current breakout 
time of 2, perhaps 3 months.
    The deal addresses the uranium enrichment, plutonium, and 
covert pathways to a nuclear weapon. The first point I would 
like to make is that the Lausanne Parameters, as the ranking 
member mentioned, are maintained and, in fact, strengthened--
not weakened, but strengthened--in the final agreement.
    This means restricting the number, type, and location of 
centrifuges, dialing back the R&D program, dramatically 
reducing Iran's enriched uranium stockpile from 12,000 to 300 
kilograms of low enriched uranium hexafluoride, and prohibiting 
introduction of any fissile materials to Fordow. Excess 
infrastructure is also removed from both Natanz and Fordow. All 
these reasons taken together establish the one-year breakout 
timeline for accumulating highly enriched uranium.
    And something that we have not stressed, but I do want to 
add, at the end of these 10 years, Iran will have far fewer 
than 19,000 centrifuges because they acknowledge the breakage 
rate, if you like, of our IR-1s, and they will not have a large 
replacement capacity because of the agreement.
    In addition, Iran will have no source of weapons-grade 
plutonium. The Arak reactor is transformed under international 
oversight and participation to produce far less plutonium than 
their current design, and no weapons-grade plutonium in normal 
operation, and essentially immediate recognition if they try to 
deviate from that practice. Furthermore, all of the irradiated 
fuel, plutonium-bearing fuel, from that reactor goes out of the 
country for life, the life of the reactor.
    This deal goes beyond the parameters in Lausanne in a 
number of ways. One area is that Iran will not engage in 
several activities that could contribute to the development of 
a nuclear explosive device, including multiple point explosive 
systems and special neutron sources. These commitments are 
indefinite. And in addition, for 15 years, Iran will not pursue 
plutonium, or uranium, or uranium alloy metallurgy. Because 
Iran will not engage in activities needed to use weapons-grade 
material for an explosive device, an additional period should 
be added to our stated breakout timeline.
    To be clear, the deal is not built on trust. It is pretty 
hard-nosed--hard-nosed requirements that will limit Iran's 
activities and ensure inspections, transparency, and 
verification. I can assure you this is not what Iran wanted. It 
is a substantial dialing back of their--of their program.
    To preclude cheating, international inspectors will be 
given unprecedented access to all of Iran's declared nuclear 
facilities. I guess we could make an exception if there were 
military occupation, but that is not the case here or with any 
other sites of concern. As well as the entire nuclear supply 
chain from the uranium supply to centrifuge manufacturing and 
operation. And this access to the uranium supply chain comes 
with a 25-year commitment. And beyond 25 years, even after a 
quarter century of compliance with a peaceful program, assuming 
we get there, we still have, as we have said many times, the 
additional protocol in place to monitor Iran's nuclear 
activities.
    But another thing that we have, also in perpetuity, is 
their adherence to Modified Code 3.1, which means that they 
must notify the IAEA even before they start building any 
nuclear facility. This eliminates a loophole where one could do 
something covertly and then say, you know, oops, we were 
planning to notify before we bought nuclear material. They must 
do this now in the planning stage, so it is another thing that 
we have beyond 25 years.
    The IAEA will be permitted to use advanced technologies, 
and, again, this was nailed down after Lausanne, including 
things like real time enrichment monitoring, which I might say 
is a technology developed by our DUE Laboratories. In this 
case, by the way, Oak Ridge played a major role, Mr. Chairman.
    If the international community suspects Iran is trying to 
cheat, the IAEA can request access to any suspicious location. 
Much has been made about a 24-day process for ensuring IAEA 
inspectors can get access. I would say that, unlike Secretary 
Kerry, I did say the words ``any time, anywhere,'' and I am 
very pleased that yesterday a member of your caucus 
acknowledged, however, that the full sentence was ``any time, 
anywhere in the sense of a well-defined process with a well-
defined end time.'' So I am pleased that we have established 
that.
    In fact, the IAEA can request access to any suspicious 
location with 24 hours' notice under the Additional Protocol, 
which Iran, again, will implement. The deal does not change 
that baseline. The issue is there then if agreement is not 
reached, then when the IAEA requests access, this 24-day clock 
will start. And this is a new tool, a finite time, a new tool 
for resolving disputes within what we think is a short period 
of time, and ``short'' is defined because of our confidence in 
environmental sampling that we will then be able to implement 
to detect microscopic traces of nuclear materials, even after 
attempts are made to remove the evidence of activities with 
nuclear material.
    And, in fact, Iran's history provides a good example. In 
February 2003, the IAEA requested access to a suspicious 
facility in Tehran. It was denied. Negotiations dragged out for 
6 months, but even after that long delay, environmental samples 
taken by the IAEA revealed nuclear activity even though Iran 
had made a substantial effort to remove and cover up the 
evidence. And we have, in addition, conducted our own 
experiments to verify the ability to detect very, very small 
traces of uranium.
    The agreement will be implemented in phases, as has been 
said already: some 10 years, 15 years, 20, 25 years, and then, 
as I have already described, the key transparency measures that 
stay beyond 25 years, of course, as long as Iran is in the NPT. 
And if they were not in the NPT, every alarm would go off all 
over the place and appropriate actions would, of course, be 
taken.
    In closing, I just want to acknowledge the tireless work of 
the negotiating team lead by my colleague, Secretary Kerry. The 
U.S. Multi-Agency delegation worked together seamlessly. And 
the E-3/EU+3 displayed remarkable cohesion throughout this very 
complex endeavor. The continued collaboration and cooperation 
among the leading nations, in particular, the P+5 of the U.N. 
Security Council, is really crucial to ensuring that Iran 
complies with the JCPOA so as to avoid the reimposition of a 
major international sanctions regime, and probably other 
responses as well.
    I just want to say again the deal is based on science and 
analysis. Because of its deep grounding and exhaustive 
technical analysis carried out largely by our DOE scientists 
and engineers, again, I am confident that this is a good deal 
for America, for our allies, and for our global security.
    And just to respond to Ranking Member Cardin's criterion, 
Iran will be farther from a nuclear weapon capability all the 
time with, rather than without, this agreement.
    So, again, thank you for the opportunity to be here. I look 
forward to the discussion.
    [The prepared statement of Secretary Moniz follows:]

         Prepared Statement of Secretary of Energy Ernest Moniz

    Chairman Corker, Ranking Member Cardin and members of the 
committee, thank you for the opportunity to discuss the historic Joint 
Comprehensive Plan of Action (JCPOA) reached between the E3/EU+3 
(China, France, Germany, Russia, the United Kingdom, the European 
Union, and the United States) and Iran.
    The JCPOA prevents Iran from getting a nuclear weapon, provides 
strong verification measures that give us ample time to respond if Iran 
chose to violate its terms, and takes none of our options off the 
table.
    America's leading nuclear experts at the Department of Energy were 
involved throughout these negotiations. The list of labs and sites that 
provided support is long, including Argonne National Laboratory, 
Lawrence Livermore National Laboratory, Los Alamos National Laboratory, 
Oak Ridge National Laboratory, Pacific Northwest National Laboratory, 
Sandia National Laboratory, Savannah River National Laboratory, the Y-
12 National Security Complex, and the Kansas City Plant.
    These nuclear experts were essential to evaluating and developing 
technical proposals in support of the U.S. delegation. As a result of 
their work, I am confident that the technical underpinnings of this 
deal are solid and the Department of Energy stands ready to assist in 
its implementation.
    This deal clearly meets the President's objectives: verification of 
an Iranian nuclear program that is exclusively peaceful and sufficient 
lead time to respond if it proves otherwise. The JCPOA will extend for 
at least 10 years the time it would take for Iran to produce enough 
fissile material for a first nuclear explosive device to at least 1 
year from the current breakout time of just 2 to 3 months.
    Let me take a moment to walk through how the JCPOA blocks each of 
Iran's pathways to the fissile material for a nuclear weapon: the high 
enriched uranium pathways through the Natanz and Fordow enrichment 
facilities, the plutonium pathway at the Arak reactor, and the covert 
pathway.
    Iran will reduce its stockpile of up-to-5-percent enriched uranium 
hexafluoride, which is equivalent now to almost 12,000 kg, by nearly 98 
percent to only 300 kilograms of low (3.67 percent) enriched uranium 
hexafluoride, and will not exceed this level for 15 years. In 
particular, Iran will be required to get rid of its 20-percent enriched 
uranium that is not fabricated into fuel for the Tehran Research 
Reactor. This is important because excess 20 percent enriched uranium 
could be converted into feed for centrifuges, which would be about 90 
percent of the way to bomb material.
    Iran's installed centrifuges will be reduced by two-thirds, leaving 
it with just over 5,000 operating centrifuges at Natanz--its only 
enrichment facility--under continuous IAEA monitoring. For the next 10 
years, only the oldest and least capable centrifuges, the IR-1, will be 
allowed to operate.
    Iran has an established R&D program for a number of advanced 
centrifuges (IR-2, IR-5, IR-6, IR-8). This pace of the program will be 
slowed substantially and will be carried out only at Natanz for 15 
years, under close International Atomic Energy Agency (IAEA) 
monitoring. Iran will not pursue other approaches to uranium 
enrichment.
    The underground uranium enrichment facility at Fordow will be 
converted to a nuclear, physics, and technology center where specific 
projects such as stable isotope production are undertaken. There will 
be no uranium enrichment, no uranium enrichment research and 
development, and no nuclear material at the site at all for 15 years. 
In cooperation with Russia, Iran will pursue a limited program for 
production of stable isotopes, such as those used for medical 
applications. And the IAEA will have a right to daily access at Fordow 
as well.
    All of these reasons taken together establish the 1 year breakout 
timeline for accumulating high enriched uranium.
    In addition, Iran will have no source of weapons-grade plutonium. 
The Arak reactor, which according to its original design could have 
been a source of plutonium for a nuclear weapon, will be transformed to 
produce far less plutonium overall and no weapons-grade plutonium when 
operated normally. All spent fuel from the reactor that could be 
reprocessed to recover plutonium will be sent out of the country, and 
all of this will be under a rigorous IAEA inspection regime.
    This deal goes beyond the parameters established in Lausanne in a 
very important area. Under this deal, Iran will not engage in several 
activities that could contribute to the development of a nuclear 
explosive device, including multiple point explosive systems. These 
commitments are indefinite. In addition, Iran will not pursue plutonium 
or uranium (or its alloys) metallurgy for 15 years. Because Iran will 
not engage in activities needed to use weapons grade material for an 
explosive device, an additional period can be added to the breakout 
timeline.
    To be clear, this deal is not built on trust. It is built on hard-
nosed requirements that will limit Iran's activities and ensure 
inspections, transparency, and verification. To preclude cheating, 
international inspectors will be given unprecedented access to all of 
Iran's declared nuclear facilities and any other sites of concern, as 
well as the entire nuclear supply chain, from uranium supply to 
centrifuge manufacturing and operation. And this access to the uranium 
supply chain comes with a 25 year commitment.
    The IAEA will be permitted to use advanced technologies, such as 
enrichment monitoring devices and electronic seals. DOE national 
laboratories have developed many such technologies.
    If the international community suspects that Iran is trying to 
cheat, the IAEA can request access to any suspicious location. Much has 
been made about a 24-day process for ensuring that IAEA inspectors can 
get access to undeclared nuclear sites. In fact, the IAEA can request 
access to any suspicious location with 24 hours' notice under the 
Additional Protocol, which Iran will implement under this deal. This 
deal does not change that baseline. The JCPOA goes beyond that 
baseline, recognizing that disputes could arise regarding IAEA access 
to sensitive facilities, and provides a crucial new tool for resolving 
such disputes within a short period of time so that the IAEA gets the 
access it needs in a timely fashion--within 24 days. Most important, 
environmental sampling can detect microscopic traces of nuclear 
materials even after attempts are made to remove the nuclear material.
    In fact, Iran's history provides a good example. In February 2003, 
the IAEA requested access to a suspicious facility in Tehran suspected 
of undeclared nuclear activities. Negotiations over access to the site 
dragged on for 6 months, but even after that long delay, environmental 
samples taken by the IAEA revealed nuclear activity even though Iran 
had made a substantial effort to remove and cover up the evidence. This 
deal dramatically shortens the period over which Iran could drag out an 
access dispute.
    The JCPOA will be implemented in phases--with some provisions in 
place for 10 years, others for 15 and others for 20 or 25 years. Even 
after 25 years, key transparency measures, such as the legal 
obligations Iran will assume under the Additional Protocol, remain in 
place indefinitely as part of its adherence to the Nuclear 
Nonproliferation Treaty regime.
    In closing, I want to acknowledge the tireless work of the 
negotiating team, led by Secretary Kerry. The U.S. multiagency 
delegation worked together collegially and seamlessly, and the E3/EU+3 
displayed remarkable cooperation and cohesion throughout this complex 
endeavor. The continued cooperation among leading nations, in 
particular the permanent members of the U.N. Security Council and the 
EU, is crucial to ensuring that Iran complies with the JCPOA so as to 
avoid the reimposition of a major international sanctions regime.
    This deal is based on science and analysis. Because of its deep 
grounding in exhaustive technical analysis, carried out largely by 
highly capable DOE scientists and engineers, I am confident that this 
is a good deal for America, for our allies, and for our global 
security.
    Thank you for the opportunity to be here. I look forward to 
answering your questions.

    The Chairman. Thank you very much.
    Secretary Lew.

 STATEMENT OF HON. JACOB LEW, SECRETARY OF THE TREASURY, U.S. 
           DEPARTMENT OF THE TREASURY, WASHINGTON, DC

    Secretary Lew. Thank you, Mr. Chairman. Chairman Corker, 
Ranking Member Cardin, members of the committee, thanks for the 
opportunity to speak today about the Joint Comprehensive Plan 
of Action. A foreign policy decision of this significance 
deserves thorough review. I am confident that a full and a fair 
debate on the merits will make it clear that this deal will 
strengthen our national security and that of our allies.
    The powerful array of U.S. and international sanctions on 
Iran constitutes the most effective sanctions regime in 
history. These measures have clearly demonstrated to Iran's 
leaders the cost of flouting international law, cutting them 
off from the world's markets and crippling their economy. Today 
the Iranian economy is about 20 percent smaller than it would 
have been had it remained on a pre-2012 growth path.
    The United States Government stood at the forefront of this 
effort across two administrations and with the bipartisan 
support in Congress and of this committee. Together we 
established a web of far-reaching United States and 
international sanctions that ultimately persuaded Iran's 
leadership after years of intransigence to come to the table 
prepared to roll back its nuclear program.
    International consensus and cooperation to achieve this 
pressure is vital. The world's major powers have been and 
remain united in preventing a nuclear armed Iran. That unity of 
purpose produced four tough U.N. Security Council resolutions 
and national level sanctions in many countries, and secured 
adherence to U.S. sanctions by countries around the world.
    The point of these sanctions was to change Iran's nuclear 
behavior while holding out the prospect of relief if the 
world's concerns were addressed. Accordingly, once the IAEA 
verifies that Iran has completed key steps to roll back its 
nuclear program and extend its breakout time to at least 1 
year, phased sanctions relief would come into effect.
    There is no signing bonus. To be clear, there will be no 
immediate changes to U.N., EU, or U.S. sanctions. Only if Iran 
fulfills the necessary nuclear conditions will the United 
States begin suspending nuclear-related secondary sanctions on 
a phased-in basis, sanctions that target third country parties 
doing business with Iran.
    Of course, we must guard against the possibility that Iran 
does not uphold its side of the deal. That is why if Iran 
violates its commitments once we have suspended the sanctions, 
we will be able to promptly snap back both U.S. and U.N. 
sanctions. And since preventing the U.N. snapback requires an 
affirmative vote from the U.N. Security Council, the United 
States has the ability to effectively force the reimposition of 
those sanctions.
    Even as we phase in nuclear-related sanctions relief, we 
will maintain significant sanctions that fall outside the scope 
of the nuclear deal, including our primary U.S. trade embargo. 
With very limited exceptions, Iran will continue to be denied 
access to the world's largest market, and we will maintain 
sanctions targeting Iran's support for terrorist groups, such 
as Hezbollah, its destabilizing role in Yemen, its backing of 
the Assad regime, its missile program, and its human rights 
abuses at home. Just this week, Treasury sanctioned several 
Hezbollah leaders, building on designations last month 
targeting the group's front companies and facilitators, and we 
will not be relieving sanctions on Iran's Revolutionary Guard 
Corps, its Quds Force, any of their subsidiaries, or their 
senior officials.
    Some argue that sanctions relief is premature until Iran 
ceases these activities, and that funds Iran recovers could be 
diverted for malign purposes. I understand the concern, but 
Iran's ties to terrorist groups are exactly why we must keep it 
from ever obtaining a nuclear weapon. The combination of those 
two threats would raise a nightmare scenario. A nuclear armed 
Iran would be a far more menacing threat. If we cannot solve 
both concerns at once, we need to address them in turn.
    JCPOA will address the nuclear danger, freeing us and our 
allies to check Iran's regional activities more aggressively. 
By contrast, walking away from this deal would leave the 
world's leading sponsor of terrorism with a short and 
decreasing nuclear breakout time.
    We must also be measured and realistic in understanding 
what sanctions relief will really mean to Iran. Iran's $100 
billion in restricted foreign reserves, which many fear will be 
directed for nefarious purposes, constitute the country's long-
term savings, not its annual budgetary allowance. We estimate 
that after sanctions relief Iran will only be able to freely 
access around half of these reserves or about $50 billion. That 
is because over $20 million is committed to projects with China 
where it cannot be spent, and tens of billions in additional 
funds are non-performing loans to Iran's energy and banking 
sector.
    As a matter financial reality, Iran cannot simply spend the 
usable resources as they will likely be needed to meet 
international payment obligations, such as financing for 
imports and external debt. Moreover, President Rouhani was 
elected on a platform of economic revitalization, and faces a 
political imperative to meet those unfulfilled promises. He 
faces over half a trillion dollars in pressing investment 
requirements and government obligations.
    Iran is in a massive economic hole from which it will take 
years to climb out. Meanwhile, we will aggressively target any 
attempts by Iran to finance Hezbollah or use funds gained from 
sanctions relief to support militant proxies, including by 
enhancing our cooperation with Israel and our partners in the 
gulf.
    Backing away from this deal to escalate the economic 
pressure and try to obtain a broader capitulation from Iran 
would be a mistake. Even if one believed that extending 
sanctions pressure was a better course than resolving the 
threat of Iran's nuclear program, that choice is not available. 
Our partners agreed to impose costly sanctions on Iran for one 
reason: to put a stop to its illicit nuclear program. If we 
change our terms now and insist that these countries now 
escalate those sanctions and apply them to all of Iran's 
objectionable activities, they would buck, and we would be left 
with neither a nuclear deal, nor effective sanctions.
    So it is unrealistic to think that additional sanctions 
pressure would force Iran to totally capitulate, and 
impractical to believe we could marshal a global coalition of 
partners to impose such pressure after turning down a deal our 
partners believe is a good one.
    The Joint Comprehensive Plan of Action is a strong deal 
with phased relief only after Iran fulfills its commitments to 
roll back its nuclear program, and a powerful snapback built in 
later if they break the deal. Its terms achieve the objective 
they were meant to achieve, blocking Iran's path to a nuclear 
bomb. That is an overriding national security priority, and it 
should not be put at risk, not when the prospects of an 
unconstrained Iranian nuclear program presents such a threat to 
America and the world.
    Thank you, and we look forward to answering your questions.
    [The prepared statement of Secretary Lew follows:]

      Prepared Statement of Secretary of the Treasury Jacob J. Lew

    Chairman Corker, Ranking Member Cardin, thank you for the 
opportunity to speak today about the Joint Comprehensive Plan of Action 
(JCPOA) between the P5+1 and Iran, a historic deal that will ensure 
that Iran's nuclear program will be exclusively peaceful. A foreign 
policy decision of such significance deserves careful, detailed, and 
public analysis and hearings like this one are central to that review. 
I am confident that a full and fair debate on the merits will make it 
clear that this deal will strengthen our national security and that of 
our allies.
    Secretary Kerry and Secretary Moniz have detailed how the deal 
effectively cuts off all of Iran's pathways to a nuclear weapon and 
ensures the inspections and transparency necessary to verify that Iran 
is complying. I will focus on describing how the international 
sanctions coalition that the United States and our partners built over 
a nearly a decade--combined with hard-nosed diplomacy and a credible 
military deterrent--allowed us to secure far-reaching and unprecedented 
nuclear concessions from Iran. I will also discuss the nature of the 
sanctions relief contained in this deal, and how the JCPOA is 
structured to maintain pressure on Iran to fulfill its commitments. 
Finally, I want to describe the powerful sanctions that will remain in 
place to counter a range of malign Iranian activity outside of the 
nuclear sphere--most notably its active support for terrorism, its 
ballistic missiles program, destabilizing regional activities, and 
human rights abuses. The administration will continue to wield these 
measures in a strategic and aggressive manner and will work with our 
allies in the region to coordinate and intensify the impact of these 
tools.
               the impact of sanctions on iran's economy
    Iran would not have come to the negotiating table were it not for 
the powerful array of U.S. and international sanctions. These sanctions 
made tangible for Iran's leaders the costs of flouting international 
law, cutting them off from world markets and crippling their economy. 
The U.S. Government--Congress and the Executive branch--stood at the 
forefront of this effort across two administrations, successfully 
pushing for four tough U.N. Security Council resolutions and deploying 
a web of new and far-reaching U.S. sanctions that ultimately persuaded 
the Iranian leadership, after years of intransigence, to come to the 
table prepared to roll back its nuclear program.
    To see the impact of these sanctions, consider that Iran's economy 
today is around 20 percent smaller than it would have been had Iran 
remained on its pre-2012 growth trajectory. This means that even if 
Iran returns to that pre-2012 growth rate, it would take until 2020 for 
Iran's GDP to reach the level it would have been last year absent 
sanctions.
    Our sanctions have cost Iran more than $160 billion since 2012 in 
oil revenue alone. Iran's oil exports were cut by 60 percent, and have 
been held at those reduced levels for the past 2 years. And Iran's 
designated banks, as well as its Central Bank, were cut off from the 
world. Since 2012, Iran's currency, the rial, has declined by more than 
50 percent. Its inflation rate reached as high as 40 percent, and 
remains one of the highest in the world.
    We have maintained this pressure throughout the last 18 months of 
negotiations. During the negotiation period alone, our oil sanctions 
deprived Iran of $70 billion in oil revenue. And Iran's total trade 
with the rest of the world remained virtually flat.
    The international consensus and cooperation to achieve this 
sanctions pressure was vital. While views on Iran's sponsorship of 
groups like Hezbollah and its interventions in places like Yemen and 
Syria differ markedly around the world, the world's major powers have 
been--and remain--united that Iran cannot be allowed to pursue a 
nuclear weapons capability. That unity of purpose produced the U.N. 
Security Council resolutions and national-level sanctions in Japan, 
Australia, Switzerland, Canada, and many other jurisdictions. In all of 
these cases, the sanctions aimed to deliver a change in Iran's nuclear 
behavior, while holding out the prospect of relief if Iran addressed 
the world's concerns about its nuclear program.
                    sanctions relief under the jcpoa
    As you have heard from Secretaries Kerry and Moniz, the JCPOA 
closes off all of Iran's pathways to nuclear weapons capability and, 
critically, gives us the access to ensure compliance and the leverage 
to reimpose sanctions if Iran breaches the deal. Should Iran fully 
comply with the terms of the JCPOA, and should the IAEA verify this 
compliance, phased sanctions relief will come into effect.
    To be clear, about 90 days from now when the JCPOA goes into 
effect, there will be no immediate changes to U.N., EU or U.S. 
sanctions. Iran will not receive any new relief until it fulfills all 
of the key nuclear-related commitments specified in the deal, thereby 
pushing back its breakout time to at least 1 year. Until Iran does so, 
we will simply extend the limited JPOA relief that has been in place 
for the last year and a half.
    Should Iran fulfill all of the necessary conditions, we will have 
reached what it is known as ``Implementation Day,'' and phased relief 
will begin. At that time, the United States will suspend nuclear-
related secondary sanctions. These are the sanctions that primarily 
target third-country parties conducting business with Iran--including 
in the oil, banking, and shipping sectors. Relief from these 
restrictions will be significant, to be sure. But a number of key 
sanctions will remain in place. Our primary trade embargo will continue 
to prohibit U.S. persons from investing in Iran, importing or exporting 
most goods and services, or otherwise dealing with most Iranian persons 
and companies. For example, Iranian banks will not be able to clear 
U.S. dollars through New York, hold correspondent account relationships 
with U.S. financial institutions, or enter into financing arrangements 
with U.S. banks. Iran, in other words, will continue to be denied 
access to the world's largest financial and commercial market.
    The JCPOA makes only minor allowances to this broad prohibition. 
These include allowing for the import of foodstuffs and carpets from 
Iran; the export on a case-by-case basis of commercial passenger 
aircraft and parts to Iran--which has one of the world's worst aviation 
safety records--for civilian uses only; and the licensing of U.S.-owned 
or controlled foreign entities to engage in activities with Iran 
consistent with the JCPOA and U.S. laws.
    The United States will also maintain powerful sanctions targeting 
Iran's support for terrorist groups such as Hezbollah and its sponsors 
in Iran's Islamic Revolutionary Guard Corps--Quds Force; its 
destabilizing support to the Houthis in Yemen; its backing of Assad's 
brutal regime; its missile program; and its human rights abuses at 
home. Just this week, Treasury sanctioned several Hezbollah leaders, 
building on designations last month that targeted the group's front 
companies and facilitators. We will not be providing any sanctions 
relief to any of these lines of activity and will not be delisting from 
sanctions the IRGC, the Quds Force, or any of their subsidiaries or 
senior officials.
    I also want to emphasize that secondary sanctions imposed by 
Congress will continue to attach to these designations, providing 
additional deterrence internationally. For example, a foreign bank that 
conducts or facilitates a significant financial transaction with Iran's 
Mahan Air or Bank Saderat will risk losing its access to the U.S. 
financial system. These sanctions will continue to be in place and 
enforced; they are not covered by the JCPOA.
                                snapback
    While our focus is on successfully implementing this deal, we must 
guard against the possibility that Iran does not uphold its side of the 
deal. That is why, should Iran violate its commitments once we have 
suspended sanctions, we have the mechanisms ready to snap them back 
into place. For U.S. sanctions, this can be done in a matter of days. 
Multilateral sanctions at the U.N. also can be reimposed quickly, 
through a mechanism that does not allow any one country or any group of 
countries to prevent the reinstitution of the current U.N. Security 
Council sanctions if Iran violates the deal. So, even as Iran attempts 
to reintegrate into the global economy, it will remain subject to 
sanctions leverage.
                  countering iran's malign activities
    As noted above, Iran's malign activities continue to present a real 
danger to U.S. interests and our allies in the region, beyond the 
nuclear file. I have heard some argue that, until Iran ceases these 
activities, sanctions relief is premature, and that funds that Iran 
recovers could be diverted to these malign activities. I understand the 
concern well--no one wants to see the world's foremost sponsor of 
terrorism receive any respite from sanctions. But it is Iran's 
relationships with terrorist groups that make it so essential for us to 
deprive it of any possibility of obtaining a nuclear weapon. The 
combination of those two threats would raise the specter of what 
national security experts have termed the ultimate nightmare. If we 
cannot solve both concerns at once, we need to address them in turn. 
The JCPOA will address the danger of Iran's nuclear program--lowering 
the overall threat posture and freeing us and our allies to check 
Iran's regional activities more aggressively, while keeping our 
sanctions on support for terrorist activity in place. By contrast, 
walking away from this deal and seeking to extend sanctions would leave 
the world's leading sponsor of terrorism with a short and decreasing 
nuclear breakout time.
    None of this is to say that we view the sanctions relief Iran will 
receive if it complies with the JCPOA with indifference. As the agency 
with primary responsibility for sanctions against Iran over the last 
three decades, we are keenly aware of its nefarious activities in the 
region and have invested years in devising and implementing sanctions 
to frustrate its objectives.
    That said, in gauging the impact of lifting these restrictions, we 
should be measured and realistic. These funds represent the bulk of 
Iran's foreign reserves--they are the country's long-term savings, not 
its annual budgetary allowance, and as a matter of financial 
management, Iran cannot simply spend them. Of the portion that Iran 
spends, we assess that Iran will use the vast majority to attempt to 
redress its stark economic needs. President Rouhani was elected on a 
platform of economic revitalization and faces a political imperative to 
meet those unfulfilled promises. Iran's needs are vast--President 
Rouhani faces well over half a trillion dollars in pressing investment 
requirements and government obligations. And Iran's economy continues 
to suffer from immense challenges--including perennial budget deficits, 
rampant corruption, and one of the worst business environments in the 
world. Put simply, Iran is in a massive hole from which it will take 
years to climb out.
    In any event, we will aggressively target any attempts by Iran to 
use funds gained from sanctions relief to support militant proxies, 
including by continuing to enhance our cooperation with Israel and our 
partners in the gulf.
                               conclusion
    The JCPOA is a strong deal--with phased relief in exchange for 
Iranian compliance and a powerful snapback built in. Backing away from 
this deal, on the notion that it would be feasible and preferable to 
escalate the economic pressure and somehow obtain a capitulation--
whether on the nuclear, regional, terrorism, or human rights fronts--
would be a mistake. Even if one believed that continuing sanctions 
pressure was a better course than resolving the threat of Iran's 
nuclear program, that choice is not available.
    The U.N. Security Council and our partners around the world agreed 
to impose costly sanctions against Iran for one reason--to put a stop 
to its illicit nuclear program. If we changed our terms now and 
insisted that these countries continue to impose those sanctions on 
Iran, despite the availability of a diplomatic solution to its nuclear 
program, they would balk. And we would be left with neither a nuclear 
deal nor effective sanctions. It is unrealistic to think that 
additional sanctions pressure would force Iran to totally capitulate--
and impractical to believe that we could marshal a global coalition of 
partners to impose such pressure, after turning down a deal that our 
partners believe is a good one.
    The terms of this deal achieve the purpose they were meant to 
achieve: blocking Iran's paths to a nuclear bomb. That is an overriding 
national security priority, and its achievement should not be put at 
risk--not when the prospect of an unconstrained Iranian nuclear program 
presents such a threat to America and the world.

    The Chairman. Thank you all very much.
    Senator Cardin.
    Senator Cardin. Once again, thank you for your testimony. 
It has been stated many times that the United States maintains 
its ability to impose sanctions relative to support of 
terrorism, human rights violations, and ballistic missile 
issues. And I have read the JCPOA, and there are several 
paragraphs in the JCPOA that give me concern. Let me just read 
one, and that is paragraph 29 where, ``The parties will refrain 
from any policy specifically intended to directly or adversely 
affect normalization of trade and economic relations with 
Iran.''
    So, Secretary Lew, I just want to get your assurance that 
we have full ability to use the tools of sanctions against Iran 
for its support of terrorism, human rights, and ballistic 
nonnuclear type of activities, which includes actions that 
Congress might want to take.
    Secretary Lew. Senator Cardin, it was a matter of fact 
extensive discussion in the negotiations. We made clear in the 
negotiations that we retained the ability and we were going to 
keep in place sanctions on terrorism, on regional 
destabilization, on human rights violations. In fact, we are 
not lifting sanctions that are based on those authorities, and 
we are not designating entities that were designated for those 
reasons.
    We also have made clear we reserve the right to put 
additional sanctions in place to address concerns about 
terrorism, human rights, and destabilization.
    Senator Cardin. And when you say ``we,'' it includes the 
Congress of the United States.
    Secretary Lew. So, Your Honor, Congress has authorities in 
this area. I know that there is currently legislation pending 
regarding Hezbollah, and we would work with you on legislation. 
The thing that we cannot do is we cannot just put right back in 
place everything that was part of the nuclear sanctions and 
just put a new label on it. We have reserved our rights to put 
sanctions in place that address those continuing activities.
    Senator Cardin. The Iran Sanctions Act expires at the end 
of 2016. Congress may well want to extend that law so that that 
power is available immediately if Iran were to violate the 
agreement. Is that permitted under the JCPOA?
    Secretary Lew. I think that if it is on expiration, it is 
one thing. If it is well in advance, it is another. I think the 
idea of coming out of the box right now is very different from 
what you do when it expires.
    Senator Cardin. Let me ask--the question is why would that 
be? It is either allowed or not allowed, but we will get to 
that. I want to go to Secretary Moniz, if I might. The 24 days 
that you referred to, and you I appreciate your explanation. 
But there are three types of activities that could take place 
in violation of the JCPOA by Iran. They could be directly using 
nuclear material that is in violation, and you have already 
addressed that issue as far as the 24 days. But it could 
involve weaponization, or it could involve research not using 
nuclear material.
    Would the 24-day delay in those cases compromise our 
ability to determine whether Iran is in compliance with the 
agreement?
    Secretary Moniz. Senator Cardin, again, let us put--the 
nuclear material I think we have addressed and is quite secure. 
Clearly when one goes into weaponization activities, even where 
there is a spectrum; for example, working with uranium metal is 
something that would still involve nuclear material, and I 
think we would have very, very strong tools there.
    When we go to some other activities, without getting into 
too many specifics, there will still be a variety of 
signatures. For example, my second priority on the 
weaponization list would be explosively driven neutron sources, 
and I think that there are quite a--there are certainly 
telltale signs that I think we would have access to or the IAEA 
inspectors, more precisely, would have access to.
    Clearly as one gets into other areas, such as computer 
modeling, that is a very different kind of detection challenge. 
And in all of these--all of these cases, to go to undeclared 
sites, we are going to rely upon our intelligence capabilities, 
those of our partners, to be able to point the IAEA to 
suspicious activities. But there are non-nuclear signatures, 
but it does--it does get more complicated.
    Senator Cardin. Thank you. Secretary Kerry, I want you to 
just elaborate a little bit more on our capacity after the time 
limits and on Iran's obligations after the time limits. I 
understand they still have obligations under their 
nonproliferation treaty. They still have obligations with the 
additional proposals under the NPT.
    But could you tell us how much lead time we will have, what 
a breakout looks like after the 15 years, and what assurances 
do we have that we will be able to detect and take action 
before Iran becomes a nuclear weapon state after the 15 years?
    Secretary Kerry. Well, first of all, Senator, throughout 
the entire life of the agreement, the Additional Protocol 
provides or the right of access, that is where the 24-hour 
notice for access comes from, and they have to respond to it. 
So if we had any intelligence regarding a suspicious activity 
or suspicious site--shared, I might add, among many, among all 
the P5+1, Israel, countries in the region, we will have an 
incredible amount of sourcing for this--we would then be able 
to put the ask to them, and they have to respond. And if they 
do not respond to that, then we have the ability to convene, to 
vote, to put back in place sanctions, or to take other actions 
if we deem that appropriate.
    Senator Cardin. After the 15 years?
    Secretary Kerry. Yes. Yes. But let me just fill out for 
you, we also have a 20-year component which allows us televised 
tracking of their centrifuge production, of their rotors and 
bellows on the centrifuges. And we have a 25-year quite 
remarkable insight, which is access and monitoring, tracking of 
their entire uranium cycle. So from the mining, the mills, the 
yellow cake production, the gasification, the centrifuge, out 
into the nuclear.
    We have an ability to appropriately monitor that every step 
of the way. So if we have X amount of raw uranium ore coming 
out or in the mill, if there is X amount of milling take place 
and then is some diverted somewhere, and we do not see it going 
into the place it next it has to go to, we are going to have 
extraordinary insight to this.
    In addition to that, under the Additional Protocol and 
under the IAEA process for civil nuclear programs, all of the 
facilities are declared because it is a civil nuclear program. 
As such, there is literally 24/7 visitation at those sites. 
They are not even request situations. It is only for the 
undeclared facility about which you have the suspicion that you 
have to go through the other process. But we are going to have 
amazing insight because they are living by the NPT, or 
allegedly they are going to live by the NPT, and that is what 
we have to make sure they are doing. And so, we have day-to-day 
insight into that.
    I might add to all our colleagues that under the interim 
agreement, which, by the way, a number of people called an 
historic mistake and a tragedy, and you heard all of the same 
rhetoric you are hearing now, those same people asked for us to 
keep that in place 2 years later because it has worked. And the 
fact is Iran has lived up to every component of that over the 
course of the last years. They reduced the 20 percent uranium, 
they stopped construction on Arak, and so on and so forth. I 
will not go through it all now.
    So we will have this level of insight, which I think is not 
being examined enough and understood enough. Nothing ends at 15 
years. Simply the size of the stockpile limitation ends, and 
the enrichment, they can enrich further. But we will have 
insight into that enrichment. A civil nuclear program requires 
enrichment at approximately 5 percent or so. I mean, that is 
the high end of it. If you start to enrich higher, up around 20 
percent, you are talking about the Tehran research reactor or a 
few other things. But there is no rationale whatsoever for 
enrichment above that.
    And we would have insight to that enrichment program so 
that we would instantly know if they are beginning to go 
somewhere. Red flags go off everywhere, and we would be all 
over it, and able to respond. We would actually have months to 
respond to be honest with you. And so, the fact is the breakout 
time never goes down to a level below which we have an ability 
to be able to respond, and I think Ernie can speak to the full 
breadth of this scrutiny.
    Senator Cardin. Thank you, Mr. Secretary.
    Secretary Moniz. Mr. Chairman, may I just add one footnote, 
because it is kind of what could be a collateral benefit, 
actually, of this agreement is that going to the uranium supply 
chain safeguards. I just want to add that this is something 
that the IAEA really wants to have much more broadly, and so 
this would actually be a first in moving towards cradle to 
grave safeguards.
    The Chairman. And I might add there are some other firsts 
that unfortunately we cannot talk about relative to some of 
their procedures, which I alluded to. And I would say to Mr. 
Secretary, yes, people have said that they would rather keep 
JCPOA in place than move to something worse. That does not mean 
that people particularly liked the JCPOA in the first place, 
but only on comparison. So I just want to clarify that.
    Senator Risch.
    Senator Risch. Thank you, Mr. Chairman. You know, it is--
Senator Cardin, who I have the highest respect for, made a 
statement which I really agree with, and that is that we really 
need to leave emotion out of this. And I could not agree with 
him more that this should be done in a very nonemotional way. 
But that does mean we got to leave common sense out of this, 
with all due respect.
    You know, we have gone from the mantra of ``no deal is 
better than a bad deal,'' and I have heard everybody say that a 
few weeks ago. And now, we have gotten to the point where, 
well, you have to accept this, or else it is war. The mantra 
has changed dramatically.
    And all I can say if after reviewing this even in a cursory 
fashion, anyone who believes this is a good deal really joins 
the ranks of the most naive people on the face of the earth. 
When you are dealing with the people that we are dealing with 
here with the history they have of cheating and everything 
else, anyone who can say this is a good deal--I know the 
justification is, well, it is not perfect. Well, the word 
``perfect'' should not even be used in the sentence with this 
agreement. It is not even close to that.
    One of the most disappointing things, and I join the 
chairman in this, in that closed hearing yesterday is that we 
have been told we have no choice in this. We have no choice in 
this because we have gone from the position where we started 
where we had Iran isolated, and they were viewed on the world 
stage as a pariah. If we do not go along with this, we are 
told, the other negotiators are going to go along with this, 
and the United States will be isolated on this issue, and we 
will be the pariah on the national stage.
    You know, just think about that where these negotiations 
have taken us from a situation where we had Iran exactly where 
we wanted them to now if we do not go along with this, then we 
are going to be the isolated and pariah character on the 
national stage.
    Well, look, the other thing that was so important in this 
was verification. We have to have verification. Everybody said 
this is the number one thing on verification. Well, everyone 
here knows that there is a site call Parchin, and Parchin was a 
subject of these negotiations. And Parchin designed, and I 
heard the Secretary say that we are going to ensure that their 
nuclear ambitions are only for peaceful purposes. How in the 
world does Parchin fit that? Parchin was designed and operated 
as an explosive testing place where they designed a detonation 
trigger for a nuclear weapon. Parchin stays in place. Now, does 
that sound like it is for peaceful purposes?
    Let me tell you the worst thing about Parchin. What you 
guys agreed to was we cannot even take samples there. IAEA 
cannot take samples there. They are going to be able to test by 
themselves. Even the NFL would not go along with this. How in 
the world can you have a nation like Iran doing their own 
testing?
    Now, I know Secretary Moniz, who, by the way, I think is 
one of the brightest guys that I know, has told, oh, do not 
worry, we are going to be able to watch it on TV, and there is 
a good chain of custody for the samples that are going to be 
taken. Are we going to trust Iran to do this? This is a good 
deal? This is what we were told we were going to get when we 
were told, do not worry, we are going to be watching over their 
shoulder, and we are going to put in place verifications that 
are absolutely bullet proof. We are going to trust Iran to do 
their own testing? This is absolutely ludicrous.
    The one thing that bothers me incredibly about this is the 
billions of dollars that Iran is going to get. We have been 
briefed on the fact that while they have been in this horrible 
financial condition, and we have gotten them to a horrible 
financial condition, one of their national priorities has been 
to support terrorism. They have supported Hezbollah, Hamas, the 
Houthis, with financial aid, with military aid, with every kind 
of aid there is. Everything we are trying to do in the world 
has their fingerprints on it trying to do us in. So these 
billions of dollars are going to be put back in their hands 
within, I am told, about 9 months.
    And, again, we were told yesterday it does not matter what 
we do. Congress, go ahead and do your little thing. It does not 
matter because we do not have control over this money. Actually 
it is the other people that were sitting at the table that have 
control over the money, and no matter what we do, they are 
going to release the billions of dollars. Well, I got to tell 
you, this is a very heavy lift when you sleep at night and you 
say, well, I am going to vote to release $50 billion--it stated 
at $100 billion; now you got it down to $50 billion, whatever 
it is--knowing that that money is--a portion of that money is 
going to be directed transferred to people who are going to be 
trying to kill Americans and who are trying to kill innocent 
people, and that are trying to kill our allies.
    To say this is a--to be able to walk away from this and say 
that this is a good deal is ludicrous. With all due respect, 
you guys have been bamboozled, and the American people are 
going to pay for that. Thank you, Mr. Chairman.
    The Chairman. Senator Boxer.
    Secretary Kerry. Can we respond at all to any of that? 
[Laughter.]
    Senator Risch. My time is up, Mr. Chairman. I suspect we 
are going to hear lots of their responses.
    Secretary Kerry. Well, is there not time built in for 
answers or comments?
    The Chairman. I am more than glad for you to take a moment 
to answer.
    Secretary Kerry. Well, let me--let me start----
    The Chairman. I want to make sure this gets a full and fair 
hearing.
    Secretary Kerry. Yes. Let me start at the beginning here. 
The comment was made that, what is it, ``naive if you think 
this is a good deal.'' This is an article from the Washington 
Post. I urge you all to read it. ``How the Iran Deal Is Good 
for Israel According to Israelis Who Know What They Are Talking 
About.'' [Laughter.]
    I urge you to read it. It says here, ``Prominent members of 
the country's security establishment have come out at various 
stages of the negotiations in support of the Obama 
administration's efforts. . . .'' In an interview this week 
with the Daily Beast, Ami Ayalon, former head of the Shin Bet, 
or Israel's top domestic security agency, suggested that 
Israel's politicians were playing with ``fears in a fearful 
society.'' He praised the Vienna agreement as a useful measure 
to curb the Iranian threat. I do not think he is naive. 
``Efraim Halevy, former chief of the Mossad, Israel's spy 
agency, hailed Obama's victory.''
    Look, folks, you know, you can throw it around. Senator, 
you said we had them exactly where we wanted them. Nineteen 
thousand centrifuges? Enough fissile material for 10 to 12 
bombs? Is that where we wanted them? What was the purpose of 
these sanctions? I was chairman----
    Senator Risch. To dismantle their operations.
    Secretary Kerry. Let me just finish. I was chairman when we 
passed those sanctions, and our purpose was to bring the 
Iranians to negotiations. So we have negotiated, and I 
guarantee you for 15 years, you have unbelievable restraints 
that make it impossible to even think about making a bomb. 
Well, they can think about it, but they cannot do anything 
about it. So at the end of 15 years, you have every option that 
you have today. Your decision is whether you want those 15 
years to be right now, or take the 15 years and figure out 
whether or not this is going to work. That is really the 
choice.
    So I do not know what you mean by ``we had them right where 
we wanted them.'' To what end?
    The Chairman. Before I turn to Senator Boxer, since we gave 
you time, I do want to say that I think Iran has done a 
masterful job in giving you a talking point with the 19,000 
centrifuges, 10 of which are operating. But we all know they 
are antiques. They are antiques. And so, we all talk about the 
number of centrifuges, but this deal lays out their ability to 
continue research and development on the IR-2Bs, the IR-4s, the 
IR-6s, the IR-8s, and in year 8 they can industrialize that.
    Secretary Kerry. For a peaceful program. For a peaceful 
program that is under the IAEA.
    The Chairman. Well, let me--let me finish. I let you talk. 
They said the IR-8 is their future. You know the IR-1 is an 
antique. It does not even operate most of the time, or at least 
it operates 60 percent. It is slow. They want to get rid of 
those.
    So they did a masterful job in getting the West and other 
countries to focus over here on something that is of no use to 
them while they are able to draft an agreement that allows them 
a pathway to continue sophisticated development on something 
that they can put in a covert facility, and enrich in levels 
and pace that they never imagined.
    So with that, Secretary Boxer.
    Secretary Moniz. Mr. Chairman, if I may add, I think I must 
say that every element of the R&D program is rolled back in 
time. The fact is they right now have very--they are very 
active in all these areas, and it is significantly delayed. So 
that is a fact.
    The Chairman. And it is a fact in year 8 they are given the 
time----
    Secretary Moniz. In year--I am sorry, sir.
    The Chairman. In year 8. That is why the President said in 
year 13 there is zero breakout, but let me move to Senator 
Boxer.
    Secretary Kerry. There is never a zero----
    Secretary Moniz. But, sir, it is an incorrect 
characterization. I apologize for saying that in year 8 they 
are an industrial activity. It is a small cascade that they can 
start to do years after their current plans.
    The Chairman. And many people thought it was going to take 
that long for them to even have the capacity to do that. So as 
I mentioned, from a critical path standpoint, they have been 
brilliant.
    Senator Boxer. Are you ready for me? [Laughter.]
    Okay. Colleagues, put me down as someone who thinks Iran is 
a bad and dangerous actor, and I do not think there is one 
person involved that does not believe that. And so, that is why 
I believe we need to curb their nuclear ambitions. I think it 
is essential. And I do not think the American people want 
another war, and at the end of the day--I know some disagree 
with this--I think that is--at the end of the day, that is 
really the option, which everyone tiptoes around.
    Now, you know, I support the right of my colleagues to say 
anything they want. But you have sat there and you have heard 
two of my colleagues go after you with words that I am going to 
repeat. You were fleeced one said. The other said you have been 
bamboozled. So putting aside the fact that I think that is 
disrespectful and insulting, that is their right to do. There 
are other ways to express your disagreement, but that goes to 
your core as a human being and your intelligence, and I think 
you are highly intelligent.
    So let me ask you, and if you could answer yes or no. I 
know it is hard for you, Secretary Kerry, to do so----
    [Laughter.]
    Senator Boxer [continuing]. Because we are Senators, and it 
is not our way, but then I can get through the rest of my list. 
So my colleagues think that you were fleeced, that you were 
bamboozled. That means everybody was fleeced and bamboozled. 
Everybody. Almost everybody in the world. So I want to ask you, 
does the United Kingdom, our strong ally, support this accord?
    Secretary Kerry. Yes.
    Senator Boxer. Does Australia, one of our strongest allies, 
support this accord?
    Secretary Kerry. Yes.
    Senator Boxer. Does Germany support this accord?
    Secretary Kerry. Yes.
    Senator Boxer. Does France support this accord?
    Secretary Kerry. Yes.
    Senator Boxer. Does New Zealand support this accord?
    Secretary Kerry. I have not seen their statement.
    Senator Boxer. Well, they are on the Security Council, are 
they not, and they voted for it.
    Secretary Kerry. Oh, you mean in the vote? Yes.
    Senator Boxer. Well, I mean----
    Secretary Kerry. All 15 members----
    Senator Boxer. Either by voice support or a vote. Did 
Jordan voice its support in their vote?
    Secretary Kerry. Yes. Yes.
    Senator Boxer. Did Spain? Did Nigeria?
    Secretary Kerry. Yes.
    Senator Boxer. Did Lithuania? Yes. You get the drift. If 
you were bamboozled, the world has been bamboozled. That is 
ridiculous, and it is unfair, and it is wrong. You can disagree 
for sure with aspects of this agreement, but I think we need to 
stay away from that kind of rhetoric.
    Now, I have the agreement right here, and I have read it. 
And one thing that I was surprised as I sat down to read it, I 
thought, you know, will I be able to understand this document. 
It is very understandable. So I want to say--cite a couple of 
things in here. ``Iran reaffirms that under no circumstances 
will Iran ever seek, develop, or acquire any nuclear weapons.'' 
That is one phrase. Another one is, and that is--this one is 
number 16. ``Iran will not engage in activities, including at 
the R&D level, that could contribute to the development of a 
nuclear explosive device.'' ``. . . a nuclear explosive device, 
including uranium or plutonium,'' and that is in this accord.
    So one of the things I want to do is send out a message to 
Iran, not to the people of Iran who I think are really good 
people, but to those folks there that are so dangerous. And 
that is you said it real clearly, and if you do not live up to 
it, I guarantee you the consequences will not be pretty. And I 
think that is an important message that has to go out because 
they signed it, and they said it, and the whole world is 
watching them.
    Secretary Kerry, I authored the U.S.-Israel Strategic 
Partnership Act and the U.S.-Israel Enhanced Security 
Cooperation Act. So proud of that, and President Obama signed 
both of those. And it means that we stand shoulder to shoulder 
with our closest ally, and we know Israel does not like this 
agreement. I am very glad you read those comments of the Shin 
Bet person because the truth is there is division. It is quiet, 
but there are some who think this was the way to go.
    So I would hope as someone who has stood so--I was going to 
say tall, but it is hard for me to say that----
    [Laughter.]
    Senator Boxer [continuing]. Stood so tall for this 
relationship with Israel, at the end of the day, I think this 
relationship is going to be even more strengthened. And I want 
to get your view on that because I know that Ash Carter went to 
Israel. Do you have anything to report about that meeting and 
how that went?
    Secretary Kerry. Well, Secretary Carter went with the 
intention of laying out and beginning a dialogue in great 
detail, which he did, with the Defense Minister of Israel. And 
they had, I think, almost a day-long meeting in which they 
discussed the many ways in which we are prepared to work with 
Israel obviously understanding the very dangerous dynamics of 
the region right now. Secretary Carter, in fact, went up toward 
the Golan Heights to review with them what the threat is 
currently from ISIL/Daesh, and so forth. These are all things 
that we are prepared to push back on in any number of ways.
    And we also believe there is the potential for a kind of 
new alignment in the region. I will be going to speak with all 
of the GCC members in a few days to talk about the ways in 
which the gulf can come together with Israel and others in a 
more--in really a new alignment, a new----
    Senator Boxer. Well, I want to press you on that because we 
were reading about Saudi Arabia's words today in the press, and 
I just--I do not--I have not had time to check it out, and I 
wanted to ask you, do you believe the Saudis are supportive now 
despite the fact they view Iran as a regional adversary?
    Secretary Kerry. I believe they will be supportive of this, 
and I was very heartened to see--I met with Adel al-Jubeir, the 
Foreign Minister, just a few days ago. He indicated to me that 
they were prepared to support it if certain things are going to 
happen. Those things, I believe, are going to happen. So I 
anticipate that.
    And, Senator, I am sorry to divert, but I just wanted to 
mention, I forgot to quote because I do not want to be accused 
of being the person, you know, saying the choice is military or 
otherwise. Efraim Halevy, chief of the Mossad, ``Anyone who has 
followed events in Iran in recent decades or has studied the 
matter has to admit truthfully that he never believed Iran 
would ever agree to discuss these issues, let alone agree to 
each of the clauses I have mentioned.'' He also said, ``The 
alternative would be military strikes, which would plunge the 
region in deeper insecurity and would likely not be 
successful.''
    So we are not alone in describing what the choice is here. 
And I think, Senator, there is a real potential to have a 
change in the Middle East. There is also a potential to have a 
confrontation.
    Senator Boxer. Right.
    Secretary Kerry. This does not end the possibility of a 
confrontation with Iran obviously, depending on the choices 
that they make.
    Senator Boxer. Okay. I just want to say, would you just 
thank Wendy Sherman for me personally for her work? Donald 
Trump said something, why do you not bring women into this 
negotiation? It would go much better. Well, she was the chief 
negotiator.
    Secretary Kerry. Wendy Sherman----
    Senator Boxer. She is fantastic. I wish she was here.
    Secretary Kerry. She is absolutely spectacular. She did an 
extraordinary job. We would not be where we are without Wendy, 
without Jack, without Moniz, and an incredible team, a team, by 
the way, all across the Government of the United States. 
Experts whose life is spent analyzing Iran, analyzing nuclear 
proliferation, who came from the Energy Department, from the 
intelligence community, from the State Department and 
elsewhere, all who worked together. And believe me, they are a 
savvy group of people, and nobody pulled any wool over their 
eyes.
    Senator Boxer. Thank you, Mr. Chairman.
    The Chairman. Thank you.
    Senator Rubio.
    Senator Rubio. Thank you. Thank you all for being here 
today. Secretary Kerry, the administration has publicly stated 
that you expect this deal is going to be rejected in majorities 
in both Houses of Congress. You said that while winning 
approval of Congress would be nice, your goal is basically to 
convince enough Democrats to support the deal so that you can 
avoid an override of the President's veto. So as far as the 
administration is concerned, this is a done deal.
    But I do think it is important for the world, and 
especially for Iran, to understand that as far as the American 
sanctions are concerned, this is a deal whose survival is not 
guaranteed beyond the term of the current President. And by the 
way, I personally hope that the next President is someone who 
will remove the national security waiver and reimpose the 
congressional sanctions that were passed by Congress because 
this deal is fundamentally and irreparably flawed. I believe it 
weakens our national security, and it makes the world a more 
dangerous place.
    And throughout this process, by the way, this 
administration, in my opinion, has repeatedly capitulated on 
some important items. The examples are endless. It begins by 
allowing a perception to be created that we were pressing for 
anywhere, any time inspections, and now denying that that was 
ever a part of the process or ever promised. And I understand 
all the disputes about the terms, but clearly there was a 
perception created among my colleagues on both sides of the 
aisle that we were pressing for anywhere, any time inspections, 
including of potential covert sites.
    Then the snapback sanctions, I think, are also hollow. We 
have this complicated 24-day arbitration process that Iran is 
going to test and exploit over and over again. They realize 
this, by the way. They know that once the international 
sanctions are gone they will be impossible to snap back. As 
uranium counterpart Mr. Zarif has bragged, ``Once the structure 
of the sanctions collapse, it will be impossible to reconstruct 
it.'' He also bragged earlier this week, by the way, that 
incremental violations of the agreement would not be 
prosecuted.
    No matter what happens, Iran will keep the more than 
billions of dollars it is going to receive up front basically 
as a singing bonus. Iran will be allowed to continue to develop 
long-range missiles, ICBMs, with only purpose, and that is for 
nuclear warfare. And so, all these promises they are making 
about never pursuing a weapon, they are all revealed as lies 
when they are developing a long-range rocket capable of 
reaching this very room one day not so far off in the future. 
There is only reason to develop those rockets. That is to put a 
nuclear warhead on them.
    By the way, the deal also allows the arms embargo to 
eventually end. On terrorism, this deal provides billions, 
possibly hundreds of billions, to a regime that according to 
the director of National Intelligence, directly threatens the 
interests of the United States and our allies. And lastly, 
nothing in the deal holds Iran to account on human rights. 
Quite the opposite. The Iranian regime is being awarded for its 
atrocious human rights record.
    I know that you have said that you brought up the American 
hostages in every negotiation, and I think we all thank you for 
that. But for the families of Americans who are missing or 
detained in Iran, such as that of my constituent, Robert 
Levinson, this deal has brought no new information regarding 
their loved ones' whereabouts. This deal does nothing for 
Washington Post reporter, Jason Rezaian, whose brother, Ali, is 
with us here in this room today. In fact, you personally met 
and negotiated with an Iranian official who when pressed on 
Jason's case, lied to the world. He lied to the world by 
saying, ``We do not jail people for their opinions.''
    This deal does nothing for Marine Corps Sergeant, Amir 
Hekmati, who dictated a letter from Evin Prison that said, 
``Secretary Kerry sits politely with the Iranians shaking hands 
and offering large economic concession to save them from 
economic meltdown'' as Iran adds hostages. It does nothing for 
Pastor Saeed Abedini, whose only crime was practicing his 
religion.
    In fact, the only people this deal does anything for 
directly are the Iranian officials who want to continue to jail 
and execute their people, who hate Israel and seek to wipe the 
Jewish state and its people from the face of the planet, who 
want to spread mayhem throughout the Middle East, and continue 
to help Assad slaughter the Syrian people and perhaps kill some 
Americans and Israelis while they are at it.
    Secretary Kerry, I do not fault you for trying to engage in 
diplomacy and striking a deal with Iran. I do not. I do fault 
the President for striking a terrible deal with Iran. I hope 
enough of my Democratic colleagues can be persuaded to vote 
against this deal and prevent the President from executing it. 
But even if this deal narrowly avoids congressional defeat, 
because we cannot get to that veto-proof majority, the Iranian 
regime and the world should know that this deal--this deal is 
your deal with Iran. I mean, yours meaning this administration. 
And the next President is under no legal or moral obligation to 
live up to it.
    The Iranian regime and the world should know that the 
majority of Members of this Congress do not support this deal, 
and that the deal could go away on the day President Obama 
leaves office. And in that realm, I wanted to ask about this. 
If you today are a company that after this deal is signed, go 
into Iran and build a manufacturing facility, and then the next 
President of the United States lifts the national security 
waiver, or Iran violates the deal, do the sanctions apply 
against that facility moving forward?
    In essence, if I go in--if a company goes into Iran now 
after this deal, builds a manufacturing facility of any kind. 
They build car batteries. And then Iran violates the deal, and 
the sanctions kick back in, will that facility be able to 
continue to operate without facing sanctions?
    Secretary Lew. Senator, if a company acts to go in to do 
business with Iran while the sanctions are lifting, that would 
be permitted. If Iran violates the deal and if the sanctions 
snap back, they would not be able to continue doing things that 
are in violation of the sanctions.
    Senator Rubio. Okay. So the reason why it is important, it 
is important for companies anywhere in the world to know that 
whatever investment they make in Iran, they are risking it. In 
essence, they are betting on the hope that Iran never violates 
the deal, and they are also hoping that the next President of 
the United States does not reimpose U.S. congressional 
sanctions by which they would become a sanctioned entity.
    I have one more specific question about the deal. There is 
a section titled ``nuclear security.'' And the document states 
that, ``Those who negotiated the deal are prepared to cooperate 
with Iran on the implementation of nuclear security guidelines 
and best practices.'' There is a provision, 10.2. It reads, 
``Cooperation through training and workshops to strengthen 
Iran's ability to protect against and respond to nuclear 
security threats, including sabotage, as well as to enable 
effective and sustainable nuclear security and physical 
protection systems.''
    Here is my question. If Israel decides it does not like 
this deal and it wants to sabotage an Iranian nuclear program 
or facility, does this deal--does this deal that we have just 
signed obligate us to help Iran defend itself against Israeli 
sabotage or, for that matter, the sabotage of any country in 
the world?
    Secretary Moniz. I believe that refers to things like 
physical security and safeguards. I think all of our options 
and those of our allies and friends would remain in place.
    Senator Rubio. Well, I guess that is my point. If Israel 
conducts an airstrike against a physical facility, does this 
deal, the way I read it, does it require us to help Iran 
protect and respond to that threat?
    Secretary Moniz. No.
    Senator Rubio. It does not?
    Secretary Moniz. No.
    Secretary Kerry. The purpose of that is to be able to have 
longer term guarantees, as we enter a world in which cyber 
warfare is increasingly a concern for everybody, that if you 
are going to have nuclear capacities, you clearly want to be 
able to make sure that those are adequately protected. But I 
can assure you we will coordinate in every possible way with 
Israel with respect to Israel's concern.
    Senator Rubio. So if Israel conducts a cyber attack against 
the Iranian nuclear program----
    Secretary Kerry. Well----
    Senator Rubio [continuing]. Are we obligated to help them 
defend themselves against the Israeli cyber attack?
    Secretary Kerry. No. I assure you that we will be 
coordinating very, very closely with Israel as we do on every 
aspect of Israel's security.
    Senator Rubio. But that is not how I read this.
    Secretary Kerry. Well, I do not see any way possible that 
we will be in conflict with Israel with respect to what we 
might want to do there. And I think we just have to wait until 
we get to that point.
    But I do think, Senator, you know, I listened to a long 
list of your objections here about the deal, but there is no 
alternative that you or anybody else has proposed as to what 
you----
    Senator Rubio. I sure have, Secretary Kerry. I have.
    Secretary Kerry. And I am confident that the next President 
of the United States will have enough common sense that if this 
is being applied properly, if it is being implemented fully, 
they are not just going to arbitrarily end it. They might want 
to engage and find a way if they think there is some way to 
strengthen it or do something. But I cannot see somebody just 
arbitrarily deciding let us go back to where we were where they 
are completely free to do whatever they want without any 
inspections, without any input, without any restraints, without 
any insight. I do not think any President would do that.
    Senator Rubio. Well, under the status quo, they are already 
in violation. Before you signed this deal, Iran was already in 
violation of existing mandates and restrictions, including 
things they had signed onto in the past.
    Secretary Kerry. And this deal brings them back into 
compliance, Senator. That is exactly the purpose of this deal.
    Senator Rubio. Well, this deal brings them back to the 
promise of compliance.
    Secretary Kerry. They have to live up to it, and if they do 
not live up to it, every option we have today is on the table. 
So we do not lose anything here.
    The way we lose is by rejecting the deal because then you 
have no restraints. You have no sanctions. You have no insight. 
You have no inspectors. You have no diminution of their 
centrifuges. You have no reduction of their stockpile. And if 
you want to just conveniently forget the fact that they had 
enough fissile material to build 10 to 12 bombs--that is the 
threat to Israel.
    I mean, if you go back to that without any alternative 
other than what, you know, most people think is going to be the 
alternative, which is confrontation. Nobody has a plan that is 
articulated, that is reasonable as to how you are going to 
strengthen this, do something more when the Supreme Leader of 
Iran and the President of Iran, and others believe they have 
signed an agreement with the world, and the rest of the world 
thinks it is a good agreement.
    Now, if you think the Ayatollah is going to come back and 
negotiate again with America--that is fantasy. You are never 
going to see that because we will have proven we are not 
trustworthy. We have 535 Secretaries of State, and you cannot 
deal with anybody, and that is going to undo a whole bunch of 
efforts and a whole bunch of things that matter to people in 
the world. That is what is at stake here.
    The Chairman. Thank you. Mr. Secretary, just to ensure that 
I have appropriately addressed the situation, I want to refrain 
and say we have been fleeced, and make sure that nothing was 
directed at an individual.
    I do want to say one of the ways we have brought them into 
compliance is that we have agreed to let them do what they are 
doing, and actually agreed to let them do it on an 
industrialized basis. So I will have to say that is how we 
brought them into compliance, but if I could, Senator 
Menendez----
    Secretary Kerry. But, Senator, this is a very important 
point because we are not alone in this, folks. The Bush 
administration proposed the exact same thing. This is not 
something that President Obama just sort of dreamed up and 
thought was a good idea.
    On June 12, 2008, President Bush through Condoleezza Rice, 
who signed the memorandum with the P5+1, said that in return 
for Iran doing things with their nuclear program, here is what 
we were ready to do: ``recognize Iran's right to . . . nuclear 
energy for peaceful purposes.'' That is all we are doing. 
``Treat Iran's nuclear programme in the same manner as that of 
any non-nuclear-weapon State party to the NPT once 
international confidence in the exclusively peaceful nature of 
Iran's nuclear programme is restored''; provide ``technological 
and financial assistance'' for peaceful nuclear energy 
including ``state-of-the-art'' power reactors, ``support for 
R&D'', and ``legally binding nuclear fuel supply guarantees''; 
improve relations with Iran; and ``support Iran in playing an 
important and constructive role in international affairs.''
    Think about that. ``Work with Iran and others in the region 
to encourage confidence-building measures and regional 
security''; ``[r]eaffirmation of the obligation to refrain . . 
. from the threat or use of force . . . cooperation on 
Afghanistan . . . steps toward the normalization of trade and 
economic relations''; energy partnership; civilian projects; 
civil aviation cooperation; ``assistance to Iran's economic and 
social development.''
    All of that was offered by President George W. Bush on June 
12, 2008, but did not happen because Iran was not----
    The Chairman. You are sort of filibustering here. The one 
element that you left out that they did not agree to is to 
allow----
    Secretary Kerry. Was to stop the enriching----
    The Chairman. [continuing]. Allowing them to enrich. So if 
I could, so you did----
    Secretary Kerry. But, Senator----
    The Chairman. Senator Menendez--let, you know. Okay.
    Secretary Kerry. That is fine.
    Senator Menendez. Thank you, Mr. Chairman. Let me start off 
by saying that I appreciate the enormous work and the arduous 
quest that you have been in pursuit of. And I think that no one 
would want to be applauding you more than I, who has been 
following Iran since my days on the House International 
Relations Committee nearly 20 years ago, and as one of the 
authors of the sanctions regime that are recognized to bring 
Iran to the negotiating table.
    However, I am concerned that the deal enshrines for Iran 
and, in fact, commits the international community over time to 
assisting Iran in developing an industrial scale nuclear power 
program complete with industrial scale enrichment. And while I 
understand the program is going to be subject to Iran's NPT 
obligations, I think it fails to appreciate Iran's history of 
deception in its nuclear program and its violations of the NPT.
    And it will in the long run, I think, make it harder to 
demonstrate that Iran's program is not, in fact, being used for 
peaceful purpose because Iran will have legitimate reasons to 
have advance centrifuges and an enrichment program. We will 
then have to demonstrate if, in fact, that is the case that is 
intention is dual use and not justified by its industrial 
nuclear power program. And that is a much more difficult 
burden.
    Now, Mr. Secretary, you have always been skeptical about 
sanctions. I know you sort of like embrace them here today. But 
when you were chairman of this committee in a hearing on 
sanctions legislation that I was authorizing, when the 
administration was vigorously--vigorously--arguing against it, 
your comment was to Wendy Sherman and David Cohen, ``So what 
you are really saying is that this is a very blunt instrument 
which risk adverse reaction as opposed to a calculated 
effort.''
    So in that hearing I remember I had to come back because I 
did not expect that even the question of the amendment was 
going to come up, and they were there trying to excoriate the 
effort. It passed 99 to zero, and then subsequently by the 
administration as the reason why Iran has come back to the 
negotiating table.
    So let me ask, under the sanctions heading of the 
agreement, paragraph 26 says, and I quote, ``The United States 
Administration, acting consistent with the respective roles of 
the President and the Congress, will refrain from reintroducing 
or reimposing sanctions specified in Annex 2,'' which are 
basically the sanctions that this committee and the Congress 
passed that it has ceased apply under the JCPOA.
    So, Secretary Lew, I read that to mean that we cannot 
reintroduce or reimpose the existing sanctions that Congress 
passed into law. Is that right?
    Secretary Lew. Senator, we have been very clear that we 
retain our right and we will, if we need to, reimpose sanctions 
for reasons that are not nuclear if they live with the nuclear 
agreement and they violate other----
    Senator Menendez. No. I am talking about existing nuclear 
sanctions which expire next year. If snapback provisions of the 
sanctions are to be an effective deterrent, as the 
administration has suggested, of Iranians breaking the 
agreement, will the administration agree to support the 
reauthorization of the existing sanctions that passed the 
Senate 99 to zero and which expire next year? Yes or no?
    Secretary Lew. So let me be clear that the sanctions that 
are being lifted if Iran complies, if they comply, we said we 
would not reimpose nuclear sanctions if they lived with the 
nuclear agreement.
    Senator Menendez. I know, but my point is this. If you are 
going to snap back, you got to snap back to something.
    Secretary Kerry. But Senator----
    Senator Menendez. So if you are not snapping back----
    Secretary Kerry. Senator----
    Senator Menendez. Let me finish, Mr. Secretary.
    Secretary Kerry. Snapback is what gives you----
    Senator Menendez. Mr. Secretary, please do not eat up my 
time. I am sorry, with all due respect, do not eat up my time. 
If, in fact, the sanctions which exist that all heralded and 
said brought Iran to the table expire next year, in 2016, and 
we do not reauthorize them, there is nothing at least in that 
context to snap back to. So why will you not simply say that 
the administration supports under all the same provisions, 
including the President's waivers, the reauthorization of those 
sanctions so that the Iranians know if they violate that the 
snapback will also include snapback to what the Congress 
passed?
    Secretary Lew. Senator, what I said earlier was that right 
now the sanctions remain in effect. We have a regime in effect. 
If Iran complies, we will lift sanctions, and it is premature 
to talk about extending a law that is not----
    Senator Menendez. But this expires next year. Iran's 
obligations go out at least 8 years before the ratification of 
the Additional Protocol, and that ratification only takes place 
if the Congress lifts the sanctions. So I do not understand how 
we ultimately have a credible belief that snapback means 
something if, in fact, you are not going to have the ability to 
have those sanctions in place.
    Let me ask this to the Secretary. Is the President willing 
to make a clear and unequivocal statement not that all options 
are on the table because Iran does not believe that that is a 
credible military threat. I think if you asked our intelligence 
community, that is what they would say to you, but that under 
no circumstances will Iran be permitted to acquire a nuclear 
weapon.
    Secretary Kerry, did you hear my question?
    Secretary Kerry. I apologize. I was just trying to 
clarify----
    Senator Menendez. Let me ask you. This is my question. Is 
President Obama willing to make a clear and unequivocal 
statement, not that all options are on the table because I 
think if you talked to our intelligence people, they will tell 
you Iran does not believe that there is a credible military 
threat, but that Iran under no circumstances will be permitted 
to acquire a nuclear weapon?
    Secretary Kerry. Absolutely. He has said that and many 
times.
    Senator Menendez. Well, he said all options are on the 
table. I hope he makes that clear and unequivocal statement.
    Secretary Kerry. The President has said very clearly under 
no circumstances will they be allowed to get a nuclear weapon, 
and, in fact, and I think Ash Carter reiterated it publicly 
very specifically. But can I----
    Senator Menendez. No, no, I am sorry.
    Secretary Kerry. You want an answer----
    Senator Menendez. I have limited time. You have been with 
Iranians.
    Secretary Kerry. No, but let me----
    Senator Menendez. I have 7 minutes.
    Secretary Kerry. I know, but it is worthy----
    [Laughter.]
    Senator Menendez. Mr. Secretary, let me ask you this. I am 
seriously concerned about the lifting of the arms embargo that 
creeped its way into this deal. As I read the Security Council 
resolution on page 119, the ban on Iranian ballistic missiles 
has, in fact, been lifted. The new Security Council resolution 
is quite clear. Iran is not prohibited from carrying out 
ballistic missile work. The resolution merely says, ``Iran is 
called upon not to undertake such activity.''
    Now, previously in Security Council Resolution 1929, the 
Council used mandatory language where it said it decides that 
``Iran shall not undertake any activity related to ballistic 
missiles capable of delivering nuclear weapons.'' Why would we 
accept in theory language that changes the mandatory ``shall'' 
to a permissive ``call upon?'' We often call upon a lot of 
countries to do or stop certain actions in the U.N., but it 
does not have the force of ``shall not,'' which has 
consequences if you do. Can you answer simply is Iran banned 
from ballistic missile work for the next 8 years?
    Secretary Kerry. They are----
    The Chairman. No. No.
    Secretary Kerry. Do you want to answer, Senator? 
[Laughter.]
    The Chairman. Yes, I will. Answer it.
    Secretary Kerry. That is not accurate. The exact same 
language that is in the embargo is in the agreement with 
respect to launches, and that is under Article 25 of the U.N. 
And that is exactly where it is today in the language. But in 
addition to that, Iran did not want it, and we insisted on it--
they are restrained from any sharing of missile technology, 
purchase of missile technology, exchange of missile technology, 
work on missiles. They cannot do that under Article 41, which 
is Chapter 7, and mandatory. And it does have the language. So 
we took----
    Senator Menendez. Well, it seems--I am reading to you--I am 
reading to you from the Security Council resolution that was 
adopted codifying the agreement.
    Secretary Kerry. Yes, the Security Council resolution----
    Senator Menendez. And that Security Council resolution says 
Iran----
    Secretary Kerry. Says ``call on.''
    Senator Menendez. Mr. Secretary, I am reading you explicit 
language. I am not making this up. Iran is called upon----
    Secretary Kerry. Correct.
    Senator Menendez [continuing]. Not to undertake that 
activity.
    Secretary Kerry. That is the Article 45----
    Senator Menendez. That is far different than ``shall not.''
    Secretary Kerry [continuing]. Which is exactly what--
Senator, that is exactly what it is today. That is the same 
language as is in the embargo now, and we transferred it to 
this, and that is what it is. But under that----
    Senator Menendez. It is not the same thing, as Security 
Council Resolution 1929. I mean, I do not know why you would 
not just keep the same language, which made it clear that you 
shall not, and because there shall not exist, there are 
consequences if you do.
    Mr. Chairman, final question. I heard Senator Risch, and I 
do not know whether that is true or not. Parchin. You know, the 
whole purpose of understanding the military dimensions of what 
happened in Parchin is not for Iranians to declare culpability, 
but, in fact, to understand how far they got along in their 
weaponization efforts. General Hayden, who is the CIA director, 
said we have estimates, but they are just that. Is it true that 
the Iranians are going to be able to take the sample Senator 
Risch said, because chain of custody means nothing if at the 
very beginning what you are given is chosen and derived by the 
perpetrator.
    Secretary Kerry. Well, as you know, Senator, that is a 
classified component of this. It is supposed to be discussed in 
a classified session. We are perfectly prepared to fully brief 
you in classified session with respect to what will happen. 
Secretary Moniz has had his lab red team on that effort, and he 
has made some additional add-ons to where we are. But it is 
part of a confidential agreement between the IAEA and Iran as 
to how they do that.
    The IAEA has said that they are satisfied that they will be 
able to do this in a way that does not compromise their needs 
and that adequately gets the answers that they need. We have 
been briefed on it. Be happy to brief you.
    Senator Menendez. My time is up, but if that is true----
    Secretary Kerry. I would like Secretary Moniz to----
    Senator Menendez [continuing]. That would be the equivalent 
of the fox guarding the chicken coop.
    Secretary Kerry. Senator, I am not confirming how it is 
happening. I am simply saying to you that we are confident the 
IAEA has the ability to be able to get the answers that they 
need, and Secretary Moniz can speak quickly to that for a 
moment if he may.
    But I also--do you want to say anything on that?
    Secretary Moniz. Mr. Chairman? Yes, as Secretary Kerry 
said, this is a roadmap worked out between the IAEA and Iran. 
They have--we do not have those documents that are, as is 
customary, confidential between the country and the Agency. But 
clearly they have--they know that they must have and be able to 
articulate a process with integrity in terms of making the 
measurements and being able to analyze them through their own 
laboratories and the network of laboratories, including U.S. 
laboratories, that do the analysis of these kinds of samples.
    The Chairman. And let me just say, bringing up part of my 7 
minutes. You need to go down and have that meeting. It will 
take about 5 seconds, okay? You need to go down and meet with 
Secretary Moniz and get that answer.
    I will also add that we as a nation do not even have a 
copy. Senator Cardin and I have asked for this. You will 
understand this very quickly in about 5 seconds with the 
Secretary. But we do not even have a copy of the agreement to 
ascertain on behalf of the American people whether the IAEA 
process, which, again, you should go look into this part of it, 
has any integrity. So it is very disappointing, and I know 
Senator Cardin and I----
    Senator Cardin. Mr. Chairman, this is a very important 
point, and I agree with you. The documents in question are 
traditional between the country and the IAEA and are kept 
confidential between the country, in this case Iran, and IAEA. 
But it is part of the JCPOA, and it regards the possible 
military dimensions which are critical for us to have baseline 
in order to deal with moving forward. So it is a very important 
part.
    And from what we can tell, if we can get eyes on that 
document, it may answer some of our questions. Secretary Moniz 
has reached conclusions, and he is greatly respected in that 
regard, but I think transparency would help us all better 
understand that. And I would just hope that in a confidential 
setting there would be an opportunity to review those 
documents.
    The Chairman. Senator Johnson.
    Secretary Lew. Mr. Chairman?
    The Chairman. We are going to move on. Senator Johnson. 
Thank you.
    Senator Johnson. Let me just make the comment. How can that 
be confidential, and why would that be classified? Okay. I can 
see IAEA having those confidential agreements with normal 
powers. Iran is not a normal nation. Iran is the largest state 
sponsor of terror, and we rushed to the United Nations, had 
this deal approved, and we do not even understand how those 
samples are going to be collected and the chain of custody. It 
is unbelievable.
    Secretary Kerry, I have heard this deal described as 
historic. I will not use Vice President Biden's full 
terminology, but this is a big deal, correct? This is a big 
deal, right?
    Secretary Kerry. It is an important agreement.
    Senator Johnson. During our unfortunately limited debate on 
the Iran Nuclear Agreement Review Act, I offered a couple of 
amendments, and tried to offer a third. One was to deem this a 
treaty because I think it rises to that level where two-thirds 
of the Senate should affirmatively approve such a big historic 
deal. That amendment unfortunately failed.
    I never got a vote on my next step in the process, an 
amendment to deem this a congressional executive agreement 
where at least both chambers--you said both chambers ought to 
be involved--would have to affirmatively approve this with just 
a simple majority vote. The third amendment I tried to offer 
really reflected what we actually ended up getting in this very 
convoluted process of a vote of disapproval, which would have 
been a congressional Executive agreement with a low threshold 
approval of only 34 votes. Now, the parliamentarian I think 
very appropriately said, no, that is out of order. That is 
unconstitutional, yet that is what we have.
    My question to you is, if you are so confident this is such 
a great deal, why would you not have been supportive of 
allowing the American people to be involved in the decision 
through their elected representatives, whether or not that was 
by just allowing both chambers to have a simple vote of 
approval rather than this convoluted process, which, let us 
face it, you are quite confident you are going to win this? You 
ran to the United Nations Security Council.
    Convince me that what we are going through right now is not 
just a big charade because I am afraid that is exactly what it 
is. But, again, please tell me why this administration did 
not--if you are so confident this is such a great deal--allow 
this body, this Congress, to at least affirmatively vote to 
approve this deal?
    Secretary Kerry. It was not my decision.
    Senator Johnson. Well, the administration certainly did not 
offer any kind of support for a more robust review process. And 
you have certainly circumvented this Congress by running and 
undermining our review process by having the Security Council 
approve this. Is that not true?
    Secretary Kerry. Well, Senator, on the contrary, this is a 
long time-honored process for several centuries of executive--
of political agreements between countries----
    Senator Johnson. This is way more than a political 
agreement. I want to go on.
    Secretary Moniz, if Iran wants a peaceful nuclear program, 
there is no reason for them to have to enrich uranium, is 
there?
    Secretary Moniz. Well, I think the--clearly there is 
uranium available on the international market.
    Senator Johnson. There you go. So there is----
    Secretary Moniz. But it is also the case that many 
countries support their nuclear program with enrichment and----
    Senator Johnson. But, again, if they want a purely peaceful 
program, there is no need for them to enrich uranium. In the 
past when, for example, South Africa and Libya gave up their 
nuclear programs to be welcomed into the world of nations in a 
more normal fashion, like Iran supposedly wants, they 
completely gave up their enrichment. We dismantled that. That 
is what we demanded, correct?
    Secretary Moniz. I believe that is the case, certainly with 
South Africa. Their whole weapons program was--of course, they 
had a weapons program that was dismantled. And if I may add, by 
the way, relative to the last discussion, the documents the 
IAEA and South Africa in a full nuclear weapons dismantlement 
program remain confidential.
    Senator Johnson. Are you familiar with the EMP Commission's 
2008 report?
    Secretary Moniz. No, I am not, sir.
    Senator Johnson. You are not? Do you know what ``EMP'' is?
    Secretary Moniz. You are going to have to explain it to me, 
please.
    Senator Johnson. Electromagnetic pulse.
    Secretary Moniz. Oh, I am sorry. Whose report, I am sorry, 
is this?
    Senator Johnson. The 2008 EMP Commission.
    Secretary Moniz. No, I am not, sir. I am just not. I 
apologize. I can respond for the record if you have a question 
there.
    Senator Johnson. Okay, and I will send you a number of 
questions because the recommendations really were for the 
Department of Homeland Security and for the Department of 
Energy. We just held a hearing.
    Are you familiar with Dr. Richard Garwin?
    Secretary Moniz. Yes, absolutely.
    Senator Johnson. Okay. He testified before our committee.
    Secretary Moniz. Everyone is.
    Senator Johnson. Good. He testified before our committee 
yesterday in combination with the CIA former director, James 
Woolsey, about the threat of EMP. One of the reasons I thought 
I would hold that hearing now is nobody knows how this is all 
going to game out, but the inevitable conclusion of this deal 
is just like North Korea eventually, Iran will have a nuclear 
weapon. Plus they already have ballistic missile technology.
    Are you aware of the fact that Iran has practiced ship-
launched EMP attacks using Scud missiles?
    Secretary Moniz. No, I am not, sir.
    Senator Johnson. They have done that according to Dr. Peter 
Vincent Pry. So an EMP attack, of course, would be conducted by 
somebody like North Korea or Iran, and it could be conducted 
from a ship off of our coast using a Scud missile. And the fact 
that you as the Secretary of the Department of Energy are not 
even aware of the 15 basic recommendations, things like 
evaluate and implement quick fixes in the event of an EMP 
attack, the fact that Richard Garwin in his testimony said that 
for $20 to $70 million we could protect 700 critical 
transformer that could help us recover from something like 
that, I am highly concerned----
    Secretary Moniz. Well, sir----
    Senator Johnson [continuing]. That you as Secretary of 
Energy are not even aware of these recommendations that were 
made public in 2008. Seven years later in testimony before our 
committee, we have nothing, virtually nothing to address these 
15 recommendations by the Commission.
    Secretary Moniz. Well, first of all, if I may, again, I do 
not know that report, and clearly many of them must apply to 
DHS and DOD. However, on the transformer question, actually if 
you look at our Quadrennial Energy Review published in April, 
we do identify EMP as a risk to transformers, and we are 
beginning to try to work up a response to that.
    Senator Johnson. Seven years later we have done virtually 
nothing to protect ourselves. So, again, in light of this deal, 
we will provide a number of questions on the record to make 
sure that we start taking action on that to provide some 
protection.
    My final comment is we have heard $50 billion to $100 
billion, $104 billion, in our terms does not really seem like 
that much. But it is 13 percent--13 percent--of Iran's economy. 
If, for example, the American economy had an interjection of 13 
percent of our economy, that would be $2.4 trillion, so this is 
not chump change, and we have already seen exactly what kind of 
actor Iran is on the world stage.
    So, again, I cannot predict this whole thing, but what 
basically this deal does is it interjects tens of billions, 13 
percent up front, of Iran's economy into the economy of the 
largest state sponsor of terrorism. And so, when Senator Risch 
said we had them right where we want them, I agree. We 
certainly did not want them with centrifuges, but this deal 
puts them in a far better position. This strengthens their 
hand. And from that standpoint, I am highly concerned.
    Thank you, Mr. Chairman.
    Secretary Lew. Mr. Chairman, could I respond to the point 
about the Iranian assets? Let us be clear what those assets 
are. It is not money we are giving to Iran. It is Iran's money 
that sits in other countries that was locked up because 
international nuclear sanctions that were designed to bring 
them to the table to negotiate a nuclear agreement. So all that 
we have gone through is trying to analyze what that is. It is 
not us giving them money. If there is a nuclear agreement that 
meets the criteria that the sanctions were designed to achieve, 
that was the reason they were locked up.
    There are competing demands for that, whatever it is. We 
think it is about $50 billion. There is at least $500 billion 
of domestic demand. They cannot possibly scratch the surface of 
that need. So we have never said that there is not going to be 
a penny going to maligned purposes. Under these sanctions they 
have managed to find money to put into maligned purposes, but I 
would not exaggerate how much that is going to change things.
    The assessment that we have, that our intelligence 
community has, is that it will not be a change in direction, 
that it will be--it will be on the margin not the kind of 
increase that you are describing.
    Secretary Kerry. And by the way----
    The Chairman. Before moving to Senator Shaheen, I do want 
to say that while we have lifted--we have not ourselves lifted 
sanctions on the IRGC, which, by the way, has the nuclear file 
and is the entity that carries out all of the terrorism on 
behalf of Iran. What we uniquely did was we lifted sanctions on 
all the financial institutions they deal with. They are going 
to be the number one beneficiary of the sanctions lifting.
    So we did not lift sanctions on them. It is like not 
lifting sanctions on a holding company. But we lifted sanctions 
on the entities that feed them the money, that through the 
economic growth, the shipment of oil, and all the things they 
do, will empower their way on top. This is almost chump change 
compared to what will happen over this next decade. And so, I 
would like to say that. Senator Shaheen?
    Secretary Kerry. Senator----
    Secretary Lew. Mr. Chairman, could I just respond? We are 
not lifting sanctions on a bank like Bank Satara that was 
sanctioned for reasons related to terrorism. We have retained 
the ability to sanction banks.
    The Chairman. But many other--many other banking entities 
and others that they rely upon, we have----
    Secretary Lew. But those entities, if they violate the 
terms of our sanctions and our regime for sanctions on 
terrorism, could be sanctioned. We have not said that any of 
those institutions are, you know, protected.
    And in terms of the snapback, the point that, you know, 
Senator Menendez ended up concluding is not correct. We have 
enormous tools with or without the Iran Sanctions Act, to snap 
back sanctions through the NDAA sanctions on oil and financial 
institutions.
    Secretary Kerry. And could I just point out----
    The Chairman. Okay, well, I would just like to move to 
Senator Shaheen by saying they disagree with that. Great 
Britain disagrees with that. Germany disagrees with that. 
France disagrees with it. The EU disagrees with it. I talked to 
you about this last night.
    The tools that we have through the nuclear file are not 
available to be applied. Senator Menendez tried to pursue that. 
The other countries disagree, and matter of fact, the most 
accurate assessment of this deal from what I have been able to 
read has been coming from Iran.
    Secretary Lew. But if Iran violates it, those sanctions 
could come back on nuclear, and if they do things that violate 
terrorism sanctions, we have the ability to sanction on other 
grounds. So it is a not fair conclusion that institutions that 
continue to engage in funding terrorism or regional 
destabilization are immune from those kinds of sanctions. It is 
just not correct.
    The Chairman. I stand by my assessment as do the other 
countries who negotiated the deal with you.
    Senator Shaheen.
    Secretary Kerry. Actually the other countries----
    The Chairman. Senator Shaheen.
    Secretary Kerry. Mr. Chairman----
    The Chairman. I am just going to stop. We will get to this 
in a second.
    Senator Shaheen.
    Senator Shaheen. Well, thank you, Mr. Chairman and Ranking 
Member Cardin. Thank you to our witnesses for your testimony 
today and to the negotiating team for the tremendous effort 
that it took to get us to this point.
    Before I ask my questions, and I do actually have 
questions, I just want to say that I do not think it is to the 
benefit of this committee, this Congress, or the American 
people for any of us to impugn the motives or intellect of 
anybody involved in this discussion. I think people have strong 
views about how they feel, and it is appropriate to express 
those views. But to--because someone disagrees with you to 
suggest that their motives are not in the best interest of this 
country or that their intellect is questionable, I think does 
not advance the debate in a way that it should be advanced. So, 
Mr. Chairman, I appreciate you and the ranking member, and hope 
that we will keep this debate as a civil discussion.
    I also want to point out for the record that everybody on 
this committee voted for the Iran Nuclear Review Act of 2015. 
It was unanimous. So while I am sure all of us had concerns 
about everything, some of the provisions that were in it, it 
was voted for by the committee unanimously.
    Now, to go to my questions, I want to, Secretary Moniz, 
follow up on the issues that were raised with respect to the 
possible military dimensions of the past Iranian nuclear 
activities because that is an area where I certainly am not 
clear about how we can be confident that the IAEA is going to 
be able to get the information that it needs to complete its 
investigation. So can you speak to that a little bit and talk 
about why you believe that we are going to have the information 
that we need?
    Secretary Moniz. Well, again, Senator, all I can say that 
is that the--I mean, the IAEA is very strong technically. I 
might add that every inspector, since 1980, has been trained at 
Los Alamos National Laboratory in terms of nuclear materials 
measurement techniques, et cetera. They have a very strong 
reputation, which frankly they need to guard to make sure that 
they have a process with integrity.
    Again, it is their--there is nothing unusual here. There is 
no side agreement. This is the way it works: the IAEA 
negotiates with the country. What we have achieved in the 
negotiation is to get Iran to the table with them because 
without satisfying their requirements by October 15 to satisfy 
the Agency, there will not be any agreement going forward. That 
is very clear.
    So after years of stiffing them, to be perfectly--to use a 
technical term, then what we have done is we forced them to the 
table. They went to Tehran, not just the director general, but 
the senior people who do safeguards, et cetera. And they came 
back and feel that they have a process with integrity.
    Now, again, in this environment I can only say that the--
and I will say flat out, I mean, I personally have not seen 
those documents that the chairman referred to. I had something 
of an oral briefing, a general one, with that. We have 
assembled a national lab team to think through the kinds of 
process that we anticipate, and to recommend steps that might 
mitigate any risks. But, again, ultimately we rely upon the 
IAEA. They will make a report. The Director General has 
committed to trying to get that out this year, this calendar 
year, and, of course, that report is then where one will see 
what their conclusions are--what the basis for their 
conclusions are.
    Senator Shaheen. And will the intelligence community either 
here or our other partner countries weigh in and assess whether 
they believe that that report reflects an accurate discussion 
of Iran's past activities?
    Secretary Moniz. Well, I would have to defer to the 
intelligence community for their reactions, but I can assure 
you that our DOE experts are going to be looking over this 
very, very carefully.
    Senator Shaheen. Thank you. And, Secretary Lew, can you 
commit that there will be no sanctions relief? I think you have 
said this, but just to be clear again, until Iran has provided 
the IAEA with this information and the access that is required?
    Secretary Lew. Absolutely, Senator. Until Iran has 
completed all of its obligations, we will not be relieving any 
of the United States sanctions, nor will the international 
sanctions be relieved.
    Senator Shaheen. And I do not know who wants to respond to 
this, either Secretary Moniz or Secretary Kerry. But at the 
time we began the negotiations, what was the best estimate of 
our intelligence community about the time for Iran to break out 
with a nuclear weapon?
    Secretary Kerry. The best estimate was 2 to 3 months.
    Senator Shaheen. And was there agreement among our 
intelligence agencies about that estimate?
    Secretary Kerry. Yes, pretty much. There was a disagreement 
actually with a couple of other countries, but there was not 
disagreement in our intel community.
    Senator Shaheen. And as we look at--if this agreement goes 
into effect, is there an estimate from our intelligence 
community about how long it might take to get a nuclear weapon 
at the end of this agreement if Iran decides to pursue that 
option at the end of 15 years?
    Secretary Kerry. Well, there is a distinction, Senator. The 
breakout time as it is used in this negotiation is a hybrid of 
the traditional understanding of breakout time. Breakout time 
in arms control has usually been referred to the time it takes 
to get a weapon. We have been dealing only with the amount of 
time it takes to get enough fissile material to produce one 
weapon. You still have to produce the weapon, and most people 
do not guestimate that a country is going to be satisfied with 
only one weapon and enough fissile material for one.
    So there is a lot of time beyond that. So we have been 
operating with a huge safety cushion here, and we will have one 
year of breakout time for fissile material for one weapon for 
at least 10 years. And then it begins to tail down, but not as 
a cliff. It begins to tail down as we go through the next five 
years. And then we are indeed arriving at a point where Iran 
has hopefully achieved normal status in the NPT. I say 
``hopefully'' because if they have not, the agreement has not 
worked in the sense that they violated it, and we have gone 
back to snapback, and have the sanctions back in place.
    Senator Shaheen. And, again, can you answer whether all of 
our intelligence agencies are agreed on that particular 
breakout period, or is there is a difference of opinion?
    Secretary Kerry. No. Our intelligence community, and the 
Energy Department, and everybody worked this very, very hard. 
And it is a very precise formula which feeds in the most rapid 
possible rate by looking at the numbers of centrifuges, all 
kinds--the amount of enrichment, the capacity for enrichment, I 
mean, all of the many, many factors that go into it. It is a 
complicated formula, and everybody is in agreement as to where 
we are.
    Secretary Moniz. It also includes capacity to rebuild all 
the infrastructure that they are taking out. And I might just 
add that beyond the 15 years where there are very severe 
constraints, like on the stockpile in terms of visibility, I 
remind you that for 20 years there is still the containment and 
surveillance activities for any centrifuge sensitive parts 
manufacturing. They will all be tracked and labeled et cetera, 
and for 25 years the uranium--the uranium transparency. So it 
is like follow the uranium and the centrifuges.
    Senator Shaheen. Thank you. My time has expired. Thank you 
all.
    The Chairman. Thank you. I might add the President was 
really clear that in year 13 they are zero breakout and begin 
industrialization at year eight.
    Senator Flake.
    Senator Flake. Thank you, Mr. Chairman.
    Secretary Moniz. I do not agree with that characterization, 
Mr. Chairman.
    Senator Flake. Thank you, Mr. Chairman, and thank you for 
your testimony. I hope you will take these questions in the 
spirit they are given. I am not looking to play gotcha at all. 
I have been supportive of these negotiations. I commend you all 
for the hard work that has been done. But there is some 
disagreement here it seems with the text of the agreement as we 
read it and the explanation that is given, and let me just 
cover a couple of these points.
    Number eight, on adoption here in the annex in the 
implementation plan, it says ``Iran will officially inform the 
IAEA that effective on implementation day, Iran will 
provisionally apply the Additional Protocol pending its 
ratification by the Parliament,'' the Iranian Parliament, ``and 
will fully implement the Modified Code, 3.1.''
    We have talked about the agreement, although it is 
voluntary to live by the Additional Protocol. What happens if 
the Parliament--first, what is the timetable that is required 
for the Parliament to address the Additional Protocol?
    Secretary Kerry. They have--Senator, they have to live by 
the Additional Protocol by Adoption Day.
    Senator Flake. Understood, but going forward----
    Secretary Kerry. And they have 8 years--within 8 years to 
adopt it formally--but they are in material breach as of 
adoption day if they do not live by it. And it is fully 
understood by everybody that would be a material breach.
    Senator Flake. But there is no timetable where the 
Parliament has to----
    Secretary Kerry. They have to do it within the 8 years.
    Senator Flake. Within the 8 years.
    Secretary Kerry. Yes.
    Senator Flake. Okay. So that is the timetable. Second----
    Secretary Kerry. Which is before the sanctions are lifted. 
So you have the snapback capacity as a result of their not 
doing or living by it.
    Senator Flake. Understood. Understood. In December of 2011, 
the President signed into law the NDAA that included sanctions 
on Iran's Central Bank. These sanctions penalize foreign 
financial institutions that were doing business with Iran 
Central Bank. These sanctions will ultimately be suspended 
because of the JCPOA.
    What I am trying to understand, and this keys off a 
question that was asked by Senator Cardin and others, we--
according to the agreement, ``The United States Administration, 
acting consistent with the respective roles of the President 
and the Congress, will refrain from reintroducing or re-
imposing the sanctions specified in Annex 2, that it has ceased 
to apply under JCPOA without prejudice to the dispute 
resolution process.'' This is what I think a lot of us are 
having a hard time reconciling here, what would constitute 
reintroducing, re-imposing sanctions specified, existing 
sanctions. If because Iran did not violate the nuclear part of 
the agreement, but for other reasons--committed terrorism 
abroad, abducted Americans--and we wanted to penalize them, we 
wanted to sanction them, could we impose sanctions on Iran's 
Central Bank, because that would mimic or it would be similar 
to what was done before, but it would be in a different 
context. Would that be allowed, or would that lead to some 
violation on our part of the agreement?
    Secretary Lew.
    Secretary Kerry. I am going to stab at this because we have 
been going around on it, and I want to try to, if I can, answer 
it dispositively.
    First of all, we will not violate the JCPOA if we use our 
authorities to impose sanctions on Iran for terrorism, human 
rights, missiles, or any other nonnuclear reason. And the JCPOA 
does not provide Iran any relief from United States sanctions 
under any of those authorities or other authorities, mind you, 
and I will go through some of those other authorities.
    What we have committed to do is quite specific. Iran was 
fearful that having witnessed the desire within the Congress 
for more sanctions that even if we cut an agreement, you folks 
might just turn around the day after and say, too bad, we are 
coming with all the same sanctions. And the President is in 
veto status or override status or whatever. So what they really 
wanted was a clarity that we are not going to re-impose the 
specific nuclear-related sanctions provisions as specified in 
Annex 2 to the JCPOA contingent on them abiding by the 
commitments of the agreement.
    So it is really simply a clarification to them that we are 
not going to come back and just slap them on again. But that 
absolutely does not mean we are precluded from sanctioning 
Iranian actors, sectors, or any other actions if circumstances 
warrant. So all of our other sanctions authorities remain in 
place. They are unaffected by this agreement. And Iran only 
said, if you read what it says, that they would treat the 
imposition of new nuclear-related sanctions as the grounds to 
cease performing.
    But they are clear and we are clear that we have all kinds 
of other authorities, and let me be specific on that because it 
is important for this whole debate to be clear. Even with the 
lifting of sanctions after 8 years on missiles, or five years 
on arms, or the U.N. sanctions--it is only the United Nations 
sanctions--we still have our sanctions. Our primary embargo is 
still in place. We are still sanctioning them. And, I might 
add, for those things that we want to deal with in terms of 
their behavior, for instance, Hezbollah, there is a U.N. 
Resolution, 1701, that prevents the transfer of any weapons to 
Hezbollah. That will continue. And what we need to do is make 
sure we are enforcing it.
    Senator Flake. I think we have got that. I just want to 
make sure that if we say, all right, what was effective on 
Iran, what really has brought them to the table more than 
anything else in my view are these sanctions on the Central 
Bank because it is more difficult for Russia, China, and other 
actors to help them evade these sanctions.
    If we decided--if want to impose penalties to deter them 
from terrorist activity and we impose sanctions on their 
Central Bank, that that will not be a material breach to the 
accord.
    Secretary Kerry. No.
    Senator Flake. It will not. All right. One other question 
on a broader topic. Assuming this goes into effect, we are 
going to need--desperately need--a regional security framework 
that you have touched on, and some discussions are already 
going on. I would just encourage you that I understand the 
problem with 535 Secretaries of State. We cannot have that. But 
I would encourage you to reach to at least the relevant 
committees here as that framework is put in place to make sure 
that it can endure longer than just, you know, the first couple 
of years, and there is agreement. We all know that to have the 
institutional fortitude to move ahead, it is best to have 
Congress involved. And there are many points between 535 
Secretaries of State and proper consultation with the relevant 
committees, at least, of jurisdiction here. And so that I would 
just----
    Secretary Kerry. I could not concur more, Senator. I think 
you are absolutely dead on. We agree. And by the way, I think 
in the course of this negotiation prior to the passage of the 
requirement for the 60 days, which we understand and joined in 
working on with the the chairman, and we are grateful to the 
chairman for the cooperation on that. But there were a huge 
number of briefings, and hearings, and telephone calls, and 
meetings, and so forth, literally in the hundreds.
    Now, I come back to this. I could not agree with you more 
about this new arrangement. We are talking about arms 
transfers, about special operations, training, about 
counterterrorism, counter insurgency. We have a major need here 
to build capacity in many of those countries. The Gulf States 
spend about $130 billion a year on their defense. Iran spends 
$15 billion, yet you see a disparity in terms of what is 
happening within the region. That has to be addressed, and that 
is the purpose of our initiative.
    Senator Flake. Thank you, Mr. Chairman.
    The Chairman. Thank you, Senator, and I, too, appreciate 
you joining in with us about an hour and a half before our vote 
on that agreement.
    Senator Udall.
    Senator Udall. Thank you, Mr. Chairman, and let me also 
just echo what everyone said. I very much appreciate the 
negotiators and the team, and especially give a shout out to 
Wendy Sherman. I would also like to just recognize--I do not 
think he is has been recognized yet--our colleague. Senator 
Angus King of Maine has been sitting here from the beginning 
very conscientiously like I think many Senators are either back 
in their offices or here in the audience to stay involved in 
this issue.
    Secretary Kerry, Secretary Lew, and Secretary Moniz, this 
is a very important deal, one based on verification and sound 
science. Those two areas are what I would like to focus on 
today. As you know, the National Labs in Tennessee, New Mexico, 
and California have played an important role, and I think it is 
important that we do the best job we can to explain to the 
American people why this deal meets the scientific rigors for 
preventing Iran from acquiring a bomb.
    So, Secretary Moniz, just as a baseline, can you tell the 
committee what the half-life of uranium and plutonium are, and 
what this means regarding how long we can detect its signature 
in nature, and why that it is important?
    Secretary Moniz. You are creating the urge for a 15-minute 
nuclear physics lecture.
    Senator Udall. But I do not want that. I do not want that.
    Secretary Moniz. The half-life of Uranium 238, which is the 
dominant isotope, is roughly the age of the earth, 5 billion 
years, and that is why we still have it in the ground. Uranium 
235 is maybe a factor of 10 less, which is why it is a minor 
isotope now. Plutonium is much shorter, 20,000 years probably, 
which is why we do not have any of it naturally, and we have to 
make it in reactors.
    Senator Udall. Okay. Iran cannot create a facility or 
enrich uranium or plutonium out of the thin air. The laws of 
physics, as you well know, are clear: energy and mass must be 
conserved, and through the IAEA we will be able to detect 
illicit use of declared sites due to extensive monitoring. Do 
both of you believe that is correct?
    Secretary Kerry.
    Secretary Kerry. Yes.
    Senator Udall. Secretary Moniz.
    Secretary Moniz. Yes.
    Senator Udall. And with regards to the worries about the 
24-day requirement for undeclared sites, given the half-life of 
uranium and plutonium and the resources needed to construct a 
parallel enrichment capability, would you say it is 
scientifically possible to hide such work within 24 days, and 
do you believe we have the technical capabilities to determine 
if enrichment is being done outside the limits of the JCPOA?
    Secretary Moniz. Well, yes. Once again, we have the 
historical example from 2003 of precisely that happening after 
6 months, easily finding uranium despite major efforts to 
disguise it. And in addition, we will have all of the 
containment and surveillance for 20 years of all of the 
sensitive parts of every machine that they make.
    Senator Udall. And so, people that have used the analogy 
that like in a drug crime you flush it down the toilet and it 
is gone, and we will not be able to find it, that is, in fact, 
been proven out, has it not?
    Secretary Moniz. If they try that, we will find it.
    Senator Udall. Good. Secretary Kerry and Moniz, our nuclear 
experts at Oak Ridge, at Los Alamos, Sandia, Lawrence 
Livermore, they have given technical support throughout these 
negotiations, are they confident that these verification 
measures, both the enhanced measures and those in the 
Additional Protocol, will enable the IAEA to detect and attempt 
to break out or sneak out in time for the international 
community to react?
    Secretary Moniz. First of all, let me say that the national 
lab scientists from the places you mentioned were really 
heroic. They were on constant call for, literally, hours 
turnaround in the negotiating sessions. And I have already 
alluded to the fact that your laboratory at Los Alamos has 
played a major role in the detection arena.
    So the answer is, yes. I mean, in fact, those are the 
people who have invented many of the safeguards technologies 
that are going to be employed here.
    Senator Udall. So it sounds to me like Iran could break the 
rules of this agreement, but they cannot break the rules of 
physics. And the international community has the know-how and 
the expertise to determine whether or not Iran is abiding by 
this deal and the Non-Proliferation Treaty not only during this 
phased agreement, but into perpetuity under the Non-
Proliferation Treaty and the Additional Protocol to the NPT. 
Would you agree with this assessment, and would the panel agree 
that if necessary, the United States and the P5+1 would then 
have the ability to snap back sanctions and deal with the 
Iranian violations as appropriate in order to prevent them from 
acquiring a nuclear weapon?
    Secretary Moniz. Well, yes. I mean, again, we will have 
much greater transparency from day one until forever than we 
would have without the agreement. That is a fact. And then the 
sanctions, I think the answer--I will venture the answer is 
yes.
    Senator Udall. All right, thank you. And then just finally, 
Secretary Kerry, one of the keys here, and you have heard all 
these questions, is implementation, how are we going to do 
implementation. And so, I just ask in the broadest possible way 
how it is going to be done, who is going to be in charge, how 
are we going to make sure that when we get to the 
implementation phase that we really do what needs to be done to 
make sure this is a success?
    Secretary Kerry. Well, we already have created an 
implementation office, and we have somebody managing that at 
this point in time. It is teamed up, but will be even more so 
as we go forward. This is going to be a full-time operation, 
and it is not going to be left to a normal bureau. There will 
be a full-time Iran agreement implementation effort with 
experienced and competent personnel staffing it.
    Secretary Moniz. And I would just add, if I may, that under 
that umbrella of the administration-wide implementation team, 
we at DOE and with our laboratories will have our own 
implementation team, and there will be some major jobs. For 
example, in Annex I you will see alluded to a working group of 
the P5+1 on the Arak reactor redesign, et cetera. We anticipate 
obviously playing a leading role in that group and making sure 
that the new reactor does only what we have laid out. And the 
parameters are in the material you have.
    Senator Udall. Good. And I just--I cannot emphasize enough 
in terms of the National Laboratories, especially the two in 
New Mexico, but all of them, that they have worked on this--
these kinds of activities and studied nuclear issues since the 
creation of the atomic bomb. And that is why they are in such a 
position to be able to give the technical advice to make sure 
this is a success.
    Secretary Moniz. Well, let me--if I could just reinforce 
that. I think it is very important--this is a pitch now for the 
national labs--that this is not the capability you invent 
overnight because you needed it for this negotiation. It has 
got to be a consistent investment in our coal and nuclear 
capacity, and that is what we have been doing.
    Secretary Kerry. And by the way, let me just emphasize: 
people like me who obviously do not have that background 
understood our limitations, and there is not any decision made 
in this agreement--none--where we did not go to our teams. In 
fact, there were days where we were delayed because we had to 
go back to the laboratories, get the laboratories' input, get 
our experts' input, and make a judgment as to whether or not 
whatever judgment we made would, in fact, result in what we 
were seeking and be sustainable. And there is not one technical 
decision within this agreement that has not been worked through 
the entire system in that regard.
    Senator Udall. Thank you, Mr. Chairman.
    The Chairman. Senator, you are right to be proud of your 
outstanding labs. I have visited them, as have many, and they 
are playing a huge role in this. And I thank you.
    Senator Gardner.
    Senator Gardner. Thank you, Mr. Chairman, and thank you to 
the Secretaries today for your time and testimony. I wanted to 
start with you, Secretary Lew, talking about a number of 
companies and individuals who will be removed by 2023 from the 
U.S. sanctions list, and I hope that you could discuss several 
of them. What can you tell this committee about Mr. 
Fakhrizadeh? Is it correct to describe him as the father of the 
Iran nuclear program?
    Secretary Lew. I would defer to Secretary Moniz who is the 
father of the Iranian nuclear program.
    Secretary Moniz. I will not vouch for it. That term 
certainly has been applied to him, yes.
    Senator Gardner. What about Mr. Abbasi? Is it accurate that 
the United Nations blacklisted him in 2009 for allegedly being 
an aide to Fakhrizadeh in working on Iran's nuclear and 
ballistic missile programs, receive relief by 2023?
    Secretary Lew. Senator, without commenting on each 
individual, if you go through the names of people who have been 
involved in Iran's nuclear program, any step to remove 
sanctions that are related to the nuclear program will involve 
individuals and organizations that had been involved in Iran's 
nuclear program.
    Senator Gardner. Okay. And German engineer, Gerhard Wisser, 
he was convicted and sentenced in prison by a South African 
court in 2007 for his role in supplying centrifuge components 
to the A. Q. Khan black market network. Is that correct?
    Secretary Lew. Yes.
    Senator Gardner. He receives relief in 2023?
    Secretary Lew. I am reluctant to get into individual names.
    Senator Gardner. Why? They are listed in there for relief. 
Why would you be reluctant----
    Secretary Lew. Because as a group, they have the same 
characteristic.
    Senator Gardner. Which is what?
    Secretary Lew. Which is, they were designated because of 
nuclear activities.
    Senator Gardner. And now they have their sanctions relief 
by 2023.
    Secretary Lew. And to the extent that Iran keeps its 
agreement, we will be relieving nuclear sanctions. If they do 
not keep their agreement, we will not be relieving nuclear 
sanctions.
    Senator Gardner. What message does this send to other 
proliferators around the world?
    Secretary Lew. I think the message is if you violate the 
rules and develop nuclear weapons, and we and the world take 
action against you, it will have significant consequence. But 
if you reach an agreement and you unwind your nuclear program, 
that will have also have consequence.
    Senator Gardner. Thank you. To Secretary Lew, again, 
following up on, I believe it was Senator Menendez's questions, 
the Iran Sanctions Act, under the JCPOA, as you understand it, 
if that act were simply to be extended, the date changed to 
2018. Obviously the national security waivers would still in 
place by the President. Is that something that Congress would 
pass, change of the date--2016, 2018? Is that acceptable under 
the JCPOA.
    Secretary Lew. So we have obviously gone back and forth on 
that a few times. The re-imposition of nuclear sanctions is 
something that if they comply with the nuclear agreement has a 
very different character than if they do not comply. And I 
think that right now they have agreed to take serious actions. 
We need to work towards the implementation of the agreement.
    What I was trying to say after the back and forth with 
Senator Menendez, we have a host of very powerful sanctions. We 
have tools that are not just----
    Senator Gardner. And I heard you explain that to Secretary 
Menendez--Senator Menendez.
    Secretary Lew. Those remain available----
    Senator Gardner. If you do not mind, we are running out of 
time here. Just to follow up on that, if Congress were to pass 
an extension to 2018, obviously the national security waivers 
under this deal would still be in place, would the President 
veto that legislation?
    Secretary Lew. I think this is not the appropriate time to 
be discussing extending a law before we have even had the 
implementation period begin on this agreement.
    Senator Gardner. Do you think that makes the snapback 
provisions weaker or stronger if they are not there when the--
--
    Secretary Lew. Well, that is what I was trying to get at. I 
think the snapback provisions are extremely powerful with or 
without the Iran Sanctions Act. Our oil sanctions, our 
financial sanctions have independent ground----
    Senator Gardner. You are prepared to have a snapback 
without the Iran Sanctions Act in place.
    Secretary Lew. I think the snapback would be very powerful 
with or without it.
    Senator Gardner. Secretary Kerry, in your testimony you 
stated that U.S. sanctions related to human rights, terrorism, 
and ballistic missiles will remain in place. Your eight 
ballistic missile activities continue under the agreement. How 
do our sanctions, if they are in effect if the United States 
stands alone, slow down their ballistic missile programs by 
year 8?
    Secretary Kerry. Well, the fact is that regrettably they 
have been pursuing certain things without recourse, and one of 
our determinations here is to up--I think the President said 
this in the East Room in his press conference the other day 
that--for instance, they have been transferring weapons for 20 
years to Lebanon, to Hezbollah, and there may be as many as 70 
to 80,000 rockets now, we all know, that are a threat to 
Israel. We need to, all of us, be engaged in a stronger effort 
to prevent the movement of these weapons. And we have the 
tools----
    Senator Gardner. So by lifting the sanctions in year 8----
    Secretary Kerry. No, no, no----
    Senator Gardner [continuing]. Israel safer today under this 
provision with the ballistic missile embargo lifted?
    Secretary Kerry. There is absolutely no question whatsoever 
that Israel is safer because Israel----
    Senator Gardner. Let me raise--with the embargo lifted 
Israel is safer.
    Secretary Kerry. We are not lifting the embargo.
    Senator Gardner. Year 8. I can read you the----
    Secretary Kerry. Oh, in year 8? No. Well, we still have 
the--see, what you are not looking at, Senator, and what 
everybody needs to take note of is we have separate U.N. 
resolutions to apply to all those other activities, and we have 
separate regimes that apply to them. For instance, the Missile 
Control Technology Regime is a very powerful instrument. The 
security proliferation----
    Senator Gardner. Let me just--I understand. I am running 
out of time. This U.N. language, would the United Nations----
    Secretary Kerry. Well, I know, but it is part of the 
answer. If you want to ask a question without an answer, we can 
all run out of time.
    Senator Gardner. With the United Nations language, do you 
believe Israel is safer in 8 years with the embargo lifted 
under United Nations language?
    Secretary Kerry. There is no question in my mind because we 
have the ability to put all kinds of other sanctions in place 
as well as enforce existing U.N. resolutions that apply to 
missiles and other things.
    Senator Gardner. You mentioned an article in the Washington 
Post, ``How the Iran Deal is Good for Israel According to 
Israelis Who Know What They Are Talking About.'' Do you believe 
Prime Minister Netanyahu, who is highly critical of this deal, 
knows what he is talking about?
    Secretary Kerry. Prime Minister--look I respect and know 
Prime Minister Netanyahu very well. I consider him a friend, 
and he and I talk regularly. We are still talking even in the 
midst of this disagreement because we have a lot of things to 
talk about. I completely understand the Prime Minister of a 
State like Israel, which has been under siege and existentially 
threatened all of its life, that this is also a big challenge. 
And I understand the expressions of concern that he has voiced.
    We just happen to disagree about the impact of what is 
going to happen here, and our ability to be able to safeguard 
Israel going forward through the mechanisms that have been put 
in place. There is absolutely no question whatsoever, 
indisputable--you cannot argue--that taking a breakout time 
from 2 months to a year, taking a 12,000 kilogram stockpile to 
zero, taking a centrifuge----
    Senator Gardner. So you would not include them in this list 
that----
    Secretary Kerry. But, I mean, you have got to look at that, 
so maybe you have----
    Senator Gardner. So according to--know what they are 
talking, you believe Prime Minister Netanyahu knows what he is 
talking about.
    Secretary Kerry. I disagree with him on his----
    Senator Gardner. But you know what he is--he knows what he 
is talking about.
    Secretary Kerry. He knows as Prime Minister the fear that 
he is expressing, absolutely.
    Senator Gardner. Secretary Moniz, I hope I am pronouncing 
this correct. Olli Heinonen, a former deputy director of the 
IAEA--we have talked a lot about the IAEA today. We have talked 
about the agreement that they have entered into that is not 
being disclosed to the committee or the public with Iran. He 
stated in the New York Times, ``A 24-day adjudicated timeline 
reduces detection probabilities exactly where the system is 
weakest, detecting undeclared facilities and materials.'' Is he 
wrong?
    Secretary Moniz. Well, the 24-day thing is explicitly for 
undeclared facilities, and I have already expressed use of 
nuclear materials in those facilities. We are very confident 
about detection. We have to know where to look, and that is, of 
course, the traditional role of intelligence, ours and those of 
our allies and friends.
    Senator Gardner. Thank you, Mr. Chairman.
    The Chairman. Senator Murphy.
    Senator Murphy. Thank you very much, Mr. Chairman. Thank 
you all for spending so much time with us here today. One 
comment on this issue of nonnuclear sanctions, and then two 
questions.
    The Iranians are worried that we are going to reimpose 
nuclear sanctions under the cover of some other excuse; thus, 
your discussion about the sensitivity of when we may 
reauthorize the Iran Sanctions Act. I would just note that what 
we are talking about here then is motive, whether or not we are 
genuine in imposing sanctions for a non-nuclear related 
activity, or whether we are doing it under the cover of trying 
to get around the agreement.
    I do not think there is any way to avoid the fuzziness of 
that section of the agreement because ultimately there can be a 
dispute over motive. But I just think we all have to understand 
that there is going to be a lack of clarity on that question 
given the fact that the dispute ultimately is not going to be 
about the letter of the law that we pass, but about the motive 
that stands behind it. I think that we can certainly defend 
instituting new sanctions on nonnuclear activity, but there is 
going to be difficulty in trying to define that motive.
    My question, though, is--first question is continuing on 
this subject of inspections. Secretary Moniz, the Iranians have 
made a commitment here that they are not going to engage in any 
research and development, that under item 16 ``could contribute 
to the development of a nuclear explosive device.'' We have 
talked about the eyes that we have on Fordow, on Natanz. We 
know we have got eyes on the full supply chain.
    But there are a host of nuclear-related research activities 
that could occur at other research sites that do not involve 
material that runs through the supply chain. How do we have an 
assurance that there are no R&D activities occurring given the 
fact that there are going to be sites that we will not even be 
asking about frankly, and there are research activities 
potentially that can happen that do not involve that nuclear 
material that we see in the supply chain inspections?
    Secretary Moniz. Well, as I said, there are a number of 
activities that are listed there which are out of bounds that 
will not involve nuclear materials. Clearly, again, almost by 
definition for any undeclared site it becomes a question of 
intelligence acquired in one way or another, and we have, 
obviously, nationally a lot of means as do others.
    So once we have the right pointer, then it is a question of 
getting in there. And there can be some smoking guns in some 
cases, for example, around neutron initiators, that we would 
detect. In others, it will be more in the context of the 
declared activities do not kind of make sense with what we see 
in there, and these all become then additional indicators for 
our intelligence.
    But, you know, I think our intelligence people will say 
very straightforwardly that clearly, in the end, these 
nonnuclear activities will be more of a challenge than the 
nuclear materials activities over which we will have a very, 
very strong handle.
    Senator Murphy. I want to ask Secretary Lew and Secretary 
Kerry about the consequences of Congress voting down this deal. 
I heard Senator Risch's frustration that he thinks that the 
suggestion has been made by the administration that there is no 
choice. In fact, I hear you to say the very opposite. I hear 
you to say that this not, in fact, a referendum on this deal. 
This is a choice between two sets of consequences, a set of 
consequences that flow forward if we approve the deal, and then 
a different set of consequences that flow forward if Congress 
rejects this deal. And so, as I look at that second set of 
consequences that we have to be fully cognizant of if the 
United States Congress rejects this deal, I sort of see it in 
five parts, and I want to give this analysis to you and then 
ask you both to tell me where I am wrong or where I might be 
right.
    First, the sanctions are going to fray initially. The 
Russians and Chinese likely will not continue to sign, and over 
time likely will in substance fall apart. Second, Iran is going 
to be able to resume full operation of its nuclear program. It 
gets closer and closer to the breakout time. Three, the 
inspections that we have under the JCPOA disappear and we go 
blind again inside Iran. Fourth, this administration's ability 
to do nuclear diplomacy frankly ends for the next year and a 
half. There is no legitimacy with the clear indication that 
Congress will not support any agreement that this 
administration enters into. And fifth, the potential that 
internally this rejection of the deal will be a major victory 
for the hardliners making it much less likely that the 
moderates are going to win in the next election, meaning that 
there may not be anyone to deal with should we get back to the 
table in the next administration.
    That is a pretty severe set of consequences, but this is 
not ultimately a referendum. This is a choice, and if you 
reject this deal, then you have got to be pretty apocalyptic 
about how badly this deal will go down if you accept those 
broad parameters as the alternative. So tell me if this how you 
read the consequences of Congress rejecting this deal.
    Secretary Kerry. Well, Senator, I think you have hit the 
nail on the head with a series of absolutely clearly 
anticipatable consequences, and I would agree with what you 
have said. I mean, this is not a case of no choices. There is a 
choice, and as Senator Murphy has said, there is a--you know, 
each person can make the judgement about the consequences of 
their choice. But the choice is really between the assurances 
we have that come with this agreement, the certainty that comes 
with a 98-percent reduction of a stockpile, the certainty that 
comes from the limitation of 3.67 percent of enrichment for 15 
years. You cannot make a bomb with just those two items, let 
alone the reduction of centrifuges, the limitation on what is 
spinning, the intrusive inspections.
    All that goes away. So that is the choice. You are going to 
wipe all that out. But, what else as a result of that? Well, I 
urge colleagues who have not done it to spend time with our 
intel community and ask for the analysis of the Supreme Leader 
and of the state of politics in Iran. The Supreme Leader highly 
distrusts us, and we highly distrust him in return. There is 
nothing in this agreement built on trust. It is all a matter of 
verification.
    But the Supreme Leader has felt from the very beginning--I 
cannot deal with the West because I cannot trust them. I tried 
it before and nothing happened, and then there were some small 
discussions that took place in Afghanistan a number of years 
ago with ambassadors. Nothing came out of that. I could give 
you--I am not going to go through the whole history, but there 
is a long history of mistrust, and much deeper than, the whole 
context of the revolution out of which the regime comes.
    So if we say no after saying in good faith we are here to 
negotiate and we can come to agreement, but we walked away from 
it--not because we chose to, but Congress chooses to--they will 
not know who to deal with. We certainly are not going to be 
dealt with. A lot of other people will not know who to deal 
with. But more importantly, he is not coming back. There is no 
way--all of the people who say go get a better deal--no way. 
When they believe they have given up things in good faith and 
made proclamations about no nuclear weapons forever, and they 
are willing to be subject to the NPT.
    The NPT is at the heart of nonproliferation, Senators. We 
have 189 nations that live by it. We would be turning away from 
the NPT. That is, part of this vote would be basically saying 
we do not trust the NPT. We do not like the NPT. There is no 
way Iran could come under the NPT. We are not going to do this. 
So the consequences of this are even more than what you laid 
out, Senator.
    And here is what else happens. I know this will happen. You 
know, I have been around politics long enough. I have a pretty 
good sense. I mean, a lot of people were out there opposing 
this agreement before it was announced. A lot of people were 
opposing it before they had read it. So I know what we are 
going to hear in the context of this. If this agreement is not 
passed--is not agreed to--it does not meet Congress' approval, 
and the sanctions are gone, and Iran goes back to enriching, 
you can hear the hue and cry right now. People are going to be 
saying, well, what are we going to do about it? They are 
enriching. You will hear the Prime Minister of Israel coming 
up, time to bomb. What are we going to do?
    That is why learned people who led security establishments 
in Israel say that is probably the alternative here. So when 
they are enriching like crazy and we have passed up diplomacy 
and we have passed up the Non-Proliferation Treaty, which 
option is left to us to enforce this? I know there are senators 
who are uncomfortable with the idea that they may have an 
industrial enrichment program. So what is your plan? Knock out 
their entire capacity, erase their memory of how to do a fuel 
cycle? Totally go to war? I heard somebody mention Iraq earlier 
that we had huge, you know, ability to know what was happening 
in Iraq. Folks, that was after we invaded the country and 
completely defeated their army. Yes, then we had anywhere, any 
time inspections. That is the only place in the world you have 
had it. No country in the world has anywhere, any time.
    So I would just ask people to be reasonable. There are more 
consequences than those laid out by Senator Murphy, but each 
one of the ones he laid out are pretty consequential.
    Secretary Lew. Senator Murphy, if I could just respond----
    Senator Murphy. Yes.
    Secretary Lew [continuing]. On the sanctions point, I agree 
with you that sanctions would fray. But I think in addition, 
you know, we have had a lot of discussion about Iran's 
reserves. We have to remember that those reserves are not 
sitting in the United States. They are sitting around the world 
in countries like India. And if this agreement falls apart, our 
ability to keep that money from Iran will also fall apart. So I 
think the concern is they get their money and there is no 
nuclear agreement and all of the other consequences. So that is 
very real.
    And with regard to your comment on our ability to re-impose 
sanctions, I totally agree with you. If it is seen as a pretext 
for putting nuclear sanctions back in place, then that violates 
the agreement. But we have reserved the ability to put 
sanctions back in place on terrorism and for other reasons.
    Senator Murphy. And my only point on that is there is 
inherent fuzziness.
    Secretary Lew. It is inherently. It is a matter of 
interpretation, which is why people can say that they have 
different views. But this was heavily discussed in the 
negotiation. It is not as if this was some accidental 
provision.
    The Chairman. Thank you. I think the thought process that 
you walked through was very helpful, and I do want to say that 
Congress in this case did put in place many of the sanctions 
that brought Iran to the table. And what I think is to a degree 
unfair about the presentation is the Secretary himself afforded 
himself the ability to walk away from this deal and face all of 
these same consequences during the negotiations. You said that 
no deal is better than a bad deal, and at many times you laid 
out the percentage chances of this happening.
    So you yourself--you yourself--had to be thinking about 
going down the very path that Senator Murphy just put out. But 
what you did by going to the U.N. Security Council and by 
laying this out in the way you are, basically even though we 
put mandates in place that brought them to the table, you are 
trying to paint this picture that basically takes that choice 
away from us. And I find that to be incredibly unfair.
    Secretary Kerry. Mr. Chairman, could I just say to you the 
choice would have been the same whether or not the Security 
Council had voted. It is the exact same choice.
    And the great distinction here--with all due respect, sir--
is that when I was ready to walk away, everybody else would 
have come with me because they understood the walking away was 
due to the intransigence of Iran. So we would have walked away 
and held the unity of the sanctions, and we could have then 
done more, or if we had to resort to it, military people would 
have understood why. The problem is now they will not 
understand why, and we will not walk away with anyone.
    The Chairman. And I do not want to put too much emphasis on 
the U.N. Security Council issue, but I will go back and say 
that, again, the way you present the options, you have put 
Congress in the place of being the pariah, taking that away 
from Iran being it. And I think the way you frame it put 
Congress in a very unfair light.
    Senator Perdue.
    Senator Perdue. Thank you, Mr. Chairman. I will go one step 
further. I am outraged. I think by the administration going to 
the United Nations before we actually have a chance to even 
read the document and go forward in these discussions in a good 
faith, bipartisan manner, we are showing the world that we do 
not stand together right now, and that is what this is all 
about. That is why we fought for the last few months in this 
committee.
    And I am so encouraged that we ended up with a unanimous 
vote in this committee and a 98-1 vote in the Senate to go back 
to the balance of power between the legislative and executive 
branch. I am encouraged that Senator King is here sitting here 
for 4 hours--3 hours this morning, 4 hours almost, listening to 
this. People are involved in this, Mr. Secretary, and I 
appreciate what you guys have done. This is a yeoman's job you 
have had, a huge task. Mr. Secretary, you have played hurt the 
last few months of this thing. Thank you for all your effort.
    I personally have tried to take a very measured approach in 
this to try and understand the issues, to try and understand 
what we were trying to achieve. I have heard the Secretary of 
State say that our goal is preclude Iran from ever becoming a 
nuclear weapon state, but I am very troubled today. I look at 
this somewhat skeptically because of the----
    Mr. Lew, I am not sure what I said was humorous.
    But let me just read you a couple of quotes here. ``This 
agreement will help to achieve a long-standing and vital 
American objective: an end to the threat of nuclear 
proliferation,'' 1994, President Bill Clinton. President Obama: 
``Iran will never be permitted to develop a nuclear weapon.'' 
President Clinton: ``Compliance will be certified by the 
International Atomic Energy Agency.'' President Obama: ``What 
we are going to do is setting up a mechanism whereby, yes, IAEA 
inspectors can go anyplace.'' President Clinton: ``This 
agreement represents the first step on a road to a nuclear free 
Korean peninsula.'' President Obama: ``This framework would cut 
off every pathway that Iran could possibly take to develop a 
nuclear weapon.''
    I am unsettled because we have had bad experiences dealing 
with bad actors. If I look at this today, I hear, Secretary of 
State, you said something I had not heard you say before, and I 
want to dial into this. We are guaranteeing they will not have 
a nuclear weapon. I know that is our goal, but I have read 
every page of this document. I have seen the classified 
documents. I am very concerned that as I read this, the deal--I 
understand our objective. I understand our intent and our 
commitment is to never allow Iran to have a nuclear weapon.
    My question, Secretary Kerry, again, is, does this deal 
actually preclude Iran from becoming a nuclear weapon state?
    Secretary Kerry. Senator, first of all, I really appreciate 
your approach to this, and I very much appreciate your 
comments, and I know you are taking this very, very seriously--
as are other Senators. And I want to speak specifically to your 
several concerns.
    First of all, I spent 29 years here on this committee back 
in the early days of the MX missile debates, and INF, and 
Europe, and SALT, and START, and so forth. This, I believe, is 
one of the most extensive agreements with the most extensive 
access provisions and accountability standards I have seen in 
the time that I was here.
    And I believe we have put in place a highly distinguishable 
set of measures from North Korea. First of all, North Korea, 
during the 8 years of the Clinton administration, they did not 
gain one ounce of plutonium capacity. What they did was they 
started cheating on the HEU--highly enriched uranium--path and 
the framework that was in place, and the administration 
changed.
    And the new administration came with a different attitude 
about how to approach them. But with the discovery of the 
cheating on the HEU, they immediately shut down the diplomatic 
track, and North Korea pulled out of the NPT--fully pulled out 
of the NPT. There were no inspections. Nothing else was 
happening. And, yes, they blew up several nuclear weapons, and 
they developed their nuclear capacity.
    That should be a warning to everybody here about why what 
we have, in fact, put in place is so important and ought to be 
embraced, because unlike North Korea, the North Korea 
experience is what gave birth to the Additional Protocol.
    Senator Perdue. Secretary Kerry, I apologize----
    Secretary Kerry. Okay. I just want you to know, though, the 
Additional Protocol came into existence to remedy the deficit 
of what happened with North Korea. So the access we have here 
we never had in North Korea. We have an unprecedented ability 
to hold Iran accountable. And I believe through the myriad of 
access to their civil nuclear program--24/7 access to their 
declared facilities, we will know instantaneously if they try 
to move to----
    Senator Perdue. I understand, and I heard you say that last 
night, and I appreciate that. If they do, we will know. But 
does this deal--does this agreement preclude Iran from becoming 
a nuclear weapon state, the deal itself?
    Secretary Kerry. I believe if the agreement is fully 
implemented, and obviously if Iran lives by it, yes.
    Senator Perdue. Thank you. Secretary Lew, with regard to 
the options, what brought Iran to the negotiating table 
recently? What is their motive for coming and negotiating in 
the first place?
    Secretary Lew. I am not sure I can tell you the specific 
thing, but when we look at the impact of the sanctions over the 
last number of years, it has crushed Iran's economy. It has 
crushed it in every way----
    Senator Perdue. Reduced it about 20 percent.
    Secretary Lew. Yes. The size of the economy is down. The 
exchange rate is terrible. The unemployment and inflation rates 
are sky high.
    Senator Perdue. So--excuse me--the concern I have then is 
in the very beginning when they came to the table we ceded to 
them the right to enrich, the right to potentially bypass 18 
countries who are good actors on the world stage, and join an 
elite group of five countries that actually have civil nuclear 
programs but do not enrich. Now, there are nine, as I 
understand it, nine countries that actually have nuclear 
weapons, five in the NPT, four out of the NPT. They obviously 
have civil programs. They obviously enrich. But the delineation 
here between the countries that are good players--Germany, 
Brazil, Afghanistan--I am sorry--Argentina, Holland, Japan--we 
are putting Iran into that group, a bad actor like Iran.
    My question is, the option that I see to this is 
potentially doubling down on the sanctions that got them to the 
table in the first place, and I would like to respond to that. 
We know it was crushing their economy. We know it was having a 
tremendous impact on their regime. And my question is, is that 
not a viable option today as we look at alternatives to the 
deal itself?
    Secretary Lew. You know, Senator, I think the reasons the 
sanctions have had the powerful effect is that they are not 
just U.S. sanctions. They have been international sanctions, 
and that requires keeping an international coalition together 
to impose the kinds of tough sanctions that we have had.
    You know, in past debates over U.S. sanctions, we have gone 
back and forth with the Congress saying if you do more and it 
keeps other countries out, then we are in the end doing less. 
And I think we have come to a good place on each of the round 
of discussions over sanctions to grow the coalition in the 
world.
    If this deal is rejected, the other partners who have 
helped us to impose those sanctions will not be of like mind.
    Senator Perdue. Of the $115 billion that you have 
identified, and I understand the nuances of the different 
categories of that cash, how much is that relative to our 
tertiary--our secondary rather--sanctions on other countries 
dealing with Iran versus the EU and other players on the P5+1?
    Secretary Lew. I would have to go back and look at the 
numbers, but these are Iran's resources.
    Senator Perdue. I understand, but I am trying to make the 
delineation here between what is--what are the sanctions--what 
percentage of the $115 is due to U.S. sanctions, congressional 
sanctions, versus the P5+1.
    Secretary Lew. It is kind of hard to disaggregate because 
our sanctions are effective as they are because we get the 
cooperation of other countries. And I can tell you on behalf of 
the other Secretaries at this table, we have had for years now 
ongoing discussions where it is getting harder and harder to 
keep countries tied to the oil sanctions, for example, because 
it is hard on their economies.
    They have been willing to do it because the goal of the 
sanctions was to get Iran to the negotiating table. Query: 
would they be willing to do it if the Iranians came to the 
negotiating table and we rejected a deal that all the other 
countries in the P5+1 have signed onto? That is where our 
sanctions ability starts to fray.
    Senator Perdue. Thank you. Thank you, Mr. Chairman.
    The Chairman. Senator Kaine.
    Senator Kaine. Thank you, Mr. Chair, and thank you to the 
witnesses. This is very hard because diplomacy with an 
adversary, with an enemy, is hard. Diplomacy with a friend can 
be hard, but diplomacy with an enemy--President Truman when he 
proposed to spend billions of dollars to rebuild the economy of 
Germany after they had done two wars against the United States 
in 25 years, that was hard, and there were objections, and 
there were no votes. President Kennedy, Nuclear Test Ban Treaty 
with the Soviet Union. During the Bay of Pigs they were 
negotiating. That was hard, it was controversial, and there 
were no votes. Diplomacy with an adversary is hard. Diplomacy 
with an adversary is often necessary.
    This is a deal that in my review produces a dramatically 
better position for about 15 years than the status quo before 
negotiations started. When you started the negotiations right 
before Iran had a program that was 19,000 centrifuges and 
growing, you have knocked it back 6,000. Twelve thousand 
kilograms of enriched, enough for multiple weapons, you have 
knocked it back to 300. An enrichment level, 20 percent and 
climbing. You have knocked it back to 3.67 percent. A heavy 
water plutonium facility, they are dismantling it.
    They were on a path where they had a huge program and it 
was growing. For 15 years this deal with the inspections 
mechanisms, et cetera, produces a dramatically better status 
quo for the United States, for regional allies, for the world.
    My questions are about after year 15. Secretary Moniz, 
various provisions start to come off certain elements of the 
program, certain inspections beginning in year 8, 10. Year 15, 
the 300-kilogram cap comes off. When you get to year 25 here is 
how I read this deal. The deal basically is Iran commits in the 
first paragraph of the agreement under no circumstances will 
Iran ever seek to develop, purchase, or acquire nuclear 
weapons. They have agreed to all the NPT obligations going 
forward, and they have agreed that any nuclear program will be 
completely civil in nature. They make that commitment.
    What we have to determine if they will cheat will be the 
intelligence that we have, the knowledge we gain through 25 
years of enhanced inspections, and the ongoing inspections 
under the NPT, especially the Additional Protocol. Is that 
level of knowledge sufficient at year 25 and thereafter to 
detect if Iran tries to violate this deal and acquire nuclear 
weapons?
    Secretary Moniz. Well, I think it certainly puts us in a 
far stronger position than we would be otherwise, and I think 
the risk on their part would be enormous to try to break their 
commitments. And I think you put your finger on a very 
important thing, which I think our intelligence community would 
support. We should not forget the tremendous knowledge of the 
program, what they are doing, where they are doing it, over 25 
years. We will have a lot of indicators to really amplify our 
national means.
    Senator Kaine. That is a good segue to the question I want 
to ask Secretary Kerry, which is about alternatives. You talked 
with Senator Murphy about them. I think there were those who 
objected to the negotiations starting in November 2013. They 
were against that diplomatic beginning. If we could go back to 
that status quo, it seems to me that the status quo then was we 
had sanctions. They were punishing Iran, hurting their economy, 
but they were racing ahead on their nuclear program. We were 
hurting their economy, but the nuclear program--19,000 
centrifuges and climbing, 12,000 kilograms and climbing, 
enrichment percentage climbing, Arak heavy water moving ahead.
    If we just had lived with status quo, it seems to me one of 
two things was going to happen: either they were going to 
eventually capitulate because of the sanctions, or they were 
going to get a nuclear weapon. They were two odds. I do not 
know, and I am not going to ask you to assign odds to those two 
things, but there was a significant risk. The program--had you 
not started diplomacy, they were going to get a nuclear weapon, 
and you have forestalled that. So that was one alternative, we 
do nothing, but that status quo was a dangerous one where their 
program was rocketing ahead.
    Let me mention another alternative because it has been 
mentioned by members of this body. After the framework was 
announced on April 2, a member of this body, who has been a 
loud and influential voice on this issue, said bombing Iran to 
end their program would only take a few days. Mr. Secretary, 
you have been at war. Do you find that to be a realistic 
statement?
    Senator Kerry. Well, it is--I find it to be a factual 
statement in the sense that it would only take a few days, but 
I do not find it to be a realistic statement in terms of policy 
because the implications of that--if you are not at the end of 
your rope, in other words, if it is not last resort--would be 
extraordinarily complicated for the United States.
    Senator Kaine. If we were to do that, that is an 
alternative. If we were to do that right now, would we have 
international support for that?
    Secretary Kerry. Not on your life. No way.
    Senator Kaine. And would we have an international legal 
basis for doing it? We were in Israel in January. A number of 
us met with Israeli intelligence officials who said they have 
concluded that Iran is trying to get to a threshold, but that 
Iran has not yet made a decision to pursue and acquire nuclear 
weapons. If we were to initiate a war against Iran when they 
had not yet made that decision, would there be an international 
basis for a war?
    Secretary Kerry. No, and furthermore, we would be 
proceeding without any of our allies, which is not a small 
consequence.
    Senator Kaine. Let me flip it around on you because I want 
to talk about credible military threat. If this deal is done, 
and if Iran confirms to the entire global community and the 
U.N., Iran reaffirms that under no circumstances will Iran ever 
seek, develop, or acquire any nuclear weapons, they pledge that 
to the world, we are all in agreement, and then they break 
toward a nuclear weapon, would we be more likely to have the 
support of international partners if we want to take military 
action to stop them from doing what they pledged not to do?
    Secretary Kerry. Absolutely.
    Senator Kaine. Would we have a greater legal basis to 
justify taking military action to stop them from doing what 
they have pledged not to do?
    Secretary Kerry. Yes.
    Senator Kaine. And we would have because of an inspections 
regime plus existing intelligence a lot more knowledge about 
how to target military action, increasing the credibility of 
our military threat?
    Secretary Kerry. Yes.
    Senator Kaine. I do not have any other questions, Mr. 
Chair.
    The Chairman. Thank you.
    Senator Isakson.
    Senator Isakson. Thank you. Chairman Corker and Senator 
Cardin, thank you for your opening statements, and thank you 
for the way in which you have handled the beginning of this 
debate that we will have over the next 56 remaining days.
    I am going to be pretty brief because everything has been 
said. Just everybody has not said it, so I am familiar with 
Senate hearings when they enter their fourth hour. But I do 
want to make a couple of things crystal clear on behalf of my 
constituents, and I speak for myself as well.
    Secretary Kerry, you said this has unprecedented 
transparency from the standpoint of inspections and hold Iran 
accountable. Is that correct?
    Secretary Kerry. With the exception of the Iraq war, yes.
    Senator Isakson. Do you recall the debate on the New START 
Treaty?
    Secretary Kerry. Somewhat.
    Senator Isakson. We were involved in that pretty heavily 
when you were chairman of the committee.
    Secretary Kerry. That was missiles, and there is a 
distinction between nuclear missiles and the nuclear program. 
But I know we had a shorter period for access to a missile. 
This is a different deal.
    Senator Isakson. But what got the two-thirds majority that 
ratified the New START Treaty in the Senate was satisfaction to 
the Senate that the inspection regimen was quick, decisive, and 
the United States had access to look and verify what the 
Russians had told us. Is that not correct?
    Secretary Kerry. Correct, on a missile. That is correct.
    Senator Isakson. But it was a verification of an agreement 
in the treaty.
    Secretary Kerry. I understand.
    Senator Isakson. This particular agreement, as I understand 
it, and you can correct me if I am wrong, the IAEA is the 
inspector.
    Secretary Kerry. Principal inspector. We are obviously 
sleuthing, and all our intelligence communities around the 
world would be following it, but they are the principal and 
identified inspector.
    Senator Isakson. And we pay 25 percent of the costs to the 
IAEA as I understand it. Is that correct?
    Secretary Kerry. Yes, it is.
    Senator Isakson. And the treaty specifically says none of 
the inspectors can be Americans. Is that correct?
    Secretary Kerry. In this particular thing, yes, that is 
correct.
    Senator Isakson. Those two points that I have raised are 
why people raise questions in terms of the inspections and 
whether they are unprecedented in their transparency. And I 
will just leave that for you to respond to now or later, but I 
think you are really going to have to deal with it deeper than 
you have today.
    Secretary Kerry. Well, I am happy to--there are a lot of 
reasons, not the least of which is that we do not have 
diplomatic relations with Iran, which is one of the principal 
reasons that we cannot proceed to have inspectors and so forth.
    The START Treaty had specific locations identified in it, 
pre-located. This inspection is for things that we cannot pre-
locate. These are for what we might suspect at some point in 
time or what we might have some evidence of at a point in time. 
And so what the START inspections are analogous to is an IAEA 
visit to a declared location. We have that. We have the same 
thing: declared location in START, declared location here.
    What is unprecedented here, Senator, which we negotiated--
and I was, you know, pleased we got it--is this ability for us 
to be able to close out the IAEA process. The reason we are all 
here today is that the IAEA could never get it finished. They 
would fight. They would go back and forth. Years went by. 
Nothing closed it out. We have an ability, through the Joint 
Commission, to vote, go to the U.N. Security Council and 
mandate that they give us access. And if they have not given us 
the access, they are in material breach, and we get snapback of 
the sanctions. So there is an automaticity to this that does 
not exist in other agreements.
    Secretary Moniz. Senator, may I?
    Senator Isakson. Give me one second, Secretary Moniz. I 
want to get one other question, and then we will elaborate. 
Thank you for the answer.
    The second that concerns a lot of people, and I think 
Senator Menendez brought it up a minute ago or in his earlier 
statement, was the negotiation of the 5-year when the United 
Nations embargo on conventional arms goes away. It appears to 
me that that appeared late in the negotiations and was not 
something that was on the table originally or even thought to 
be talked about because this was a nuclear deal. Why and when 
did that embargo--the expiration of that embargo get into the 
deal?
    Secretary Kerry. The discussions of the embargo actually 
began on almost day one of the negotiations.
    Senator Isakson. Well then----
    Secretary Kerry. And they went on for 2 years--2\1/2\ 
years.
    Senator Isakson. Why in a hearing based on nuclear weapons 
and prohibiting the Iranians from getting a nuclear weapon 
would we waive a sanction at some point in time in the future 
on exporting conventional arms? Why would that be a part of the 
agreement to start with?
    Secretary Kerry. Well, let me explain to you. It is a good 
question, and let me answer it. It was slid into the U.N. 
resolution at the last minute. Frankly----
    Senator Isakson. The arms embargo provision.
    Secretary Kerry. The arms embargo and the missile. The arms 
embargo specifically was the last minute, then----
    Senator Isakson. It is a nuclear resolution, right?
    Secretary Kerry. Right. Then, you know, U.N. Permanent 
Representative Susan Rice helped write that or wrote a good 
part of it, and she put it in. And, in fact, the Iranians 
bitterly objected to it, felt it was being rammed at them in 
the context of a nuclear agreement, and it had no business 
being part of a nuclear agreement. These are conventional arms, 
and they thought they had every right in the world to do it.
    They have fundamentally ignored it for all these years, but 
they made it clear from the get-go that one of the primary red 
lines was they had to get all those sanctions lifted. We said, 
no, we are not going to lift them. We are not going to do this 
when your behavior--look at what you are doing in Yemen, look 
at what you are doing with Hezbollah. We are not going to lift 
it.
    The problem is, Senator, we had three countries out of 
seven that were ready to lift it all together on day one, and 
four countries that said, no, we need to keep it. So the 
compromise ultimately was, recognizing that we had many 
different ways of coming at the enforcement of activities on 
missiles and arms--with specific resolutions for no arms to the 
Houthi, no arms to the Shia in Iraq, no arms to Hezbollah, no 
arms to Libya, no arms to North Korea.
    All these are existing resolutions that we have and can 
enforce. So we did not think we were losing anything. In fact, 
we won a victory to get the 5 and the 8 years to continue them 
in the context of a nuclear resolution where they believed they 
did not belong in the first place.
    Senator Isakson. My time is almost up, so I am going to 
interrupt. I apologize for doing that.
    Secretary Kerry. No, that is fine.
    Senator Isakson. But correct me on one thing. You said at 
the beginning it was on the table from almost the beginning.
    Secretary Kerry. Well, no. What was----
    Senator Isakson. No, but let me finish.
    Secretary Kerry. Their demand was on the table from the 
beginning.
    Senator Isakson. Okay.
    Secretary Kerry. Their demand, and we said no from the 
beginning, and frankly we knew this was going come down to be 
probably the last issue.
    Senator Isakson. And then you said, ``quite frankly it was 
slid in at the end.''
    Secretary Kerry. At the U.N. by Susan Rice when she first 
wrote Resolution 1929, the arms embargo came into that 
resolution at the very last minute.
    Senator Isakson. Well, my only point--I am sorry I am 
cutting you off, but I want to respective of time. The 
inspection and the transparency of those inspections, in some 
satisfaction we did not give away the store on conventional 
arms to put Israel or some of the other Middle Eastern 
countries into jeopardy is a serious question that needs to be 
responded to.
    Secretary Moniz, you wanted to say something.
    Secretary Moniz. I was going to add a small footnote to the 
issue of countries without diplomatic relations not being part 
of the inspection team, which obviously includes us. I just 
wanted to point out that, again, that for decades now, all the 
inspectors are trained--have training here in the United 
States. We are very confident in a very, very broad set of very 
competent people. In addition, and I can get you the exact 
number, but right now I think we have about a dozen Americans 
in the safeguards effort at IAEA, and obviously they play a 
very critical role.
    Senator Isakson. I would love it if you would get me that 
information specifically.
    [The written reply provided for the record to the above 
information requested follows:]

    As of April 30, 2015, the IAEA had 786 total staff in its 
Department of Safeguards. Of that number, 80 are American citizens.

    Secretary Kerry. And, Senator, I will get you a list of all 
the mechanisms we have to prevent the arms from flowing, that 
are a threat to Israel and the region.
    Senator Isakson. Those are critical questions to me and I 
think the American people. Thank you for your service to the 
country.
    Secretary Kerry. Thank you.
    The Chairman. Thank you. Senator Markey, we are going to 
take a break when we have the second round start. Can you all 
make it through three more Senators?
    Secretary Kerry. Yes.
    The Chairman. Okay, thank you.
    Senator Markey.
    Senator Markey. Thank you, Mr. Chairman, and thank you for 
your service to our country. We very much appreciate all your 
great work.
    Secretary Moniz, one of the assertions which is made is 
that in--after 15 years that all bets are off, and that Iran 
can then begin to enrich theoretically up to 90 percent if they 
want, which is a bomb grade material. Can you deal with that 
issue, that is what happens in 15 years? What happens when Iran 
announces that it would go past 3 percent, go past 5 percent, 
go past 20 percent in terms of its enrichment of uranium? What 
is the law, the regulation, the sense of the world community in 
terms of what they could do at that point to make sure that 
there was not a bombmaking program that was now put in place in 
Iran?
    Secretary Moniz. Well, of course, Senator, first of all, 
whether it is 15 or 20 years or whenever, they will be required 
to report all their nuclear activity, and clearly if they were 
to report that they were enriching to 90 percent, every alarm 
bell in the world would go off because there is no reason to do 
that. So----
    Senator Markey. And when the alarm--when the alarm bell 
went off, what would then happen?
    Secretary Moniz. I would imagine there would be, first of 
all, an extraordinarily strong, and I would imagine, cohesive 
international pressure, perhaps sanctions, and perhaps a 
military response.
    Senator Markey. So, for example, what would Russia's 
response be in 15 years if Iran started enriching to 50, 60, 
80, 90 percent? What would happen?
    Secretary Moniz. Everything I saw in the last months of 
negotiations is they would be solidly with us in very, very 
strong opposition to that.
    Senator Markey. Secretary Kerry, do you agree with that?
    Secretary Kerry. Totally. They, and China, were really 
surprisingly and very welcomingly deeply committed to this 
effort, and very anti any nuclear weapons program.
    Senator Markey. So in 15 years. Secretary Moniz, please 
continue.
    Secretary Moniz. No, I was going to say, and then, of 
course, as I mentioned, if they declare this, the alarm bells 
would go off. But furthermore, if they did not declare it, 
which would be a more likely scenario frankly, then what we 
still have is through these 25 years actually, the containment 
and surveillance on any manufacturing of centrifuges, the 
uranium. So once again, they would need the entire supply chain 
covertly, which would be an extraordinarily difficult thing to 
carry off.
    Senator Markey. So in the early years, Secretary Moniz, if 
Iran decided that they wanted to violate the agreement after 
dismantling their program, how long would it take for them to 
take their rotors, their components, out of mothballs and to 
reconstitute their program in the first 10 years if we were 
successful in watching its dismantlement in the early years?
    Secretary Moniz. I would say in rough terms, 2 to 3 years 
probably to do that. That would depend a lot upon conditions of 
their machines, et cetera. But that is a ballpark.
    Senator Markey. Yes.
    Secretary Kerry.
    Secretary Kerry. Senator, I just wanted to add something 
because you are dealing, sort of, with this 15-year concept. 
But the truth is, because of the 25-year tracking of their 
uranium, it would be impossible for them to, you know, have a 
separate covert track. So the only track by which they might be 
able to begin to enrich would be through the declared facility, 
and we would know it instantaneously.
    Senator Markey. And the world would say stop.
    Secretary Kerry. Exactly.
    Senator Markey. Okay. So, let me ask you this, Secretary 
Kerry. You spoke earlier about the Iranian Foreign Minister 
visiting the Emirates this weekend. Can you talk about that and 
what your hopes are for the unfolding diplomatic opportunities 
that may be possible in that region?
    Secretary Kerry. I will, Senator Markey, but I would 
preface it by saying to all my colleagues that nothing we have 
done in here is predicated on some change or something that is 
unanticipatable. Can one hope that this kind of opportunity 
perhaps provides a moment for possibilities and change? Yes, 
absolutely.
    And, in fact, President Rouhani and Foreign Minister 
Zarif--both in their public statements embracing this 
arrangement--talked about how it could open a new moment in the 
Middle East for the countries to be able to come together and 
be able to resolve some of the differences that have separated 
them. I know for a fact that the Foreign Minister of Iran wants 
to engage with the GCC countries, that this is not the only 
country he plans to visit. He wants to sit down with them. The 
Saudis have indicated a willingness to sit down.
    So who knows where that dialogue goes, but I can guarantee 
you the United States will do everything that we can to 
encourage it and to try to help it find some kind of specific 
steps that might be able to begin to deal with Yemen, the 
Houthi, with other issues that we face.
    Senator Markey. You spoke earlier about the Saudis, and you 
have talked to them in the last week. Could you expand upon 
that a little bit more in terms of what you feel is a 
possibility going forward?
    Secretary Kerry. Generally what I would say, Senator, is 
this: of course, all the countries in the region are 
apprehensive because they see Iran engaged with the Houthis in 
Yemen. They see them engaged with the Shia militias in Iraq. 
They seem them also fighting against ISIL. They also see them 
in Syria where they have made the most havoc supporting Assad 
and supporting Hezbollah over the years. And Hezbollah 
obviously is a threat to Israel, a threat to the region, not to 
mention that there has been support for Hamas even lately.
    These things concern us deeply, and it concerns them. And 
that is precisely why we have come together and are working on 
what I talked about earlier with, I think Senator Gardner, 
about the evolution of the Camp David process that begins to 
fill out a new security arrangement and a new understanding of 
how together we can push back against these activities.
    Senator Markey. Thank you. Secretary Moniz, did you want to 
anything in terms of the likelihood that there could be a 
breakout under the regime--the legal regime which we have in 
place that would not be detected early enough in order for 
there to be an international response?
    Secretary Moniz. No, I think a breakout would be very 
quickly, I think, detected, and then it is a question of the 
response. And, of course, especially in these--in this first 
decade or so I think we have a--and beyond the first decade I 
think we have a very comfortable period of time to do 
diplomatic and/or other responses.
    Senator Markey. Okay. Thank you, Mr. Secretary. Thank all 
of you for your work. Thank you.
    The Chairman. Thank you, Senator.
    Senator Paul.
    Senator Paul. Thank you for your testimony. I continue to 
support a negotiated solution and think it preferable to war. I 
think a military solution, in all likelihood, will accelerate 
the possibility of them having nuclear weapons, of ending 
inspections, et cetera. However, it does have to be a good 
deal, and I think that is the debate we have.
    Secretary Kerry, I guess I would ask, in general, how would 
you describe Iran's history of compliance with international 
agreements? Would you say they are generally trustworthy or 
generally untrustworthy?
    Secretary Kerry. There is no trust built into this deal at 
all. It is not based on any concept of trust.
    Senator Paul. And I agree. I think everybody sort of 
understands that. The Ayatollah's recent comments where he 
said, ``The Americans say they stopped Iran from acquiring a 
nuclear weapon. They know it is not true.'' So we have the 
history of, you know, untrustworthiness. We have a lot of 
verbal or verbiage coming from the Ayatollah already saying, 
well, you know, this really is not any limitation on our 
ability to make a weapon. So really then it comes down to a 
good agreement.
    Someone asked, well, you know, this stops them from having 
nuclear weapon. Yes, if they comply, sure. So then the question 
is compliance. And my question, and to my, I guess, my problem 
is that there is a great deal of credence being given to 
snapback, you know, sanctions as this way, as this lever to get 
them to comply. Secretary Lew talked about there being a phased 
reduction in sanctions. That is not exactly the way I read the 
agreement, though, because they do have to do some things, and 
I think they are significant things: reducing the amount of 
enriched uranium, et cetera, to a low level, and getting rid of 
centrifuges, et cetera.
    The problem is that the wording of the agreement then says 
that sanctions are simultaneously withdrawn, and the vast 
majority are. There is some compliance, but to me it is the 
initiation of compliance. I am more worried about the 
continuing compliance after that. And I think the argument 
would be that snapback sanctions will be that lever.
    I guess my preference would have been that there would have 
been more of a truly phased reduction or a step-wise reduction 
over a many-year period of the sanctions and not the immediate 
release of sanctions. And I guess my question is, in the 
negotiations, was there discussion, was it ever our position 
that we should not have simultaneous release of all sanctions, 
but a more step-wise or gradual reduction in sanctions to 
ensure compliance?
    Secretary Kerry. Well, this was obviously at the heart of 
the negotiation, which is why we drove, what we considered to 
be, such a very hard bargain with respect to what they needed 
to do.
    Look, it was always the fundamental equation of this 
negotiation. You folks passed sanctions. We passed sanctions. 
And our passage of sanctions was specifically to bring them to 
table to negotiate. So if that was the negotiating lever, 
clearly when they came to the table, they wanted the lever 
taken away. And so, the quid pro quo here was always what 
restraints will we get? What insight to their program? What 
long-term commitments can we get that? They cannot get a bomb. 
How do we fulfill President Obama's pledge to close off the 
four pathways to a bomb? That is the exchange. And they get 
some relief from sanctions.
    Now, their insistence for 2 years was obviously this 
notion, and all the way to the end actually, has to all go away 
at once. Everything, all the sanctions, all the U.N., 
everybody's sanctions. Well, we resisted that. We did not do 
that. It is not what happened.
    What we did was we wound up securing the 1-year breakout 
time going from 2 months to 1 year, securing the safety of 
reducing their operable centrifuges, and reducing the research 
that they could do on the next advanced wave of centrifuges. 
Reducing the stockpile, locking it in a low level that could 
not produce a bomb, locking in their enrichment level at a low 
level that cannot produce a bomb.
    So, in exchange for all of the things we have required them 
to do, which, by the way, Senator, are genuinely extensive, 
they have to undo their piping. They have to undo their 
electrical. They have move things. There is a huge amount of 
work they do.
    Senator Paul. I guess, though----
    Secretary Kerry. So when that is done, I do not know 
whether it will be 6 months or a year, but when it is done, we 
lift the fundamental component of financial and banking 
sanctions that were the heart of what brought them to the 
table. That is the exchange.
    Senator Paul. But I guess my point is that everybody that 
is for the agreement, yourself included, are saying this will 
prevent them from having a nuclear weapon, and the Ayatollah is 
saying exactly the opposite.
    Secretary Kerry. Well, no, the Ayatollah has actually, and 
the intel community--I urge you to connect with them. There is 
no decision there whatsoever. What he is doing is protecting 
his domestic turf. By the way----
    Senator Paul. But he is saying the opposite. He is saying 
that this is not true, that this not stop us from acquiring a 
nuclear weapon. That troubles us. Zarif was saying the same 
thing in March when you came out with your statement of what 
you though the agreement meant. They were saying the opposite. 
It troubles us----
    Secretary Kerry. Let me----
    Senator Paul. Those who want--I want a negotiated 
settlement. I want to believe that we could have an agreement, 
but it troubles us that immediately the Iranians say the 
opposite of what we are being told.
    Secretary Kerry [continuing]. The opposite of this. In 
fact, the Supreme Leader's quote is in this document--that Iran 
will never go after a nuclear weapon--and the Iranians put that 
in. And the intel community will tell you they have made zero 
decision----
    Senator Paul. But do you dispute what he said this week: 
``The Americans say they stopped''----
    Secretary Kerry. I know what he said.
    Senator Paul [continuing]. ``Iran from acquiring a nuclear 
weapon. They know it is not true.''
    Secretary Kerry. And you know why he is saying that? 
Because he does not believe the Americans stopped them. He 
believes he stopped them because he issued a fatwah, and he has 
declared the policy of their country is not to do it. So he is, 
as a matter of sovereignty and pride, making a true statement. 
He does not believe the Americans stopped them. He said they 
did not want to get one in the first place.
    Senator Paul. Thank you.
    The Chairman. Thank you.
    Senator Coons.
    Senator Coons. Thank you, Chairman Corker and Ranking 
Member Cardin, for convening this important hearing. And I 
would like to thank all three of our witnesses for your service 
to our Nation and for your testimony here today.
    I think we all share a simple basic premise, which is that 
the United States must not allow Iran to acquire a nuclear 
weapon. A nuclear-armed Iran would threaten our national 
security, our vital ally, Israel, and the stability of the 
entire Middle East. So in the 2 months I will review the 
details of this nuclear agreement and consider its 
ramifications for our Nation and for the region. I will compare 
it to the alternatives and support it only if I am convinced it 
sufficiently freezes every Iranian pathway to a nuclear weapon.
    In my years as an attorney for a corporation, I would often 
get handed a big complex deal by optimistic business units that 
believed that they launched a new marriage, a new partnership, 
and my job was to review it, not with the wedding bells ringing 
in my ears, but with the likely divorce day in the picture 
before me, because frankly no one ever pulled those agreements 
out again unless there was a violation, there was a 
disappointment, there was a breakdown in the relationship.
    And I will say as I look not at the spin or the politics of 
this agreement, but as I dig into the substance of it, it is an 
agreement built on distrust. It is a wedding day where the 
bride is shouting ``I hate you and your family,'' and the groom 
is shouting, ``I distrust you, and you have always cheated on 
me.'' And each is announcing their distrust of the other really 
at the outset. And I do wonder what the alternative is given 
that disagreement here seems inevitable.
    So let me turn to the wedding guests and a question about 
how that may play out. A key piece of this agreement is the 
joint commission, a joint commission that has eight 
representatives, P5+1, and the European Union, and Iran. And 
they will resolve access disputes. They are a key piece of how 
we would gain access to undisclosed sites. And if Iran does not 
sufficiently answer IAEA concerns about a suspect facility 
within a certain number of days, there is a consensus vote and 
so forth.
    But our confidence about our ability to resolve disputes 
under this agreement depends on the reliability of those votes, 
and I do not mean to impugn the partnership of our vital allies 
who have gotten us to this point. But I am concerned that CEOs 
from many European nations are already winging to Tehran and 
talking about significant economic relationships.
    Should we be nervous about the votes in the future on that 
joint commission of the EU or our other allies given what will 
be, I suspect, significant economic interests that might 
inspire them to either direct the EU to vote against access or 
block access for us. How confident can we be of our allies' 
enduring support of our interests in the, I think, likely event 
of cheating?
    Secretary Kerry. I think we can be very confident, and here 
is the reason why. The access issue goes to the core--the 
absolute core--of this agreement, which is preventing them from 
getting a weapon. And if we have sufficient information, 
intelligence, input, shared among us--by the way, we share all 
this information. And by the way, Israel will be feeding into 
that. The Gulf States will be feeding into that.
    When we have any indicator that there is a site that we 
need to get into, and we are all--we have shared that amongst 
ourselves. We are in agreement. This goes to the heart of this 
entire agreement. They will prosecute that. They will 
understand the circumstances.
    And by the way, there is a converse--you know, there is 
another side to that coin about the economic interests. You 
have a young generation of Iranians who are thirsty for the 
world. They want jobs. They want a future. Iran has a huge 
stake in making sure there is not an interruption in that 
business, and that they are living up to this agreement.
    So if, in fact, even when you are way beyond the 15 years, 
if we find there is a reason for us to have suspicion under the 
Additional Protocol and we cannot get in, the United States 
alone--for the duration of the agreement--has the ability to 
snap back sanctions in the U.N. by ourselves. We always have 
the ability to put our own sanctions back in place, and given 
our position in the world, and that is not going to change in 
the next 10, 15 years. We are still the most powerful economy 
in the world. We will have an ability to have an impact on 
their transactions and ability to do business.
    So we believe we are very well protected here, Senator 
Coons, because we created a one-nation ability to go to the 
Security Council and effect snapback.
    Senator Coons. Well, let me--if I could follow up on that, 
Mr. Secretary. The snapback sanctions that we can effect 
through the U.N. Security Council, are they the broad, sweeping 
financial sector sanctions that we worked on together that 
brought Iran to the table, or are they a paler version of that?
    Secretary Kerry. No, no, no, they are the full--they are 
the full Monty.
    Senator Coons. Because as you know, we have had debate 
among some of the colleagues on this committee whether or not 
this agreement prevents the reimposition----
    Secretary Kerry. Well, we do have some discretion. I mean, 
language is in there that says ``in whole or in part.'' Now, if 
we find there is some minor something and we want to slap their 
wrists, we can find an ``in part.'' So that is up to us.
    Senator Coons. So in your view, we have the ability to 
ratchet back sanctions in pieces or in whole.
    Secretary Kerry. If needed, in pieces or in whole.
    Senator Coons. Let me, if I might, turn to Secretary Moniz 
in the time I have left. About centrifuge development--I will 
articulate the question and then if you would have an answer 
for me. How long did it take Iran to master the IR-1 
centrifuge? What is the difference in performance between the 
IR-1 and the IR-8? And how long do you think it will take Iran, 
given the restrictions of this agreement if observed, to master 
the IR-6 and 8? And then what would the impact be on their 
ability to enrich after years 10 to 15?
    Secretary Moniz. So, Senator Coons, first of all, the IR-1, 
of course, they have been working on for quite some time, and 
they have some challenges still. In terms of the R&D on the 
more advanced machines, of course, first of all, the program 
does substantially shift back in time their program plans.
    Where they are today is the IR-6 that you mentioned is, let 
us say, seven or eight times more powerful than the IR-1, and 
they are already spinning small cascades of that with uranium. 
The IR-8, which is projected to be maybe 15 times more 
powerful, is at the mechanical testing stage only. That is what 
got frozen-in in the interim agreement.
    Senator Coons. So if I might in closing, Mr. Chairman. It 
would be perfectly reasonable to expect that on a 10-year time 
horizon, the IR-6 and 8, which they have already--they are 
already testing cascades of the 6. They have already gotten 
mechanical testing of the 8 underway. It would be reasonable to 
expect that a decade from now they would be 15 times better, 
faster at their enrichment, but not 100 percent.
    Secretary Moniz. No, we do not--we do not believe that they 
will have--with this schedule, we do not think that they will 
have--be anywhere near ready for industrial-scale deployment of 
those--of those machines, certainly not in the decade and for 
some years thereafter.
    Senator Coons. Thank you, Mr. Chairman.
    The Chairman. Senator Barrasso.
    Senator Barrasso. Thank you very much, Mr. Chairman. Thank 
you all for being here. Secretary Kerry, you mentioned a 
Washington Post story related to Israelis who know what they 
are talking about. I would like to point out to you that was 
not even in the newspaper. That was a blog post, and it was 
written by someone who has been described as a left-wing 
political activist. And if I have to choose between them and 
the Prime Minister of Israel, Prime Minister Netanyahu, I am 
going to stand with the Prime Minister of Israel.
    But if you want to start talking about the newspaper, let 
us take a look at yesterday's New York Times, a real news 
story. ``Some Experts Question Verification Process in Iran 
Accord.'' First paragraph, ``The Obama Administration's claim 
that the Iran nuclear accord provides for airtight verification 
procedures is coming under challenge from nuclear experts with 
long experience in monitoring Tehran's program. Several 
experts, including a former high-ranking official at the IAEA, 
said a provision that gives Iran up to 24 days to grant access 
to inspectors might enable it to escape detection. A 24-day 
adjudicated timeline reduces detection probabilities exactly 
where the system is weakest, detecting undeclared facilities 
and materials.''
    So I would just say to all three of you, I find it very 
telling and very disturbing that the President of the United 
States to go to the United Nations on Monday before coming to 
the American people. I think the American people have a right 
to have their voices heard. We expect to hear from them in 
August as we head home and listen in townhall meetings across 
the country. I think Congress has the right and the 
responsibility to provide oversight.
    Secretary Kerry, our Nation's highest military commanders 
have very clearly warned the President, have warned you, have 
warned Congress that lifting the arms embargo and current 
restrictions on ballistic missile technologies to Iran would be 
wrong.
    On July 7 of this year, the Chairman of the Joint Chiefs of 
Staff, Martin Dempsey, testified before the Senate Armed 
Services Committee. He was unequivocal. He said, ``Under no 
circumstances should we relieve pressure on Iran relative to 
ballistic missile capabilities and arms trafficking.'' Under no 
circumstances, that is what he said. Defense Secretary Ash 
Carter also testified about Iran. He said, ``We want them to 
continue to be isolated as a military and limited in terms of 
the kinds of equipment and materials they are able to get.'' 
And just 7 days later you did the complete opposite of what our 
military advisors very clearly warned against. You disregarded 
the views and the advice of our top military commanders, 
negotiated away these important restrictions on Iran getting 
deadly military technologies. U.S. negotiators I believe 
capitulated, surrendered, agreed to lift the arms embargo to 
get this deal. And Russia, I must point out, can gain about $7 
billion from arms sales to Iran.
    This administration repeatedly ignores the advice of our 
military leaders when it comes to important national security 
decisions. The administration ignored General Odierno's 
recommendations to keep U.S. troops in Iraq after 2011. 
President Obama withdrew all of the troops. The administration 
ignored Secretary Leon Panetta, Chairman of the Joint Chiefs of 
Staff Martin Dempsey's recommendations to arm vetted Syrian 
rebels. President Obama refused. The administration is now 
coming to Congress once again ignoring the advice and 
recommendations of our military leaders. This time it is about 
Iran.
    Mr. Secretary, how can you justify ignoring this advice and 
the judgment of military commanders responsible for securing 
the safety of the American people?
    Secretary Kerry. Well, Senator, we did not. I work with 
Martin Dempsey. I have great respect for him. We heard what he 
said very clearly, and we respect what he said, which is why we 
have the 8 years and why we have the 5 years. In fact, we held 
out very, very strongly to keep them. And the fact is, Senator, 
during those 5 years and those 8 years, we have all the options 
available to us in the world to strengthen, or find other 
means, or deal with those very issues. So they are not gone. 
They are there. We respected his advice.
    Moreover, we have additional capacities to be able to deal 
with missiles. We have the lethal military equipment sanctions 
provision in the Foreign Assistance Act. We have the 1996 Iran 
Sanctions Act. We have the Iran-Iraq Arms Non-Proliferation 
Act. We have--those are unilateral tools, by the way--we have a 
bunch of multilateral tools: the Proliferation Security 
Initiative with 100 countries, which works to help limit 
Iranian missile-related imports and exports. We have the 
Missile Control Technology Regime, which does a lot to prevent 
the growth of any missile capacity.
    You know, there are many things we will continue to do, but 
it did not go away. We actually kept it, and we kept it 
notwithstanding the fact that three out of seven of the 
negotiating parties wanted to get rid of it all together. We 
kept it.
    Next thing, on the U.N. You know, we fought for the 
prerogatives of the Congress. But, you know, six of the seven 
countries we were negotiating with are not beholden to the 
United States Congress. If their Parliaments passed something 
and said you have to do this or that, and you are being told 
what to do, you would be pretty furious. They were negotiating 
under the United Nations, and their attitude was: we finished 
negotiations, we ought to be able to conclude our agreement and 
put it before the U.N. And we said, wait a minute, our Congress 
needs to be able to review this.
    We got them to accept a 90-day provision in the agreement 
for nonimplementation. They are respecting our desire, and we 
are respecting your desire. For 90 days there is no 
implementation of this deal. If they had their way, they would 
be implementing it now, immediately, but they are not.
    So, I respectfully suggest that we have to have a balancing 
here of interests and equities. I think we have preserved the 
prerogative of Congress. The same consequences will apply if 
you refuse to do this deal with the U.N. vote as without it. 
The same consequences. And none of us have sat here and thrown 
the U.N. vote at you. We are simply saying this is a 
multilateral agreement that has been negotiated by seven 
countries. I would say the same thing if I was here without the 
U.N. vote.
    Senator Barrasso. Well, you know, Secretary Lew mentioned--
you said a deal our partners believe is a good one, and, 
Secretary Kerry, you had talked about the P5+1, and you said, 
and they are not dumb. Well, I agree with that. They are not 
dumb. And it makes, though, wonder if Russia truly is our 
partner in this. We pressed the reset button. We saw how that 
failed. We see Putin's belligerence around the world. I believe 
Russia and Iran teamed up against the United States during 
these negotiations.
    Secretary Kerry. Actually, the Iranians were furious at the 
Russians on any number of accounts. The Russians, they felt, 
were not cooperative with them and did not help them. You are 
exactly wrong.
    Senator Barrasso. Well, time will judge us on all of that, 
but just coming from Ukraine and seeing what is happening as 
well from Estonia, and Latvia, and Lithuania, I can see the 
belligerence and the aggression of Russia, and I see it in this 
agreement. And it is not because they are our partners, or were 
our partners, or are going to be our partners in the future.
    Thank you, Mr. Chairman. My time has expired.
    The Chairman. Thank you. It is my understanding you guys 
want to keep rolling for a while and take a break. Is that 
correct?
    Secretary Kerry. I did not know that. [Laughter.]
    The Chairman. That is what Julia had mentioned to us, but 
why do we not a 5-minute break?
    Five-minute break taken. Thank you.
    Secretary Kerry. I have to be over at the House, that is my 
problem.
    Secretary Moniz. We have a House----
    Secretary Kerry. So I have to be at the House--they do not 
have to be there. I have to be at the House--you have to be at 
the House also. So we are supposed to be at the House in 20 
minutes.
    The Chairman. You want to keep going then?
    Secretary Kerry. Well, I am happy to try to get whatever we 
can in those 15, 20 minutes if you allow me to hobble over 
there for a minute and then come back. I would appreciate it.
    The Chairman. Hobble away. Thank you. Thank you.

[Brief recess.]

    The Chairman. I want to thank you--all of you for your 
patience and spending so much time with us. Each of us I think 
will be very brief just to try to finish up before you go over 
to the House.
    I want to make just a couple of points and move to Senator 
Cardin. On the PMD issue, it is my belief that whether that is 
resolved in an A-plus fashion or a D-minus fashion, the 
sanctions relief will continue. And I will say that Salehi 
today has stated that, ``By December 15 at the end of the year 
the issue of PMD should be determined. The IAEA will submit 
reports to the board of governors. The joint comprehensive plan 
of action will continue independently of the results of this 
report.'' That is exactly the way that I read the agreement. I 
do not see any debate there.
    Secondly, again, I believe that the Secretary continues to 
create a false narrative about where we are. I would just like 
to remind him of the letter from Secretary Geithner to Senator 
Levin on December the 1, 2011, when Senator Menendez had an 
amendment to the NDAA regarding the CBI sanctions. And here is 
what he said: ``However, as currently conceived, this amendment 
threatens severe sanctions against any commercial bank or 
central bank if they engage in certain transactions with the 
CBI. This could negatively affect many of our closest allies 
and largest trading partners,'' highlighted.
    ``Rather than motivating these countries to join us in 
increasing pressure on Iran, they are more likely to resent our 
actions and resist following our lead. A consequence of that 
could lead--that would serve the Iranians more than it harms,'' 
and obviously that was not the case. Obviously through U.S. 
leadership, it actually caused them to come to the table.
    And, again, I think that you unfairly characterize where we 
are, and that I do believe that with your leadership and 
others, if Congress were to decide that this was not something 
worth alleviating the congressionally mandated sanctions, a 
different outcome could occur.
    But with that, Senator Cardin.
    Senator Cardin. Mr. Chairman, I want to follow up on that 
point with Secretary Lew because I am in agreement that 
Congress has been the strongest on sanction-type legislation, 
whether it relates to the nuclear activities of Iran or whether 
it relates to their terrorism or their missile program. And 
whether it is the Obama administration, or the Bush 
administration, or any previous administration, they prefer to 
act on their own rather than having Congress provide the 
framework when in reality it has worked to America's advantage, 
and it has given us a strong position to go internationally to 
get sanctions imposed. So it has worked. Bottom line, the 
system has worked for U.S. leadership.
    So, Secretary Lew, I am concerned, and I started with this 
question, I am going to come back to it. Paragraph 26 says, 
``We will refrain from reintroducing or reimposing the 
sanctions that have been terminated.'' And you have gone 
through some of the things we could do for nonnuclear related 
activities, but if it is an institution, say the Central Bank 
of Iran, that is getting relief under the JCPOA, and we have 
clear evidence that they have been involved in sanctionable 
activities that are nonnuclear related, can we sanction them 
under this agreement?
    Secretary Kerry. Absolutely.
    Secretary Lew. Senator Cardin, I have tried to be clear. If 
there are nonnuclear sanctions being imposed, we have retained 
all of our right----
    Senator Cardin. Including an institution that has been----
    Secretary Lew. Including institutions that are de-listed.
    Senator Cardin. Second question.
    Secretary Lew. It just cannot be a pretext to put back 
nuclear sanctions.
    Senator Cardin. And I agree with that.
    Secretary Lew. Yes.
    Senator Cardin. I understand. If we have clear evidence 
that Iran has used its crude oil sales in a way that has 
furthered nonnuclear sanctionable type of activities, can we go 
back to the crude oil issue if we have clear evidence that that 
would further provide relief in regards to a nonnuclear 
activity?
    Secretary Lew. I think in principle we have not taken any 
of the means that we have of applying economic pressure off the 
table for nonnuclear purposes.
    Senator Cardin. So it could be sectorial to the types of 
relief that they have received under this agreement.
    Secretary Lew. It would have to be justified based on a 
nonnuclear basis.
    Senator Cardin. I understand. Okay. That is very helpful, 
and we are going to be free to have some interesting 
discussions as we move forward.
    Secretary Lew. Yes.
    Senator Cardin. Second point, and this is to Secretary 
Kerry, quickly. I am very happy to hear you talk about our 
strong commitment in the region. The security issues are 
changing. They are changing for Israel. They are changing for 
our allies. No question with ISIS, and North Africa, and Syria, 
in addition to Iran.
    If you will just quickly, how we are committed to making 
sure that Israel is secure in that region with a true and 
trusted partnership with the United States to meet any 
challenge that they may confront as a result of the changing 
circumstances?
    Secretary Kerry. Thank you, Senator. First of all, I would 
begin by saying that I am proud that I had a 100-percent voting 
record for 29 years here on the subject of Israel, and I have 
worked as hard as anybody, I think you know, over the last 
years to try to meet those needs with respect to the peace and 
security demands for Israel.
    We are completely--I mean, I think it is fair to say that 
even with this disagreement, we are constantly in touch and 
working with the intel community, with their folks. And we 
continue to dialogue about the threats to Israel. We understand 
those threats. They are real, and they are existential. And 
there is no debate in this administration whatsoever about our 
willingness to commit anything and everything necessary to be 
able to provide for the security of Israel.
    Now, we believe that security of Israel will also be 
enhanced by not only this agreement, but by bringing the Gulf 
States together in a way that can deal with some of the 
problems of the region, and particularly Daesh, Assad, Syria, 
and so forth. And that is very much on our agenda at this point 
in time.
    Senator Cardin. Thank you. I will yield back my time.
    The Chairman. I do want to say there is a significant 
disagreement among our allies and Iran over the issue that was 
answered relative to reapplying nuclear sanctions in other 
areas. I would love for you to develop a letter. I am sure Iran 
would not sign it, but one where Great Britain, France, and 
Germany, and the EU agree with the statement you just made 
because I just met with them, and my impression--maybe I do not 
understand things correctly--was they are in strong 
disagreement with the statement that you just made.
    Senator Johnson.
    Senator Johnson. Thank you, Mr. Chairman. I think it is 
abundantly clear from this hearing that this is obviously 
complex. This agreement is subject to different 
interpretations, and I am not blaming you or the 
administration. I blame Iran. I just believe that this is going 
to end like our sanctions and the program against North Korea. 
I think in the end, Iran will have a nuclear weapon with 
ballistic missile technology, so that is why I want to quickly 
go back to Secretary Moniz.
    I was surprised and I would say disappointed that you were 
not aware of the recommendations from the 2008 EMP Commission 
report. By the way, and, again, I guess I caught you by 
surprise. You were not expecting that for this hearing. Just so 
you know, that was commissioned by the 2001 National Defense 
Authorization Act. They reported in 2004 and 2008. This is 
something certainly I had heard about before, and it is not 
just Star Wars stuff, something that could not possibly happen.
    Again, you have acknowledged knowing Dr. Richard Garwin, 
correct?
    Secretary Moniz. Absolutely, yes.
    Senator Johnson. A brilliant man.
    Secretary Moniz. Yes, absolutely.
    Senator Johnson. He worked with Enrico Fermi, who referred 
to him as one of the few true geniuses he had ever heard or 
ever known.
    Secretary Moniz. Dick is a national resource.
    Senator Johnson. He testified, and my ranking member during 
the hearing said, he looked through this and somebody said it 
was hokum. The threat of EMP is not hokum. It is a real threat, 
and I think it is a growing threat when you have North Korea, 
and potentially a state like Iran if this thing turns out like 
North Korea. Particularly in light of the fact that we know 
Iran has been testing a potential EMT attack using a Scud 
missile off of a ship, which would be one of our threats, 
particularly on our southern border when we have no defense, or 
potentially a satellite orbiting.
    I just want to make sure that you are fully aware of that 
because the 2008 EMP Commission pretty well tasked DHS and the 
Department of Energy as the two lead departments to enact their 
15 recommendations. And, again, they are pretty basic 
recommendations: evaluate and implement quick fixes, assure 
availability of equipment, replacement equipment, What Dr. 
Garwin reported, and this is what I thought was actually pretty 
encouraging is, if we would just protect 700 transformers to 
the tune of about $100,000 per transformer, that is only $70 
million.
    It has been 7 years--7 years--since that recommendation, 
and, again, the Secretary of the Department of Energy did not 
really know anything about it. I am just asking you----
    Secretary Moniz. Can I clarify, though, Senator?
    Senator Johnson. Go ahead.
    Secretary Moniz. I mean, I know something about EMP. I do 
not know that specific report, and as I said--and also, by the 
way, I will--Dick Garwin also does a lot of work with our OSTP. 
I will talk with Dr. Holdren, the President's science and 
technology advisor. Maybe there is an administration-wide thing 
that we can do and consult with you on that.
    But I do want to emphasize, in April we did our energy 
infrastructure report, and the issues of transformers, and EMP, 
and other threats were there. And furthermore, we have made a 
recommendation about going forward in a public/private 
partnership to potentially establish a transformer reserve in 
addition.
    So I would love to discuss this. I just do not know that 
particular report. I know the issues.
    Senator Johnson. What we will probably do is call you in 
for a hearing in front of my committee, Homeland Security. But, 
again, these recommendations were issued in 2008, and this is 7 
years later. According to GAO, an agency that also testified, 
of the 15 recommendations, we have done virtually nothing. This 
is a real threat America needs to understand. Certainly the 
Secretary of the Department of Energy needs to be aware of 
these recommendations and be working toward their 
implementation. There is a relatively quick fix, which we will, 
quite honestly, have as an amendment to authorize spending $70 
million. It is imperfect, but it goes a long toward protecting 
some of those transformers. I hope you will be supportive of 
that.
    Secretary Moniz. Okay, thank you.
    Senator Johnson. Thank you.
    The Chairman. Senator Menendez.
    Senator Menendez. Well, thank you, Mr. Chairman. Secretary 
Lew, I basically understood your answers to my previous 
question that you have no intention of seeking reauthorization 
of the Iran Sanctions Act, an act that in October 3 of 2013 
entitled--in a hearing entitled ``Reversing Iran's Nuclear 
Program,'' Wendy Sherman and David Cohen heralded as critical 
to moving forward. In 2014, negotiation on Iran's nuclear 
program, another hearing, they both said the same thing and 
talked about the important congressional sanctions.
    So it seems to me that if you want a deterrent, Iran has to 
know consequences. Maybe it will never be called into play. 
That is fine. That is good. Hopefully it will not be called 
into play. But they need to know what the consequences are. And 
so, as far as I am concerned, I think we should be moving to 
reauthorize the sanctions that Congress passed and that expire 
next year, and let the Iranians know that if they violate, 
those are one of the things they are going to have to go back 
to. So I am going to move to reauthorize them because I think 
it needs to be part of the deterrence.
    Let me ask Secretary Kerry the following question. Do you 
believe that Iran will be, and should be, a regional power?
    Secretary Kerry. Do I believe that they should be in the 
future or something?
    Senator Menendez. Will be and should be a regional power?
    Secretary Kerry. Well, I think to some degree there is an 
element of power in what they are doing right now, so I do not 
know about the ``will be.'' But do I want them to be? Not in 
the way that they behave today, no.
    Senator Menendez. All right. Well, I am glad to hear that 
because, you know, the President in a column with Tom Friedman 
said that, ``The truth of the matter is that Iran will be, and 
should be, a regional power.'' But that is a pretty bold 
statement about a country that is the largest state sponsor of 
terrorism in the world as defined by our government.
    Secretary Kerry. Well, I know----
    Senator Menendez. It would have to be a dramatically 
different Iran to have any aspiration to be a regional power.
    Secretary Kerry. Correct. And the President knows that. I 
think, Senator, honestly----
    Senator Menendez. Let me ask you one final thing. You are 
an excellent, excellent lawyer, and when you can get to argue 
something both ways, if you can achieve that, that is great. So 
I have heard you argue we will have everything on the table 
that we have today. We will have the sanctions. We will have a 
military option. Then I have also heard you say sanctions are 
not going to get Iran to stop its nuclear program in terms of--
and a military option will only deter them for 3 years.
    So is really what you are saying, that at the end of the 
day, we hope that Iran will change its course over the next 10 
to 15 years; that if they violate, we will get notice from 3 
months that we had until 12 months, a year. But at the end of 
the day, neither sanctions nor military option is going to--if 
I listen to you, your arguments, nor military option is going 
to ultimately deter Iran if they decide to do so. So does that 
not in essence say to us that we are reconciled at the end of 
the day if they want to accept Iran as a nuclear weapons----
    Secretary Kerry. Absolutely, positively not. Not in the 
closest of imagination, and I will tell you why. They are not 
going to be sanctioned into submission. We have seen that. They 
have what is called their resistance economy. There are limits 
to what our friends and allies are able and willing to do. You 
know the challenge we have had in just bringing people along on 
Ukraine. Bringing people along, particularly the Russians and 
the Chinese, over a long period of time is going to be very, 
very difficult. There is sort of a half-life, if you will, to 
the capacity to keep the sanctions pressure in place.
    In addition to that, on the military option, we all know as 
it is described to us by the military, it is a 2-to-3-year 
deal. That option is--that is real. It is a last resort option. 
If you cannot make diplomacy work, if you cannot succeed in 
putting together a protocol that they have to follow--by which 
they live, which guarantees they will not have a weapon--that 
is your sort of last resort. But it should not be the first 
resort. It should not be the place you force yourself to go to.
    And I think given the structure of this agreement, we have 
a much better option because whatever it is, 15 years, 20 
years, whatever the moment is that the alarm bells go off on a 
civil nuclear program--which has 24/7 access, which has 
inspectors, which we will know has suddenly moved from 5 
percent to 10 percent to 20 percent enrichment--all the alarm 
bells go off. We will have the ability to bring those nations 
back together.
    The question is do you have a sort of readiness and 
willingness of those countries to come together because you 
have honored a process and worked through a process, or are 
you, you know, sort of pushing them away?
    Senator Menendez. The point is to come together, what, for 
the sanctions that you say will not lead them to----
    Secretary Kerry. No, but sanctions obviously brought them 
to the table. That is a different thing.
    Senator Menendez [continuing]. Or come together for a 
military option, which at the end of the day will deter but not 
end it? I mean, I just do not understand the proposition. It 
sounds like your proposition will be there whether it is today 
or whether there is a violation in the future.
    Secretary Kerry. No, Senator, because I believe this deal, 
in fact, achieves what we need to achieve now. We would not 
have come to you, we would not have signed this, I assure you. 
Germany, France, the United Kingdom would not have signed this 
agreement--all of us together on the same day if we did not 
have a sense of confidence that this is doing the things we 
need to do: shutting off the uranium paths, shutting off the 
plutonium path, shutting off the covert path, and so forth. And 
we believe it does that. That is why we are here. We believe it 
does that.
    Now, the proof will be in the implementation. We all know 
that, but we have a sufficient cushion here of those years 
because of the very dramatic steps Iran has agreed to take and 
to implement. We have a very real cushion during which time we 
have a chance of building up confidence. I am not going to sit 
here and tell you that is absolutely going to work 100 percent. 
I believe it will. But if they do not comply, I do have 
confidence we are going to know there is noncompliance. And 
then we have the options available to us that we have today.
    Senator Cardin. Mr. Chairman, I know that Secretary Kerry 
said that he had to leave at 2:30.
    Secretary Kerry. We do, I am afraid.
    Senator Cardin. And we have a couple more. So if that is a 
hard time, I think we should----
    Secretary Kerry. It is a hard time. I actually have to be 
at the House right now.
    The Chairman. Okay. Well, listen, obviously this is a 
serious matter that the three of you have spent a tremendous 
amount of time on over the last 2 years. We appreciate your 
patience with us today and testifying the way you have. We 
appreciate your service to our country.
    Julia, who I know is having a heart attack, his staffer, we 
thank you and hope you have a good meeting with the House of 
Representatives.
    Thank you.
    Secretary Kerry. Thank you very much.
    [Whereupon, at 2:31 p.m., the hearing was adjourned.]
                              ----------                              


              Additional Material Submitted for the Record


           Responses of Secretary John F. Kerry to Questions 
                    Submitted by Senator Bob Corker

    Question. Are the results of the IAEA's PMD report in any way tied 
to sanctions relief on Implementation Day?

    Answer. The International Atomic Energy Agency (IAEA) and Iran have 
agreed on a time-limited process through which Iran will address the 
IAEA's concerns regarding past and present issues, including the 
possible military dimensions (PMD) of Iran's nuclear program. Under the 
Joint Comprehensive Plan of Action (JCPOA), Iran must complete the 
activities required of it in this roadmap by October 15, well in 
advance of any sanctions relief. If Iran does not implement those 
commitments, we will not implement our commitment to provide sanctions 
relief.

    Question. Is Iran's cooperation with the PMD report tied to 
sanctions relief on Implementation Day? I understand that Iran needs to 
comply by Adoption Day and would be in violation of the agreement, but 
the requirements for sanctions relief on Implementation Day do not 
include paragraph 66 of Annex I. If Iran does not comply, would the 
United States use the Dispute Resolution Mechanism all the way through 
snap back in order to address the violation?

    Answer. Under the Joint Comprehensive Plan of Action (JCPOA), Iran 
must complete the activities required of it in this roadmap by October 
15, well in advance of any sanctions relief. If Iran does not implement 
those commitments, we will not implement our commitment to provide 
sanctions relief. There would, therefore, be no need to snap sanctions 
back because they would never have been removed in the first place. We 
will be in continuous contact with the International Atomic Energy 
Agency (IAEA) to make sure Iran fully implements its commitments under 
the roadmap, so that the IAEA can complete its investigation into the 
possible military dimensions of Iran's nuclear program. Iran will no 
longer be able to stonewall the IAEA and string out the process. It 
must address the questions the IAEA poses and the IAEA must have what 
it needs to prepare its final assessment or there will be no sanctions 
relief.

    Question. You stated that Iran must ratify the Additional Protocol 
in 8 years. The agreement says ``seek.'' If Iran does not ratify AP in 
8 years, will the United States consider that a material breach of the 
agreement?

    Answer. The Joint Comprehensive Plan of Action (JCPOA) includes the 
most comprehensive and rigorous verification regime ever negotiated. As 
part of this verification regime, Iran will provisionally apply the 
Additional Protocol (AP) pending its entry into force, and subsequently 
seek ratification and entry into force, consistent with the respective 
roles of Iran's President and Majlis. Provisional application of the AP 
will create legally binding obligations on Iran to implement the AP's 
provisions. Implementation of the AP will give the International Atomic 
Energy Agency the tools it needs to be in a position to provide 
credible assurance about the absence of undeclared nuclear material and 
activities in Iran.
    If Iran fails to ratify the AP, we would have to determine whether 
it ``sought'' ratification in good faith: if it did not, that would be 
inconsistent with its JCPOA commitment and, potentially, a case of 
``significant nonperformance'' that could trigger snapback. We would 
also look very closely at Iran's overall performance under the JCPOA, 
including its willingness to continue provisional application of the 
AP, to determine whether Iran was in full compliance. And because the 
JCPOA is a nonbinding international arrangement, we would always have 
the ability to terminate our participation in the JCPOA if we deemed it 
to be in the national interest.

    Question. Would imposition of sanctions in response to Iranian 
support for terrorists be in violation of paragraph 29 of the JCPOA? If 
not, why?

    Answer. No, we would not violate the JCPOA if we used our 
authorities to impose sanctions on Iran in response to its support for 
terrorism, human rights abuses, missile procurement activities, or for 
any other nonnuclear reason. The JCPOA does not provide Iran any relief 
from U.S. primary sanctions relating to these activities.
    What we have committed to do is quite specific: not to reimpose 
those specific nuclear-related sanctions specified in Annex II to the 
JCPOA and not to impose new nuclear-related sanctions, contingent on 
Iran abiding by its JCPOA commitments. But, that does not mean that we 
would be precluded from sanctioning specific Iranian actors or sectors 
if the circumstances warranted. All of our other sanctions authorities 
remain in place and are unaffected by the JCPOA. Moreover, we have made 
it clear to Iran that we would continue to use and enforce sanctions to 
address its other troubling activities, including its destabilizing 
activities in the region.
    That said, of course, the United States would not be acting in good 
faith if we simply reimposed all of our sanctions the day after they 
were relieved using some other justification. In the end, if we decide 
to reimpose sanctions for any reason, it will be important that we have 
a credible rationale. That has always been the case and will remain the 
case in the future.
    Other authorities that will remain include those that target: human 
rights abuses in Iran, including by means of information technology 
(E.O. 13553, E.O. 13606, E.O. 13628); support for Syria's Assad regime 
(E.O. 13582); human rights abuses in Syria (E.O. 13572); fomenting 
instability in Iraq (E.O. 13438); threatening the stability of Yemen 
(E.O. 13611); and foreign persons that evade sanctions with respect to 
Iran and Syria (E.O. 13608).
    Iranian individuals and entities that have been sanctioned under 
these nonnuclear sanctions authorities will continue to be sanctioned 
under the JCPOA. U.S. persons will continue to be prohibited from 
dealing with such persons, and non-U.S. persons that deal with such 
persons will risk being cut off from the U.S. financial system or 
having their property or interests in property that are in the United 
States, come within the control of the United States, or come within 
the possession or control of a U.S. person blocked.

    Question. You stated that the new UNSCR does not remove the ban on 
ballistic missile testing. Can you please explain how it does not?

    Answer. The new United Nations Security Council resolution (UNSCR) 
does not let Iran's ballistic missile program off the hook. The UNSCR 
continues to call on Iran specifically not to undertake any activity 
related to ballistic missiles designed to be capable of delivering 
nuclear weapons, including launches using such ballistic missile 
technology. Most importantly, UNSCR prohibitions on the supply of 
ballistic missile-related items, technology, and assistance to Iran 
will remain in place for eight additional years (or until the IAEA 
reaches the Broader Conclusion that all nuclear material in Iran 
remains in peaceful activities). These binding prohibitions directly 
constrain Iran's ballistic missile capability by limiting its access to 
new technology and equipment. Under these prohibitions:

   All States are still required to prevent transfers to Iran 
        of ballistic missile-related items from their territory or by 
        their nationals.
   All States are still required to prevent the provision to 
        Iran of technology, technical assistance, and other services 
        related to ballistic missiles.
   All States are still required to prevent transfers from Iran 
        of ballistic missile-related items to or through their 
        territory or by their nationals.
   All States are still required to prevent Iran from acquiring 
        interests in commercial activities in their territories related 
        to ballistic missiles.
   All States are still called upon to inspect cargo in their 
        territories suspected of containing ballistic missile items.
   Flag States are still called upon to allow inspections of 
        their flag vessels suspected of containing ballistic missile 
        items.
   If ballistic missile-related items are found, States will 
        still be required to take actions, in accordance with guidance 
        from the Security Council, to seize and dispose of them.

    Under these prohibitions, the framework for disruption of ballistic 
missile-related transfers is fundamentally unchanged from the status 
quo. Separate from these UNSC restrictions, we have now and will 
continue to have a number of robust domestic and multilateral 
authorities to address Iran's ballistic missile and arms activities.
                                 ______
                                 

           Responses of Secretary John F. Kerry to Questions 
                    Submitted by Senator Marco Rubio

    Question. What happens if during the 24-day period to gain access 
to a suspect site Iran is observed cleansing a site? Would this 
constitute a violation of the agreement?

    Answer. If Iran were to deny an International Atomic Energy Agency 
(IAEA) request for access to a suspicious undeclared location, and Iran 
and the IAEA cannot resolve the issue within 14 days, the issue is 
brought to the Joint Commission, which then has 7 days to find a 
resolution. If Iran still will not provide access but five members of 
the Joint Commission (such as the United States, United Kingdom, 
France, Germany, and the European Union) determine that access is 
necessary, Iran must then provide access within 3 days.
    We anticipate that situations requiring the full 24 days of the 
dispute resolution process will be rare because Iran understands that 
any failure to cooperate with the IAEA will raise significant 
suspicions among the P5+1 and could well lead to a snapback of 
sanctions. Moreover, we would watch closely for indications that Iran 
was attempting to sanitize a site following a request for access by the 
IAEA and would respond appropriately.

    Question. Is it not correct that the timeline for gaining access to 
a suspect site could indeed stretch well beyond 24 days if the 
arbitration process is followed and Iran eventually grants access prior 
to Security Council action?

    Answer. If Iran were to deny an International Atomic Energy Agency 
(IAEA) request for access to a suspicious undeclared location, and Iran 
and the IAEA cannot resolve the issue within 14 days, the issue is 
brought to the Joint Commission, which then has 7 days to find a 
resolution. If Iran still will not provide access but five members of 
the Joint Commission (such as the United States, United Kingdom, 
France, Germany, and the European Union) determine that access is 
necessary, Iran must then provide access within 3 days. We anticipate 
that situations requiring the full 24 days of the dispute resolution 
process will be rare because Iran understands that any failure to 
cooperate with the IAEA will raise significant suspicions among the 
P5+1 and could well lead to a snapback of sanctions. If Iran refused 
access after a decision of the Joint Commission, the United States 
could take appropriate action at that time.

    Question. What will be the threshold for a violation to be appealed 
to the Security Council and a reimposition of all sanctions?

    Answer. If we believe that there has been a violation related to 
any commitment in the Joint Comprehensive Plan of Action (JCPOA), we 
can refer the issue to the Joint Commission. If, after a short period 
of time, our concerns are not resolved to our satisfaction, we could 
notify the United Nations (U.N.) Security Council that we believe 
Iran's actions constitute ``significant nonperformance'' of its JCPOA 
commitments. We have full discretion to determine what is, and is not, 
significant nonperformance.
    The United States has the ability to reimpose both unilateral and 
multilateral nuclear-related sanctions in the event of nonperformance 
by Iran. And, in the case of U.N. sanctions, under U.N. Security 
Council Resolution 2231 we could reimpose sanctions, even over the 
objections of any other member of the Security Council, including China 
or Russia. In addition, we have a range of other options for addressing 
minor noncompliance. These include snapping back certain domestic 
sanctions to respond to minor but persistent violations of the JCPOA. 
Our ability to calibrate our response will serve as a deterrent to 
Iranian violations of the deal.

    Question. Do you agree that with Foreign Minister Zarif's statement 
that incremental violations of the deal would not be prosecuted?

    Answer. No. We are committed to ensuring that Iran complies with 
all of its commitments, even very minor ones. Under the JCPOA, we have 
a wide range of options to respond to any Iranian noncompliance, from 
significant nonperformance to more minor instances of noncompliance.
    Specifically, the United States has the ability to reimpose both 
unilateral and multilateral nuclear-related sanctions in the event of 
nonperformance by Iran. In the case of U.N. sanctions, under U.N. 
Security Council Resolution 2231 we could reimpose sanctions over the 
objections of any member of the Security Council, including China or 
Russia. This unilateral ability to snap back all of the UNSC sanctions 
gives us extraordinary leverage to get cooperation from other countries 
if we seek to take lesser steps instead. In addition, we have a range 
of other options for addressing minor noncompliance. These include 
designating specific entities that are involved in activities 
inconsistent with the JCPOA, snapping back certain domestic sanctions 
to respond to minor but persistent violations of the JCPOA, or using 
our leverage in the Joint Commission on procurement requests.

    Question. Paragraph 37 of the nuclear deal indicates that Iran will 
cease performing all of its commitments in the event of a full or 
partial snapback. How can the U.S. use snapback to compel Iran to allow 
inspections, if using snapback releases Iran from all of its 
commitments?

    Answer. The threat of snapback under the Joint Comprehensive Plan 
of Action (JCPOA) provides us and our partners with enormous leverage 
to deter Iranian noncompliance because Iran would have to weigh the 
potential benefits of the activities that amount to a violation against 
the very real risk that multilateral and national sanctions will be 
reimposed against Iran as a result of that violation. Nothing in the 
JCPOA suggests that if sanctions were snapped back as a result of 
Iranian noncompliance, Iran's noncompliant activities would be 
absolved. Moreover, it is important to remember that snapback would not 
``release'' Iran from all of its commitments because Iran is still 
required by the Nuclear Non-Proliferation Treaty never to seek or 
acquire nuclear weapons.

    Question. Doesn't the all-or-nothing nature of snapback effectively 
deter the U.S. from ever seeking to punish Iranian violations?

    Answer. The snapback provision we have secured is unprecedented and 
it allows the U.S. to have the unilateral ability to reimpose United 
Nations sanctions without the worry of a veto by any other permanent 
member of the Security Council, including Russia and China. This gives 
us enormous leverage. If there are violations, whether minor or 
significant, we can use the threat of full snapback to convince our 
partners to take steps to address it. This approach gives us maximum 
flexibility and maximum leverage. We also have a range of options for 
snapping back domestic sanctions--in whole or in part--to respond to 
lesser violations of the JCPOA if we so choose.

    Question. Did Iran have a nuclear weapons program?

    Answer. The U.S. Intelligence Community assesses Iran had a 
structured nuclear weapons program until 2003. We would refer you to 
the Office of the Director of National Intelligence for further 
questions related to assessments of Iran's past nuclear capabilities.

    Question. For the record, was Iranian Deputy Foreign Minister Abbas 
Araqchi lying when he stated in March that any assertion that Iran had 
a nuclear weapons program was ``bogus'' and that Iran's nuclear 
activities were always entirely peaceful?

    Answer. I refer you to the Iranian Government on statements made by 
Iranian officials. However, I will note that the United States has 
taken a clear position on Iran's past nuclear work. A 2007 National 
Intelligence Estimate assessed with high confidence that until fall 
2003, Iranian military entities were working under government direction 
to develop nuclear weapons.

    Question. If the IAEA certifies Iran has met its nuclear 
obligations under the JCPOA, but has yet to make a finding on the 
possible military dimensions of Iran's nuclear program, will sanctions 
relief still be provided?

    Answer. The International Atomic Energy Agency (IAEA) and Iran have 
agreed on a time-limited ``Roadmap'' through which Iran will address 
the IAEA's concerns regarding past and present issues, including the 
possible military dimensions (PMD) of Iran's nuclear program and those 
specific issues set out in the IAEA Director General's November 2011 
report. Under the Joint Comprehensive Plan of Action (JCPOA), Iran must 
complete the activities required of it in this Roadmap by October 15, 
well in advance of any sanctions relief. The IAEA will report whether 
or not Iran has taken those steps. If Iran does not take those steps, 
we will not implement our commitment to provide sanctions relief.

    Question. Which scientists involved in Iran's nuclear weapons work 
will be interviewed by the IAEA and under what conditions?

    Answer. Under the Joint Comprehensive Plan of Action (JCPOA), Iran 
must complete the activities required of it in the ``Roadmap for 
Clarification of Past and Present Outstanding Issues regarding Iran's 
Nuclear Program with the IAEA.'' The Roadmap notes that in the case 
that the International Atomic Energy Agency (IAEA) has questions on any 
possible ambiguities regarding information provided to it by Iran, 
technical-expert meetings, technical measures, as agreed in a separate 
arrangement, and discussions will be organized in Tehran to remove such 
ambiguities.

    Question. Which scientists did Iran declare off limits to the IAEA?

    Answer. Under the Joint Comprehensive Plan of Action (JCPOA), Iran 
must complete the activities required of it in the ``Roadmap for 
Clarification of Past and Present Outstanding Issues regarding Iran's 
Nuclear Program with the IAEA.'' The Roadmap notes that in the case 
that the International Atomic Energy Agency (IAEA) has questions on any 
possible ambiguities regarding information provided to it by Iran, 
technical-expert meetings, technical measures, as agreed in a separate 
arrangement, and discussions will be organized in Tehran to remove such 
ambiguities.

    Question. Will the IAEA be given access to all of the data 
generated as part of Iran's weaponization work and will any copies of 
this data and research remain under Iranian control?

    Answer. Under the Joint Comprehensive Plan of Action (JCPOA), Iran 
must complete the activities required of it in the ``Roadmap for 
Clarification of Past and Present Outstanding Issues regarding Iran's 
Nuclear Program with the IAEA.'' The Roadmap notes that in the case 
that the International Atomic Energy Agency (IAEA) has questions on any 
possible ambiguities regarding information provided to it by Iran, 
technical-expert meetings, technical measures, as agreed in a separate 
arrangement, and discussions will be organized in Tehran to remove such 
ambiguities.

    Question. What will be the specific procedures for gaining IAEA 
access to the suspected nuclear weapons development site at Parchin?

    Answer. Under the Joint Comprehensive Plan of Action (JCPOA), Iran 
must complete the activities required of it in the ``Roadmap for 
Clarification of Past and Present Outstanding Issues regarding Iran's 
Nuclear Program with the IAEA.'' This includes a separate arrangement 
on Parchin. We cannot address publicly the details of what the Roadmap 
activities entail.

    Question. On August 29, 2014 the State Department sanctioned 
several Iranian individuals and organizations, including one that goes 
by the Farsi initials SPND for current and past nuclear weapons 
development work. When did nuclear weapons development work by SPND 
end?

    Answer. We would refer you to the Office of the Director of 
National Intelligence for questions related to assessments of Iran's 
nuclear capabilities and nuclear weapons activities.

    Question. Does the United States have any concerns about the travel 
or permitted activities of the individuals involved in Iran's covert 
weapons program after U.S. sanctions are to be lifted?

    Answer. Under the Joint Comprehensive Plan of Action (JCPOA), the 
United States has committed to provide Iran certain sanctions relief, 
including relieving secondary sanctions on certain individuals and 
entities designated in connection with Iran's nuclear program on 
Implementation Day; i.e., only after Iran completes the required 
nuclear steps under the deal. We will provide relief from secondary 
sanctions for certain other individuals and entities designated for 
nuclear-related reasons on Transition Day; i.e., 8 years after Adoption 
Day or when the International Atomic Energy Agency (IAEA) reaches the 
broader conclusion that all nuclear material in Iran remains in 
peaceful nuclear activities.
    However, under the JCPOA, Iran has also committed to refrain from a 
number of activities, including those that could contribute to the 
development of a nuclear explosive device. If Iran were to violate this 
or any other JCPOA commitment, we could snap sanctions back into place, 
including by imposing sanctions on specific individuals and entities if 
the circumstances warranted. Moreover, Iran's JCPOA commitments, 
including on transparency and on refraining from certain activities 
that could contribute to the development of a nuclear explosive device, 
will better position the international community to detect and respond 
to such weaponization activities and the individuals and entities 
involved in such activities.
    It is also worth reiterating that, while the JCPOA provides for the 
United States to relieve secondary sanctions on certain designated 
individuals and entities specified in the JCPOA (i.e., sanctions on 
non-U.S. persons that engage in transactions with such persons), the 
U.S. primary embargo on Iran will largely remain in place. The 
Government of Iran and Iranian financial institutions--including any 
property in which they have an interest--will remain blocked by the 
United States. U.S. persons, including U.S. companies, will continue to 
be broadly prohibited from engaging in transactions or dealings with 
the Government of Iran, as well as Iranian individuals and entities, 
including those subject to relief from secondary sanctions under the 
JCPOA.

    Question. What steps will the United States take to remediate the 
proliferation risk represented by these individuals as well as those 
involved with the A.Q. Khan network?

    Answer. The United States will continue to use all relevant 
authorities and tools to prevent the proliferation of nuclear materials 
and nuclear weapons-related technology. We will continue to implement 
all relevant U.S. laws and will continue to sanction countries, 
entities, and individuals that engage in weapons of mass destruction 
(WMD) proliferation. Moreover, we will continue to interdict prohibited 
transactions, block the financing of such deals, and work with partners 
to prevent the travel of WMD proliferators.

    Question. In Section T of the JCPOA, ``Activities Which Could 
Contribute to the Design and Development of a Nuclear Explosive 
Device,'' Iran agrees to not engage in several activities. What is the 
most recent date on which Iran has engaged in any of the listed 
activities?

    Answer. We would refer you to the Office of the Director of 
National Intelligence for questions related to assessments of Iran's 
nuclear capabilities and activities.

    Question. Does the 24-hour inspection under the Additional Protocol 
apply just to sites suspected of having nuclear material? Or does it 
apply to sites such as centrifuge manufacturing plants or weaponization 
sites, in which no fissile material may be present?

    Answer. Under the Additional Protocol (AP), the International 
Atomic Energy Agency (IAEA) must provide at least 24 hours' notice 
prior to seeking access to a location, whether declared or undeclared, 
except that the IAEA can seek access in as little as 2 hours or less in 
certain circumstances. Implementation of the AP will deter Iran from 
cheating by creating a high likelihood that such cheating would be 
caught early. It will give the IAEA the tools it needs to investigate 
indications of undeclared nuclear material and activities in Iran. Over 
time, if Iran cooperates, this would enable the IAEA to draw the 
broader conclusion that all nuclear material in Iran is declared and 
remains in peaceful use.

    Question. Iran is only required to ``seek'' ratification of the 
Additional Protocol in year 8 of an agreement. What happens if the 
ratification does not take place?

    Answer. Beginning on Implementation Day, Iran will provisionally 
apply the Additional Protocol (AP), pending its entry into force. It 
will subsequently seek ratification and entry into force of the AP, 
consistent with the respective roles of Iran's President and Majlis.
    Provisional application of the AP will create legally binding 
obligations on Iran to implement the AP's provisions pending the AP's 
entry into force. If Iran fails to ratify the AP, we would have to 
determine whether it ``sought'' ratification in good faith; if it did 
not, that would be inconsistent with its JCPOA commitment and, 
potentially, a case of ``significant nonperformance'' that could 
trigger sanctions snapback. We would also look very closely at Iran's 
overall performance under the JCPOA, including its willingness to 
continue provisional application of the AP, to determine whether Iran 
was in full compliance. And because the JCPOA is a nonbinding 
international arrangement, we would always have the ability to 
terminate our participation in the JCPOA if we deemed it to be in the 
national interest.

    Question. Will Iran still be required to ratify the Additional 
Protocol if Congress does not permanently lift U.S. sanctions?

    Answer. Iran has committed under the Joint Comprehensive Plan of 
Action (JCPOA) to seek ratification and entry into force of the 
Additional Protocol (AP), consistent with the respective role of Iran's 
President and Majlis.

    Question. Would a failure to ratify the agreement constitute a 
violation and reimposition of sanctions?

    Answer. If Iran fails to ratify the Additional Protocol (AP), we 
would have to determine whether it ``sought'' ratification in good 
faith; if it did not, that would be inconsistent with its Joint 
Comprehensive Plan of Action (JCPOA) commitment and, potentially, a 
case of ``significant nonperformance'' that could trigger sanctions 
snapback. We would also look very closely at Iran's overall performance 
under the JCPOA, including its willingness to continue provisional 
application of the AP, to determine whether Iran was in full 
compliance.

    Question. After year 15 of the agreement, is it correct that there 
are no limits on the numbers or types of centrifuges that Iran can 
deploy?

    Answer. Under the Joint Comprehensive Plan of Action (JCPOA), after 
year 10, Iran will abide by its long-term enrichment and enrichment 
research and development plan submitted to the IAEA under the 
Additional Protocol (AP), which ensures a measured, incremental growth 
in Iran's enrichment capacity consistent with a peaceful nuclear 
program. Without a deal, Iran would proceed now with unconstrained 
research and development on advanced centrifuges and field second 
generation centrifuges within months and third generation centrifuges 
within years.
    Under the JCPOA, Iran is constrained to using only its first 
generation IR-1 centrifuges for the first 10 years, but it will be 
limited to enriching only up to 3.67 percent and constrained to a 
minimal 300 kilogram stockpile for another 5 years. These limitations 
are important to ensuring that Iran's breakout timeline does not drop 
dramatically after year 10. Importantly, under the JCPOA, the IAEA will 
have unparalleled insight into Iran's nuclear program during this 
period, and various enhanced transparency and monitoring measures will 
remain in place well past 10 years. There are also other measures that 
last for 15 years and some that last for 20-25 years. Others, such as 
Iran's adherence to the Additional Protocol, will last indefinitely. 
After 15 years, should we suspect Iran is pursuing nuclear weapons or 
have concerns regarding Iran's nuclear program, we would have the same 
options as we do today to prevent such an effort from coming to 
fruition.

    Question. After year 15 of the agreement, is it correct that there 
are no limits on the level of enrichment Iran can pursue? It can enrich 
to 20 percent or even higher?

    Answer. Enrichment activities are not prohibited, but Iran will 
continue to be subject to the Nuclear Non-Proliferation Treaty (NPT) 
after year 15, and we will retain the right to take action if Iran 
pursues a program inconsistent with its commitments under the Joint 
Comprehensive Plan of Action (JCPOA) and the NPT. In addition, 
inspections and transparency measures will continue well beyond 15 
years--some for 25 years--with others, such as those under the 
Additional Protocol and Safeguards Agreement, lasting permanently. 
Furthermore, Iran has also committed indefinitely to not engage in 
specific activities that could contribute to the design and development 
of a nuclear weapon.
    Any uranium enrichment after 15 years above 5 percent by Iran would 
raise serious concerns given Iran's past activities and would require a 
clear civilian justification. In short, higher levels of enrichment 
would be a warning flag that Iran is not pursuing an entirely peaceful 
program.

    Question. According to the April 2015 parameters for the nuclear 
deal, known as the Agreed Framework, Iran would accept a permanent 
prohibition on the reprocessing of spent nuclear fuel, which would 
allow it to produce weapons-grade plutonium. The final deal only 
prohibits Iran from reprocessing that fuel for 15 years. At that time, 
the prohibition on building heavy water reactors and reprocessing 
facilities will also expire.

   If you believed that a permanent prohibition on the 
        processing of spent fuel was necessary in April, why did you 
        allow that prohibition to expire in the final deal?

    Answer. Under the Joint Comprehensive Plan of Action (JCPOA), Iran 
has committed not to reprocess spent fuel from its nuclear reactors for 
15 years and has expressed its intent not to do so indefinitely. Iran 
has also committed not to conduct reprocessing research and development 
activities, such that Iran will not be able to learn how to separate 
plutonium from spent fuel. These measures will help ensure that the 
plutonium pathway to a nuclear weapon is comprehensively and verifiably 
shut down.

    Question. President Obama said in April that a ``relevant fear 
would be that in year 13, 14, 15, they [Iran] have advanced centrifuges 
that enrich uranium fairly rapidly, and at that point the breakout 
times would have shrunk almost down to zero.'' According to 
proliferation expert David Albright, if Iran installed advanced 
centrifuges in year 13, as the deal allows them to, it ``would allow 
Iran to lower its breakout times down to days or a few weeks.'' Yet 
Secretary Moniz and Secretary Kerry, you have both denied that the 
breakout time would ever be zero, saying instead there would be a 
``soft landing.''

   Can you specify the rate at which breakout times will 
        decrease after year 12, so Congress can understand what you 
        mean by a ``soft landing''?

    Answer. We have ensured that Iran's breakout timeline comes down 
only gradually after year 10, in no small part due to the continued 
restriction on Iran's enriched uranium stockpile until year 15. 
Additionally, even after the initial 10-year period, Iran must abide by 
its enrichment and research and development plan submitted to the 
International Atomic Energy Agency under the Additional Protocol and 
pursuant to the Joint Comprehensive Plan of Action, which will ensure a 
measured, incremental growth in its enrichment capacity consonant with 
a peaceful nuclear program.

    Question. Does the agreement in anyway restrict the U.S. from 
imposing new sanctions on Iran for its human rights abuses? For its 
missile program? For its support of terrorism? For its cyber attacks? 
For its support of the Assad regime? For its support of the Houthis in 
Yemen? For any other nonnuclear reason we deem a national security 
threat to the United States?

    Answer. No. We would not violate the JCPOA if we used our 
authorities to impose sanctions on Iran for terrorism, human rights, 
certain arms or ballistic missile activities, or any other nonnuclear 
reason. The JCPOA does not provide Iran any relief from U.S. sanctions 
under these authorities.
    This does not give us free rein to simply reimpose tomorrow all of 
our nuclear-related sanctions under some other pretext. Iran would 
obviously see that as bad faith, as would our international partners. 
In the end, if we decide to impose new sanctions, it will be important 
that we have a credible rationale for doing so. This has always been 
the case and will be no different in the future.

    Question. Would the administration support congressional attempts 
to impose sanctions on entities and individuals that will have 
sanctions removed under the agreement if it is shown that those 
entities or individuals have supported terrorism or human rights 
abuses?

    Answer. The Joint Comprehensive Plan of Action does not preclude us 
from sanctioning individuals and entities if the circumstances warrant, 
including if such individuals and entities are involved in support for 
terrorism, human rights abuses, or proliferation. We will continue to 
aggressively enforce our sanctions against Iran's support for 
terrorism, human rights abuses, and proliferation, as well as 
destabilizing activities in the region, and we look forward to working 
constructively with Congress to that end.

    Question. For instance, would the administration support 
congressional efforts to impose secondary sanctions for terrorism and 
human rights on Setad?

    Answer. We do not comment on potential ongoing investigations or 
the potential imposition of sanctions on specific entities. The Joint 
Comprehensive Plan of Action does not preclude us from sanctioning 
individuals and entities if the circumstances warrant, including if 
such individuals and entities are involved in supporting terrorism, 
human rights abuses, or proliferation. We will continue to aggressively 
enforce our sanctions against Iran's support for terrorism, human 
rights abuses, and proliferation, as well as its destabilizing 
activities in the region.

    Question. What about additional sanctions on the IRGC?

    Answer. U.S. sanctions on the IRGC will not be relieved under this 
deal. The United States will also maintain sanctions on the IRGC Qods 
Force, its leadership, and its entire network of front companies. This 
includes secondary sanctions that would penalize foreign financial 
institutions that engage in transactions with any of these designated 
entities. We retain the ability to impose additional sanctions on 
individuals and entities providing support to the IRGC or those 
involved in supporting terrorism or human rights abuses, if 
circumstances warrant.

    Question. According to the agreement, Iran has stated that it will 
treat the reintroduction or reimposition of the sanctions as grounds to 
stop complying with its commitments. Is your understanding of Iran's 
view, that the reimposition of any sanction, regardless of the reason, 
is grounds for walking away from the agreement?

    Answer. We do not have free rein to reimpose nuclear-related 
sanctions without a credible rationale. We would not violate the JCPOA, 
however, if we imposed new sanctions on Iran, on a legitimate, credible 
basis, for terrorism, human rights abuses, missiles, WMD, or any other 
nonnuclear reason. We have been clear about this fact with Iran and the 
other P5+1 countries.
    If Iran used our legitimate imposition of new sanctions as a 
pretext to stop performing its JCPOA commitments, such a decision would 
have enormous consequences for Iran, such as the reimposition of all of 
the sanctions that have damaged its economy to date and isolation again 
from the international community.

    Question. How can you defend your statement on PBS NewsHour that 
``None of what they [Iran] are doing today . . . is a reflection of 
money,'' if Iran must spend billions to keep Assad in power and support 
other terrorist and guerrilla organizations?

    Answer. Iran faces severe economic challenges, which will make it 
harder for it to simply divert its financial gains from sanctions 
relief away from its domestic economy and toward its regional 
activities. For example, Iran needs about half a trillion dollars to 
meet its pressing investment needs and government obligations. Even the 
most severe sanctions regime in history has not been enough to prevent 
Iranian support to militant proxies or terrorism because, regrettably, 
these activities do not require substantial resources.
    What has been more effective--and what we are going to be doing 
more of--is to focus on strategies that counter this behavior, 
especially by working with our partners in the region. In addition, we 
have numerous domestic authorities--including sanctions--to counter 
Iran's support for terrorism and other destabilizing activities.
    If we determine any of these funds go to support entities that are 
sanctionable, we will absolutely take action. Additionally, we will 
continue to aggressively enforce our sanctions against Iran for its 
support for terrorism, human rights abuses, and destabilizing 
activities in the region broadly.

    Question. Secretary Kerry, you told PBS that since Iran will now 
have significantly increased means to support Hezbollah and other 
terrorist or guerrilla forces, ``We're going to clamp down.'' Yet 
President Obama said, ``It's not like the U.N. has the capacity to 
police what Iran is doing,'' although the U.S. does have ``authorities 
that allow us to interdict those arms.''

   Has Iran complied with the existing arms embargo and other 
        U.N. Security Council resolutions barring illicit arms 
        transfers to/from Iran?

    Answer. Iran has a record of noncompliance with the existing U.N. 
arms embargo that was imposed in connection with its nuclear program. 
The existing UNSCRs impose obligations on all states to implement the 
embargo and provide authorities to facilitate enforcement, and are 
dependent on the compliance of the rest of the U.N. member states to 
work, rather than Iran's compliance. Under UNSCR 2231 that endorsed the 
JCPOA, those sanctions will continue for another 5 years after Adoption 
Day (or until the IAEA reaches the broader conclusion that all nuclear 
materials in Iran remain in peaceful activities, whichever is earlier). 
After that, we will continue to have a number of other unilateral and 
multilateral tools available to us to counter Iran's arms transfers and 
other destabilizing activities in the region.

    Question. Have Russia and China complied with these resolutions?

    Answer. The United States has consistently engaged China and Russia 
when we have had releasable information that a transaction involving 
entities in these countries could violate U.N. Security Council 
Resolutions on Iran.

    Question. Secretary Kerry, you told ABC News on July 14 that Qasem 
Soleimani, the head of the Iranian Revolutionary Guard Corps (IRGC), 
was not actually listed in the nuclear deal as someone who would have 
sanctions against him lifted. Specifically, you said, ``No, that's 
another Soleimani.''

   Can you confirm that the Qasem Soleimani listed in the 
        JCPOA is, in fact, General Qasem Soleimani of the IRGC and that 
        he will have at least some European sanctions lifted?

    Answer. There is an individual by the name of Ghasem Soleymani who 
will be delisted under U.N. sanctions in the first phase after Iran has 
verifiably taken all of its key nuclear steps, but he is a completely 
different person from IRGC Quds Force Commander Qasem Soleimani. Ghasem 
Soleymani was listed as the Director of Uranium Mining Operations at 
the Saghand Uranium Mine (Saghand Mine).
    U.S. sanctions on Qasem Soleimani and the IRGC Quds Force will not 
be lifted as part of this deal. This includes the secondary sanctions 
that apply to foreign individuals and entities, including foreign banks 
that engage in transactions with Soleimani, the Quds Force, or any 
other Iranian entity that remains on our SDN list. These sanctions are 
highly effective in preventing designated entities from gaining access 
to the international financial system.
    Qasem Soleimani will be removed from the EU's nuclear-related 
designation list on Transition Day; i.e., 8 years after Adoption Day or 
when the International Atomic Energy Agency reaches the broader 
conclusion that all nuclear materials in Iran remain in peaceful 
activities, as provided for in the JCPOA. However, because Qasem 
Soleimani was also designated in the EU for support of the Assad regime 
in Syria, he will remain sanctioned in the EU under that authority. So, 
he will remain subject to sanctions in the EU.
    These EU sanctions, combined with our own secondary sanctions, give 
us a powerful tool to continue disrupting Soleimani and the IRGC Quds 
Force's access to the global financial system.

    Question. Former CIA Director General David Petraeus called 
Soleimani ``truly evil.'' Can you detail for this committee the 
activities of General Soleimani and the IRGC in the Middle East over 
the past decade?

    Answer. The United States has designated Iran as a State Sponsor of 
Terrorism, and that designation and the sanctions consequences that 
flow from it will remain in place under the deal. In addition, Iranian 
individuals and entities designated for terrorism will remain subject 
to sanctions, including IRGC-QF Qasem Soleimani and the IRGC-QF itself. 
We continue to have very serious concerns with both Soleimani and the 
IRGC-QF, including efforts to provide cover for Iranian intelligence 
operations and promote destabilizing activities in the Middle East. In 
addition, the IRGC-QF is the regime's primary mechanism for cultivating 
and supporting terrorists abroad.
    Soleimani was designated by the United States in 2011 for his 
involvement in a plot to assassinate the Saudi Ambassador. He was also 
designated in May 2011 pursuant to E.O. 13572, which targets human 
rights abuses in Syria, for his role as the commander of the IRGC-QF, 
the primary conduit for Iran's support to the Syrian General 
Intelligence Directorate (GID). We have made clear to Iran that we will 
continue to vigorously enforce sanctions not subject to relief under 
the JCPOA, including those related to Iran's role in supporting 
terrorism and destabilizing activities in the region. We will continue 
to hold the Iranian Government accountable for such actions.
    We would direct you to the Director of National Intelligence with 
any additional questions you might have about his activities or the 
IRGC.

    Question. How many U.S. citizens have been killed by Iran, 
including by Iran's terrorist proxies, since 1979?

    Answer. The death of any U.S. citizen due to acts of terrorism is a 
tragedy that we take very seriously. As the President said in his 
August 5 speech, a nuclear-armed Iran is a danger to Israel, America, 
and the world. The central goal of the JCPOA is to eliminate the 
imminent threat of a nuclear-armed Iran. We still have significant 
issues of contention with Iran, including its support for terrorism and 
its destabilizing activities in the region, and will continue to 
aggressively counter such activities. Iran remains designated by the 
United States as a State Sponsor of Terrorism.

    Question. How many U.S. troops and soldiers were killed by Iranian 
provided weapons or by Iranian-backed militias in Iraq and Afghanistan?

    Answer. We are extraordinarily grateful for the service of the men 
and women of the United States Armed Forces, and we mourn the loss of 
every servicemember. The JCPOA is not about a change in the broader 
U.S. relationship with Iran. It is about eliminating the biggest and 
most imminent threat--a nuclear-armed Iran. We still have significant 
issues of contention with Iran, including its support for terrorism and 
its destabilizing activities in the region.
    Moreover, we will continue to aggressively counter Iran's 
destabilizing and threatening actions in the Middle East region. The 
President is committed to working closely with Israel, the gulf 
countries and our other regional partners to do just that.

    Question. How many Israelis have been killed by Iran, including by 
Iran's terrorist proxies since 1979?

    Answer. The central goal of the JCPOA is to eliminate the imminent 
threat that Iran will acquire a nuclear weapon. But the JCPOA cannot 
erase decades of Iranian anti-American and anti-Israeli rhetoric and 
actions. We will continue to aggressively counter Iran's support for 
terrorism and destabilizing activities in the region, working closely 
with Israel, the gulf countries and our other regional partners.

    Question. Why does this deal lift sanctions on the Central Bank of 
Iran and other entities involved in illicit finance if the President 
promised that we will keep in place sanctions focused on support for 
terrorism?

    Answer. The United States has committed to relieve U.S. secondary, 
nuclear-related sanctions on Iran. This includes the sanctions on non-
U.S. financial institutions that engage in significant transactions 
with the Central Bank of Iran (CBI). However, the CBI and all other 
Iranian financial institutions will continue to be subject to U.S. 
primary sanctions under the JCPOA, such that U.S. persons and financial 
institutions will continue to be prohibited from dealing with the CBI. 
Further, the determination that Iran is a ``Jurisdiction of Primary 
Money Laundering Concern'' pursuant to section 311 of the USA Patriot 
Act will not change under the JCPOA. This finding will continue to 
affect the CBI until it resolves outstanding concerns.

    Question. Secretary Kerry, you have sent letters to the Foreign 
Ministers of China, Germany, France, and the United Kingdom regarding 
the impact of U.S. sanctions on Iran on their nations' companies. 
Please elaborate on the assurances that have been provided.

    Answer. When we were negotiating this provision, some of our 
partners expressed concerns that if sanctions snapped back, their 
companies would be suddenly sanctioned for doing business in Iran that 
was consistent with the JCPOA. We made clear that if we were in the 
position of snapping back sanctions in the event of Iranian 
noncompliance, we would want Iran to pay the price for that 
noncompliance, not our partners that were engaging in activity 
consistent with the JCPOA. In that light, we would consult with 
relevant states on a case-by-case basis to address issues that may 
arise. We have not, however, committed to provide a blanket exemption 
(or grandfather clause) for contracts that extend after snapback. This 
approach is entirely consistent with the U.S. Government's long-
standing practice when sanctions have been imposed.
    We would also refer you to the administration's submission to 
Congress on July 19 transmitting the JCPOA and other materials, 
including documents on this topic.

    Question. The JCPOA states in the event of snapback of U.N. 
sanctions ``these provisions would not apply with retroactive effect to 
contracts signed between any party and Iran or Iranian individuals and 
entities prior to the date of application. . . .'' Does that mean if I 
sign a contract to sell Iran 100 widgets, and I've delivered only 50 
when snapback occurs, I can still deliver the other 50? What about a 
major energy contract to develop an oil field? Or a contract for the 
purchase of natural gas? Such contracts could last decades; would those 
contracts be allowed to continue?

    Answer. The language in the UNSCR is meant to affirm that we will 
not apply sanctions retroactively to legitimate business activities 
that take place prior to sanctions being snapped back. Furthermore, 
this conclusion is very clear from the provision you cite, which goes 
on to say that sanctions would not be applied ``provided that the 
activities . . . are consistent with this JCPOA and the previous and 
current UNSCRs''--meaning they would not be prohibited even under the 
current UNSCR regime. This paragraph merely clarifies that snapback 
does not affect activities that have always been permitted under the 
UNSCRs and that are consistent with the JCPOA. The language in the 
JCPOA in no way provides an exemption for business activities to 
continue after snapback.

    Question. The snapback mechanism only refers to U.N. sanctions. If 
the U.S. snaps back our own sanctions, will we also provide contract 
sanctity? In the past we have often given companies just 90 to 180 days 
to wind down business. How would this work?

    Answer. As explained above, there is no contract sanctity--or 
grandfather clause--as part of the U.N. sanctions snapback. Nor is 
there such an exemption if U.S. sanctions are reimposed. Should we 
decide to snap back sanctions, consistent with the U.S. Government's 
long-standing practice, we would not retroactively sanction companies 
for actions consistent with the JCPOA relief undertaken while JCPOA 
relief was in effect. Sanctions will, however, apply to actions after 
the snapback has taken place. For companies that have contracts that 
would otherwise continue after snapback, we have a consistent past 
practice of working with companies to wind down their contracts in 
order to ensure the cost of Iran's noncompliance is borne primarily by 
Iran.

    Question. In February 2014, Wendy Sherman testified to the Senate 
Foreign Relations Committee and said, ``It is true that in these first 
6 months we have not shut down all of their production of any ballistic 
missile that could have anything to do with delivery of a nuclear 
weapon, but that is, indeed, going to be part of something that has to 
be addressed as part of a comprehensive agreement.'' How are ballistic 
missiles addressed in the agreement?

    Answer. The deal retains important United Nations (U.N.) 
restrictions on transfers of ballistic missile technologies for 8 
years, or until the IAEA reaches its Broader Conclusion that all 
nuclear material in Iran remains in peaceful activities. We are keeping 
these restrictions in place for an extended period of time while Iran 
establishes confidence that its nuclear program is exclusively 
peaceful. These binding prohibitions directly constrain Iran's 
ballistic missile capability by limiting its access to new technology 
and equipment. Under these provisions:

   All States are still required to prevent transfers to Iran 
        of ballistic missile-related items from their territory or by 
        their nationals.
   All States are still required to prevent the provision to 
        Iran of technology, technical assistance, and other services 
        related to ballistic missiles.
   All States are still required to prevent transfers from Iran 
        of ballistic missile-related items to or through their 
        territory or by their nationals.
   All States are still required to prevent Iran from acquiring 
        interests in commercial activities in their territories related 
        to ballistic missiles.
   All States are still called upon to inspect cargo in their 
        territories suspected of containing ballistic missile items.
   Flag States are still called upon to allow inspections of 
        their flag vessels suspected of containing ballistic missile 
        items.
   If ballistic missile-related items are found, States will 
        still be required to take actions, in accordance with guidance 
        from the Security Council, to seize and dispose of them.

    We are keeping these restrictions in place for an extended period 
of time while Iran establishes confidence that its nuclear program is 
exclusively peaceful. Under these prohibitions, the U.N. framework for 
disruption of ballistic missile-related transfers is fundamentally 
unchanged from the status quo.
    Separate from these U.N. Security Council restrictions, we have now 
and will continue to have a number of robust domestic and multilateral 
authorities to address Iran's ballistic missile and arms activities. We 
will keep in place the U.S. sanctions that apply to Iran's missile 
program, including the secondary sanctions that apply to foreign banks 
that engage in transactions with entities that have been designated for 
their role in the missile program.
    In addition, we will continue to use the full range of tools 
available to us to counter Iran's missile activities. For example, we 
will continue our efforts to counter the spread of missiles and related 
technology to or from Iran through the use of U.S. sanctions, export 
controls, and cooperation with partner states, including through the 
34-country Missile Technology Control Regime (MTCR).

    Question. According to the new U.N. Security Council Resolution, 
the prohibition on Iran carrying out ballistic missile work is not 
mandatory, but rather the text simply ``calls'' on Iran not to conduct 
such activity for 8 years. Is that the case? What are the penalties if 
Iran ignores this international ``call''?

    Answer. The new United Nations Security Council Resolution (UNSCR) 
does not let Iran's ballistic missile program off the hook. The UNSCR 
calls on Iran specifically not to undertake any activity related to 
ballistic missiles designed to be capable of delivering nuclear 
weapons, including launches using such ballistic missile technology. 
Since the Security Council has called upon Iran not to undertake these 
activities, if Iran were to undertake them it would be inconsistent 
with the UNSCR and a serious matter for the Security Council to review. 
The UNSCR will continue binding prohibitions that directly constrain 
Iran's ballistic missile capability by limiting its access to new 
technology and equipment, and the United States will continue to use 
the full range of tools available to us to counter Iran's missile 
activities.

    Question. If Iran tested a ballistic missile during the next 8 
years, would that be a violation of the agreement?

    Answer. The issue of ballistic missiles is addressed by the 
provisions of the new United Nations Security Council Resolution 
(UNSCR), which do not constitute provisions of the Joint Comprehensive 
Plan of Action (JCPOA). Thus, it would not be a violation of the JCPOA 
if Iran tested a conventional ballistic missile. However, since the 
Security Council has called upon Iran not to undertake any activity 
related to ballistic missiles designed to be capable of delivering 
nuclear weapons, including launches using such ballistic missile 
technology, any such activity would be inconsistent with the UNSCR and 
a serious matter for the Security Council to review.

    Question. What happens to the arms and missile embargoes if the 
IAEA certifies after a year or two that Iran's program is peaceful? The 
Chairman of the Joint Chiefs of Staff, GEN Martin Dempsey, recently 
testified, ``under no circumstances should we relieve pressure on Iran 
relative to ballistic missile capabilities and arms trafficking.'' Why 
was the General's advice and judgment on this matter overruled?

    Answer. The arms and missile embargoes remain in place for 5 and 8 
years, respectively, following Adoption Day under the Joint 
Comprehensive Plan of Action (JCPOA), or until the International Atomic 
Energy Agency (IAEA) reaches the Broader Conclusion that all nuclear 
activities within Iran are exclusively peaceful. Given the extent of 
Iran's nuclear activities, we do not expect the IAEA to reach the 
Broader Conclusion in such a short period of time. The IAEA's past 
history in other countries suggests it will take a substantial number 
of years of applying the Additional Protocol and evaluating the full 
range of Iranian nuclear activities.
    We remain very concerned about Iran's ballistic missile program and 
will continue to take actions to counter it, including through regional 
security initiatives with our partners, missile defense, and sanctions. 
At whatever time that the United Nations (U.N.) restrictions on arms 
and missile transfers lapse, we will continue U.S. pressure to deter 
and prevent such transfers, as General Dempsey testified. The United 
States and its allies were combating such transfers before the U.N. 
Security Council resolutions were in place, using a variety of tools 
available to us, and we will continue to do so.

    Question. Has the IAEA made any assurances to the United States 
regarding the specific actions that will be required by Iran for it to 
make the ``broader conclusion'' that would relieve Iran from the arms 
and missile restrictions early?

    Answer. We have complete confidence in the International Atomic 
Energy Agency (IAEA) and its technical ability to faithfully implement 
the Safeguards Agreement and the Additional Protocol in Iran, as well 
as undertake the additional verification activities provided for under 
the Joint Comprehensive Plan of Action (JCPOA). We expect the IAEA to 
pursue a rigorous process of implementing Iran's Additional Protocol. 
We are confident that the IAEA would only draw the Broader Conclusion 
when it is confident about the exclusively peaceful nature of Iran's 
nuclear program.

    Question. Why did the U.S. agree to lift the U.N. arms embargo on 
Iran in 5 years, at a time when Iran continues to violate this 
requirement? Was this done on an expectation of a change in Iranian 
behavior?

    Answer. The only arms and missile sanctions that are being relieved 
under this deal are those that were put in place by the United Nations 
Security Council. This is because the Security Council was explicit in 
its resolutions that these sanctions were put in place in order to 
address the international concerns about Iran's nuclear program and 
would be lifted when Iran addressed those concerns. We remain concerned 
about Iran's destabilizing activities in the region and will work with 
partners to address this. To support these efforts, we will continue to 
invoke other relevant U.N. arms restrictions, including those banning 
arms shipments to Houthis in Yemen, nonstate actors in Lebanon and 
Iraq, and to all terrorist groups.
    In addition, we still have a number of ways, including through our 
unilateral sanctions authorities, to continue to restrict Iranian 
conventional arms transfers. The size of the U.S. economy, the power of 
our financial system, and the reach of U.S. unilateral measures give us 
enormous leverage to pressure other countries to abide by restrictions 
on Iranian arms activity.

    Question. Does Iran understand that the U.S. will sanction entities 
that provide arms to terrorist groups? If IRISL or Iran Air is found to 
be shipping arms, will the U.S. reimpose sanctions on these entities? 
Have our partners agreed to go along with this?

    Answer. We have been explicit with our partners and with Iran that 
we intend to continue enforcing our sanctions on nonnuclear activities, 
such as support for terrorism. We will continue to aggressively counter 
Iran's destabilizing and threatening actions in the region. The 
President is committed to working closely with Israel, the gulf 
countries, and our other regional partners to do just that. We have 
been explicit with our partners and with Iran that our sanctions 
targeting Iran's support for terrorism, its human rights abuses, 
missile and weapons of mass destruction proliferation, and 
destabilizing activities in the region, including support for the Assad 
regime, will remain in place and we will continue to vigorously enforce 
them.

    Question. The administration has cited various international and 
domestic authorities that will allow the U.S. to continue addressing 
Iranian arms exports and imports. The agreement specifically highlights 
the Iran, North Korea, and Syria Non-Proliferation Act as a U.S. 
sanctions law that will remain in effect. The GAO recently conducted a 
review and found the State Department had failed to carry out the law 
and was some 3 years behind in issuing mandatory reports under the law.

   What are you doing to come into compliance with the law? 
        Why should we trust the administration to enforce the law now, 
        when you have failed to do so for years?

    Answer. The Iran, North Korea, and Syria Nonproliferation Act 
(INKSNA) is an important tool in the nonproliferation toolkit. The 
imposition of INKSNA sanctions and the threat of potential INKSNA 
sanctions have been effective in prompting foreign governments to take 
action to stop proliferators or even prevent INKSNA-reportable 
transfers from happening in the first place. In response to the recent 
GAO report regarding the timeliness of the INKSNA reports, the 
Department is reviewing its INKSNA process and continuing to 
incorporate lessons learned into each new reporting cycle.
    The unique requirements of this law are broad--identifying every 
foreign person if there is ``credible information'' that the person 
transferred or received even one of several thousand items, including a 
wide range of conventional weapons--and therefore preparation of this 
report is time intensive. The Department must carefully and thoroughly 
vet decisions that carry significant foreign policy implications, 
internally and through the interagency. In addition, the focus of the 
law has greatly expanded since the Iran Nonproliferation Act went into 
effect in 2000 and included only transfers to Iran. The law now 
requires reporting on transfers to or from Iran (added in 2005), Syria 
(added in 2005), and North Korea (added in 2006). This has 
significantly increased the scope of INKSNA without expanding the 
statutory timeframes for reporting. While there is no disputing the 
fact that reports have been late, the Department of State continues to 
regularly implement this law, as witnessed by the ongoing delivery of 
INKSNA reports to Congress and the substantial number of foreign 
persons sanctioned under INKSNA.

    Question. In November 2011, the Treasury Department determined Iran 
was a ``Jurisdiction of Primary Money Laundering Concern'' pursuant to 
section 311 of the USA Patriot Act. Is it correct that this designation 
will remain in effect? As such, will U.S. banks continue to be required 
to conduct special due diligence to their correspondent accounts to 
guard against their improper indirect use by Iranian banking 
institutions?

    Answer. The determination that Iran is a ``Jurisdiction of Primary 
Money Laundering Concern'' pursuant to section 311 of the USA Patriot 
Act will not change under the JCPOA. Moreover, U.S. sanctions will 
continue to prohibit U.S. banks from providing services to Iranian 
financial institutions. As a result, Iranian banks will not be able to 
clear U.S. dollars through the U.S. financial system, hold 
correspondent account relationships with U.S. financial institutions, 
or enter into financing arrangements with U.S. banks. As we have made 
clear, we have aggressively enforced our primary sanctions on U.S. 
banks that have failed to abide by their legal obligations.

    Question. Will Iran remain prohibited from accessing the U.S. 
financial system through the banning of U-Turn transactions?

    Answer. Yes. Under the JCPOA, U-turn transactions will remain 
prohibited. The JCPOA contains no provisions allowing Iran access to 
the U.S. financial system.

    Question. Secretary Kerry, do you agree with Foreign Minister 
Zarif's statement that Iran does not ``jail people for their 
opinions?''

    Answer. We take issue with the suggestion that the Iranian 
Government does not detain people solely for expressing their opinions. 
In fact, the Iranian Government continues to arrest and detain 
journalists, activists, students, and many others on charges that 
appear spurious and without due process. It places severe restrictions 
on the enjoyment of civil liberties and human rights, including 
freedoms of peaceful assembly, expression, and religion or belief, as 
well as on press freedoms. According to the March 2014 report of the 
U.N. Special Rapporteur for human rights in Iran, at least 895 
political prisoners and prisoners of conscience are incarcerated by 
Iran. Other human rights activists have estimated there could be more 
than 1,000 prisoners of conscience in Iran.
    We document these issues in our annual Human Rights and 
International Religious Freedom Reports, and remain vocal in our 
condemnation of Iran's human rights violations.

    Question. Do you believe that this denial of the human rights 
situation faced by millions of Iranians makes Foreign Minister Zarif a 
human rights violator?

   Given his role in overseeing the Iranian Government's 
        institutions is President Rouhani a human rights violator? What 
        about Supreme Leader Khamenei?

    Answer. Since 2010, the Treasury Department, in consultation with 
the State Department, has sanctioned five Iranian entities and 14 
Iranian individuals under Executive Order 13553 for their involvement 
or complicity in serious human rights abuses. These designations will 
not go away under the JCPOA, and neither will the designations of 12 
Iranian entities and six Iranian individuals under Executive Order 
13628 for activities that limit the exercise of freedoms of expression 
or peaceful assembly by Iranians. Lastly, the four entities we have 
targeted pursuant to Executive Order 13606--for their provision of 
information technology that could be used by the Government of Iran to 
commit serious human rights abuses--will remain designated.
    Iranian entities sanctioned pursuant to various human rights-
related authorities include the Islamic Revolutionary Guards Corps 
(IRGC), the Basij, the Ministry of Intelligence and Security (MOIS), 
the Ministry of Culture and Islamic Guidance, the Committee to 
Determine Instances of Criminal Content, and the Iranian Cyber Police. 
We have also sanctioned top officials within some of these 
organizations. We have enforced and will continue to enforce existing 
human rights-related sanctions.

    Question. Has the United States, pursuant to this agreement, or any 
side agreements, either written or verbal, made any commitment to Iran 
of any type that we will not take military action against Iran or its 
proxies?

    Answer. No, there are no such commitments.

    Question. Have we made any commitments not to challenge Iranian 
activity in Iraq, Syria, Lebanon, or Yemen?

    Answer. No. We have been clear that we are not suspending or 
removing sanctions related to nonnuclear issues, such as Iran's support 
for terrorism, its ballistic missile activities, its abuse of human 
rights, or its support for the Assad regime, Hezbollah, or the Houthis 
in Yemen. Similarly, we have not made any commitments that prevent us 
from imposing sanctions in response to those activities. Iran's 
destabilizing activities in the region are a serious concern for the 
administration, and we are committed to working with our partners in 
the region and around the world to take the necessary steps to counter 
Iranian aggression.

    Question. Have we made any commitments to roll back or lessen our 
efforts to seek changes in regime behavior as it relates to human 
rights?

    Answer. No. Our position on Iran's human rights record has not 
changed. We remain vocal in our condemnation of human rights abuses and 
violations in Iran. We have enforced and will continue to enforce 
existing human rights-related sanctions against Iran. Our human rights-
related designations of entities and individuals are not affected by 
the JCPOA.
    We will continue to cosponsor and lobby for the U.N. General 
Assembly's annual resolution expressing deep concern over human rights 
violations in Iran and to lead lobbying efforts to maintain the mandate 
of the Special Rapporteur on human rights in Iran--a mandate we were 
instrumental in establishing through our leadership at the U.N. Human 
Rights Council.
    We will also continue to document reports of Iran's human rights 
violations and abuses in our annual Human Rights and International 
Religious Freedom Reports.

    Question. Will we continue to support human rights and democratic 
activists in Iran that seek an open society that protects basic human 
rights and civil liberties?

    Answer. We will continue to speak out in support of Iranians and 
their desire for greater respect for human rights and the rule of law.
    U.S. Government-funded programming continues to provide tools and 
training to Iranian citizens and civil society groups to support 
democratic principles, as laid out in Iran's own constitution.
    These projects build the capacity of civil society to advocate for 
citizens' interests and expand access to independent information 
through media projects.
    Projects also provide digital safety training and increase safe 
access to the Internet and other communications technologies to allow 
Iranians to communicate with each other and with the outside world.
    U.S. Government-funded projects also build the capacity of Iranian 
citizens to urge greater respect for human rights and the rule of law.

    Question. Will we continue to confront Iran's abysmal human rights 
record, including through the imposition of sanctions with respect to 
the transfer of goods or technologies to Iran that are likely to be 
used to commit human rights abuses?

    Answer. We remain vocal about human rights violations in Iran, and 
will continue to enforce existing human rights sanctions.
    Since 2010, the Treasury Department, in consultation with the State 
Department, has sanctioned 5 Iranian entities and 14 Iranian 
individuals under Executive Order 13553 for their involvement or 
complicity in serious human rights abuses. These designations will not 
go away under the JCPOA, and neither will the designations of 12 
Iranian entities and 6 Iranian individuals under Executive Order 13628 
for activities that limit the exercise of freedoms of expression or 
peaceful assembly by Iranians. We have also targeted four entities 
pursuant to Executive Order 13606 for their provision of information 
technology that could be used by the Government of Iran to commit 
serious human rights abuses; these entities will similarly remain 
designated.
    Iranian entities sanctioned pursuant to various human rights-
related authorities include the IRGC, the Basij, the Ministry of 
Intelligence and Security (MOIS), the Ministry of Culture and Islamic 
Guidance, the Committee to Determine Instances of Criminal Content, and 
the Iranian Cyber Police. We have also sanctioned top officials within 
some of these organizations.

    Question. President Obama said that the alternative to this deal is 
an unconstrained Iranian nuclear program and a substantial increase in 
the risk of war. Yet just 2 weeks before finalizing the deal, he 
insisted, ``I've said from the start I will walk away from the 
negotiations if, in fact, it's a bad deal.'' Secretary Kerry, you are 
on the record saying several times, ``No deal is better than a bad 
deal.''

   If President Obama said that he would walk away from 
        negotiations if necessary, don't his words clearly show that 
        there are acceptable alternatives to signing a deal?

    Answer. Prior to reaching the JCPOA, the President made clear that 
the United States would only accept a deal that provides confidence to 
the international community that Iran's nuclear program will be 
exclusively peaceful. Had the President determined that such a deal was 
unobtainable, he was prepared to walk away and consider alternative 
ways of addressing the problem. The President continually weighed this 
option against the alternatives during the negotiations, taking into 
consideration a variety of factors, including the degree to which the 
United States would have international support for any actions that we 
would take.
    Fortunately, we were able to conclude a deal that verifiably 
ensures that Iran's nuclear program will be exclusively peaceful and 
that enjoys broad international support. As a result, we believe that 
no other option can as effectively constrain the Iranian nuclear 
program for the long term and ensure that Iran cannot obtain a nuclear 
weapon.

    Question. Even though you clearly believe this deal is a good one, 
shouldn't Congress have the same right as yourself and President Obama 
to walk away from a deal if we believe it's a bad one?

    Answer. Congress does have the ability to prevent this deal from 
going forward. However, such a decision would have significant 
ramifications. We urge Congress to evaluate this choice against the 
alternatives to a deal, none of which can prevent Iran from obtaining a 
nuclear weapon as effectively and for as long as the JCPOA does. We 
believe it would be a mistake to walk away from a deal that will 
verifiably prevent Iran from obtaining a nuclear weapon, includes the 
most comprehensive and intrusive verification regime ever negotiated, 
and has broad international support. We look forward to working 
constructively with Congress during the review period to discuss any 
questions or concerns you and your colleagues have.

    Question. How would you define a bad deal such that it would have 
compelled you to walk away from the negotiating table?

    Answer. A bad deal would be a deal that, unlike the JCPOA, does not 
verifiably ensure that Iran's nuclear program will be exclusively 
peaceful by cutting off all of the pathways to enough fissile material 
for a nuclear weapon.

    Question. You have assured Congress that over the course of years 
of negotiations with Iran that U.S. hostages were raised at every 
meeting, yet during the course of the negotiations, the number of U.S. 
hostages grew. Would the administration support the imposition of 
sanctions against those responsible for unjustly detaining American 
citizens in Iran?

    Answer. We have long maintained that Iran's detention of Saeed 
Abedini, Amir Hekmati, and Jason Rezaian is unjust and that Iran should 
release these U.S. citizens without delay. We have also maintained that 
Iran should cooperate with us to find Robert Levinson; he went missing 
on Iranian soil and thus the Iranians should help locate him. All of 
these cases deserve resolution, and we will not cease our efforts until 
these U.S. citizens are reunited with their families.

    Question. Will the United States support other countries in the 
Middle East or elsewhere that desire a uranium enrichment program of 
similar size and capabilities as that Iran will possess under the 
JCPOA? If not, why not?

    Answer. We remain committed to ensuring compliance with the Nuclear 
Non-Proliferation Treaty (NPT) by all parties to the treaty, not just 
Iran. Iran ran afoul of its NPT and IAEA obligations because it engaged 
in clandestine nuclear activities at clandestine facilities in pursuit 
of a nuclear weapon outside the IAEA safeguards regime. A deal that 
restricts Iran's enrichment capacity and brings Iran's nuclear 
activities in line with its NPT and IAEA obligations will contribute to 
the security of the region. Other countries in the region have 
expressed an interest in nuclear energy, and we have engaged them on 
this issue.
    More broadly, we will continue our efforts to combat the 
proliferation of enrichment and reprocessing technologies. The United 
States employs a range of measures, both multilateral and bilateral, to 
help minimize the spread of related technologies around the world. As 
part of this effort, we seek to ensure that states make the choice to 
rely on the international market for fuel cycle services. Our approach 
has been effective in convincing a number of states to do just that.
                                 ______
                                 

           Responses of Secretary John F. Kerry to Questions 
                    Submitted by Senator Jeff Flake

    Question. Language in paragraph 29 of the JCPOA states that ``the 
United States, consistent with their respective laws, will refrain from 
any policy specifically intended to directly and adversely affect the 
normalization of trade and economic relations with Iran inconsistent 
with their commitments not to undermine the successful implementation 
of the JCPOA.''
    It seems to me that this commits future administrations and 
Congresses to avoid putting into place policies regarding trade and 
economic relations with Iran.

   In the context of the agreement, who would make the 
        determination as to whether a specific policy or legislative 
        initiative constituted a violation of this provision?
   If a specific policy or legislative initiative were to be 
        seen as a violation of the JCPOA, would Iran have grounds to 
        walk away from its commitments under the agreement?

    Answer. No, the JCPOA does not prevent future administrations and 
Congress from implementing policies or sanctions on certain conduct of 
concern--even if such policies have trade or economic consequences on 
Iran.
    Paragraph 29, by its terms, does not apply to sanctions that are 
intended to prevent and counter specific conduct by Iran, such as 
support for terrorism, abuses of human rights, missile proliferation, 
WMD proliferation, or violations of the JCPOA. Such sanctions are not 
``specifically intended to directly and adversely affect the 
normalization of trade and economic relations with Iran.'' Moreover, 
such sanctions would not be ``inconsistent with [our] commitments not 
to undermine the successful implementation of the JCPOA'' because the 
JCPOA sanctions relief only encompasses nuclear-related sanctions.
    Paragraph 29 does not preclude us from sanctioning individuals and 
entities if the circumstances warrant, including if such individuals 
and entities are involved in support for terrorism, human rights 
abuses, or proliferation. Nor would it prevent us from targeting 
certain economic sectors, if the circumstances warranted, because the 
intent of those types of sanctions would be to change Iran's behavior. 
It is important to note, though, that this fact does not give us free 
rein to simply reimpose the day after sanctions relief is provided 
under the JCPOA all of our suspended sanctions under some other 
pretext. Iran would obviously see that as bad faith, as would our 
partners. In the end, if we decide to impose new sanctions, it will be 
important that we have a credible rationale.
    With respect to how Iran will react, there is always the 
possibility that Iran could use any action by the United States, 
related to sanctions or otherwise, as a pretext to stop performing its 
JCPOA commitments. However, such a decision would have enormous 
consequences for Iran, such as the reimposition of all of the sanctions 
that have damaged its economy to date and isolation again from the 
international community.

    Question. Similarly, language in Annex V states that after 
Transition Day, ``the United States will seek such legislative action 
as may be appropriate to terminate'' statutory sanctions.

   If the President at that time does not want to seek this 
        relief, would that constitute a violation of the agreement, 
        giving Iran grounds to walk away?

    Answer. Under the JCPOA, the United States committed to seek 
legislative action to terminate the specified nuclear-related sanctions 
on Transition Day. Therefore, if the President did not make a good 
faith effort to seek this legislative action, Iran and the other P5+1 
members could accuse us of violating the JCPOA. However, we structured 
this provision in recognition of the President's and Congress' 
respective constitutional authorities and the fact that the termination 
of statutory sanctions is within Congress' purview. This and other U.S. 
commitments on sanctions relief were necessary to secure Iran's 
commitments under the JCPOA that address the international community's 
concerns with its nuclear program. Provided that Iran complies with its 
commitments under the JCPOA until Transition Day, we intend to take the 
steps necessary to fulfill our sanctions relief commitments under the 
JCPOA, and as is the long-standing practice with respect to 
multilateral commitments of the United States, we would expect future 
administrations would do so as well. If, however, Iran violates its 
JCPOA commitments, the United States maintains the ability to snap back 
U.S. national or multilateral sanctions at any time.

    Question. If approved, this deal will have powerful impacts on the 
geopolitics of the Middle East and beyond for decades to come and it 
will span two, maybe three Presidential administrations.

   How does the administration plan to preserve the agreement 
        throughout its duration to ensure its success?

    Answer. The durability of this deal will largely depend on Iran's 
compliance because, when fully implemented, the JCPOA will verifiably 
prevent Iran from developing a nuclear weapon. Thus, if the JCPOA is 
fully implemented, we assess that future administrations will seek to 
preserve it.
    For our part, if Iran does abide by its commitments, we intend to 
take the steps necessary to fulfill U.S. sanctions relief commitments 
and would expect future administrations to do so as well. Maintaining 
the economic benefits from sanctions relief will serve as a powerful 
incentive for Iran to continue meeting its commitments. If, however, 
Iran violates its JCPOA commitments, the United States maintains the 
ability to snap back U.S. national or multilateral sanctions at any 
time.

    Question. Paragraph 26 of the JCPOA says that ``the U.S. 
administration, acting consistent with the respective roles of the 
President and the Congress, will refrain from re-introducing or re-
imposing the sanctions specified in Annex II . . . Iran has stated that 
it will treat such a re-introduction or re-imposition of the sanctions 
specified in Annex II, or such an imposition of new nuclear-related 
sanctions, as grounds to cease performing its commitments under this 
JCPOA in whole or in part.''

   If the United States Congress passed into law some of the 
        sanctions specified in Annex II but for reasons unrelated to 
        the nuclear issue, would that constitute a violation of the 
        JCPOA? Would Iran consider it a violation of the JCPOA?

    Answer. We have been clear that we would not violate the JCPOA if 
we used our authorities to impose sanctions on Iran in response to its 
support for terrorism, human rights abuses, missile activities, or for 
any other nonnuclear reason. The JCPOA does not provide Iran any relief 
from U.S. sanctions relating to these activities.
    What we have committed to do is quite specific: not to reimpose for 
nuclear reasons the specific nuclear-related sanctions specified in 
Annex II to the JCPOA and not to impose new nuclear-related sanctions, 
contingent on Iran abiding by its JCPOA commitments. But, that does not 
mean that we would be precluded from sanctioning specific Iranian 
actors or sectors if the circumstances warranted. All of our other 
sanctions authorities remain in place and are unaffected by the JCPOA. 
Moreover, we have made it clear to Iran that we would continue to use 
and enforce sanctions to address its other troubling activities, 
including its support for terrorism and destabilizing activities in the 
region.
    That said, of course, the United States would not be acting in good 
faith if we simply reimposed all of our sanctions the day after they 
were relieved using some other justification. In the end, if we decide 
to reimpose sanctions for any reason, it will be important that we have 
a credible rationale. That has always been the case and will remain the 
case in the future.
    Other authorities that will remain include those that target: human 
rights abuses in Iran, including by means of information technology 
(E.O. 13553, E.O. 13606, E.O. 13628); support for Syria's Assad regime 
(E.O. 13582); human rights abuses in Syria (E.O. 13572); fomenting 
instability in Iraq (E.O. 13438); threatening the stability of Yemen 
(E.O. 13611); and foreign persons that evade sanctions with respect to 
Iran and Syria (E.O. 13608).
    Iranian individuals and entities that have been sanctioned under 
these nonnuclear sanctions authorities will continue to be sanctioned 
under the JCPOA. U.S. persons will continue to be prohibited from 
dealing with such persons, and non-U.S. persons that deal with such 
persons will risk being cut off from the U.S. financial system or 
having their property or interests in property that are in the United 
States, come within the control of the United States, or come within 
the possession or control of a U.S. person blocked.

    Question. Iran signed the Additional Protocol in 2003 but never 
ratified it. It implemented the Additional Protocol until 2006, when 
Iran stopped implementing it. The JCPOA requires Iran to implement the 
Additional Protocol, but Iran is not required to ratify it.

   Is there anything in this agreement that would require Iran 
        to continue to implement the Additional Protocol beyond the 
        length of the JPOA?

    Answer. The Joint Comprehensive Plan of Action (JCPOA) includes the 
most comprehensive and rigorous verification regime ever negotiated. As 
part of this verification regime, Iran will provisionally apply the 
Additional Protocol (AP) pending its entry into force, and subsequently 
seek ratification and entry into force, consistent with the respective 
roles of Iran's President and Majlis. Under international law, 
provisional application creates a legally binding obligation on Iran to 
comply with the AP. There is no end date to this legal obligation, and 
it is not tied to any duration in the JCPOA. Implementation of the AP 
will give the International Atomic Energy Agency the tools it needs to 
be in a position to provide credible assurance about the absence of 
undeclared nuclear material and activities in Iran.

    Question. If not, and if Iran were to stop applying the Additional 
Protocol at some point more than 10 years from now, what effect would 
that have on inspectors' access to Iranian facilities?

    Answer. Iran's implementation of the Additional Protocol (AP) will 
provide the International Atomic Energy Agency with expanded access to 
locations in Iran and impose additional reporting requirements on Iran. 
That is why the AP is a critical element of the Joint Comprehensive 
Plan of Action's (JCPOA) verification regime and why we insisted that 
Iran commit to provisionally apply the AP--which will create legally 
binding obligations on Iran to implement the AP's provisions--and to 
seek ratification of the AP. There is no end date to this JCPOA 
commitment, and it is not tied to any duration in the JCPOA.

    Question. The Joint Comprehensive Plan of Action says that Iran 
will fully implement the ``Roadmap for Clarification of Past and 
Present Outstanding Issues'' agreed with the IAEA by October 15, 2015, 
and that the Director General of the IAEA will provide a ``final 
assessment on the resolution of all past and present outstanding 
issues'' related to Iran's nuclear program to the Board of Governors, 
and that the ``E3+3, in their capacity as members of the Board of 
Governors, will submit a resolution to the Board of Governors for 
taking necessary action, with a view to closing the issue'' (JCPOA, 
paragraph 14, page 9).

   What will happen if the Director General of the IAEA 
        determines that there has not been resolution of the past and 
        present outstanding issues related to Iran's nuclear program?

    Answer. The P5+1 spoke with one voice throughout the talks that it 
will be critical for Iran to cooperate fully with the International 
Atomic Energy Agency (IAEA) to address the possible military dimensions 
(PMD) of Iran's nuclear program. The IAEA and Iran agreed on a roadmap 
that contains steps to clarify past and present issues, including PMD. 
Under the Joint Comprehensive Plan of Action, Iran must complete the 
activities required of it in this roadmap by October 15, well in 
advance of any sanctions relief.

    Question. If the resolution submitted by the E3+3 to the IAEA Board 
of Governors requires Iran to take specific actions to resolve these 
outstanding issues, does the JCPOA at any time require Iran to comply 
with these actions?

    Answer. The International Atomic Energy Agency (IAEA) and Iran 
agreed on a roadmap that contains steps to clarify past and present 
issues, including the possible military dimensions (PMD) of Iran's 
nuclear program. We will be in continuous contact with the IAEA to make 
sure Iran fully implements its commitments under the roadmap, so that 
the IAEA can complete its PMD investigation. Iran will no longer be 
able to stonewall the IAEA and string out the process. It must address 
the questions the IAEA poses and the IAEA must have what it needs to 
prepare its final assessment or there will be no sanctions relief.

    Question. The ``Dispute Resolution Mechanism'' detailed in 
paragraphs 36 and 37 of the JCPOA allows for a complaining participant 
to request that an outstanding issue be considered by ``an Advisory 
Board, which would consist of three members (one each appointed by the 
participants in the dispute and a third independent member).''

   Who is responsible for appointing the ``third independent 
        member'' and what criteria will be used to determine that 
        appointment?

    Answer. The dispute resolution process in the Joint Comprehensive 
Plan of Action (JCPOA) contemplates that a complaining participant 
could refer an issue to an Advisory Board if the issue is not resolved 
following 15 days of consideration by the Joint Commission. The 
Advisory Board process would occur in parallel--or in lieu of--review 
of the issue by Ministers of Foreign Affairs. At the end of this second 
15-day period, the JCPOA participants would have 5 additional days to 
consider an opinion of the Advisory Board, if any. If, at the end of 
that 35-day process, the issue has not been resolved, the complaining 
participant could treat the issue as grounds to cease performance of 
its JCPOA commitments in whole or in part or to refer to the issue to 
the United Nations Security Council. The opinion of the Advisory Board 
is nonbinding and would in no way preclude us from exercising our 
option to refer the matter to the Security Council or to cease 
performance of our commitments. Furthermore, even if the Advisory Board 
was unable to issue a recommendation within the relevant time period, 
we would still have the ability to refer the issue to the Security 
Council. The procedures for the Advisory Board have not been 
elaborated, and we anticipate that the JCPOA participants will address 
this issue in the Joint Commission.

    Question. The ``Dispute Resolution Mechanism'' details the process 
by which the U.N. Security Council ``shall vote on a resolution to 
continue the sanctions lifting. If the resolution described above has 
not been adopted within 30 days of the notification, then the 
provisions of the old U.N. Security Council resolutions would be 
reimposed, unless the U.N. Security Council decides otherwise.''

   What does ``unless the U.N. Security Council decides 
        otherwise'' mean? How could this change the process detailed in 
        the JCPOA for dispute resolution?

    Answer. United Nations Security Council Resolution 2231 establishes 
an unprecedented ``snapback'' mechanism under which any Joint 
Comprehensive Plan of Action participant has the unilateral ability to 
reimpose United Nations (U.N.) sanctions without the worry of a veto by 
any of the permanent members of the U.N. Security Council. Instead, 
there would be a vote in the Security Council to continue the sanctions 
relief, which we could veto, thereby resulting in the reimposition of 
all U.N. sanctions.
    ``Unless the Security Council decides otherwise'' in this provision 
means that, during the 30-day period following notification of 
significant nonperformance, the Security Council could decide to do 
something other than reimpose all U.N. sanctions. For example, if the 
nonperformance was significant but there was a desire within the P5+1 
to impose partial snapback, the Security Council could decide to 
reimpose some but not all U.N. sanctions. However, this would require 
an affirmative vote by the Council, and we would be able to veto such a 
decision and ensure full snapback if we were not satisfied with partial 
snapback. The threat of full snapback will provide us with important 
leverage in such situations.
                                 ______
                                 

           Responses of Secretary John F. Kerry to Questions 
                   Submitted by Senator David Perdue

    Question. During the State Department Authorization markup, I 
offered an amendment, which passed by voice vote, to require that the 
Secretary of State, in coordination with the Secretary of Defense and 
other members of the National Security Council, develop a strategy for 
a post-Iran deal Middle East, to include: efforts to counter Iranian-
sponsored terrorism in the Middle East, efforts to reassure U.S. allies 
and partners in the region, and efforts to address the potential for a 
conventional or nuclear arms race in the Middle East.

   Does such a strategy exist currently? If so, could you 
        please provide?

    Answer. Iran's support for terrorism and its destabilizing 
activities in the region are a serious concern for this administration. 
U.S. actions to counter Iran's destabilizing actions fall into several 
broad lines of effort. First, we are undermining Iran's capacity to 
execute attacks directly and through its partners and proxies by 
expanding our cooperation with, and strengthening the capacity of our, 
regional partners. Second, we are working to restrict Iran's ability to 
move money and material for illicit purposes through sanctions and 
direct action when necessary. Third, we remain committed to Israel's 
security and that of our other regional allies and we continue to build 
up our partners' capacity to defend themselves against Iranian 
aggression. Fourth, we are working unilaterally and with allies to 
weaken Hezbollah's financial networks. Fifth, we publicize Iran's 
meddling wherever we can in order to disrupt Iran's relationships with 
its partners. Finally, over the long term, we seek to strengthen 
democratic institutions and the rule of law in countries that face 
threats from Iranian proxy activities.

    Question. Martin Dempsey said on Capitol Hill that the U.S. should 
not release any pressure on Iran relating to its ballistic missile 
program and conventional arms trade. ``Under no circumstances should we 
relieve pressure on Iran relative to ballistic missile capabilities and 
arms trafficking,'' he told the Senate Armed Services Committee.

   Why were the concessions on the arms embargo and ballistic 
        missile ban given to Iran?

    Answer. The only arms and missile sanctions that are being relieved 
under this deal are those that were put in place by the United Nations 
Security Council. The UNSC was explicit in its resolutions that these 
sanctions were put in place to address the international concerns about 
Iran's nuclear activities and would come off when Iran addressed those 
concerns, and no other regional issues were mentioned in these 
resolutions. Because we recognize their value, we have insisted that 
these sanctions remain in place for a considerable period of time. 
Specifically, the arms embargo will remain in place for up to 5 years 
and missile restrictions will remain in place for up to 8 years.
    These provisions are not the only ones we utilize to curb Iran's 
missile and conventional arms-related activities. Separate from these 
UNSC restrictions, we have now, and will continue to have, a number of 
robust domestic and multilateral authorities that we will continue to 
use with international partners to counter Iran's destabilizing 
activities. For example, we will continue our efforts to counter the 
spread of missiles and related technology to or from Iran through the 
use of U.S. sanctions, export controls, and cooperation with partner 
states, including through the 34-country Missile Technology Control 
Regime (MTCR).

    Question. In the hearing, you said in response to questions, ``Even 
with the lifting of sanctions after 8 years on missiles or 5 years on 
arms or the U.N. sanctions, it's only the U.N. sanctions. We still have 
sanctions. Our primary embargo is still in place. We are still 
sanctioning them.'' If that is the case, why was the arms embargo and 
missile ban language even included in the JCPOA, if its inclusion has 
such little impact, as you indicated in the hearing?

    Answer. The only arms and missile sanctions that are being relieved 
under this deal are those that were put in place by the United Nations 
Security Council. The UNSC was explicit in its resolutions that these 
sanctions were put in place to address the international concerns about 
Iran's nuclear activities and would come off when Iran addressed those 
concerns. These resolutions laid out a roadmap for removing these 
sanctions if the nuclear concerns were resolved and it was always 
envisioned by the UNSC that these--and all other sanctions in these 
resolutions--would ultimately be removed. Nevertheless, we have 
insisted that the conventional arms and missile provisions remain in 
place for a considerable period of time. Specifically, the arms embargo 
will remain in place for up to 5 years and missile restrictions will 
remain in place for up to 8 years.

    Question. According to reports by Roubini Economics and Foundation 
for Defense of Democracies, sanctions had forced Iran's economy into a 
severe recession in 2012 and early 2013. Given that Iran's economy was 
in a severe recession, marked by negative growth, a plummeting 
currency, and hyperinflation, why was the $700 million per month 
payment necessary to bring Iran to the negotiating table? Do you 
believe the P5+1 could have extracted larger concessions from Iran 
without those monthly payments, or if you had waited longer to initiate 
the JPOA process?

    Answer. The powerful set of U.S. and international sanctions on 
Iran, and especially those imposed over the last 5 years, effectively 
isolated Iran from the world economy. International consensus and 
cooperation were vital to the pressure that we imposed. During the 
leadup to the Joint Plan of Action (JPOA), we were able to maintain 
strong economic pressure because Iran's major trading partners and oil 
customers joined us in imposing pressure on Iran. These countries paid 
a significant economic price to do so, and they did it based on U.S. 
sanctions and a credible path forward toward a negotiated solution. The 
point of these efforts was clear: to change Iran's nuclear behavior, 
while holding out the prospect of relief if Iran addressed the world's 
concerns about its nuclear program. The $700 million per month 
repatriation of Iran's restricted oil revenue--which belongs to Iran 
and is not a ``payment''--was a critical component of the JPOA's 
temporary sanctions relief, and necessary to reach a final Joint 
Comprehensive Plan of Action (JCPOA). The limited and temporary 
sanctions relief offered to Iran as part of the JPOA was a vital 
intermediate step that made it possible for the P5+1 to reach a 
comprehensive deal with Iran to ensure that it does not develop a 
nuclear weapon.
    Sanctions were a means to an end, and were only possible in 
cooperation with our international partners. U.S. failure to initiate 
negotiations in conjunction with our partners to pursue a JCPOA would 
have left the United States isolated and would have undermined the 
effectiveness of our sanctions pressure. The deal we have achieved in 
the JCPOA is a strong one. It provides sanctions relief only in 
exchange for verified Iranian compliance with nuclear-related steps, 
and it has a strong snapback mechanism built in to reimpose sanctions 
if Iran does not meet its commitments.

    Question. Secretary Kerry, you said before SFRC in March, ``our 
negotiation is calculated to make sure they can't get a nuclear 
weapon.'' President Obama said in April that ``in year 13, 14, 15'' . . 
. ``the breakout times would have shrunk down to almost zero.'' With 
that said, does this deal preclude Iran from ever obtaining a nuclear 
weapon? Or merely delay this from happening?

    Answer. Full implementation of the Joint Comprehensive Plan of 
Action (JCPOA) will peacefully and verifiably prevent Iran from 
obtaining a nuclear weapon. Under the JCPOA and as a nonnuclear weapons 
state party to the Nuclear Non-Proliferation Treaty (NPT), Iran will 
remain prohibited from developing or acquiring a nuclear weapon 
indefinitely. Furthermore, in addition to the enhanced transparency and 
verification measures under the JCPOA, Iran will undertake legally 
binding safeguards obligations under the Additional Protocol to its 
Safeguards Agreement with the International Atomic Energy Agency 
(IAEA), which will significantly enhance the IAEA's ability to 
investigate questions about covert nuclear activities in Iran through 
access to a broader range of Iranian facilities. Iran's commitments 
under the AP provide the IAEA with the tools needed to draw credible 
assurances about the absence of any breakout effort, and the AP 
obligations will extend indefinitely.

    Question. On November 24, 2013, you said in an ABC News interview: 
``There is no right to enrich. We do not recognize a right to enrich. 
It is clear, in the--in the NPT, in the nonproliferation treaty, it's 
very, very [clear] that there is no right to enrich.'' Why did P5+1 
negotiators cede enrichment to Iran in the JCPOA?

    Answer. The Joint Comprehensive Plan of Action (JCPOA) does not 
address the question of whether there is a ``right'' to enrich. The 
JCPOA simply acknowledges that full implementation of the JCPOA would 
enable Iran to enjoy its right to nuclear energy for peaceful purposes 
under the relevant articles of the Nuclear Non-Proliferation Treaty 
(NPT), in line with its obligations therein. Under the JCPOA, Iran will 
continue to enrich, but its enrichment activities will be significantly 
constrained and rigorously monitored by the IAEA.

    Question. Would you confirm that this deal does, in fact, reverse 
decades of U.S. nonproliferation policy?

    Answer. No, we disagree with that assertion. Full implementation of 
the Joint Comprehensive Plan of Action (JCPOA) will peacefully and 
verifiably prevent Iran from obtaining a nuclear weapon and return Iran 
to compliance with its international nuclear obligations. A deal that 
restricts Iran's enrichment capacity and brings Iran's nuclear behavior 
in line with its obligations under the Nuclear Non-Proliferation Treaty 
and under its IAEA safeguards agreements is consistent with 
longstanding U.S. nonproliferation policy to prevent countries from 
developing or acquiring nuclear weapons and advances the U.S. goal of 
strengthening and promoting the global nonproliferation regime.

    Question. This deal would allow Iran, a pariah state, to leap 18 
nations with peaceful nuclear programs who do not enrich, and to be 
treated like Japan, Argentina, the Netherlands, Brazil, and Germany. 
Why should Iran be granted the right to enrich, when 18 other nations 
with peaceful nuclear programs do not enrich domestically? What is the 
purpose, if not to obtain a nuclear weapon?

    Answer. Iran has been enriching for over a decade and it has a 
comprehensive knowledge of the nuclear fuel cycle, which cannot be 
sanctioned or bombed away.
    The JCPOA does not address the question whether there is a 
``right'' to enrich. The JCPOA simply acknowledges that full 
implementation of the JCPOA would enable Iran to use nuclear energy for 
peaceful purposes under the relevant articles of the Nuclear Non-
Proliferation Treaty (NPT) in line with its obligations therein.
    The deal requires dramatic cuts in Iran's installed enrichment 
capacity and imposes other limits on Iran's nuclear program. Moreover, 
the JCPOA includes the most comprehensive and rigorous verification 
regime ever negotiated.

    Question. From what I understand, this deal is predicated on the 
idea that the Iranian regime will change its behavior. What indications 
do you have that Iran will change its behavior in the next 10-15 years, 
when it is allowed to have an industrial-scale nuclear program?

    Answer. This deal is about verifiably ensuring that Iran's nuclear 
program is and will remain peaceful going forward. Every one of Iran's 
nuclear commitments will be verified by the IAEA and reported upon. The 
interim Joint Plan of Action (JPOA) agreed to in January 2014 has 
demonstrated that given the proper incentives, Iranian compliance can 
be secured and verified. Under the JCPOA, inspections and transparency 
measures will continue well beyond 15 years; some extend for 25 years 
and some are permanent. For example, the deal provides for Iranian 
implementation and ratification of the IAEA's Additional Protocol, 
which would make those transparency obligations permanent.

    Question. Can you describe how Iran currently provides weapons and 
other military equipment to Syria? When was the last time the United 
States intercepted ships or illicit cargo from Iran to Syria?

    Answer. Iran has supplied critical support to the Assad regime, 
providing not only billions of dollars in funds, but also weapons, 
strategic guidance, technical assistance, and training, thus enabling 
the regime's continued repression and slaughter of tens of thousands of 
Syrians. Iran utilizes ground, air and shipping routes to continue to 
supply the Assad regime. We continue to work with our partners to 
discourage this support in violation of international sanctions. We are 
coordinating with the international community on ways to limit Iran's 
efforts to resupply the Assad regime with the means to perpetuate its 
brutality. We have imposed targeted sanctions on Iran's Islamic 
Revolutionary Guard Corps and its Ministry of Intelligence and Security 
for their support to the Assad regime and its campaign of horrors 
against the Syrian people.

    Question. I am concerned with what I have learned about the 
``roadmap'' being negotiated between the IAEA and Iran regarding 
Parchin and PMD. Will the United States, or the rest of the P5+1, ever 
see the documents relating to the unresolved issues regarding the 
Possible Military Dimensions (PMD) of Iran's nuclear program? How can 
the United States, or any other nation or body, provide any sanctions 
relief to Iran without knowing was has been resolved regarding the 
Parchin facility or PMDs?

    Answer. The International Atomic Energy Agency (IAEA) and Iran have 
agreed on a time-limited ``Roadmap'' through which Iran will address 
the IAEA's concerns regarding past and present issues, including PMD 
and those specific issues set out in the IAEA Director General's 
November 2011 report. Under the Joint Comprehensive Plan of Action 
(JCPOA), Iran must complete the activities required of it in this 
roadmap by October 15, well in advance of any sanctions relief. The 
IAEA will report whether or not Iran has taken those steps. If Iran 
does not take those steps, we will not implement our commitment to 
provide sanctions relief.
    The roadmap text refers to two ``separate arrangements'' between 
the IAEA and Iran, one of which concerns the issue of Parchin. Such 
arrangements related to safeguards agreements and inspections 
activities, including the arrangement concluded pursuant to the U.S. 
safeguards agreement with the IAEA, are confidential within the IAEA 
system. Our experts have been briefed on the contents of these 
documents, and we have in turn briefed Congress on them in a classified 
setting.
    The roadmap makes clear that the Director General will provide 
regular updates to the IAEA Board of Governors, which includes the 
United States, and will provide a final assessment on the resolution of 
all past and present outstanding issues by December 15. And as 
Secretary Kerry has noted, we are already confident in our knowledge of 
what occurred at Parchin.
    Indeed, ongoing concerns about the nature of Iran's nuclear program 
are what made it so imperative that we finalize a deal that cuts off 
all of the pathways to enough fissile material for a nuclear weapon, 
implements unprecedented transparency measures, and imposes real 
constraints on activities that Iran would need to conduct weaponization 
efforts in the future.

    Question. As I am sure you have seen, a recent GAO report found 
that our own State Department failed to provide timely reports to 
Congress on Iran's weaponization efforts--with delays ranging from 22 
months to 3 years. According to the GAO report, the State Department 
admitted that political concerns, such as international negotiations, 
can delay State's process in notifying Congress of violations.

   Can you assure Congress that such delays will not occur 
        while enforcing the JCPOA?

    Answer. The administration's level of engagement with Congress on 
the Joint Comprehensive Plan of Action (JCPOA) has been unprecedented 
and we look forward to continuing our close and timely consultations 
with you, including on possible concerns related to the implementation 
of the JCPOA.
    In response to the recent GAO report regarding the timeliness of 
the INKSNA reports, the Department is reviewing its INKSNA process and 
continuing to incorporate lessons learned from previous iterations into 
each new reporting cycle. As you know, INKSNA requires that we notify 
Congress of transfers of a wide range of goods, services, or 
technologies to or from Iran, Syria, or North Korea. This includes 
transfers of many dual-use items, even if those items may be used for 
ordinary commercial purposes and have no connection to weapons 
development.

    Question. From what I understand of Iran's cheating, they tend to 
cheat incrementally, but the sum total of their cheating is egregious. 
However, paragraph 37 of the JCPOA indicates that Iran will cease 
performing all of its commitments in the event of a full or partial 
snapback. How can the United States use snapback to compel Iran to 
comply with the deal, allow inspections, or make any changes in their 
behavior--if using snapback releases Iran from all of its commitments? 
Doesn't the all-or-nothing nature of snapback effectively deter the 
United States from ever seeking to punish Iranian violations? 
Specifically, how would you enforce small violations?

    Answer. The snapback provision we have secured is unprecedented and 
it allows for us to have the unilateral ability to reimpose U.N. 
sanctions without the worry of a veto by any other permanent member of 
the Security Council, including Russia or China.
    The threat of snapback under the Joint Comprehensive Plan of Action 
(JCPOA) provides us and our partners with enormous leverage to deter 
Iranian noncompliance because Iran would have to weigh the potential 
benefits to it of the activities that amount to a violation against the 
very real risk that multilateral and national sanctions will be 
reimposed against Iran as a result of that violation.
    If there are small violations, we can use the threat of full 
snapback to convince our partners to take steps to address it. For 
example, if the nonperformance was significant but there was a desire 
within the P5+1 to prevent full snapback, the Security Council could 
decide to reimpose some but not all U.N. sanctions. This would require 
an affirmative vote by the Council, and we would be able to veto such a 
decision and ensure full snapback if we were not satisfied with partial 
snapback. This approach gives us maximum flexibility and maximum 
leverage. We also have a range of options for snapping back domestic 
sanctions to respond to smaller violations of the JCPOA if we so 
choose. And we have other areas of leverage for responding to small 
violations, including action in the Joint Commission, on procurement 
proposals, and in civil nuclear projects.

    Question. Since the JCPOA is very heavily front-loaded on sanctions 
relief to Iran, are you concerned that Iran could sufficiently pad its 
economy to be more resistant to efforts to ``snap back'' sanctions?

    Answer. We have been very clear: when the JCPOA goes into effect in 
October, there will be no immediate changes to U.N., EU, or U.S. 
sanctions. There is no ``signing bonus.'' Only if Iran fulfills the 
necessary nuclear steps--which will roll back its nuclear program and 
extend its breakout time fivefold to at least 1 year--will the United 
States, the EU and the U.N. provide sanctions relief. We expect Iran to 
take at least 6 to 9 months to accomplish these nuclear steps. Until 
Iran completes those steps, we are simply extending the limited relief 
that has been in place for the last year and a half under the Joint 
Plan of Action.
    Should Iran violate its commitments once we have suspended 
sanctions, we will be able to promptly snap back both U.S. and U.N. 
sanctions, and our EU colleagues have reserved the ability to do so 
with respect to their sanctions as well. New measures could also be 
imposed if Iran were to violate its commitments and renege on the deal. 
This credible ``snapback'' mechanism ensures that we will be able to 
reimpose sanctions pressure in cooperation with our international 
partners, thereby ensuring their maximum effectiveness in inducing Iran 
to meet its commitments. Moreover, after Implementation Day, as Iran 
enters into new financial relationships, attracts foreign investment, 
conducts trade and exports goods, the higher the cost will be if 
sanctions snap back.

    Question. Can you clarify the contract sanctity provision built 
into the snapback provision? The agreement states in the event of snap 
back of U.N. sanctions ``these provisions would not apply with 
retroactive effect to contracts signed between any party and Iran or 
Iranian individuals and entities prior to the date of application . . 
.'' What does that mean for a major energy contract to develop an oil 
field, or to purchase natural gas, in the event of snapback sanctions?

    Answer. There is no ``grandfather clause'' in the JCPOA. While we 
would not impose sanctions retroactively on foreign companies that did 
business with Iran during the period of sanctions relief, we would not 
give those companies a free pass to continue to do business with Iran 
after a snapback. We have been very clear in communicating this to our 
diplomatic partners as well as to the private sector. Moreover, this 
conclusion is very clear from the language of the JCPOA: the passage 
quoted in your question leaves out the key qualifying language 
``provided that the activities contemplated under, and execution of, 
such contracts are consistent with this JCPOA and the previous and 
current U.N. Security Council resolutions.'' This simply means that the 
activities allowed under a snap back are the same as those that are 
allowed under current UNSCRs and that are consistent with the JCPOA.

    Question. The Iran Sanctions Act (ISA) is set to expire in December 
of next year. ISA was originally passed in response to not only Iran 
stepping up their nuclear program, but to curb its support of terrorist 
organizations, such as Hezbollah, Hamas, and the Palestine Islamic 
Jihad.

   Does the administration support this Congress extending 
        that law beyond its current expiration? Please explain your 
        answer.

    Answer. Given that the Iran Sanctions Act does not expire until 
December 2016, we believe it would be premature to extend it before 
then. We look forward to continuing this discussion with Congress.

    Question. Last week, the UNSC voted unanimously to approve the 
JCPOA. If Congress were to override a veto on a resolution of 
disapproval on the deal, would this have any effect on the UNSC's 
decision?

    Answer. If Congress were to override a veto on a resolution of 
disapproval and the United States walked away from this deal, the most 
likely scenario would be that Iran would refuse to meet its commitments 
under the JCPOA, the JCPOA would collapse, and the U.N. sanctions 
relief contemplated under UNSC Resolution 2231 would never materialize. 
This is because the U.N. sanctions relief under the UNSC resolution 
does not occur until the IAEA verifies that Iran has taken the nuclear 
steps outlined in the JCPOA. Without domestic sanctions relief from the 
United States, Iran would not disconnect centrifuges, or get rid of its 
uranium stockpile, or fill the core of the current Arak reactor with 
concrete. In such a scenario, the existing UNSC sanctions regime would 
remain in place, but we anticipate that it would be much harder to 
ensure that these measures are adequately enforced. If the United 
States walked away from the strong deal that has been negotiated, 
states would be less willing to cooperate with us in enforcing these 
measures, such as by interdicting suspicious cargo at our request. This 
would put us in the worst possible position of having no deal on the 
nuclear side, and losing our leverage to ensure the effectiveness of 
multilateral and national sanctions.

    Question. Would you disagree that the UNSCR directly violates the 
spirit of the Iran Nuclear Agreement Review Act that passed in the 
Senate with the support of 98 Senators?

    Answer. Yes, we disagree with that assertion. Nothing in the 
Security Council resolution affects Congress' review of the JCPOA, and 
nothing in the Security Council resolution requires the United States 
to take any action that would be inconsistent with the Iran Nuclear 
Agreement Review Act (INARA). The Security Council resolution does not 
lessen the importance of Congress or its review of the JCPOA, and we 
will remain in close consultation with Congress throughout the review 
period.

    Question. Secretary Kerry, in light of your pledge on this deal, 
that this deal would have to pass muster with Congress, didn't the 
administration act in bad faith by pushing the deal through the 
Security Council before Congress could vote? How could President Obama 
have said--with any measure of sincerity--that Congress would get a 
full opportunity to review the deal if he already planned to preempt 
Congress by going to the Security Council within 6 days?

    Answer. Congress has a full opportunity to review the deal. U.N. 
Security Council Resolution 2231 does not lessen the importance of 
Congress or its review of the JCPOA. Nothing in the resolution affects 
Congress' review of the JCPOA, and nothing in the resolution requires 
the United States to take any action that would be inconsistent with 
the Iran Nuclear Agreement Review Act (INARA). As we have explained, 
our P5+1 negotiating partners felt strongly that the Security Council 
should not delay in endorsing this important deal, and adopting the 
U.N. Security Council resolution was the next logical step given that 
the Iranian nuclear program has been a long-standing issue among the 
P5+1 and in the Security Council.
    We remain committed to continuing our close consultations with 
Congress on the JCPOA throughout the 60-day review period and beyond.

    Question. On Monday, July 20, 2015, Iranian Defense Minister 
Brigadier General Hossein Dehqan stated that no foreign authority would 
be allowed access to Iranian military and security sites. How can an 
effective inspections and verification regime be implemented without 
unfettered, unannounced access to those sites?

    Answer. The Joint Comprehensive Plan of Action (JCPOA) includes the 
most comprehensive and rigorous verification regime ever negotiated. It 
ensures both timely and effective International Atomic Energy Agency 
(IAEA) access necessary to verify Iran's compliance, including at 
military sites. For example, in an instance where the IAEA has a 
question about an undeclared location, the IAEA would be able to 
request access under the Additional Protocol. Under the JCPOA, if Iran 
disputes the IAEA's access to such a location, the Joint Commission 
established under the JCPOA can require Iran to provide the IAEA the 
access it requested within a time-bound period if we and a majority of 
our P5+1 and EU partners agree it is necessary. The United States, 
along with the United Kingdom, France, Germany, and the EU High 
Representative, would constitute a majority of Joint Commission members 
even if all others opposed.

    Question. One of the largest firms controlled by the IRGC, Khatam 
al-Anbia will be de-listed through the terms of the JCPOA. This firm 
which employs more than 135,000 in Iran was designated for 
proliferation of weapons of mass destruction and is currently 
developing a new pipeline from Iran to Pakistan.

   Why should all EU sanctions be lifted on this company 
        without a certification that it is no longer engaging in 
        proliferation activities? Why should the United States support 
        de-listing of one of the major sources of revenue for the IRGC?

    Answer. The European Union will maintain its nuclear-related 
sanctions on Khatam al-Anbia as late as was possible under the JCPOA--
until Transition Day, which is 8 years from Adoption Day, or when the 
IAEA reaches the Broader Conclusion that all nuclear material remains 
in peaceful activities, whichever comes first. Moreover, Khatam al-
Anbia will not be subject to any relief from U.S. sanctions under the 
JCPOA. As we have noted, we retain all the authorities necessary to 
aggressively combat and enforce our sanctions against the Islamic 
Republican Guard Corps (IRGC), as well as Iran's support for terrorism, 
human rights abuses, and destabilizing activities in the region. These 
authorities are in no way impacted by the JCPOA. Moreover, U.S. 
``secondary'' sanctions on persons and entities designated under those 
authorities remain in place. These sanctions will continue to allow us 
to target foreign parties doing business with those persons and 
entities.

    Question. Ansar Bank along with Mehr Bank in Iran are both IRGC-
owned. They will now be given access to the global financial network 
through access to the SWIFT banking system. How will the United States 
and the international community ``snap back'' sanctions on these banks 
should they continue to support the exportation of terrorism? Do you 
envision a scenario where these banks are put back on designation 
lists? Can you please describe that scenario?

    Answer. Ansar Bank and Mehr Bank are not receiving sanctions relief 
under U.S. sanctions as part of the JCPOA and will still be denied 
access to the U.S. financial system, the world's largest commercial and 
financial market. This includes powerful secondary sanctions that allow 
us to target foreign banks if they engage in transactions with Iranian 
persons on the SDN List. We will continue to aggressively enforce such 
measures.

    Question. There is confusion over whether sanctions on Qassem 
Soulemani, the head of the IRGC, will be lifted under the deal. Can you 
clarify whether U.S. and EU sanctions will also be lifted? Why were 
individuals, like Soulemani, included in a final deal and what process 
will be put in place to redesignate them should they continue to engage 
in terrorism? Wouldn't Iran see a redesignation of these individuals as 
in violation of the deal?

    Answer. Soleimani and other IRGC and Quds Force officials and 
entities are not being delisted by the United States; they will remain 
designated for their support for terrorism and other destabilizing 
activities, and all sanctions pertaining to them will absolutely remain 
in effect and will be vigorously enforced.
    The United States will maintain sanctions on the IRGC, the Quds 
Force, its leadership, and its entire network of front companies--and 
the JCPOA has no effect on those sanctions whatsoever. These are 
powerful sanctions that also target non-U.S. persons, meaning that 
foreign banks that conduct business for, or on behalf of, the Quds 
Force or Soleimani will risk being cut off from the U.S. financial 
system. In addition to U.S. sanctions, the EU will continue to list 
Soleimani and the IRGC-QF under other, nonnuclear sanctions 
authorities.

    Question. Ayatollah Khamenei told supporters on July 18 that U.S. 
policies in the region were ``180 degrees'' opposed to Iran's at a 
speech in a Tehran mosque punctuated by chants of ``Death to America'' 
and ``Death to Israel.'' Secretary Kerry, following those comments, you 
said, ``If it is the policy, it's very disturbing, it's very 
troubling.'' Do you stand by these comments? If this is truly Iran's 
policy toward our Nation, why did we negotiate such a generous deal 
with them? What types of behavior do you expect to see from Iran in the 
future?

    Answer. This agreement is not about a change in the broader U.S. 
relationship with Iran. It is about eliminating the biggest and most 
imminent threat--a nuclear-armed Iran.
    We do not have the luxury of only negotiating with our friends and 
allies. Just as we managed to reach understandings with the Soviet 
Union on very specific security issues despite our differences, our 
very real disagreements with Iran continue and we have been honest 
about that with them. This deal advances the national security 
interests of the United States and our closest allies, while furthering 
regional security.
    We have been clear from the beginning of this process that these 
negotiations are only about the nuclear issue and that our end goal is 
preventing Iran from obtaining a nuclear weapon and ensuring that 
Iran's nuclear program is and will remain peaceful going forward. This 
deal is about stopping Iran's pathways to a nuclear weapon, not 
changing all of the regime's behavior.
    Moreover, we will continue to counter Iran's destabilizing and 
threatening actions in the region aggressively. The President is 
committed to working closely with Israel, the gulf countries and our 
other regional partners to do just that. Our sanctions targeting Iran's 
support for terrorism, its human rights abuses, and its destabilizing 
activities in the region will remain in place and we will continue to 
vigorously enforce them.

    Question. Iran's Ambassador to the U.N. after the Security Council 
approved of a nuclear deal stated that ``The resolution and the 
agreement also provided for the termination of Council resolutions that 
unjustifiably placed sanctions on Iran for its efforts to exercise its 
rights. Nobody had ever presented any proof indicating that Iran's 
programme had been anything but peaceful.'' How does this statement 
stand up to scrutiny as a report from May 2011 stated that there was 
evidence of Iranian ``studies involving the removal of the conventional 
high explosive payload from the warhead of the Shahab-3 missile and 
replacing it with a spherical nuclear payload.''?

    Answer. The International Atomic Energy Agency (IAEA) documented 
many failures by Iran to comply with its safeguards obligations, which 
resulted in the IAEA Board of Governors finding Iran in noncompliance 
with its Comprehensive Safeguards Agreement and referring the matter to 
the United Nations Security Council. The Director General's November 
2011 report to the IAEA Board of Governors provided the most 
comprehensive and detailed public assessment of the possible military 
dimensions of Iran's nuclear program. In addition, the U.S. 
Intelligence Community assesses Iran had a structured nuclear weapons 
program until 2003.
    Full implementation of the Joint Comprehensive Plan of Action 
(JCPOA) will verifiably prevent Iran from acquiring a nuclear weapon 
and ensure Iran's nuclear program is exclusively peaceful.

    Question. If the IAEA certifies Iran has met its nuclear 
obligations under the JCPOA, but has yet to make a finding on the 
possible military dimensions of Iran's nuclear program, will sanctions 
relief still be provided? What happens if the IAEA has additional 
questions and concerns that cannot be answered by December 15? Is that 
a hard deadline, or can the Director report whenever he chooses? Will 
the IAEA inspectors investigating the PMD file have full unfettered 
access to all scientists and sites they deem necessary, or will Iran 
have a say in who and what they can see? What happens if the IAEA 
concludes in future reports that it still cannot rule out a possible 
military dimension to Iran's program? Will this provide grounds to snap 
back sanctions, or is this purely a technical issue between Iran and 
the IAEA?

    Answer. The International Atomic Energy Agency (IAEA) and Iran have 
agreed on a time-limited ``roadmap'' through which Iran will address 
the IAEA's concerns, including those specific issues set out in the 
IAEA Director General's November 2011 report on PMD.
    Under the JCPOA, Iran must complete the activities required of it 
in this roadmap by October 15, 2015, well in advance of any sanctions 
relief. If Iran does not implement those commitments, we will not 
implement our commitment to provide sanctions relief. The Director 
General will issue a report on PMD by December 15, 2015, as detailed in 
the roadmap.
    The purpose of the ``final assessment'' is to resolve outstanding 
issues, not to give Iran a clean bill of health. The U.S. Intelligence 
Community assesses that Iran had a structured nuclear weapons program 
until 2003, as documented in the 2007 National Intelligence Estimate 
(NIE). The JCPOA is fundamentally focused on ensuring that Iran's 
nuclear program is exclusively peaceful. This is why the JCPOA has the 
most rigorous verification regime ever negotiated, including a special 
access provision that goes beyond the Additional Protocol in setting a 
defined time limit to ensure the IAEA gets access to any undeclared 
locations suspected of containing nuclear materials, nuclear 
activities, or other activities inconsistent with the JCPOA.
    We would take seriously any future concerns raised by the IAEA 
regarding Iran's implementation of its commitments under the JCPOA and/
or its safeguards obligations. We have a range of options to address 
Iranian noncompliance so as to more effectively deter Iran from 
violating the deal. Allegations that it was conducting weapons-related 
work would obviously be the most serious and result in the most serious 
of responses.

    Question. If the same Iranian regime is in place 10, 15 years from 
now, with the same record of support for terrorism and human rights 
abuses, why would we trust it with an industrial sized enrichment 
program, when we don't trust it today?

    Answer. This deal is not about trust. It is about verifiably 
ensuring that Iran's nuclear program is and will remain peaceful going 
forward. Every one of Iran's commitments will be verified by the IAEA 
and reported. Important monitoring and verification measures extend 
beyond 15 years; some extend for 25 years and some are permanent. For 
example, the deal provides for Iranian ratification of the IAEA's 
Additional Protocol, which would make those transparency obligations 
permanent. The Additional Protocol gives the IAEA the access and 
information it needs to provide credible assurances about the absence 
of undeclared nuclear activities in Iran and will continue 
indefinitely.
    The United States remains deeply concerned about Iran's support for 
terrorism, its destabilizing activities in the region, and its abysmal 
human rights record. All U.S. terrorism and human rights-related 
sanctions will remain in place.

    Question. If the Iranian regime moves to build an industrial sized 
nuclear program after 15 years, what would your recommended course of 
action be for the United States? Could reimposition of sanctions be a 
successful deterrent when Iran could breakout in days?

    Answer. Under the Joint Comprehensive Plan of Action (JCPOA), Iran 
is constrained to using only its first generation IR-1 centrifuges for 
the first 10 years. Importantly, the transparency measures under the 
JCPOA will ensure unparalleled insight into Iran's program during this 
period, and various enhanced transparency and monitoring measures will 
remain in place well past 10 years. Certain measures will last for 15 
years, others for 20-25 years, and some will last forever, such as 
Iran's adherence to the Additional Protocol. After 15 years, should we 
suspect Iran is pursuing nuclear weapons, we would have the same 
options available to us then as we do today to prevent such an effort 
from coming to fruition. Without a deal, Iran would likely resume 
unconstrained research and development on advanced centrifuges and 
could be in a position to field second generation centrifuges within 
months and third generation centrifuges within years.

    Question. To what extent, if any, will lifting the arms embargo and 
ballistic missile ban contribute to Iran's ability to modernize its 
armed forces and expand its influence in the region? Do you foresee, 
then, a conventional arms race in the Middle East, as Iran's neighbors 
scramble to defend themselves from Iran's growing power?

    Answer. The arms embargo and missile restrictions on Iran under 
U.N. Security Council Resolution (UNSCR) 1929 were designed to pressure 
Iran specifically to address the international community's concerns 
with its nuclear program. UNSCR 1929 anticipated that the related 
restrictions would be lifted as Iran addressed these concerns. Not 
surprisingly, Iran and Russia pushed for an immediate lifting of the 
arms embargo and missile restrictions as soon as Iran came into 
compliance with the Joint Comprehensive Plan of Action. Through hard 
bargaining, we were able to ensure that UNSCR 2231 codifying the JCPOA 
extends the arms embargo and missile restrictions for an extended 
period of time, even after the JCPOA takes effect. Even after these 
arms and missile restrictions on Iran are lifted, we can still rely on 
a broad set of multilateral and unilateral tools, including other 
UNSCRs and sanctions, to continue to restrict Iranian conventional arms 
and missiles. We will also keep in place the U.S. sanctions that apply 
to Iran's missile program, including the ``secondary'' sanctions that 
apply to foreign banks that engage in transactions with entities that 
have been designated for their role in the missile program.
    This deal does not mark the beginning of an arms race in the Middle 
East. We seek to undermine Iran's capacity to execute attacks directly 
and through its partners and proxies by expanding our cooperation with 
and strengthening the capacity of regional partners. We are working to 
restrict Iran's ability to move money and material for illicit purposes 
through sanctions and direct action when necessary. We remain committed 
to Israel's security and that of our other regional allies, and we 
continue to build up our partners' capacity to defend themselves 
against Iranian aggression.

    Question. Iran is violating the arms embargo with shipments to 
Assad, Hezbollah, and the Houthis. If Iran continues to violate the 
arms embargo what is the United States prepared to do? If Iran will not 
adhere to this requirement, why should we believe it will adhere to 
other provisions? If the United States will not snap back sanctions for 
violations of the arms embargo, why should Iran believe in snapback for 
other violations?

    Answer. We will continue to hold the Iranian Government accountable 
for its terrorist actions and destabilizing activities in the region, 
and have already engaged in very forward-leaning initiatives to do just 
that. We worked with partner nations to turn around a convoy that was 
bringing weapons to Yemen; thanks to international pressure, Iran was 
forced to turn around an Islamic Revolutionary Guard Corps (IRGC) Naval 
flotilla that attempted to dock in Yemen in April 2015. As a result of 
this effort, in May 2015, Iran sent an aid shipment to Yemen aboard the 
Iranian merchant vessel Nejat through proper U.N. channels in Djibouti. 
We also continue to work with our partners to restrict Iran's ability 
to move money and material for illicit purposes through sanctions.
    The JCPOA contains specific language in its annexes, which lay out 
what is expected of whom and when. That precision is what gives us 
confidence we will be able to hold Iran accountable. If Iran violates 
its commitments once we have suspended sanctions, we can promptly snap 
back both U.S. and U.N. sanctions. In the U.N., the United States has 
the ability to effectively force the reimposition of those sanctions, 
no matter which country objects. This puts us in a strong position to 
ensure resumption of sanctions should the Iranians violate the deal.

    Question. The administration has cited various international and 
domestic authorities that will allow the United States to continue 
addressing Iranian arms exports and imports. The agreement specifically 
highlights the Iran, North Korea, Syria Non-Proliferation Act as a U.S. 
sanctions law that will remain in effect. The GAO recently conducted a 
review and found the State Department had failed to carry out the law, 
and was some 3 years behind in issuing mandatory reports under the law. 
What are you doing to come into compliance with the law? Why has the 
administration been out of compliance with the law?

    Answer. The Iran, North Korea, and Syria Nonproliferation Act 
(INKSNA) is an important tool in the nonproliferation toolkit and the 
Department has sanctioned a substantial number of foreign persons 
pursuant to INKSNA. In response to the recent GAO report regarding the 
timeliness of the INKSNA reports, the Department is reviewing its 
INKSNA process and continuing to incorporate lessons learned into each 
new reporting cycle. We are working to get the remaining INKSNA reports 
submitted as soon as possible.

    Question. Throughout the negotiations, including in the weeks prior 
to the agreement, the administration promised ``anywhere, anytime'' 
inspections. The agreement now allows ``managed access'' and could take 
up to 24 days to resolve any disputes over access and allow actual 
inspections. Why the 24 day period? Are you fully confident that the 24 
day window for inspectors to gain access to suspect sites is sufficient 
to prevent Iran from hiding its activities or covering its tracks?

    Answer. The suggestion that we sought anytime/anywhere inspections 
is not accurate--the administration did not seek anytime/anywhere 
inspections. The IAEA has never had anytime/anywhere inspections except 
in Iraq for a period of time after the 1991 war (until Iraq stopped 
cooperating) and the concept has never been accepted for the IAEA as 
part of a negotiated agreement. Throughout the JCPOA negotiations, we 
sought to ensure the IAEA would have access wherever it needed to go/
whenever it needed to go to verify that Iran is complying with its 
commitments. The JCPOA has achieved just that. The IAEA has the access 
it needs to do its job in Iran.
    To be clear, the IAEA can request access to any suspicious location 
with 24 hours' notice under the Additional Protocol, which Iran will 
implement under this deal. This deal does not change that baseline. It 
enhances it, by creating a new mechanism to ensure the IAEA gets the 
access it needs and setting a firm limit to resolve access issues--24 
days. Without the special access provisions we negotiated in the JCPOA, 
Iran could stonewall the IAEA for years. The IAEA has been seeking 
access to the Parchin facility for well over 3 years.
    Either Iran must provide the necessary access to resolve the 
International Atomic Energy Agency's (IAEA) concerns within 24 days (at 
the maximum), or Iran would be in violation of its Joint Comprehensive 
Plan of Action (JCPOA) commitments and sanctions could be snapped back. 
Our experts believe, and the history in Iran and elsewhere has shown, 
that a site contaminated with nuclear materials is very unlikely to be 
successfully sanitized within 24 days, or longer for that matter.

    Question. A great deal of weaponization work does not include 
nuclear material. Won't Iran be able to conceal or move nonnuclear 
related weaponization work easily within the 24 day window?

    Answer. Iran's JCPOA commitments, including on transparency and on 
refraining from certain weaponization-related activities, will better 
position the international community to detect weaponization activities 
and better position the IAEA to demand access.
    The IAEA has historically had good success, including in Iran, in 
detecting traces of nuclear material following months of sanitization 
efforts. Other activities of concern, such as work on explosively 
driven neutron sources, could also leave signatures. Certain small-
scale activities not involving nuclear material might be quickly 
removed, but a covert effort to develop a nuclear weapon would 
necessarily also include larger and less easily concealed activities, 
including some with nuclear materials, that could be uncovered even 
after 24 days to resolve access issues. Iran would also face the risk 
in undertaking a covert weapons program that the IAEA could detect 
signatures inconsistent with their explanation of activities at a 
suspicious location. The ability for the IAEA to have assured access to 
any location in Iran could serve as a powerful deterrent against a 
covert attempt to develop a nuclear weapon.

    Question. While monitoring facilities with satellites during the 24 
day period will detect large-scale efforts at deception; i.e., repaving 
areas, ferreting out nuclear material or equipment, how will you 
prevent Iran from covering up other activities, like computer modeling 
for weaponization purposes?

    Answer. Iran's JCPOA commitments, including on transparency and on 
refraining from certain weaponization-related activities, will better 
position the international community to detect weaponization activities 
and better position the IAEA to demand access. Furthermore, our 
intelligence community will continue its robust efforts to identify any 
activities that would be inconsistent with this JCPOA.
    There is no realistic verification system that could reliably 
ensure detection of all activities like computer modeling for nuclear 
weapons. However, such activities have been detected in Iran in the 
past and the explicit prohibition on conducting such work in the JCPOA 
means that these activities would now be grounds to find Iran in 
violation of its JCPOA commitments and snapback sanctions.

    Question. What happens if after the 24 day period Iran has still 
not provided access to a site? Why are there no consequences spelled 
out in the agreement for specific violations? It would appear the only 
mechanism is to go to the Security Council and reimpose all sanctions?

    Answer. We have the ability to snap back U.N. Security Council 
sanctions and/or U.S. domestic sanctions on our own authority, but we 
also have other means at our disposal short of snapback. Of course, we 
expect the Joint Commission to have an opportunity to resolve a range 
of compliance issues, including at the Ministers level if needed, and 
we have provided for this in the JCPOA itself. And because we have 
enormous leverage, we expect this process to be effective. We also have 
a range of other options for addressing minor noncompliance. These 
range from snapping back certain domestic sanctions to respond to minor 
but persistent violations of the JCPOA, to using our leverage in the 
Joint Commission on procurement requests.

    Question. As part of the IAEA process of requesting site access, 
the agency must provide Iran ``reasons for access in writing and will 
make available relevant information.'' Won't this reveal sources and 
methods and jeopardize future monitoring capability? Will we be limited 
in the number of times we are willing to come forward because we are 
concerned about exposing our sources?

    Answer. The requirement to provide the ``reasons for access in 
writing and [to] make available relevant information'' is consistent 
with standard safeguards practice by the IAEA. The information provided 
would be at the discretion of the IAEA and would not compromise the 
IAEA's methods or ability to press for access. The IAEA has a long 
track record of making use of relevant information in a way that 
advances, rather than jeopardizes, its access rights.

    Question. If Iran adheres to the agreement to the letter, aren't 
restrictions on the number and types of centrifuges that Iran can 
install lifted after year 15? Is that also not true for the number of 
enrichment facilities and the amount of R&D Iran can conduct? If Iran 
chooses to install advanced centrifuges after year 15, what would 
Iran's breakout time be? At that point if Iran did break out, would the 
international community have any options to stop Iran other than 
military force? We could not reimpose sanctions and have a meaningful 
impact in weeks or months at that point, correct?

    Answer. Under the JCPOA, Iran is constrained to using only its 
first generation IR-1 centrifuges for the first 10 years. Iran will 
have the option after year 10 to undertake a gradual development of its 
enrichment program, but it will be limited to enriching only up to 3.67 
percent and constrained to a minimal 300 kg stockpile for another 5 
years. These limitations are important to ensuring that Iran's breakout 
timeline does not drop dramatically after year 10. Importantly, the 
transparency measures under the JCPOA will ensure unparalleled insight 
into Iran's program. Certain transparency and monitoring measures will 
last for 15 years, others for 20-25 years, and some will last 
indefinitely, such as Iran's adherence to the Additional Protocol. 
After 15 years, should we suspect Iran is pursuing nuclear weapons, we 
would have the same options available to us then as we do today to 
prevent such an effort from coming to fruition.

    Question. The 24 day challenge inspection process only lasts for 10 
years and then inspections will be done according to the Additional 
Protocol, correct? What is the process for handling denial of access to 
suspect sites under the Additional Protocol? My understanding is the 
dispute goes to the IAEA Board of Governors which may, or may not, 
refer the matter to the U.N. Security Council. This process can take 
months and there is no guarantee of access.

    Answer. No, the special access provision under the Joint 
Comprehensive Plan of Action (JCPOA) lasts for 15 years. It is 
precisely the concern about Iran attempting to game the process to 
achieve delay that makes the JCPOA access provision for 15 years so 
valuable.
    And while Iran could seek to deny the IAEA access after that point, 
the United States can and would work with our international partners on 
the IAEA Board of Governors and elsewhere--as it has in the past--to 
ensure that any failure by Iran to comply with its IAEA safeguards 
obligations would be brought the U.N. Security Council and acted upon. 
This existing IAEA process is available both during and after the 15 
years that the special access provision is in place, and it is a 
significant deterrent to Iran: the UNSCRs in place for the past 9 years 
were a result of the IAEA's referral of Iran's noncompliance to the 
Security Council. In addition, the United States retains the right to 
pursue unilateral or multilateral steps with our European and other 
allies to bring Iran back into compliance with its obligations.

    Question. Iran is only required to ``seek'' ratification of the 
Additional Protocol in year 8 of an agreement. What happens if the 
ratification does not take place? Why is the ratification only after 8 
years? Beyond the NPT, what in this agreement is legally binding on 
Iran prior to ratification of the Additional Protocol?

    Answer. Iran has committed to provisionally apply the Additional 
Protocol starting on Implementation Day. Under international law, 
provisional application is legally binding, pending ratification. Iran 
was not willing to take the permanent step of ratifying the Additional 
Protocol until the United States and EU terminated sanctions, which we 
were not prepared to do until Iran had complied with the JCPOA for a 
substantial period of time. In the meantime, beginning on 
Implementation Day, Iran will be legally obligated to abide by the 
Additional Protocol.
    There is no end date to this JCPOA commitment, and it is not tied 
to any duration in the JCPOA.
    If Iran fails to ratify the AP, we would have to determine whether 
it ``sought'' ratification in good faith: if it did not, that would be 
inconsistent with its JCPOA commitment and, potentially, a case of 
``significant nonperformance'' that could trigger snapback. We would 
also look very closely at Iran's overall performance under the JCPOA, 
including its willingness to continue provisional application of the 
AP, to determine whether Iran was in full compliance.

    Question. In 2003, Iran agreed to voluntarily adhere to the 
Additional Protocol. We all know that Iran cheated on the commitment 
and then pulled out of the commitment. President Rouhani famously 
boasted how he fooled the West. What has changed in Iran that gives you 
confidence that Iran will not repeat the pattern of cheating?

    Answer. First, Iran has committed to provisionally apply the 
Additional Protocol, which makes it legally binding on Iran pending 
ratification. This is different from the ``voluntary'' implementation 
Iran undertook in 2003. Second, this time any Iranian failure to abide 
by the Additional Protocol would risk a snapback of sanctions by the 
U.N. Security Council, the United States, and the European Union.

    Question. The agreement includes an entire Annex on Civil Nuclear 
Cooperation. Under what parameters will the United States participate 
in nuclear cooperation with Iran, the leading state sponsor of 
terrorism?

    Answer. Russia and China will take the lead on the projects that 
have been identified to date (regarding Fordow and Arak, respectively), 
and other countries may participate in additional projects. Any 
cooperation between the United States and Iran would be of limited 
scope and consistent with current law, which significantly restricts 
any such cooperation with Iran.

    Question. Will the administration seek a formal U.S.-Iran civilian 
nuclear cooperation agreement under section 123 of the Atomic Energy 
Act of 1954? Under what circumstances would we allow the export of 
U.S.-controlled nuclear technology to Iran?

    Answer. The United States has no intention to seek a civil nuclear 
cooperation (i.e. ``123'') agreement with Iran, nor do we envision 
engaging in the sort of cooperation that would require such an 
agreement. Any export of U.S.-controlled nuclear technology to Iran 
would have to conform with existing law and be subject to policy 
consideration of whether such an export would advance U.S. objectives 
vis-a-vis Iran.

    Question. Will we continue to confront Iran's abysmal human rights 
record, including through the imposition of sanctions with respect to 
the transfer of goods or technologies to Iran that are likely to be 
used to commit human rights abuses?

    Answer. U.S. sanctions that focus on Iran's human rights abuses 
will remain in effect, and we will continue to use these authorities to 
vigorously target the perpetrators of such abuses. Pursuant to 
Executive Order 13606, the Treasury Department, in consultation with 
the State Department, has designated entities for the provision of 
information technology that could be used by the Government of Iran to 
commit serious human rights abuses; these entities will remain 
designated. Similarly, our sanctions against entities and individuals 
we have designated under Executive Order 13553 for their involvement or 
complicity in serious human rights abuses will remain in place, as will 
sanctions against entities and individuals we have designated under 
E.O. 13628 for restricting the freedoms of expression or peaceful 
assembly of Iranians. Such entities include the Islamic Revolutionary 
Guards Corps (IRGC), the Basij, the Ministry of Intelligence and 
Security (MOIS), the Ministry of Culture and Islamic Guidance, the 
Committee to Determine Instances of Criminal Content, and the Iranian 
Cyber Police; we have also sanctioned top officials within some of 
these organizations.
    We will continue to press Iran to end its mistreatment of its 
citizens. We will continue to cosponsor and lobby for the U.N. General 
Assembly's annual resolution expressing deep concern at human rights 
violations in Iran and to lead lobbying efforts to maintain the mandate 
of the Special Rapporteur on human rights in Iran--a mandate we were 
instrumental in establishing through our leadership at the U.N. Human 
Rights Council. We will continue to document Iran's human rights 
violations and abuses in our annual Human Rights and International 
Religious Freedom Reports. Additionally, we will continue to raise our 
voice in support of the Iranian people and their desire for greater 
respect for human rights and the rule of law.

    Question. As you know, I chair the State Department Management 
Subcommittee of SFRC. Since being sworn in as Secretary of State, what 
efforts have you personally made to ensure that the State Department is 
more efficient and effective?

    Answer. During my tenure as Secretary, I have launched several 
efforts to ensure that the Department is more efficient and effective. 
I have focused on improving our technology; streamlining internal 
operations; strengthening knowledge management; enhancing our 
workforce; and improving strategic planning and performance management.
Improving our Technology
    As the breach to our network demonstrated, the Department is facing 
cybersecurity challenges similar to those of other Federal agencies. 
Several efforts illustrate the commitment I have made, as Secretary, to 
strengthening our cybersecurity. I hired a new Deputy CIO for 
Information Security and doubled the information security budget and 
staffing. I have continued and strengthened the Department's system for 
continuous monitoring of IT systems (known as ``iPost''), which was 
established under Secretary Clinton. This program, which goes beyond 
what is required by the Federal Information Security Management Act 
(FISMA), has served as the model for the Department of Homeland 
Security's Continuous Diagnostic and Mitigation (CDM) program, which is 
now being deployed to Agencies government-wide. Under my leadership, we 
have significantly accelerated our deployment of card-based two-factor 
authentication and are on target to complete global deployment to all 
Department network users by December 31, 2015. We are also restricting 
and reducing the number of users with privileged system access.
    In addition to these efforts, we are also segmenting our network to 
protect our most sensitive data (such as personnel and consular 
records) from the Internet, while moving appropriate work to a separate 
outward-facing, cloud-based network. Not only will this segmentation 
strengthen our network security, but this transition of appropriate 
work to a cloud-based architecture will also significantly enhance the 
mobility and productivity of our people and the efficiency of our 
operations. By the end of fiscal year (FY) 2016, all Department 
employees will have unclassified cloud-based tools and collaboration 
tools (such as collaborative document-editing). We are also leveraging 
the cloud to enhance operations, such as rolling out a cloud-based 
integrated business process management platform to serve as a one-stop 
shop for a wide variety of employee services (such as facility 
requests).
    Likewise, we are deploying wireless networks within select domestic 
and overseas facilities (including to 20 overseas posts by the end of 
FY 2016) to improve staff productivity and realize cost-savings. For 
example, Embassy London--one of the first posts to take part in this 
pilot--estimated that having wireless capabilities would yield cost-
avoidance through lower cellular data costs and reduce the amount of 
consular staff time required for data-entry that could be done on-the-
spot if wireless were available for hand-held devices.
    In addition to improving technology Department-wide, we are also in 
the midst of a focused effort to transform our consular technology 
platform--the architecture at the center of how the Department 
interacts with the American public. Outages in our consular systems in 
2014 and 2015 that limited our ability to serve the public through 
passport and visa issuance have deepened our commitment to modernizing. 
Our modernization effort is two-pronged. We are improving our existing 
infrastructure to stabilize current systems (12 databases and 92 
software applications, many of which are 20 years old) and lay the 
foundation for more modernized systems. Our focus is a more stable, 
reliable, and efficient database infrastructure with ample redundancy 
to reduce system outages.
    Concurrently, we are replacing legacy systems with ConsularOne, a 
single, all-in-one platform suite of citizen and noncitizen services. 
We have started with online passport renewal, which will enable 
citizens to submit renewal applications, payment, and photos online. By 
eliminating the current paper- and mail-based process, we estimate we 
will increase processing speed by approximately 2 weeks, thereby 
enhancing customer satisfaction. In partnership with the Department of 
Homeland Security (DHS), we are also moving to an online immigrant visa 
application, which will reduce the overall processing time by several 
months and simplify a process that many U.S. citizens navigate as they 
support immigrant family members in coming to the United States.
Streamlining Internal Operations
    As Secretary, I have launched efforts to streamline several 
internal operational processes--everything from service requests to 
travel and conference room reservations. We expect these efforts to 
save staff time and result in cost-savings. For example, last year, we 
embarked on an ambitious initiative to develop and deploy a cloud-based 
solution to deliver an integrated service management platform to 
maximize employee productivity and increase service efficiency. This 
consolidated system will replace over 400 stand-alone servers and 
numerous homegrown, one-off solutions to more efficiently deliver, 
track, and measure enterprise services for over 150,000 State 
Department and other government agency employees at embassies and 
consulates worldwide. We are expanding the success of this approach 
overseas to our domestic operations to have a single, unified system 
worldwide.
    We are also streamlining the process for purchasing airline 
tickets--a frequent type of transaction in a Department where employees 
travel extensively. Drawing on results of a December 2014 survey of 
9,000 Department employees, we are working with GSA and our travel 
contractor to increase the use of our online reservation tool, which we 
estimate will save approximately $65 per transaction and up to $700,000 
per year.
    Similarly, based on a Department-wide user experience survey and a 
comprehensive assessment of our conference rooms and utilization rates, 
we are shifting from a highly decentralized, labor-intensive 
reservation process to an online, centralized one across our 
Washington, DC, facilities. We expect this effort to save personnel 
time and boost utilization of existing space, while also greatly easing 
access to the ``collaborative space'' that enables our diplomats to 
engage in the teamwork that is increasingly central to effective 
diplomacy.
Strengthening Knowledge Management
    I have launched an initiative to transform the way we manage 
knowledge management at the Department, given the vital role it plays 
in diplomacy. This effort was highlighted in the 2015 Quadrennial 
Diplomacy and Development Review (QDDR) released in April, which 
emphasized the importance of harnessing knowledge, data, and 
technology. In particular, we are creating two technology platforms to 
transform how our people produce, access, and use information to pursue 
our foreign policy objectives more effectively and efficiently. First, 
we are developing a user-friendly portal through which staff will be 
able to search for a specific issue, region, or person across a wide 
variety of sources (e.g., emails, cables, information and action 
memoranda). Second, we are creating a mobile-friendly contact 
management system to give our diplomats on-the-go access to relevant, 
up-to-date information about their foreign counterparts, such as topics 
discussed during last point of contact. Given the personnel transitions 
that occur every year in the Department with the rotational model of 
the Foreign Service, this tool will enable diplomats new to their 
assignments to quickly get up-to-speed.
    In a related effort also highlighted in the 2015 QDDR, we have 
established a center for data analytics to improve our policy and 
operational effectiveness in this new era of ``Big Data.'' This unit 
will collaborate with our overseas missions and domestic offices to 
enhance the use of analytical tools and make data more accessible to 
employees and senior leaders. This effort will enable the Department to 
leverage data and information to uncover trends; foster strategic 
thinking to connect policy to operations; and enhance and integrate 
big-data analytics into our problemsolving and decisionmaking.
Enhancing our Workforce
    Our single most important asset as a Department is our people and 
the most prudent investments we can make in a resource-constrained 
environment are in them. To this end, as Secretary, I have launched 
several efforts to improve training for and the evaluation of our 
workforce. The 2015 QDDR included specific recommendations to invest in 
our workforce by expanding the core training curriculum, increasing 
long-term training options as well as excursion tours to other 
agencies. Although enrollment at the Foreign Service Institute (FSI) 
has increased 56 percent since 2010 while appropriated funding has 
declined 28 percent, I have driven innovation in several critical 
areas. This includes developing new content, improving methodology, and 
increasing accessibility of our training programs. The Department is 
also implementing a core curriculum for our personnel and emphasizing 
continued training throughout the course of an employee's career. These 
improvements are enhancing the effectiveness of our people in executing 
on our foreign policy objectives.
    Likewise, I have streamlined and improved the processes we use to 
evaluate staff performance. For example, we have revamped and shortened 
the Employee Evaluation Report used for Foreign Service personnel to 
focus on employee effectiveness in achieving goals, rather than 
focusing on competencies in performing tasks. We have also updated the 
mid-year professional development form to promote earlier and better 
performance related discussions, establish clear expectations and 
goals, and identify areas of excellence and areas for additional 
professional growth.
    I have also taken steps to increase the flexibility, diversity, and 
overall work-life wellness of our workforce. These efforts, highlighted 
in the 2015 QDDR, are improving the Department's ability to efficiently 
and effectively promote our strategic priorities and deliver foreign 
assistance. We are working to increase the agility of our workforce so 
that we can get the right people with the right skills, in the right 
place at the right time. The requirement that we respond quickly and 
deploy expertise wherever it is needed is driving us to create expanded 
opportunities for Foreign Service, Civil Service, and local staff 
abroad to take on temporary rotational assignments to fill staffing 
gaps, more quickly align skills with positions and speed hiring.
    A diverse workforce--one that more closely reflects the diversity 
of our Nation--is also critical to our ability to achieve our foreign 
policy objectives effectively. We are therefore making significant 
efforts to recruit and support women, minorities, LGBTI persons, and 
persons with disabilities. Our recruitment initiatives include the 
successful Pickering and Rangel fellowship programs, opportunities for 
military veterans and persons with disabilities, the 2012 Diversity and 
Inclusion Strategic Plan, as well as outreach activities across the 
nation targeting underrepresented student populations.
    Retaining the best personnel requires that we both invest in our 
employees, but also ensure that they can balance their work and 
personal lives. I therefore have established a Work-Life Wellness Task 
Force and launched a Voluntary Leave Bank. The Department's Family 
Liaison Office continues to support careers for eligible family members 
both at our overseas posts as well as domestically. A number of 
flexible work schedule and telework options also exist. As a result of 
these and other efforts, in 2014 the Partnership for Public Service 
found the State Department ranked third among large agencies in their 
annual ``Best Place to Work in the Federal Government'' survey.
Improving Strategic Planning and Performance Management
    Improving and refining our strategic planning processes is an 
important element of the effort to make the Department more effective 
and efficient. During my tenure as Secretary, I have strengthened our 
focus on using strategic planning to identify the highest priorities of 
the Department and align our resources to those actions and activities 
that most effectively and efficiently advance our foreign policy goals. 
At the agency level, the Joint Strategic Plan (JSP) for the Department 
and USAID outlines our overarching goals and objectives and guides 
bureau and mission planning. At the bureau level, multiyear bureau 
strategies guide priority setting and resource allocation and are a 
department-wide effort incorporating partner bureaus and the 
interagency priorities. The multiyear country strategies, known as the 
Integrated Country Strategies (ICS), reflect a whole-of-government 
process with input from interagency members of the embassies' country 
teams. These multiyear strategies are now used to guide and inform the 
Department's annual budget processes, strengthening our focus on 
aligning foreign policy priorities with resource requests.
    Bureaus and missions review these strategies to determine progress 
against the goals to ensure that all U.S. Government efforts are 
aligned with U.S. foreign policy. The Department of State is committed 
to using strategic planning to achieve U.S. foreign policy outcomes 
effectively, efficiently, and with greater accountability to the 
American people.

    Question. What steps have been taken to remove duplication of 
effort among programs and staff?

    Answer. Particularly in this budget-constrained environment, I have 
made it a priority to identify and eliminate duplication of effort 
among programs and staff within the State Department and between the 
Department and other U.S. Government agencies and departments. I and my 
senior leadership use several mechanisms for doing this, including our 
whole-of-government strategic planning process centered on developing a 
multiyear Integrated Country Strategies (ICS) for each mission; 
strategic efforts to eliminate potential redundancies with other 
agencies; and strategic reviews of the Department's internal 
organizational structure. Several examples illustrate the commitment I 
have made to eliminating duplication.
    We are conducting a significant effort to eliminate redundant 
services overseas between the Department and USAID. We first 
consolidated 15 administrative services, which are provided to agencies 
through the International Cooperative Administrative Support Services 
(ICASS) system and include services under General Services, Financial 
Management, and Human Resources. By selecting the most obvious 
redundant services and those most feasible to consolidate, we have 
successfully consolidated 97 percent of these services. More recently, 
we have added other services to the list of those to be consolidated, 
including furniture, furnishings, appliances and equipment; travel 
management centers; administrative and travel voucher processing; and 
some aspects of human resource management of locally employed staff.
    In addition to this effort, we also ensure that, where an office at 
the State Department and an office at USAID have related missions, the 
offices work in concert to ensure alignment of programs and staff. For 
example, to avoid duplication between the Department's Bureau of 
Conflict and Stabilization Operations (CSO) and USAID's Office of 
Transition Initiatives (OTI), CSO works closely with OTI to share 
analysis, undertake joint State-USAID assessments and plans, and ensure 
effective division of labor in focused efforts to support embassies in 
conflict zones.
    Within the Department, we also regularly review our internal 
organizational structure to ensure we are not duplicating effort among 
programs and staff. For example, when I entered the Department, I 
conducted a strategic review of offices reporting wholly, dually, or in 
title to me, such as Special Envoys, to determine which should be 
merged into bureaus where appropriate and I have ordered that a regular 
review take place to ensure the justification of the office or position 
remains. Of 37 offices reviewed, I identified 9 that had matured to a 
stage where the issue it addressed was either no longer urgent, or 
sufficient perspectives, capabilities, and tools had been developed 
across the Department that the office could be integrated and 
mainstreamed into another office.
    Special Envoys fill temporary positions created to address critical 
foreign policy needs. Some urgent efforts require high-level 
representatives to coordinate immediate and cohesive responses across 
the government and with foreign governments, like the Special 
Presidential Envoy for the Global Coalition Against ISIL. Other 
positions are created for occasional events and filled by people who 
generally work full-time in other positions. For example, our Special 
Representative to the Organization of Eastern Caribbean States is a 
role filled by our Ambassador to Barbados when meetings of the 
Organization of Eastern Caribbean States occur.
    The ad hoc nature that makes these positions useful for 
accomplishing specific and limited foreign policy goals means that this 
number will continue to vary widely, particularly in what is generally 
acknowledged as the most complex foreign policy environment in recent 
memory. Our regular strategic review of these positions ensures that, 
even as the number varies widely, Special Envoys and Representatives do 
not duplicate the work of our long-standing organizational system. 
Instead, they complement existing staffing and leadership, offering 
unique expertise and perspective to mission critical programs and 
initiatives. An example would include the Ebola Response Coordinator, a 
position created to respond to a sudden crisis, but whose work was 
reintegrated into standing State Department offices after approximately 
6 months. During the time the position existed, the Ebola Response 
Coordinator helped greatly to harmonize our efforts to aid countries 
stricken by the Ebola virus.

    Question. Please provide any additional information you have 
regarding the State Department's proposed FASTC that you think would be 
important for the committee to consider, including:

          (a.) Any information you have about the parcel(s) of land 
        that the State Department hopes to use for the proposed FASTC, 
        including geographical, geological, or environmental concerns.
          (b.) Any information you have on any the proposed designs of 
        the proposed FASTC.

    Answer. (a.) The Department of State (DOS), in conjunction with the 
General Services Administration (GSA), previously identified 1,350 
acres of land, composed of three separate parcels, at Fort Pickett in 
Blackstone, VA, to construct the Foreign Affairs Security Training 
Center (FASTC). The Fort Pickett site is ideal due to its contiguous 
nature and proximity to both Diplomatic Security's Washington, DC, 
headquarters and our primary overseas security partners, which will 
allow continued training with the same units and personnel with which 
DOS operates overseas. These military units do not have the resources 
and time to travel to remote training locations. One parcel, owned by 
Nottoway County, VA, was purchased by GSA on May 29, 2015. On June 23, 
2015, the Department of the Army (DOA) and DOS executed a Land Use 
Permit that allows DOS to utilize the remaining parcels, which are 
owned by DOA, to construct facilities to conduct its hard skills 
training. In accordance with the National Environmental Policy Act 
(NEPA), an Environmental Impact Statement (EIS) was conducted on the 
proposed site to assess the effects of the DOS training program on the 
local environment. The results of the EIS confirmed the selection of 
Fort Pickett as the preferred site for FASTC. On May 26, 2015, the 
Record of Decision (ROD) to move forward with Fort Pickett as the 
preferred site for FASTC was signed by GSA.
    (b.) The design effort for the FASTC project is composed of plans 
for hard skills training venues (driving tracks, explosives ranges, 
munitions firing ranges), associated support spaces, and associated 
site work and infrastructure. The design effort is composed of five 
separate design packages. Design package 1 is at 100 percent 
completion. Design packages 2, 3 and 4 are at near 100 percent 
completion. Design package 5 has not commenced.
    (c.) The key advantage of FASTC at Fort Pickett is that all ranges, 
tracks, classrooms, Helicopter Landing Zones, armories, armored 
vehicles and related support services, explosive materials 
transportation, warehousing functions, emergency medical support, as 
well as a host of other training and support functions would be under 
the exclusive and consolidated control of the Diplomatic Security 
Service allowing for robust and agile training. This training needs to 
be conducted in both day exercises and 175 to 200 nights of training, 
in an environment that faces no noise abatement restrictions. This 
exclusive control over FASTC would be the cornerstone of our 
requirement for training with U.S. military, other government agencies, 
and our foreign counterparts. The exclusive control of FASTC by 
Diplomatic Security allows for training programs that are operationally 
challenging, realistic in scope, and designed to counter myriad threats 
and attacks like those experienced in today's overseas environment.

    Question. Do you believe FLETC can train the State Department's 
diplomatic security personnel for less funding than it would take to 
assist the State Department to construct a brand-new training facility?

    Answer. The Department of State (DOS) worked closely with the 
General Services Administration (GSA) to develop a cost estimate for 
locating the Foreign Affairs Security Training Center (FASTC) at Fort 
Pickett in Blackstone, VA. Given the fact that this cost estimate was 
vetted by two independent cost estimation firms, DOS is confident in 
the efficacy of the cost estimation process as well as the estimated 
total project cost of $413 million. DOS is unable to provide comment in 
reference to the efficacy of the Federal Law Enforcement Training 
Center (FLETC)'s cost proposal because we are not privy to the details 
of FLETC's cost estimation process. However, a consensus document 
jointly produced by DOS and FLETC reflects both agencies are in 
agreement that FLETC would need to newly construct (or augment existing 
infrastructure for) 90 percent of the proposed FASTC training venues in 
order to meet DOS' training requirements. At FLETC, significant 
training restrictions exist such as noise abatement requirements 
(because of the populated areas surrounding the training venues) and 
limits on night time training, which preclude many of Diplomatic 
Security (DS)'s training activities. In addition, significant 
restrictions currently exist at FLETC on the types of heavy weapons 
that DS employs. FLETC would require DS to train at two separate 
facilities; Glynco and the Townsend Bombing Range. Conversely, the 
FASTC option provides for a consolidated hard skills training facility 
and minimizes both travel expenses and the loss of valuable training 
time due to unnecessary transportation.

    Question. In terms of specific curriculum and training objectives, 
what requirements has the State Department established for the DS 
training?

    Answer. The Bureau of Diplomatic Security (DS) is responsible for 
the security training of Department employees and other U.S. Government 
personnel serving overseas under Chief of Mission authority as well as 
specialized training for DS personnel primarily responsible for the 
safety and security of those employees overseas. Additionally, DS 
trains security and law enforcement officers from partner foreign 
governments to create a more safe and secure environment for our 
diplomatic missions. DS became the first Federal law enforcement 
training organization to receive academy accreditation from the Office 
of Federal Law Enforcement Training Accreditation (FLETA).
    The Foreign Affairs Security Training Center (FASTC) would be a 
consolidated hard-skills training center for a rotating student 
population of approximately 8,000-10,000 annually. Approximately 600 
students would be on-site on an average training day. This student 
population is made up of Foreign Service employees, eligible family 
members, and U.S. and foreign security partners. Training courses range 
from 5 days to 6 months in length, with an average duration of 14 days. 
Approximately 175-200 training days per year require after-hours night 
training, including several courses that conduct 24/7 training 
operations with heavy weapons, explosions and helicopter movements, 
often in concert with military partners. DS training at FASTC would 
necessarily involve Department of Defense (DOD) assets, including the 
Marine Corps Embassy Security Group based out of Quantico, VA, using 
military weapons and equipment, to include aircraft such as the V-22 
Osprey.
    DS provides a wide range of training courses to a variety of 
student populations. Training curricula for DS courses include (but are 
not limited to): high speed driving; attack recognition; live fire 
maneuvers; rotary wing aircraft operations; rural and urban land 
navigation; live fire driving and shooting; live fire shoot house 
exercises; urban operations; static firing in excess of 800 meters; 
tactical medicine; personnel recovery; small unit tactics; advanced 
communications; border security concepts; tactical breaching; counter 
assault tactics; detecting and responding to explosive devices and 
suicide bombers; hostage rescue; and personnel evacuation. Given the 
current security environment and cooperation with DOD, much of this 
training would include participation with the military counterparts 
that would be involved in the real-life events (i.e. Noncombatant 
Evacuation Operation-evacuations).
    Training facilities will require long-distance weapons ranges; 
ranges for heavy weapons, including the M2 .50 caliber machine gun and 
the MK-19 grenade launcher; high-speed driving tracks designed to 
support heavy, armored vehicles; tracks designed with changes in 
elevation and sight lines; sufficient explosives demonstration ranges; 
critical adjacencies between venues that permit a continuous training 
flow without administrative breaks; critical sequencing of venues; 
flexibility to train on a 24/7 basis; and sole discretion of scheduling 
and training priorities to facilitate unexpected requirements as they 
arise.

    Question. It is my understanding that the Office of Management and 
Budget (OMB) has conducted its own analysis of the cost differential 
between FLETC and the State Department's proposed FASTC, and determined 
that upgrades to FLETC are far more economical than the construction of 
a brand new FASTC.

    Does anyone in your Department possess this OMB cost 
        analysis? If the answer is yes, please provide a copy of this 
        cost analysis to my office.

    Answer. Our understanding is that OMB prepared a template for such 
an analysis, populated by numbers that they admitted were preliminary 
and not internally consistent. We are not aware that OMB ever prepared 
a final analysis.

    Question. It is my understanding, from a staff-level meeting with 
OMB, that the State Department never provided OMB with the information 
necessary to provide an apples-to-apples comparison of FASTC versus an 
expanded FLETC. Why was this information not provided? Could you 
provide this information to my office?

    Answer. We are not aware of any specific information requests from 
OMB during 2013 that were not addressed at some point in the 
deliberative process. In April 2013, the Bureau of Diplomatic Security 
(DS) provided to the Office of Management and Budget (OMB) an 
informational package on the proposed Foreign Affairs Security Training 
Center (FASTC). This package was a compilation of documents that 
provided detailed descriptions of the DS training mission and 
requirements, proposed hard skills venues, and excerpts from both the 
Program of Requirements (POR) and the Master Plan (MP). The package was 
intended to provide OMB with a comprehensive portrait of the FASTC 
program to assist in its assessment of the Federal Law Enforcement 
Training Center (FLETC) as a viable option for DS hard skills training 
functions. The information contained in the package sent to OMB is the 
same information used by the Department of State (DOS) to develop its 
assessment of Fort Pickett in Blackstone, VA, as a possible location 
for FASTC and the associated cost estimate. We are able to provide this 
information to the committee pursuant to Department of State policy.

    Question. With regard to internal investigations at State 
Department, do you believe that the current structure for 
investigations allows for real or perceived undue influence?

    Answer. No. The Department of State has taken important steps to 
ensure our internal investigations are insulated from any potential 
undue influence or the appearance thereof; changes in the Department's 
organizational structure further increased the independence of the 
Diplomatic Security Office of Special Investigations (OSI). In 
addition, the OSI Office Director position was raised to a senior-level 
Foreign Service official, who will report directly to the Deputy 
Assistant Secretary for Domestic Operations. Recent updates to 
Department policies and procedures further prevent the appearance of 
undue influence in investigations. OSI opens and conducts 
investigations without influence by higher authorities.

    Question. A State OIG Review of Selected Internal Investigations 
Conducted by the Bureau of Diplomatic Security found ``issues with 
current Department policies and procedures that may have significant 
implication regarding actual or perceived undue influence.'' I 
introduced legislation, S. 1527, that would require the State OIG to be 
notified of any and all investigations that take place within the State 
Department, in order to remove the appearance of undue influence, and 
to allow the OIG the proper opportunity to investigate, if need be.

   Do you agree with this effort? If no, why not?

    Answer. The October 2014 OIG report (ESP-15-01) and the three other 
OIG reports on this topic (ISP Report ISP-I-13-18, published February 
2013; September 2013's Oversight Review Report, which was never 
released; and the Sensitive but Unclassified version of ESP-15-01--ESP-
14-01, released October 2014) confirm there is not a systemic problem 
with the Department's internal investigations. The OIG found no 
evidence of undue influence on internal investigations; a positive and 
constructive report for Diplomatic Security and the Department. The 
final report (ESP-15-01) claims the ``appearance'' of undue influence 
in three specific cases out of the many the OIG reviewed, but does not 
find any actual undue influence.
    The Department respects the OIG's authority to conduct 
investigations and has a longtime practice of referring cases to the 
OIG within the OIG's investigative purview and in instances in which 
there may be a conflict of interest. The Department also understands 
the importance of making the OIG aware of Department investigations 
into employees. However, expanding the OIG's authority in the manner 
suggested will create unnecessary bureaucracy and delay investigative 
action, and could inhibit the OIG's ability to achieve its mission to 
prevent and detect waste, fraud, abuse and mismanagement in Department 
programs and operations.
    As a practical matter, requiring the various investigative offices 
in the Department to report investigations to the OIG within 5 days of 
learning about an allegation places an enormous burden on those 
offices, particularly those that handle a large number of such matters. 
It also seems likely to delay the initiation of an investigation while 
the relevant office reports the allegation to the OIG, which can have a 
detrimental effect on the investigation.
    In addition, other Department entities with legal investigatory 
mandates must be able to effectively exercise those mandates. This 
ensures that the entity with primary expertise is handling the 
investigation.
    The Department remains willing to work with the OIG to keep it 
informed about appropriate Department investigations and to maintain 
the practice of referring cases to the OIG.
                                 ______
                                 

                        THE JOINT COMPREHENSIVE 
                             PLAN OF ACTION

                              ----------                              


                        WEDNESDAY, JULY 29, 2015

                                       U.S. Senate,
                            Committee on Foreign Relations,
                                                    Washington, DC.
    The committee met, pursuant to notice, at 10:48 a.m., in 
room SD-419, Dirksen Senate Office Building, Hon. Bob Corker 
(chairman of the committee) presiding.
    Present: Senator Corker, Risch, Rubio, Johnson, Flake, 
Gardner, Perdue, Isakson, Barrasso, Cardin, Menendez, Shaheen, 
Udall, Murphy, Kaine, and Markey.

             OPENING STATEMENT OF HON. BOB CORKER, 
                  U.S. SENATOR FROM TENNESSEE

    The Chairman. The meeting of the Foreign Relations 
Committee will come to order. I want to thank everybody for 
being here, and for everyone being present earlier for the 
business meeting.
    I want to thank our witnesses for being here today, and I 
just want to make a couple comments and move on.
    First of all, I was pretty frustrated when we began our 
hearings last week with the classified meeting we had the night 
before. It was not really classified. It just happened to be 
down in the skiff, where after all the work we had done 
together to create a vehicle to weigh in on a very, very 
important foreign policy, something that is maybe one of the 
biggest that will occur during the time that we are in the 
Senate, we were being faced every time we would ask a question 
about the deal, Secretary Kerry would say, well, it is either 
that you support us or it is war. You either support us or it 
is war. You either support us or it is war.
    To me, again, I think, everybody on this committee has 
worked hard to make sure that it is a committee where people 
take their votes seriously, not necessarily themselves 
seriously. But then to be faced with a situation when you ask 
questions about the quality of the deal, to basically say you 
have no vote, it is either support us or war. So I expressed 
those last week.
    I also wanted to say one other thing. I had probably one of 
the only real good conversations I have had with Secretary 
Kerry in 8.5 years, about 10 days before we arrived at the 
final deal. I know that people have all kinds of concerns and 
some positive expectations about what might occur. But the 
final issues of PMD and the ``anywhere, anytime'' inspections, 
they were qualitative issues. To me, they said more than just 
about the particular issues themselves but about how serious we 
are going to be in carrying out these issues and carrying out 
this policy, if it continues.
    To me, on the PMD piece, it was a total punt. I think we 
understand that whatever Iran does on the PMD piece, it has no 
effect whatsoever on the sanctions. And to me, it was just a 
signal to Iran that we are not going to be that serious about 
even carrying out some of the details.
    Secondly, on ``anytime, anywhere'' inspections, that is 
just not the way that it is. Again, Senator Perdue and I were 
talking on the floor a minute ago. There is the big picture 
issue of just moving beyond and allowing Iran to enrich. And 
for many people, that is a threshold that many people cannot 
cross.
    But then there are other qualitative issues that I know 
everyone is looking at. And then you add to that the fact that 
just at the last minute we did away with the ballistic missiles 
sales ban in 8 years, the conventional weapons ban in 5 years. 
And then we realized that the way it is constructed, we have 
done away with the ballistic missile testing ban immediately.
    So to me, those qualitative pieces just at the end sent a 
signal to me and to others that we are really not that serious, 
even about carrying this out in a stringent way.
    Now, let me say this. All that being said, I think we, as a 
committee, have to figure out what we do. Is it just a binary 
decision? Is it just a vote of approval or vote of disapproval? 
Is it that or is there something else?
    So I appreciate the witnesses being here today. I know both 
of them are very, very highly respected. I know they are going 
to give 180 degrees different perspective on the deal, as far 
as how we go ahead.
    But I just want to thank the committee, number one, for 
putting us in a position to be able to weigh in. I want to 
thank our witnesses for being here. And I hope that what we 
will see over the course of the next period of time is a 
continued effort by the committee to figure out what is the 
very best way for this committee, if you will, as a group, to 
weigh in on a very important issue. Is it attaching different 
conditions? What is it? But I look forward to continuing to 
work with each of you.
    I want to thank our ranking member for his cooperation. And 
with that, I would love to hear his comments.

        OPEINING STATEMENT OF HON. BENJAMIN L. CARDIN, 
                   U.S. SENATOR FROM MARYLAND

    Senator Cardin. Senator Corker, first, thank you for your 
leadership on this committee. I think we are all proud of the 
role that the Senate Foreign Relations Committee has been 
playing on this very important moment in the history of our 
country.
    We are not all going to come to the same conclusion. I 
think that is pretty obvious. But I hope we would all want to 
have this process be one that gives the Members of the U.S. 
Senate and the American people the information we need to make 
a determination.
    This is day 9 of a 60-day review. There is still time for 
us to get information that is helpful. We still have plenty of 
opportunities to present this information to the American 
people.
    Let me just share with you day 8 in my life. I met with 
Europeans. I met with an Israeli. I met with administration 
representatives. I met with our colleagues. I even met with 
ordinary Marylanders in a discussion on Iran. That was just 1 
day. I am sure my colleagues are having the same type of 
opportunities. I think that is a very helpful process.
    Last Thursday was our first public hearing, and it went on 
for about 4.5 hours. It was with Secretary Kerry, Secretary 
Moniz, and Secretary Lew. I found the hearing to be very 
informative and helpful and I learned a lot at the hearing.
    This is public hearing number two, and we have two very 
distinguished panelists, who I hope will get into an exchange 
of information, rather than sharing opinions, so that we can 
better understand the ramifications of this agreement.
    From the witnesses in Thursday's hearing, there were some 
pretty impressive points that were made.
    The first is that this set of negotiations which started 
almost 2 years ago were in some respects a continuation of 
negotiations that took place under the Bush administration, and 
the framework was not that different than what we were looking 
at a decade ago. So that speaks to the international resolve to 
get an agreement with Iran through diplomacy.
    It was also very obvious that this agreement provides, in 
writing, a lifetime commitment from Iran not to pursue a 
nuclear weapon. The question, of course, is, are the additional 
restrictions and inspections enough in order to make sure that 
is a reality? The agreement gives us time to gather more 
information about Iran's nuclear policies in order to judge its 
activities, and it gives us a framework to work with the 
international community.
    However, Thursday's hearing also raised concerns that have 
yet to be fully understood. One of those concerns is why did we 
allow a violator of a nuclear policy to be able to now legally 
enrich? That presents a challenge for us going forward. Will 
there be enough time, at the end of the day, for us to know if 
Iran is breaking and will we be able to take effective action 
to prevent them from becoming a nuclear weapons state.
    We also questioned what happens when the sanction regime is 
dismantled. Can it effectively and in a timely way be 
reconstructed, if Iran violates the agreement and will it be 
effective in preventing Iran from moving forward? It took us a 
long time to get the current sanctions regime in place beyond 
just the U.S.-imposed sanctions.
    That also becomes particularly important because Iran will 
have additional resources. And with the arms embargoes being 
lifted starting 5 years from now, it presents additional 
challenges for us as to Iran's financial capacity.
    There are also concerns about the 24-day potential delay in 
gaining access particularly to nondeclared military sites. And 
the issue of an arms race in the Middle East is one that 
concerns many of us.
    Perhaps the most difficult question for any of us to 
answer, and I will acknowledge that I do not know the answer, 
is: What happens if the U.S. Congress effectively blocks this 
agreement from going forward? What is the logical consequence 
of that?
    Our chairman has said that members of the administration 
have made some very bold comments. Well, let us talk about what 
is likely to happen. No one knows for certain, but I would be 
interested in our witnesses sharing with us their observations 
as to the consequences of us effectively rejecting an 
agreement.
    And then lastly, Mr. Chairman, let me say we all need to 
start concentrating on the challenges moving forward, whether 
we reject this agreement or we accept this agreement. If this 
agreement is accepted, there needs to be compliance. And 
compliance means that we have to have adequate understanding of 
Iran's nuclear program, and that is where the PMD, the possible 
military dimension, becomes so critically important. And there 
are still a lot of question marks in my mind, and I know the 
chairman's mind and others', as to the PMD progress that we 
made, whether we will get a full accounting.
    Regarding sanction relief, we know that Iran is likely to 
use some of these funds for nefarious activities. If they are 
nonnuclear, what are our options? Will we be monitoring those 
activities? Will we be able to take effective action against 
Iran if they increase their level of terrorism? What are our 
options in that regard?
    And then lastly, we need to have a regional strategy. That 
region of the world is particularly important to us. This 
agreement, if it goes forward or does not go forward, will 
change the regional security issues. What is our commitment to 
a regional strategy to deal with changes that will take place 
with this agreement or without this agreement? Particularly, 
what is our commitment to Israel's security and the moderate 
Gulf States' security?
    With that, Mr. Chairman, I look forward to hearing from our 
witnesses.
    The Chairman. I want to thank you. I think, obviously, the 
essence for all of us, there is, obviously, all kinds of 
collateral issues that we have to deal with as we take into 
account what we are going to do at the end. But the bottom line 
is this: Congress put in place some sanctions, and we are going 
to have to decide whether this arrangement that has been agreed 
to by the P5+1 we believe is one that causes us to believe we 
should lift the congressionally mandated sanctions that we put 
in place or not.
    So the two of you could not be better witnesses for us 
today. We appreciate both of you being here.
    Our first witness is Mark Dubowitz, the executive director 
of the Foundation for the Defense of Democracies. Our second 
witness is the Hon. Nicholas Burns, Goodman Professor of 
Diplomacy and International Relations at the Harvard Kennedy 
School.
    We thank you both immensely for being here and, certainly, 
we look forward to your testimony. You all can go in whichever 
order you wish to go in.

STATEMENT OF MARK DUBOWITZ, EXECUTIVE DIRECTOR, FOUNDATION FOR 
             DEFENSE OF DEMOCRACIES, WASHINGTON, DC

    Mr. Dubowitz. Chairman Corker, Ranking Member Cardin, 
honorable members of the committee, on behalf of FDD and its 
Center on Sanctions and Illicit Finance, thank you for the 
privilege of testifying. It really is a privilege.
    I will address some of the major structural flaws of the 
JCPOA, and then I will assess alternative scenarios, if 
Congress were to reject this agreement.
    First, the JCPOA provides Iran with patient pathways to a 
nuclear weapon over the next decade to decade and a half. 
Tehran has to simply abide by the agreement to emerge as a 
threshold nuclear power with the following: an industrial-size 
enrichment program; near-zero breakout time; an easier, 
advanced, centrifuge-powered, clandestine sneak-out pathway; 
ICBMs; and hundreds of billions of dollars in sanctions relief, 
which it will use to immunize its economy against future 
economic snapbacks, increase its conventional military power, 
and support terrorism and other rogue regimes.
    Second, the agreement grants Iran a nuclear snapback, which 
diminishes the ability of the United States to apply even 
nonnuclear sanctions. In three places in the agreement, it is 
made clear that using snapback sanctions may lead to canceling 
the agreement, with Iran walking away to resume its nuclear 
program. In short, it will be difficult to persuade our 
partners to punish Iran for any violation short of the most 
flagrant and egregious.
    Third, the agreement effectively dismantles the U.S. and 
international economic sanctions architecture, which was 
designed to address the full range of Iran's illicit 
activities. These activities led to Iranian banks, including 
Iran's Central Bank being banned from SWIFT. The agreement 
erases these measures, but not because Iran has halted its 
financial crimes. And it is difficult for me to imagine a 
scenario where any of our most powerful economic sanctions are 
reimplemented, particularly the SWIFT and Central Bank 
sanctions, short of the most egregious Iranian violations.
    Fourth, the agreement emboldens the most hardline elements 
of the regime--the IRGC and the Supreme Leader Ali Khamenei and 
his $95 billion financial empire, all of which will be major 
beneficiaries of this agreement.
    Now many in Congress have profound concerns about the deal, 
but they rightly ask, well, what are the alternatives? Some in 
the administration say this is a choice between this deal and 
war.
    Now, President Obama has said repeatedly that no deal is 
better than a bad deal. In making this commitment, the 
President clearly had an alternative in mind. No President 
would enter a negotiation without having identified an 
alternative. The alternative is a better deal, an amended deal, 
and Congress should require the administration to amend and 
renegotiate parts of this agreement and resubmit the amended 
agreement for congressional approval. This should more 
effectively cut off every single one of Iran's pathways to a 
nuclear weapon, not expand them over time.
    Now, an amended agreement should return to the principles 
Congress requested and that are contained in six U.N. Security 
Council resolutions. It should address substantial flaws, and 
let me go over six ways that I would recommend amending this 
agreement.
    Number one, the most important, ensuring that limitations 
on Iran's nuclear program, arms, and ballistic missiles only 
sunset upon an affirmative vote of the U.N. Security Council.
    Number two, permanently require excess uranium to be 
shipped out of Iran as Iran does for spent fuel. This deal does 
not do that.
    Number three, limiting Iran's enrichment to IR-1 
centrifuges and banning advanced centrifuge R&D.
    Number four, requiring an inspection regime like we had in 
South Africa with ``go anywhere, go anytime'' inspections.
    Number five, requiring the upfront ratification of the 
Additional Protocol.
    And, number six, resolving the PMD issue in ways that meet 
the criteria that I outlined in my testimony.
    People say there is no precedent for this. Well, in fact, 
Congress has rejected or required amendments to more than 200 
treaties and international agreements, of which 80 of them were 
actually multilateral. This includes major bilateral arms 
control agreements during the height of the cold war: SALT I, 
the Threshold Test Ban Treaty, and SALT II, amongst many 
others. And the Soviet Union was a much more formidable 
adversary than Iran, with thousands of nuclear-tipped missiles, 
where the consequences of war were much more profound.
    By the way, the Chemical Weapons Convention, which was 
reached under President Clinton, is a good example of a complex 
multilateral negotiation involving 87 countries, far more than 
the six of the P5+1. And there are many others that provide a 
substantial precedent for Congress to require the 
administration to amend the agreement.
    If Congress were to override the Presidential veto and 
reject this deal, I see three possible scenarios. None is good, 
each is problematic, but each is preferable to this fatally 
flawed agreement.
    Scenario one is Iranian faithful compliance to the 
agreement, despite congressional disapproval. In this scenario, 
Iran decides to implement its commitments in good faith. This 
would ensure U.N. and EU sanctions relief under the terms of 
the agreement. The President could then either rebuff Congress 
and use his Executive authority to circumvent the statutory 
sanctions blocking in the Iran Nuclear Agreement Review Act, or 
he could accept the rejection by Congress, wield U.S. secondary 
sanctions, and undertake difficult efforts to persuade Europe, 
in particular, to join the United States in demanding better 
terms.
    Scenario two, the Iranians walk away but do not break out. 
If Congress disapproves of the agreement, Iran could abandon 
its commitments and walk away. In this scenario, Iran gets none 
of the benefits. But as it has done in the past, Iran is likely 
to escalate its nuclear program, but incrementally. It would 
avoid taking egregious steps forward in its nuclear program to 
avoid unifying the P5+1, not to mention avoiding crippling 
economic sanctions or even U.S. military strikes.
    In the third scenario, and this is the one that I think is 
most likely, the Iranians try to divide the P5+1. It is a messy 
diplomatic scenario. After congressional disapproval, Iran 
implements certain nuclear commitments but not others. In the 
policy disagreements that are sure to follow, Iran tries to 
divide the Russians and the Chinese from the West and the 
Europeans from the United States.
    Now, if all members remain united around their common 
strategic goal that brought them to the table, which is to 
prevent an Iranian nuclear weapon, a crisis can be mitigated. 
The key will be to persuade the French, the British, and the 
Germans, in particular, to maintain the toughest multilateral 
sanctions and join the United States in demanding key parts of 
the agreement be amended.
    Now, none of the above scenarios are good. None are ideal. 
But they are not likely to lead to disasters either. And they 
are better than this current deal. These options hinge on the 
power of American leadership, coercive diplomacy, economic 
sanctions, and the deterrence credibility of the American 
military option.
    They also depend on the private sector's appetite for risk, 
upon which the true power of the U.S. financial sanctions is 
based.
    I do not predict an immediate gold rush into Iran, even if 
Congress approves this deal. I certainly would not expect such 
gold rush if Congress disapproves it.
    Mr. Chairman, it is better to test the strength of 
America's sanctions architecture now in order to improve this 
deal, rather than try to test the questionable notion of 
snapback sanctions when Iran is at near-zero breakout and 
easier sneak-out, and has ICBMs, and hundreds of billions of 
dollars already in hand.
    At that point, I believe military force may be our only 
option. And if war ensues, Iran will be much stronger, and the 
consequences will be much more severe.
    To avoid this, Congress should insist on amending this 
fatally flawed deal, just as its predecessors have done before 
and, in some cases, under much more dangerous circumstances.
    Thank you for the invitation to testify, and I look forward 
to your questions.

    [Editor's note.--The prepared statement of Mr. Dubowitz can 
be found in the ``Additional Material Submitted for the 
Record'' section at the end of the hearing.]

    The Chairman. Thank you.
    Nick.

STATEMENT OF NICHOLAS BURNS, GOODMAN PROFESSOR OF DIPLOMACY AND 
  INTERNATIONAL RELATIONS, HARVARD KENNEDY SCHOOL, BOSTON, MA

    Ambassador Burns. Mr. Chairman, thank you. Senator Cardin, 
members of the committee, thank you for this invitation to 
testify. I am honored by it.
    I think you know that I have been following this issue for 
a long time. I was Under Secretary of State in the George W. 
Bush administration. I had lead responsibility for Iran from 
2005 to 2008, and I have tried to follow it closely from 
Cambridge, MA, since then.
    I think that both the Obama and Bush administrations have 
tried essentially to operate in the same plane here. Both 
administrations set as a strategic objective to deny Iran a 
nuclear weapon, and both have been trying to push back against 
Iran's, I think, quite open attempt to become the most dominant 
military power in the region.
    And so I think that has to be the dual-track strategy of 
the United States, to try to prevent them from becoming a 
nuclear weapons power, and I think we are right to try 
diplomacy first, to see if that can work, but also to push back 
simultaneously against this major expansion of their influence 
in Syria, Iraq, Lebanon, and Yemen.
    And it is within that context that I support the nuclear 
deal negotiated by Secretary Kerry and Secretary Moniz. I see 
clear benefits for the United States.
    First, it arrests the forward movement that the Iranians 
have been experiencing going on for 10 years now. Mahmoud 
Ahmadinejad was elected 10 years ago this summer. He is the one 
who cut the ties with the nonproliferation regime. They have 
been steaming forward, increasing both their uranium and 
plutonium programs since then. And this agreement stops them, 
and it arrests their movement, and it will freeze that program 
for 10 to 15 years into the future. I think that is a 
substantial benefit for the United States that we were not able 
to realize in the Bush administration, that President Obama was 
not able to realize until this agreement.
    Second, it does cut off the two likely avenues, I know that 
Secretary Moniz talked about this last week, to a nuclear 
capability--uranium enrichment and plutonium processing.
    Third, and I think here is the major Iranian concession, it 
essentially extends the breakout time, Iran's path to a nuclear 
weapon, from what the administration is telling all of us 
publicly is about 2 to 3 months right now to roughly a year for 
the next 10 to 15 years under this agreement. That is a 
substantial Iranian concession, and that is a substantial 
achievement for the United States.
    Next, I think that the inspections regime has been 
strengthened, not foolproof, not perfect. But the inspections 
regime that Secretary Moniz has been testifying about is 
considerably strengthened from what we were able to utilize 
during the Bush administration when I was in government, 
because we will be able to have the IAEA monitor the nuclear 
supply chain for 25 years, and there will be permanent 
verification and monitoring procedures by the IAEA under the 
additional protocol that the Iranians have pledged to sign up 
to.
    Sanctions are not going to be lifted until after Congress 
votes and until after Iran implements the agreement. I do not 
think it is going to be soon. I would anticipate that this 
would go on for many months, perhaps even into 2016, that we 
will not lift sanctions, that we should not lift sanctions, 
until we say see full Iranian compliance with this deal.
    I know, Chairman and Senator Cardin, you both mentioned the 
possible military dimensions. We will have to see what that 
IAEA report says on August 15. I have a pretty clear conviction 
that the Iranians are not going to tell the truth about much of 
what they did do in the past. So that is an important pathway 
on this nuclear continuum, as well.
    Finally, Mr. Chairman, I cite another advantage. If this 
agreement can be implemented effectively, and if it ends up 
stopping Iran from becoming a nuclear weapons power, that will 
then be achieved by diplomacy backed up by the threat of force, 
which is when diplomacy is always most effective. But, I think, 
just as we in the Bush administration sought a diplomatic 
solution in 2006, 2007, 2008, I think President Obama and 
Secretary Kerry have been right to walk down that path, because 
we always have the right and the capacity--we are so much 
stronger--to threaten or to use military force, should that be 
necessary. But it is clearly not necessary now.
    Those are the benefits as I see them. But I do not think 
this is an easy vote for you. And I do not think it has been 
easy for many of us who are studying it to determine what we 
should do. I see clear risks as well. I see a balance of 
benefits and risks to this deal.
    The primary risk, in my view, is that the agreement will 
freeze Iran's nuclear program, but the superstructure of that 
program will be put into mothballs. And 10 to 15 years from 
now, as the restrictions begin to lapse, that program can be 
revived. And I would think it is fair to say that the Iranians 
will rebuild a civil nuclear program.
    The problem for us will be, will we have a line of sight 
into what they are doing to make sure they do not use that 
civil nuclear program reconstituted to build a covert program, 
an illicit nuclear weapons program, as Senator Cardin said, 
quite rightly. They have now sworn before the rest of the world 
that they will not seek that. But based on their past 
performance, we cannot trust them, because they have 
continuously misled the international community.
    That is a risk in this agreement, as I see it.
    An additional risk, which Mark Dubowitz just mentioned, and 
I am happy to be testifying with him, will we be able to 
reimpose an effective sanctions regime if there is a clear 
Iranian violation? I am sure we will get into this. I think the 
answer is it really depends. It depends on what kind of 
violation it is going to be. It depends on who the American 
President will be when this occurs, presumably after President 
Obama has left office. It depends on who is leading this 
committee and leading the Congress.
    So I actually think the most important thing to focus on--
maybe this is the former diplomat speaking--can we implement 
this in a tough-minded, hard-nosed way? Can we establish 
strategic intimidation of the Iranians, so that we can be 
ensured that this can be implemented effectively and Iranians 
do not break out toward a nuclear weapon? I think that is the 
most important thing for me to look at.
    So I see the benefits. I see the risks. In my view, we gain 
too much from this deal for Congress to disapprove it. I think 
the benefits outweigh the risks.
    And I think the key question that members have to ask, and 
I know a lot of people have been saying this, is what is a 
credible, realistic alternative, right now in 2015, to this 
nuclear deal?
    One of the alternatives that has been bandied about, 
offered by both Republicans and Democrats who are critics of 
the deal, is that we should have walked away at some point in 
the last 3 or 4 months because it was clear, this argument 
goes, that the deal was not going to be good enough. We should 
sanction Iran further. And we should reconstitute the 
negotiations and get a better deal.
    If I thought that was possible, I would be for that 
alternative. That is where I would be, because this is an 
imperfect deal. I do not think that is possible. This was a 
deal made by eight parties, the P5+1 and the European Union and 
Iran. And I do not think it is possible to go back to those 
parties, even the French and the British and Germans, to say we 
do not like the deal anymore, the one we just committed to, and 
we want to renegotiate it.
    I think if we did walk out, the P5 unity that we have had 
now for 10 years--we formed this group 10 years ago in the Bush 
administration--would fall apart. The sanctions regime that we 
have built up over 10 years would fray and it would 
disintegrate.
    Look at the French Foreign Minister Laurent Fabius. He was 
just in Tehran over the weekend, lining up commercial deals, 
presumably, for French firms.
    And most importantly, the Iranian nuclear program has been 
frozen since January 2014 under the interim agreement, will be 
frozen for the 10 or 15 years. All of those restrictions would 
be lifted.
    So if that is the scenario, if that is realistically the 
alternative, that is a bad deal, I think, for the United 
States. I think it leaves us weakened. And I say weigh the cost 
and benefits, and the benefits and risks, I really think the 
President's deal is a more sound and sensible path forward, not 
without risks, but a more sound and sensible path for the 
United States.
    Finally, Mr. Chairman, I would like to say, I think, there 
is more the administration can do, both in testimony to 
Congress but also in its own actions over the next 2 or 3 
months to strengthen our ability to implement this deal 
effectively.
    First, I think it is very important, and Mark alluded to 
this and I agree with him, we have to have a very tough-minded 
approach to inspections. I think the Iranians will test the 
inspections regime, because that is what they have done in the 
past. They will try to cut corners. There will not be a major 
violation, probably minor ones, and they will presume that we 
will not call them on it. I think we have to have an unyielding 
implementation of these inspections, these verification 
procedures, and call the Iranians on every violation.
    Secondly, it is very important that we reaffirm our ability 
to line up our sanctions partners, particularly the Europeans. 
I am under no illusions that the Russians and Chinese will come 
with us if we have to reconstitute sanctions. I do not believe 
that they will.
    But I think a coalition of the United States, if there is 
some violation that occurs in the future, a substantial one, 
and Europe and Japan and South Korea and possibly India--India 
would be a very difficult regime to put together, a major 
hurdle. But I think it is possible, depending on the scenario. 
So we need to do that.
    Third, the President, I would think, would want to reaffirm 
the threat of force. President Bush made it very clear that he 
was willing to use force, should Iran get close to a nuclear 
weapon. President Obama should do the same. We should practice 
coercive diplomacy going forward, as we implement this deal 
with Iranians.
    Next, I think we have to narrow the gap with Israel. This 
public division between the United States and Israel is very 
unfortunate. It weakens us, and it weakens the Israelis. It is, 
obviously, a two-way street. I would think the stronger party 
here, the United States, needs to take steps to try to get us 
closer to Israel. We are going to disagree on the fundamentals 
of this agreement, but put that into the private domain, not 
the public.
    Prime Minister Netanyahu, who I think has been excessively 
critical, too critical publicly, of our President, I think 
ought to take the same pledge. And it is very important that 
Israel's qualitative military edge be advanced.
    I helped negotiate the last 10-year United States-Israel 
military agreement back in 2007. We assured Israel's 
qualitative military edge against any possible foe, namely 
Iran, in the Middle East. That deal expires in 2 years. The 
administration could expedite that negotiation and send 
advanced military technology to Israel to make sure that it had 
the capacity to defend itself, should that be necessary. I 
think that would be smart for the administration to do that.
    Finally, Mr. Chairman, President Carter articulated the 
Carter doctrine that was embraced by President Reagan, that the 
Persian Gulf is vital for interests and that we will defend the 
free flow of energy, but more importantly, the people and the 
states of the Persian Gulf. We ought to rearticulate that at a 
time when Iran is on the march into the Sunni world, and we 
ought establish a containment regime against Iran.
    So I am advocating a two-track policy: advance the nuclear 
deal, but also contain Iran.
    And the last thought, Mr. Chairman----
    The Chairman. You been doing last thoughts for a good 
while, but we will let you----
    Ambassador Burns. I would just like to finish, with your 
permission.
    The Chairman. Thank you.
    Ambassador Burns. I apologize if I have exceeded my time 
limit.
    The Iranians were complicit in the bombing of the U.S. 
Embassy in Beirut in 1983. They were complicit in the bombing 
of the U.S. Marine Barracks in 1983. They were complicit in the 
assassination of Malcolm Kerr, the President of the American 
University of Beirut in 1984. We ought to press the Iranians on 
these issues.
    The grandson of Malcolm Kerr is seated here. He is an 
intern on Capitol Hill for Congressman Maloney, Derek van de 
Ven. He is here today, and that family deserves justice.
    I would not make all this conditional on the nuclear deal. 
I would not link it. But I would make it conditional on any 
attempt to normalize United States-Iranian relations in the 
future, because a measure of justice has to be paid to the 
American families.
    So I am for this deal, but I am also for a tough-minded way 
to implement it.

    [Editor's note.--The prepared statement of Ambassador Burns 
can be found in the ``Additional Material Submitted for the 
Record'' section at the end of the hearing.]

    The Chairman. Because of your prior service, we let you go 
over about 150 percent of your time.
    Ambassador Burns. Thank you very much.
    The Chairman. But we thank you for your fulsome testimony. 
I do not know anything relative to your last point, but I will 
just add on to your last comment.
    I know nothing and, certainly, our hearts go out to the 
families of the four hostages that today are prisoners who are 
being unjustly held. I have to believe that somehow or another, 
the administration has coordinated with Iran so that over the 
course of us considering this, something may change in their 
status just to show some good will. I have no knowledge of 
whether that will or will not occur. I hope, for the families, 
something does happen.
    You spoke to the inspections piece, and I think that is 
what troubled me so much about the final 2 weeks, in that what 
we did on the inspections component is nothing like what we 
said we were going to do. To me, it was a signal to Iran that 
we were not going to be serious about these issues.
    On the PMD piece that you just mentioned, again, these are 
details, but again, the sanctions relief is not dependent at 
all on whether they lie, the word you used, or whether they do 
not. It is going to happen.
    So I think you are right. The sanctions relief will begin 
next March.
    Let me just ask you this question, though. Mark Dubowitz 
created some alternative scenarios. He is right, I think, that 
Congress in some ways has weighed in on previous treaties, on 
previous Executive agreements.
    Is there something different about this agreement? You 
mentioned eight countries. Sometimes we have had 70 or 80 
countries involved and we have intervened in a different way. 
Is there something about this that is different that would 
cause you to say, no, Congress should not create different 
conditionality relative to this agreement, that should not 
occur?
    Ambassador Burns. Mr. Chairman, I would say that this is a 
negotiation that has unfolded over 10 years, and the specific 
round over the last 18 months. I think if the Obama 
administration went back to the parties of the agreement and 
asked to reopen it, to renegotiate certain parts of it, I do 
not think our European allies would support us. I know the 
Russians and Chinese would not. I know the Iranians would not. 
If I thought that was an option, I would want to pursue it.
    The Chairman. You know, that is what was said to us when we 
put in place these sanctions. We had exactly that testimony a 
few years ago and had people just like you, maybe you, 
actually, come up here saying this cannot happen. If we put 
these sanctions in place, we will break apart the unity.
    But instead, what happened was the other countries joined 
us, as a matter of fact, on the congressionally mandated 
sanctions that Senator Menendez led and others helped put in 
place, all of us, mostly. What happened was just the opposite. 
We actually forged something that brought Iran to the table.
    So you are saying that somehow the dynamic is different in 
this case at this time.
    Ambassador Burns. Yes, sir, I am. I supported the sanctions 
that Congress added, at some points against the will of the 
Obama administration. I thought it was smart. But that was just 
about American policy. Here you have this agreement, 
multinational. It is all bound together. And, I think, in 
essence, what the administration has presented here is a deal 
that you will approve or disapprove. I hope that you will 
approve it.
    The Chairman. And a big part of this deal is it seems based 
on the fact that somehow the administration sees into the eyes 
of the Iranians and sees something different than what we have 
seen. I remember President Bush, unfortunately, made the 
comment that he shook hands with Putin and saw into his soul or 
heart. And as it turned out, Putin is who he is. He is carrying 
out things exactly the way that he did in the beginning. And 
the Obama administration has not wanted to provoke him, and 
they realized that has not been a good policy.
    China is doing the same thing. A new regime came in. There 
were all these hopes of them conducting themselves in a 
different way. They doubled down, in many ways.
    So do you agree that a portion of this is us gambling, if 
you will, with the administration that somehow this regime is 
different than what has been occurring in previous times, and 
we are to believe that if we were to do this trusting deal with 
them and allow them to enrich and industrialize their nuclear 
program, somehow they are going to be different players. Would 
you respond to that?
    Ambassador Burns. I would be happy to. You will remember 
President Reagan's famous dictum with Gorbachev, ``trust, but 
verify.'' A lot of people have been saying about the Iranians 
``do not trust, but verify.'' You cannot build this agreement, 
and I would not advise you to vote for it, on the hope that 
Iran might change. I think there is no evidence that the 
Iranian Revolutionary Guard or the Supreme Leader are going to 
change. They are anti-American. They are violent. And they 
operate against our interests.
    So the hope here is that the deal will go forward. Their 
program will be frozen. But we have to be tough-minded to 
implement the deal in a way that works for us.
    I think the inspections regime are stronger than people 
give them credit for, particularly the inspections of the 
Natanz facility, the Arak facility, and the Fordow facility, 
the two enrichment plants and the plutonium plant.
    The Chairman. Yes, I do not think anybody at all is 
concerned about inspections of declared sites. I think people 
are concerned about the covert sites. That is why this other 
element of having to ask and getting Iran to respond on the 
front end, and telling them what you are concerned about and 
Iran then having 24 days, is a concern.
    I am going to reserve the balance of my time to interject.
    Senator Cardin.
    Senator Cardin. Again, thank you, Mr. Chairman.
    Let me thank both of our witnesses for their participation 
here today.
    Both of you did comment on what are potential outcomes are 
if Congress effectively rejects the agreement. I just want to 
drill down on that a little bit further.
    I will confess, I do not have a comfort level as to what 
would happen if Congress rejects this agreement. I do not know 
what is going to happen. I am trying to figure it out.
    I think it is clear though that the sanctions regime would 
not be as effective as it is today, that we know that China and 
Russia and other countries are likely to do business with Iran. 
We know that some of the frozen assets are likely to be 
released to Iran, so they will get some sanction relief.
    We also can sort of anticipate that, at least in the short 
term, Iran is not going to return to a negotiating table. They 
are not going to have confidence that they can negotiate with 
the United States where the President could not deliver the 
support of Congress for an agreement. So, at least in the short 
term, it seems like it would be unlikely.
    The U.S. policy will not change. We are going to prevent 
Iran from becoming a nuclear weapons state. We are prepared to 
use our military option. But our preference is to use 
diplomacy. That has always been our preference.
    So recognizing that, and still looking for a diplomatic way 
to resolve this issue, I am trying to figure out what comes 
next. It is likely that Iran will significantly increase its 
modernization of its enrichment. They have the capacity to do 
that. They will continue to present that this is for civil 
nuclear purposes, but with a much more efficient system. So 
rather than being months away, they will get to become weeks 
away.
    How does that put us in a stronger position going forward, 
to negotiate a better agreement sometime after the dust settles 
from the congressional action? Or are my assumptions for 
potential diplomatic solutions wrong? Are there different ways 
that you look at it? I will start with Mr. Burns and then go to 
Mr. Dubowitz.
    Ambassador Burns. Thank you, Senator Cardin.
    If the United States is in a position following a 
congressional vote that our government could not execute the 
agreement, fulfill the responsibilities that we have 
undertaken, I think the eventual winner here will be Iran. Iran 
will emerge from that vote strengthened for the reasons you 
suggested.
    But based on my own experience, as someone who worked in 
this context and the P5, P5 unity would unravel.
    More importantly, it is the Japanese, the other Asians, the 
Indians, who have joined in the sanctions regime who would, I 
think, stop enforcing the sanctions. You would see the 
sanctions regime wither gradually, and then, I think, 
disintegrate.
    And most importantly, the restrictions on Iran for the last 
18 months and the next 10 to 15 years would evaporate. So they 
could go back to uranium enrichment at Natanz and Fordow. They 
would not have to dismantle the core of the reactor at Arak. 
And we would not have a line of sight through the IAEA into 
their operations because the additional protocol would not be 
adhered to, and the IAEA would not have the access that comes 
with this nuclear agreement.
    As I have said, I see the risks here, but I think the 
benefits outweigh the risks. I want the United States to be in 
the strongest possible position and keep Iran under the 
spotlight of international attention. I think a vote to 
disapprove that prohibits the administration from going 
forward, if that is the scenario that we are talking about, I 
think that is very negative for our national security 
interests.
    Senator Cardin. Mr. Dubowitz.
    Mr. Dubowitz. So, Ranking Member Cardin, a few responses.
    The first is on sanctions. I think that that 
characterization misunderstands the kind of powerful financial 
sanctions regime that has been built up over the past decade 
first by Juan Zarate and then by Stuart Levey and then by the 
U.S. Congress.
    I think what Nick is talking about is a sort of classic 
trade-based sanctions regime where you actually depend on many 
countries to join you in a trade-based, essentially, embargo.
    What Congress has done, what the Treasury Department has 
done, is they have used the power of the U.S. financial system. 
So I do not imagine that the Europeans, the Japanese, the South 
Koreans, and others are willing to risk having their financial 
institutions sanctioned by the U.S. Treasury Department. I do 
not believe those financial institutions are going back into 
Iran in the early years of this agreement, even if you approve 
this deal.
    Senator Cardin. Let me say that I agree with you. I do not 
disagree with what you are saying.
    But in the short term, there will be some sanction relief. 
There will be some leakage. There will be some assets released. 
Iran is likely, I think, to go forward with some modernization 
of their enrichment capacity. And at that stage, we would hope 
we would get an opportunity to move forward with the diplomatic 
process.
    How are we stronger at that point?
    Mr. Dubowitz. I think we are stronger because I think, if 
you take Nick's argument to its logical extension--and I agree 
with Nick, this is about tough-minded diplomacy and tough-
minded implementation.
    I did some research in preparation for this, and I thought 
it was really interesting, looking back at the cold war at the 
congressional role with respect to SALT I and Democratic 
Senator Henry Jackson, who was very interesting. He, obviously, 
had some serious concerns about SALT I. He authored an 
amendment essentially saying that in future strategic arms 
control negotiations, that America's strategic arms had to be 
set at parity with the Soviet Union.
    That amendment, which was known as the Jackson amendment, 
passed by 56 to 35. Interesting. SALT I goes ahead. The 
amendment lays the predicate for Senator Jackson's later 
critique that the Carter administration actually did not meet 
the criteria of the Jackson amendment in the SALT II Treaty. 
And, in fact, it actually laid the predicate for the eventual 
essential erosion of the SALT II Treaty. Republicans and 
Democrats in the Senate at that time expressed disapproval of 
SALT II to President Carter. And after the Soviet invasion, 
Carter essentially withdrew it from Senate consideration.
    So I think what I am suggesting is that I think a strong 
resounding message of disapproval of this deal will provide the 
kind of political leverage to the next President and to the 
next Congress to do a number of things.
    Number one is to negotiate a better agreement based on very 
specific amendments, not ripping up the agreement, not no 
enrichment, not some of the positions that have been taken by 
folks. But some very specific amendments that I outline, 
including, and I think the most dangerous part of this deal, 
the sunset restrictions, because that is the fundamentally 
flawed architecture of the deal.
    We all agree that in the first few years of the agreement, 
it is a pretty good agreement with respect to constraining the 
program. The problem with this agreement is that once those 
sunsets start falling at year 8.5 with respect to advanced 
centrifuge R&D, and with respect to year 10 they can install 
advanced centrifuges, a limited number of advanced centrifuges 
at Natanz.
    By the way, breakout time is not 1 year to 15 years. 
Breakout time starts falling at year 10. Now, I have not been 
involved in classified briefings, obviously, so I do not know 
if it falls to zero by year 13, as President Obama had feared, 
or it falls to 5 months by year 15. I do not know exactly 
whether it is a hard landing or soft landing.
    What I do know is breakout time starts to drop between 
years 10 and 15. And by year 15, we are in a terrible position, 
because at that point, it is not a civilian nuclear program 
that we all imagine. It is an industrial-sized nuclear program.
    Now industrial-sized to me is deeply concerning from a 
verification and inspection point of view, because let us 
imagine what this program looks like. There are multiple 
Natanzes. There are multiple Fordows. There are multiple Araks.
    Senator Cardin. Let me let my other colleagues have a 
chance. I appreciate it. I think you have answered my question 
pretty thoroughly.
    Mr. Dubowitz. Thank you, sir.
    The Chairman. Thank you.
    Senator Perdue.
    Senator Perdue. Thank you, Mr. Chairman.
    Mr. Ambassador, thank you for being here, and Mr. Dubowitz.
    We are trying to execute something that we fought hard here 
in this committee and end up with a unanimous approach to this, 
because we realized this was bigger than a partisan issue. It 
is bigger than the President. It is bigger than any member of 
this committee or, indeed, the Senate. This is about the future 
security of that part of the world, and, indeed, I would argue 
the entire world, as Prime Minister Netanyahu has said 
repeatedly. I personally met with him twice in the first 6 
months of this year about this very issue. His concerns are 
very real.
    And now that we see the actual document, you know, 
honestly, Mr. Ambassador, with all due respect, I do not care 
if Ronald Reagan himself were bringing this deal, I would see 
the same flaws and benefits as I see right now. So this is not 
about Obama's deal or a Bush deal or anything else. I have been 
very measured in my approach to this. As a business guy and an 
outsider to the process, I want what is right for America. 
People back home want us to get this right.
    Let me read you a couple quotes. I did this the other day, 
and I hate to repeat myself, but I think it is so paramount 
that we remember what is at risk here.
    This is a quote. ``This agreement will help to achieve a 
long-standing and vital American objective, an end to the 
threat of nuclear proliferation on the Korean Peninsula.'' That 
was President Clinton in 1994. President Obama, just this year, 
``Iran will never be permitted to develop a nuclear weapon.''
    I am sorry, I see this deal in the first 10 years, I think 
the characterization has been said, in the first 10 years, it 
probably does an adequate job. The sunsets are a real flaw. The 
enrichment capability is a real flaw. I want to focus on that.
    But let me remind you of another thing. We talk about 
inspections. We have really gotten down in the weeds in this 
deal, and I want to come back to enrichment, but I want to ask 
a couple questions, so I will try to be very brief.
    President Clinton: ``Under the agreement, North Korea has 
agreed to freeze its existing nuclear program and to accept 
international inspection of all existing facilities.'' 
President Obama: ``This deal intends to stop the progress of 
Iran's nuclear program and roll it back in key areas.''
    You know, if you look at the enrichment presupposition of 
this deal when we started, it was like we gave up the position 
and said, okay, we are going to assume that we are going to 
allow you to continue to enrich, albeit at low levels, albeit 
with low enrichment percentages, albeit you will have to 
mothball your IR-1s.
    And by the way, in Natanz, they are not dismantling these. 
They are moving it from one hall to another.
    I do not know what breakout time is. I think the President 
said his fear is that after years 13, 14, or 15, that the 
breakout does approach zero. I do not know that either, but I 
do see that after the sunset year of 10, and certainly 8 and 
even 5, the stability of that region deteriorates dramatically.
    We gave them the right, early on, we just presumed that we 
would allow them to enrich from day one in the negotiations, 
therefore bypassing 18 countries that have civil nuclear 
programs that are not allowed to enrich. There are five 
countries that have civil nuclear programs and are allowed to 
enrich under the NPT. There are nine countries that have the 
bomb, five that are NPT, four that are not NPT.
    The countries that are allowed to enrich and have civil 
nuclear programs are, indeed, exceptions out of the 180-plus 
countries in the NPT. Those five countries are countries like 
Holland, Germany, Japan, Brazil, Argentina. Now we are taking a 
bad actor, one of the greatest supporters of terrorism in the 
world, and we are allowing them to become a member of a very 
exclusive club that has a civil nuclear program and is allowed 
to enrich but does not have the bomb.
    I just do not see that Iran has earned that right. We gave 
that up in the very beginning, as a part of the presupposition 
to this thing.
    So I would like to ask both of you, first of all, is that 
presupposition right?
    Let us start with Mr. Dubowitz. What was the purpose of the 
early acquiescence of that? And then as we go forward, is the 
real issue here, how do we keep them from enriching not just 
during the period of time? I realize we are going to have 
pretty much control over what they are enriching, if we can 
inspect past the sunset time and past 10 years. I do not think 
that we have eliminated the possibility of Iran becoming a 
nuclear--I think we just delayed that and actually have given 
them an additional path or two to do that.
    They have given up plutonium in the first few years, or my 
presumption is that they have. But we have not forced them to 
give up the uranium path.
    Mr. Dubowitz, would you start?
    Mr. Dubowitz. Senator, thank you for the question.
    The short answer of why we gave it up, we gave it up 
because the Iranians demanded it. We gave it up at the 
beginning of the negotiations, not the end of the negotiations. 
We took our most valuable concession, and we gave it up front 
instead of keeping it until the end.
    Now, what are the consequences of this? The consequence of 
this is that by year 15, Iran will be able to engage in 
unlimited enrichment, not only 3.67 percent, not just 20 
percent. They will be able to engage in 60 percent enrichment. 
And they will use as the justification for that that they need 
a nuclear-powered submarine fleet. Not only are they able to 
stockpile 300 kilograms of low enriched uranium, they will be 
able to stockpile an unlimited amount of enriched uranium at 
3.67 percent, at 20 percent, and at 60 percent.
    So when you talk about a verification and inspection regime 
of an industrial-sized nuclear program, what you have to 
imagine is that Iran has scores of enrichment facilities, 
multiple heavy water reactors. And the enriched uranium, which 
is at 3.67 percent, 20 percent, and 60 percent, is sitting all 
around the country, a country that is more than twice the size 
of Texas. So imagine the verification and inspection regime 
that has to be put in place in year 15, 16, and 17, in order to 
monitor a massive nuclear program with tens and tens of 
thousands of kilograms of 20 percent and 60 percent enriched 
uranium sitting in Iran.
    I mean, I think that what happens at that point is that it 
is not a question of breaking out of their declared facilities. 
I do not think most experts believe Iran will break out of 
their declared facilities. It is trying to prevent a covert 
sneak-out when Iran essentially has the ability, with tens of 
thousands of kilograms of enriched uranium at 20 percent to 60 
percent, which is literally a step away from weapons grade, and 
they have it dispersed around this huge country, and now we are 
depending upon 150 or 200 IAEA inspectors to inspect that 
massive stockpile of enriched uranium.
    And the fact, at that point, is that they will also have 
advanced centrifuges that are so powerful, you do not need 
19,000 to weaponize. You probably need 600. So you need to 
basically build an enrichment facility, which you are legally 
allowed to do at year 15, that looks like Fordow with 600 
centrifuges buried under a mountain on a Revolutionary Guard 
base.
    And then the only Iranian challenge is how to get the LEU 
or the MEU, which is the 60 percent, to that covert, 
clandestine base, which by the way, at that point, is not 
covert or clandestine, because the Iranians have legally been 
allowed to build it.
    Now Olli Heinonen, on verification inspection, I think put 
it better than anyone to the Financial Services Committee last 
week, where we testified together. He was asked, how good is 
this verification and inspection regime? And Dr. Heinonen said, 
on declared facilities, Nick is right, the verification and 
inspection, he rated it a 7 or an 8 out of 10. On suspicious 
sites, he rated it a 5 out of 10. And on detecting where Iran 
would engage in weaponization activities, on a scale of 1 to 
10, he gave it a zero.
    So our fundamental problem here is on the two most 
dangerous parts of this program, suspicious sites and detection 
of weaponization, the former Deputy Director General of the 
IAEA who is in charge of safeguards said a five and a zero.
    So my biggest concern is an industrial-sized program with 
that kind of verification and inspection regime, we have a 
tremendously difficult challenge ahead of us.
    Senator Perdue. Thank you.
    I am sorry. I am charged with managing my time, and I am 
over, Mr. Chairman. Thank you.
    The Chairman. Thank you.
    Senator Menendez.
    Senator Menendez. Thank you, Mr. Chairman.
    Thank you both for your testimony.
    Let me ask you a question, and I would like to get through 
a series of them in my time. Would it be fair to say that the 
sanctions that Congress passed and that were implemented into 
law were critical in bringing Iran to the negotiating table?
    Mr. Dubowitz. Yes.
    Ambassador Burns. Yes, but along with the global nature of 
the sanctions, the EU sanctions. That was the critical 
determinant, not just the U.S. sanctions.
    Senator Menendez. But the sanctions that we passed, in 
essence, got the other countries to join, because they had 
secondary consequences to them. Is that not a fair statement?
    Mr. Dubowitz. Absolutely, Senator Menendez. I mean, I 
remember the debate over SWIFT and the central bank sanctions 
and oil export sanctions that you coauthored. The Europeans 
were opposed to them. And because of congressional pressure, 
they eventually went along, because they were under U.S. 
secondary pressure.
    Senator Menendez. And is it not fair to say that the threat 
of sanctions, even though suspended during performance, but the 
threat of sanctions, is a significant deterrent toward breach 
in the future?
    Ambassador Burns. I would say it depends. If we are alone 
in threatening those sanctions, they will be partially 
effective, perhaps, a partial impact. But what makes the 
greatest difference is when you have the other global 
economies--Japan, China, Russia, the EU--on board. That is when 
the Iranians finally decided to negotiate.
    We could not bring them to the negotiating table in 2006.
    Senator Menendez. So if oil was more important to you than 
Iran achieving a nuclear weapon, deterrence is all gone, is 
basically what you are telling me.
    Ambassador Burns. That is not what I----
    Senator Menendez. Mr. Dubowitz, is the continuing threat of 
potential sanctions, including the sanctions that are 
implemented in law by the United States, which has secondary 
consequences--I mean, it seems to me you have to make a 
decision. Do I want to do business with a maybe trillion dollar 
economy, or do I want to do business with a $17 trillion 
economy? In that respect, while I may grudgingly not like it, 
the reality is I want to do business with a $17 trillion 
economy.
    Mr. Dubowitz. Senator Menendez, we do not sanction 
countries. As you know, we sanction companies and financial 
institutions. Our sanctions are powerful. The financial 
sanctions are powerful because they are based on market 
participants making risk-reward decisions, tens of thousands of 
those decisions every month.
    And the notion that financial institutions are going to go 
rushing back into Iran on a congressional vote of approval or 
disapproval I think actually defies the history of what exactly 
has happened.
    We do not sanction Japan. We sanction financial 
institutions in Japan who would be cut off from the U.S. 
financial system under U.S. secondary pressure from CISADA.
    Senator Menendez. Is it not fair to say that if snapback is 
to mean anything, it has to be snapped back to something, 
because otherwise what are you snapping back to?
    If that is heralded by the administration in the testimony 
brought before this committee, that we can do everything that 
we are doing now, if they violate, if snapback is also 
considered a deterrent, does it not mean you have to snap back 
to something?
    Ambassador Burns. I would say, this, Senator, and I 
understand the question, the purpose of the sanctions is 
tactical. It is to influence the behavior of the Government of 
Iran. If the negotiations were to break down, or if Congress 
were to disapprove, I would favor American sanctions reimposed 
on Iran. But I would not believe that those sanctions would 
drive Iran back to a deal, because we would not have the buy-in 
of the----
    Senator Menendez. So then snapback is insignificant, is 
what you are saying?
    Ambassador Burns. No, I think snapback is critical.
    Senator Menendez. You cannot have it both ways, Ambassador. 
Either it is significant or it is insignificant. Which one is 
it?
    Ambassador Burns. No, I am answering your question. 
Snapback is----
    Senator Menendez. Let me give a simple question. Is it, or 
is it not, significant? Is snapback significant or not?
    Ambassador Burns. Snapback is important, but it is only 
going to be effective if we have some major economies with us.
    Mr. Dubowitz. And, Senator Menendez, the problem is it is 
going to be snapping back in 10 years against an Iranian 
economy that will be twice the size, with hundreds of billions 
of dollars in investment, where a number of contracts, and 
there has been a dispute over this, but some of the contracts 
will be grandfathered. There will be huge business lobbies in 
these capitals.
    So we will be snapping back against a much harder target in 
10 years than we will be snapping back in a year or 2.
    Senator Menendez. That presumes performance over this whole 
period of time.
    Mr. Dubowitz. Correct.
    Senator Menendez. Right. So that snapback could actually 
take place sooner, if, in fact, there is a violation of 
performance, except that in a letter that the Iranians sent to 
the Security Council, dated July 20 of this year, it says in 
paragraph six, ``It is clearly spelled out in the Joint 
Comprehensive Plan of Action that both the European Union and 
the United States will refrain from reintroducing or reimposing 
the sanctions and restricted measures lifted under the Joint 
Comprehensive Plan of Action. It is understood that 
reintroduction or reimposition, including through extension of 
the sanctions and restricted measures, will constitute 
significant nonperformance, which would relieve Iran from its 
commitments in part or in whole.''
    So basically, what I tried to get from Secretary Lew and 
what I cannot get from my own government--I have to read it 
from the Government of Iran--to understand what the agreement 
as I read it was about, and the language was pretty clear, that 
the sanctions that expire next year that Congress passed 99-0, 
at least in the Senate, and overwhelmingly in the House, that 
was signed by the administration, that the administration, 
notwithstanding what you say, Ambassador Burns, heralds as the 
reasons that Iran came to the table, with tough diplomacy as 
part of it as well, and will expire next year--well, number 
one, you are not going to be snapping back to that. And number 
two, the Iranians are saying, if you just simply reauthorize it 
as it is, with all of the waiver options the President has, 
they will consider that a violation.
    So we, the Congress of the United States, have been told 
basically by the Iranians that our actions, in essence, will 
violate their understanding.
    Now, I do not know what you snap back to if, at the end of 
the day, you do not have anything in place in law, 
notwithstanding whether or not you get the international 
community's support.
    And then it goes on. Now I understand why Secretary Lew did 
not give me answers to my questions, because there is a further 
sentence in here. ``The Joint Comprehensive Plan of Action 
requires an effective end to all discriminatory compliance 
measures and procedures, as well as public statements 
inconsistent with the intent of the agreement.''
    So that is why Secretary Lew would not give me a definitive 
answer, because, number one, they signed an agreement that says 
Congress cannot even extend the existing sanctions with all of 
the present waivers, and number two, if you say something 
wrong, that is also in violation.
    That is pretty outrageous. Pretty outrageous.
    Mr. Dubowitz. And the Iranians are right, Senator Menendez, 
because if you look at paragraphs 26, 29 to 37 of this 
agreement, they have effectively written into this agreement a 
nuclear snapback.
    Now, the administration will tell you that there is a 
distinction between nuclear and nonnuclear sanctions. The 
Iranians do not believe that there is a distinction between 
nuclear and nonnuclear sanctions. They believe that any 
reimposition of sanctions will constitute a breach of this 
agreement, and they will essentially use that, in my view, to 
threaten the Europeans not to join us on any transatlantic 
snapback. And if Nick is right and the Europeans are essential 
to a snapback, then we will lose some of the Europeans, if not 
all of them, when the Iranians begin to threaten nuclear 
escalation, when they walk away from this agreement based on 
three provisions in the agreement they believe justify that.
    Senator Menendez. Mr. Chairman, I have several other lines 
of questioning, but I will hopefully wait for a second round.
    The Chairman. Absolutely.
    And this was very frustrating. Senator Flake the other day 
tried to get an answer to that, and there is certainly, at a 
minimum, ambiguity.
    I reserved a little time, by the way. I did not use it all 
a minute ago.
    I would think, at a minimum, we would absolutely extend, at 
some point, the sanctions we have in place and reserve the 
right to put in place the nuclear sanctions for terrorism or 
other activities if we believe those are being carried out.
    But let me, since I have a little time, I want to ask this 
question. Senator Cardin hit on it for a moment.
    And, Secretary Burns, you have mentioned the international 
aspect of our sanctions. What would happen if the EU sanctions 
were relieved, and the U.N. sanctions were relieved, but the 
congressionally mandated sanctions stayed in place? I mean, my 
guess is that Iran would continue to adhere to the deal because 
they were getting some relief.
    So I do wonder, I mean, I think sometimes we get put in a 
situation where we have a false choice, or a straw man gets put 
up. But if you could both, fairly briefly, respond to what 
would happen if we decided not to lift our congressionally 
mandated sanctions.
    Ambassador Burns. Well, I assume then that the 
administration would not be in compliance with the agreement, 
because the administration has committed to relieve certain 
sanctions, specific sanctions.
    The Chairman. Let me say this. The administration, Iran, 
the U.N., the EU, all knew that we were going to have a chance 
to weigh in. As a matter of fact, they have said publicly that 
the reason this 90 days occurs before it actually kicks in is 
to give us that opportunity.
    So, I am sorry, I am not going to play that game, okay? 
Everyone knew when this was being negotiated that, at some 
point, we were going to have the opportunity to weigh in. That, 
to me, has been what has been most frustrating, the arrogance 
shown by some of our witnesses last week regarding that issue 
that we unanimously voted on. So I am not going to allow you to 
play that game either.
    So go ahead.
    Ambassador Burns. I am not playing a game. I am just giving 
you a direct answer.
    If the question is, if the United States--Congress and the 
administration--is not able to lift the sanctions that the 
executive branch promised the Iranians and others that we would 
lift, I think the agreement would probably fall apart. And you 
would be stuck with the situation where the Iranians then had 
sanctions relief and yet did not have restrictions on their 
nuclear program.
    I would just like to say to Senator Menendez, I have not 
seen the letter. I would hope that the administration would 
challenge that letter that the Iranian Ambassador presumably to 
the U.N. signed, and I would think we would not have to abide 
by it. And we ought to test the Iranians on effective, tough-
minded compliance.
    The Chairman. I think Congress ought to pass them back in 
place.
    But, Mark, go ahead.
    Mr. Dubowitz. Senator Corker, this is a scenario that I 
described. The President would have two options. One is that he 
would try to neutralize the statutory sanctions block that he 
put in place. I actually think that he could give probably 
about 60 percent to 70 percent of the sanctions relief through 
Executive order. I am happy to talk about how he would do that.
    But the other thing that would not happen, which is, I 
think, very important with respect to ongoing economic 
leverage, Iranian banks would not get back onto SWIFT. The 
Central Bank of Iran would not get back onto SWIFT, because 
SWIFT would not allow banks back on if there were U.S. 
secondary financial sanctions and designations of those banks 
still in place.
    So you would still maintain the most powerful sanction that 
is in place. And just to underscore that, without access to 
SWIFT, Iran has no access to the global financial community. 
They cannot move money.
    The Chairman. Senator Flake.
    Senator Flake. Thank you, Mr. Chairman.
    And I thank the witnesses.
    This really does come down, in terms of Congress' role, as 
to which are nuclear-related sanctions and which are not. I 
still have not been given a good answer from the State 
Department or others as to what constitutes nuclear-related 
sanctions and which do not. In a question last time, as the 
chairman said, they had a hard time answering that. Their 
answer did not reflect what I think a lot of us consider the 
plain text of the agreement.
    I posed a question last time of what would happen if Iran 
in the next couple years, if the agreement is signed and 
implemented, abducts some Americans or commits atrocities that 
clearly warrant some action on our part, and we decide that the 
most effective sanctions were the ones against Iran's Central 
Bank. We go ahead then and sanction Iran not for nuclear 
infractions but for other nefarious activity in the region. 
Would that be considered a violation of the agreement?
    I think we were assured no. But if you read the agreement 
and read the annexes, it would seem that it would.
    Ambassador Burns, do you want to comment a little further 
on that? I know we have tread this territory before, but that 
is an important point for this committee and for kind of the 
institutional issues we are dealing with here.
    Ambassador Burns. Right. I am intrigued by the letter that 
Senator Menendez read out, because if the Iranians are putting 
forth that position, we ought to challenge it. So my view is, 
the administration should keep the terrorism- and human rights-
related sanctions that we have on Iran. We should not disavow 
those. And we ought to test the Iranians.
    This is going to be a giant game of diplomatic chicken. 
They are going to try, as I said in my testimony, to eat away 
at it with small infractions, hoping we will not call them on 
it. We ought to call them on it.
    If there is some episode where American national interests 
are at stake, and we think we have to punish the Iranians, we 
are going to have to calculate the risk, but we should not shy 
away from it. And I will bet that the Iranians, if we are firm, 
are going to elect to stay with this agreement in most 
respects, because they have sanctions relief. They need that 
for their economy.
    So a lot will come down on the toughness of this 
administration and its successor and the one after that through 
the life of this agreement. That is why I put so much emphasis 
both on inspections but also on being able to reimpose 
sanctions if we have to on the part of the United States.
    Mr. Dubowitz. Senator Flake, let me read to you passage 
here, because I agree with Nick. We should not lift sanctions 
on anything related to terrorism.
    So the Central Bank of Iran, there was a finding under 
Section 311 of the U.S.A. PATRIOT Act that said that the entire 
financial sector of Iran, including the Central Bank of Iran, 
is a jurisdiction of primary money laundering concern. Treasury 
cited the Central Bank's support for terrorism, pursuit of 
weapons of mass destruction, financing of nuclear, ballistic, 
use of deceptive financial practices, poses an illicit 
financial risk for the entire global financial system.
    This has gone on, and it has been repeated over and over 
again. The Financial Action Task Force has warned its financial 
institutions about these risks.
    In other words, the Central Bank of Iran sanction, which is 
the legislative sanction, is a sanction that is also based on 
terrorism. That is not a nuclear sanction. That is a sanction 
that is a hybrid.
    So as a result of that logic, we should not be relieving 
sanctions on the Central Bank of Iran as part of the JCPOA. Now 
since it is happening and if we try to reimpose sanctions, to 
your question on the Central Bank of Iran, the Iranians would 
flip it around. They would say that the administration relieved 
the sanction on the CBI and essentially characterized that as a 
nuclear sanction, because we are only lifting nuclear 
sanctions. They would use administration's argument to say, 
``The reimposition of sanctions on the CBI is a nuclear 
sanction, a violation of the agreement. We have a nuclear 
snapback. We are walking way.''
    I do not believe, as a result of this agreement, the way it 
is drafted, we will ever be able to reimpose sanctions on the 
Central Bank of Iran without the Iranians absolutely crying 
foul. I would guess the Iranians would declare that literally 
an act of economic war, in the way that the Russians have 
suggested. And as a result of that, I think we will be 
deterred, particularly the Europeans, from ever redesignating 
the Central Bank of Iran again.
    Senator Flake. Thank you.
    Ambassador Burns, you have spoken in the past quite a bit. 
You mentioned what we do, should this agreement pass, in terms 
of diplomacy and in terms of muscular diplomacy in the region, 
what I refer to as a regional security framework that really 
needs to be in place.
    Obviously, this agreement to deal with Iran's nuclear 
ambitions is one thing. It is another to have peace and 
stability in the region, which a lot of these questions we 
raised have an impact on.
    But what do you see is our responsibility or what do we 
need to do and what is Congress' role in that regard? I think a 
lot of us recognize that, with Iraq, our withdrawal there was 
not followed by muscular diplomacy, not to suggest that that 
would have prevented a lot of what is happening there, but it 
probably would have helped. The situation in Syria with the 
redline and not following up there probably has not served our 
interests well, in terms of what we ought to be doing with this 
agreement or not in the region.
    What do you see as Congress' responsibility or our role, 
should this agreement go into effect, on the kind of regional 
security framework there?
    Ambassador Burns. Thank you.
    I think we ought to see, Senator, the application of an 
American containment strategy on Iran in the region as part of 
these negotiations. We are going to be negotiating with Iran, 
implementing this deal, for the next 10 or 15 years, and I 
think we ought to put pressure on them in another sphere. Where 
they are pushing into the Sunni world, you mentioned Iraq, 
Syria, Lebanon certainly through the support of Hezbollah, and 
Hamas in Gaza, Yemen.
    But there are two things I think Congress can do. One is 
support the administration in renegotiating the United States-
Israel military assistancwe agreement. It expires in 2 years, 
but we could advance those negotiations to ensure Israel's 
qualitative military edge. I think Israel has to worry that 
Iran is not going to attack it, but that Hamas and Hezbollah 
may well resume the rocket wars against Israel. We have an 
obligation to support Israel in that conflict.
    Secondly, and the President has already begun to do this, 
can we knit up the gulf countries in a tighter, stronger 
military bloc in order to effectively deter Iranian influence 
in the gulf? Syria and Iraq are much more difficult, where Iran 
is in a dominant position, but we can begin to chip away at 
that as well.
    So I think it is incongruous to think about these dual 
strategies. They seem to be opposites, but I think they go 
together. The nuclear deal makes sense because it sets the 
Iranians back. But we have to push them back on the 
conventional side, the regional side as well, to keep the 
pressure on them in all cases.
    Senator Flake. Thank you, Mr. Chairman.
    The Chairman. Thank you.
    Just so that I am not misunderstood, when I mentioned that 
we should pass them back in place, I am talking about the 
expiring sanctions that expire at the end of 2016, so that 
there is something to snap back to at some point.
    Senator Kaine.
    Senator Kaine. Thank you, Mr. Chairman, and to the 
witnesses.
    The way that I look at this deal is I think the United 
States, by diplomacy, has achieved something very, very strong 
from day 1 to year 15, achieved something that it was not 
achieving with sanctions. But then from year 15 to 25, we enter 
into a significant transitional period. And I would say, after 
25, we are kind of in a normalization period. The only 
obligation on Iran after year 25 is to abide by the NPT, 
including the additional protocol inspection, which they need 
to ratify in year 8.
    So I think there is sort of a very strong day 1 to 15 
transitional, with question marks in 15 to 25, and then more 
question marks after.
    But let me lay out first the day 1 to year 15, because I 
think it is important to acknowledge what diplomacy has 
achieved. Here was the status quo. The status quo, before the 
negotiations started, the November 2013 round, was, even in the 
face of punishing sanctions, Iran's nuclear program was 
rocketing ahead.
    There were 19,000 centrifuges to enrich uranium, and that 
number was growing. There were 11,000 kilograms of enriched 
uranium, and that number was growing. They had enriched up to 
the 20 percent level, and that level was growing. They had an 
ongoing construction of a heavy water facility at Arak to 
process plutonium, and that was ongoing. And they had very 
limited inspection access, especially shielding any 
international scrutiny of their covert program.
    Here is what the Israeli Prime Minister Netanyahu said 
about the program when he spoke to the U.N. in September 2012. 
For over 7 years, the international community has tried 
sanctions with Iran. It has had an effect on the economy, but 
we must face the truth: Sanctions have not stopped Iran's 
nuclear program. That is what Prime Minister Netanyahu said. 
Sanctions have not stopped Iran's nuclear program.
    Many would argue that sanctions may have had an opposite 
effect. I mean, if folks were trying to get the United States 
to stop something, the international community, would we just 
stop or would we say we are the United States of America. You 
are not going to stop us. There is some argument that defiance 
over the sanctions accelerated the nuclear program.
    So in terms of looking at alternatives, the notion that we 
just should not have entered into diplomacy at all, which some 
have suggested, and just allowed that status quo to continue, 
it was going to one of two places. It was going to Iran, as was 
said, they were a few months away from being a nuclear 
threshold state and they were going to cross it, or the global 
community was not going to allow them to cross it by taking 
military action.
    That was the status quo, in my view, before these 
negotiations started. So what does the deal now provide to 
contrast that status quo? Iran pledges, in the first paragraph 
of the deal, it will never seek, develop, or acquire nuclear 
weapons. Iran disables two-thirds of the centrifuges. Iran 
reduces the enriched uranium stockpile by 97 percent, capping 
at 300 kilograms, which is insufficient to make one weapon. 
Iran caps the enrichment level of the stockpile at 3.67 
percent. Iran disables the Arak facility, so that it cannot 
process plutonium. Iran commits to limitations on R&D to 
guarantee any nuclear program is exclusively peaceful. And Iran 
agrees to a robust inspection of sites, the uranium supply 
chain, and suspected covert facilities.
    That is what we have that we did not have without diplomacy 
and that, frankly, we were not going to have without diplomacy 
from day one until year 15, in my view.
    Now, in year 15, what we have, to pick up some of your 
testimony, is the caps to come off. They come off on the 
stockpile. They come off on the enrichment percentage. They 
come off on spent fuel reprocessing. They come off on R&D 
activities. They start to come off on the number centrifuges.
    So, the caps come off progressively starting in year 10 but 
really 15 to 25.
    What we have from year 15 to 25 that is Iran-specific is we 
have the continued monitoring of the centrifuge program up to 
year 20, and then we have this kind of lifecycle supply chain, 
Iran-specific inspection of uranium to year 25.
    Then we get to year 25 and at 25-plus-1, here is what we 
have: They promise not to get nuclear weapons. They are an NPT 
nation. I am going to assume that they ratify the additional 
protocol, because if they do not, that is a breach. So we get 
the inspections that anybody gets under the additional 
protocol, which was designed after North Korea to try to fix 
some gaps in what we did with North Korea.
    So I think as I am looking at this, there is sort of a 
three-level thing, which is upfront, it really produces 
something that we would not have gotten absent diplomacy. In 
the middle years, the transitional period is challenging. And 
then after 25, there is sort of an assumption of normalization.
    The deal really looks at Iran and says, because you have 
been a bad actor, you suffered under years of sanctions, and 
for 25 years, you are going to have to comply with Iran-
specific requirements that no other nation in the world will 
have to comply with. But after 25 years, we will just treat you 
as we treat any other NPT nation.
    So, I do not know, am I looking at the deal wrong?
    Mr. Dubowitz. I think, Senator, that there are a few things 
that you said that I would draw attention to.
    Senator Kaine. I did have one more quick question, so if 
you could be quick, that would be great.
    Mr. Dubowitz. Sure.
    So really quick, this deal gets dangerous after year 10, 
not after year 15. I can explain why, but we do not have a lot 
of time. But essentially, unlimited number of centrifuges is 
installed at Natanz, breakout times starting to drop, maybe to 
zero, maybe to 5 months.
    Second of all, if you actually look at the history that you 
were suggesting, I actually did an analysis of this, because 
what I did was I looked at the period of time in 5 years when 
the most intensive sanctions were being imposed. I actually 
looked at what happened to Iran's installation and operation of 
centrifuges and their stockpiling of LEU. I do not have time to 
read the statistics. They are in my testimony at page 32.
    Senator Kaine. Okay.
    Mr. Dubowitz. But I did the analysis, and the conclusion 
is, Iran moved incrementally. They did not rush forward. They 
did not go hell-bent. They moved incrementally because they 
fundamentally feared, number one, U.S.-crippling sanctions, and 
they understood our redlines with respect to military force.
    So that history of most intensive sanctions was a history 
of incremental nuclear progress, not a significant breakout or 
expansion of the program in the way that you suggested.
    And third is the problem with respect to years 10 to 15 is 
Iran starts industrializing by the year 10. Once they hit 15, 
as you have explained, you literally have an unlimited 
enrichment and plutonium reprocessing capacity with some 
restrictions, as you suggested.
    That is when things get, as you suggested, very, very 
dangerous.
    Ambassador Burns. Very quickly. I think you gave a good 
answer to Senator Perdue's question, which was a very good 
question. The danger after year 15 is that Iran reconstitutes 
its civil program and uses it as a cover for a covert program. 
It is not inevitable that they will do that. They are going to 
have to fear the risk of isolation, if they do that, the 
reimposition of sanctions, but mainly the fear of military 
force by Israel or the United States.
    So what we do, I think, will have a big impact on what the 
Iranians do. And that gets back to having a tough-minded 
American policy in year 15 to year 25. And it means we are in a 
long-term struggle with the Iranians.
    I support this because, for the next 10 years, we have the 
advantage in the long-term struggle. But it means we have to be 
really good and focused on these questions after year 15.
    Senator Kaine. Thank you.
    The Chairman. Thank you. Thank you very much.
    Senator Murphy.
    Senator Murphy. Thank you very much, Mr. Chairman. Another 
fantastic hearing. Thank you for the way in which you are 
conducting this review.
    Just a quick note about how we use history in our 
deliberations. My great friend, Senator Perdue, talked in his 
remarks about the lessons from North Korea, and others mostly 
outside this building have made comparisons to these 
negotiations with the negotiations that took place in Munich in 
1938. There are undoubtedly plenty of examples in which 
diplomacy has gone wrong, in which we signed a deal that did 
not work out for the best interests of American national 
security.
    But I think it is just important to concede that there are 
a lot more examples of where we signed diplomatic agreements 
that turned out very well for the United States, that advanced 
our national security interests, that prevented war. You can 
have the discussion about the very small number of countries 
that violate the NPT or do not sign it. But the NPT itself is 
an example of diplomacy, of a diplomatic agreement between 
nations that has advanced national security interests. A lot of 
people said that JPOA would not be observed by the Iranians. As 
it turned out, it was.
    So I just wanted to make sure that we do not allow 
ourselves to believe that just because one agreement went 
wrong, everyone will.
    Mr. Dubowitz, I am obsessed over this question of the 
alternative. I thank you for spending some real time kind of 
playing out the various iterations. I just maybe want to get a 
little bit of clarification, based off of your conversation 
with Senator Cardin of where you come out as to what the most 
likely alternative is. So let me sort of tell you what I 
thought you said.
    You concede that sanctions will probably fray, but you do 
not think that that will be substantial. And you think that the 
United States, by continuing our sanctions on the financial 
sector, will continue to have an impact. So you think that they 
are probably a little bit weaker but that they are not 
substantially weaker. Is that right?
    Mr. Dubowitz. Yes.
    Senator Murphy. And then as to what Iran does moving 
forward, you were talking about what was happening before when 
they had a sanctions program in place. You suggest that while 
they may move forward in small steps, they are not likely to 
rush toward breakout or make any giant leaps forward, for fear 
of either military strike or additional sanctions, that they 
will maybe increase the number of centrifuges of little bit but 
it will not be anything substantial.
    Mr. Dubowitz. If past is prologue, then that is correct.
    Senator Murphy. So I guess this is where I struggle with 
this, because if I am the coach of a football team and I am 
going into halftime, I will concede that whether the score is 
21-17 or 21-13, I can make up either of those deficits. But 
every single time, I will want to be down 21-17, rather than 
21-13.
    So if you concede that, in your estimate of the most likely 
scenario, the sanctions are going to be weaker, even by a 
little bit, and Iran is going to move forward on their nuclear 
program, I guess I am still just having a hard time 
understanding how that leads to a better outcome when we get 
back to the table than we have today. If the sanctions are 
going to be weaker and the sophistication of their nuclear 
program is going to be greater, by definition, to me, that 
sounds like a scenario in which we get a worse deal even if it 
is a slightly worse deal.
    So maybe just give me a little bit more on why you think 
that, under those circumstances, we actually turn out better.
    Mr. Dubowitz. So, Senator Murphy, a very good question. I 
would answer in a couple ways.
    The first is that in my testimony, I outlined also what new 
sanctions could do, and I recommended, I think, 9 or 10 new 
sanctions. So my view is that there are many more sanctions 
that the U.S. Congress could pass, particularly financial 
sanctions. And the threat and power of those secondary 
sanctions would actually not only restore that delta that you 
talked about, but could take us beyond that.
    The second thing is that, on the issue of Iran's nuclear 
behavior, the fact is the Iranians have moved incrementally on 
this program, and I believe they will move incrementally in my 
third scenario. I think they will move incrementally in turning 
on new centrifuges and beginning to make some nuclear steps 
forward, but I believe, at the end of the day, it comes down to 
the power of American leadership, the power of the American 
coercive diplomacy, and the ability of American negotiators to 
get better deals.
    Now I am imagining that this scenario improves on a 
congressional vote of disapproval because it sends a message to 
the international financial community and business community: 
do not go back into Iran, because if you do, you are going to 
get a hit with new sanctions, particularly when there is 
another President. I think that power of coercion improves 
immensely, actually, as a result of those political and 
economic dynamics.
    And I would say this again. I think that what I am 
suggesting is not to rip up a deal. I am suggesting actually 
seven ways to amend it. And I am actually underscoring one way 
that this deal could be improved significantly, per Senator 
Kaine's analysis, and that is on the sunset provisions. I 
suggested in my testimony that before we allow these provisions 
to sunset, creating the kind of situation that we all 
acknowledge would be incredibly difficult, leaving, as Nick 
said, the only option would be military force at that period, 
which means the deal makes war more likely, not less likely.
    My recommendation is to expand those threats of new 
sanctions, go in there and negotiate on the sunset provision a 
term that says this will be subject to an affirmative vote of 
the U.N. Security Council, and that unless Iran is behaving in 
ways that we want, these dangerous restrictions are not going 
to sunset.
    Senator Murphy. So I hear you to say that you think if we 
pass new sanctions that could possibly override the fraying 
that happens other places. But if you concede, as I thought I 
heard you did, that the sum total will still be weaker 
sanctions, it just puts us in a worse place.
    I just want to get into a quick question----
    Mr. Dubowitz. Senator Murphy, that is not what I said. I 
just want to clarify that for the record.
    Senator Murphy. Okay, sure.
    Mr. Dubowitz. Sanctions are not about legalities only. They 
are about psychology. The mere threat of new sanctions changes 
the fundamental psychology in the marketplace, which is driven 
by two emotions: fear and greed. So if you want to affect 
market behavior of financial institutions and companies, what 
you have to do is send a message that you are willing to 
escalate sanctions. And if you are willing to escalate 
sanctions, even if you do not escalate them but you threaten 
escalation, you actually are not doing what you are suggesting, 
which is you are not reducing that delta. You are enhancing 
that delta from a psychological perspective, which is the main 
way that you affect financial institutions and market actors.
    Senator Murphy. Just a quick question for Secretary Burns.
    Mr. Dubowitz talked about his belief that a rejection of 
the deal would not empower hardliners internally, which sounds 
a little contrarian to what I have heard. What is your 
estimation of the balance of power between moderates and 
hardliners in Iran, should we reject this deal? What is the 
most likely scenario internally within their political 
dynamics?
    Ambassador Burns. It is very difficult to say, but, 
obviously, there are a lot of hardliners in the Iranian 
Revolutionary Guard Corps command and some around the Supreme 
Leader who do not like this deal and I think would like to see 
it unravel.
    But the more important point here is, if we deal new 
sanctions on Iran, it will, in a real-world situation, blow 
this negotiation apart. Iran will get sanctions relief from the 
rest of the world. It will have no restrictions on its nuclear 
program, and we will be sanctioning them. We will be back 
exactly where we started a couple years ago, which is in a 
disadvantageous position, I think, for our country.
    The Chairman. Senator Rubio.
    Senator Rubio. Thank you, Mr. Chairman.
    Mr. Dubowitz, here is the central argument that we are 
being given: There exists these sanctions in the world today. 
They are going to go away as part of this deal, the U.S. 
sanctions, the international sanctions. If Congress somehow 
rejects this deal, then one of two things is going to happen. 
Number one, the sanctions are still going to go away 
internationally, and then Iran, I just heard, is going to 
continue to enrich. But if that happens, under that scenario, 
if in fact the rest of the sanctions stay in place around the 
world, but Iran violates the terms of the deal, then by the 
very definition of the deal, the sanctions would be reimposed 
again, would they not?
    Mr. Dubowitz. Correct.
    Senator Rubio. So therefore, this argument that somehow if 
we walk away from the deal, this guarantees that sanctions go 
away and that Iran moves forward on a nuclear weapon is absurd.
    Mr. Dubowitz. Correct.
    Senator Rubio. What they are basically arguing is that the 
rest of the world is not serious about sanctions. They want to 
do business with Iran no matter what, whether they comply or do 
not comply.
    Here is the second argument I reject, and I am interested 
in having your input on it, and that is that somehow, without 
the rest of the world, the sanctions are irrelevant. Yet it is 
my understanding that the U.S. sanctions are the biggest piece 
of the sanctions in place that have the greatest impact. For 
example, imagine for a moment if you are a German bank and you 
now must choose to have either access to the United States 
economy or access to the Iranian economy. Which one, in your 
mind, are they going to choose?
    Mr. Dubowitz. The U.S. economy.
    Senator Rubio. In fact, my understanding is the U.S. 
economy represents close to 50 percent of the flow of capital 
in the world. Iran is probably less than 1 percent of that. I 
cannot imagine any entity on the planet, especially in the 
banking sector, deciding we would still rather have access to 
the Iranian market and somehow cut ourselves off from the rest 
of the world.
    Why I find this all absurd is this idea that somehow the 
United States must now do this because the rest of the world 
would be really upset at us. The last time I checked, this 
country saved the world on at least two occasions in the last 
century. I do not remember the last time the world saved 
America.
    So my point is, we are called to lead on this matter. And I 
just think that this argument that somehow these sanctions, the 
whole thing collapses, all the sanctions will be irrelevant if 
somehow America is not a part of this deal, does not make any 
sense to me. It just does not, because in my mind, if you are 
the Europeans and the rest of the world, you have agreed to 
lift sanctions on Iran in exchange for specific behavior on 
their part. If they no longer comply with that behavior because 
they are upset that America walked away, then by definition, 
their own sanctions should kick in again.
    Am I wrong in my assessment of this?
    Mr. Dubowitz. Senator Rubio, you are not wrong because 
people are trying to have it both ways, as you suggested.
    But I would like to suggest one other reason why you are 
right, and it is a technical reason. It gets back to the SWIFT 
sanctions.
    To understand this, the Europeans are not going to allow 
Iranian banks back onto SWIFT if the United States retains 
secondary financial sanctions on international institutions 
doing business with those Iranian banks and retains U.S. 
secondary sanctions on SWIFT. So even in your scenario, and the 
Europeans provide ``all of that relief,'' the one thing that I 
believe they will not do is readmit 46 Iranian banks, including 
the Central Bank of Iran, back onto SWIFT, as long as United 
States financial sanctions remain in place, because the 10,000-
plus banks around the world that actually use SWIFT are not 
going to do business with those Iranian banks that have been 
readmitted onto SWIFT, if U.S. financial sanctions still remain 
in place.
    So the most powerful sanction that we have imposed, that 
Congress imposed, which were the SWIFT sanctions, will remain 
intact, even if the Europeans are upset with us, because 
fundamentally, thousands of financial institutions around the 
world are not going to do business with Iranian banks on SWIFT.
    Senator Rubio. I also want, as a point of comparison, think 
back to the North Korean negotiation.
    As I recall, Mr. Burns, I think, you were at the State 
Department during this time. When the negotiations were going 
on with North Korea about their deal, my recollection is that 
the countries in the region most impacted by it, the Japanese 
and the South Koreans, were at the table. In fact, they were 
part of that process. Is that correct?
    Ambassador Burns. There were two negotiations. There was 
the agreed framework of 1994 with President Clinton. And then 
there was President Bush's negotiations in 2007 and 2008. I was 
not involved in either one, but I am more familiar with the 
second one, President Bush's.
    Senator Rubio. But in both instances, both the Japanese and 
the South Koreans, neighbors of North Korea, were in favor. In 
fact, they both supported the agreement and the process that 
was in place. They felt that was a better alternative to the 
direction that everything else was going at the time.
    Ambassador Burns. Certainly, in 2007 and 2008, the Japanese 
and South Koreans were part of the six-party talks framework 
with North Korea.
    Senator Rubio. So what does it say about this negotiation 
that while it is great that the P5+1, the European powers, the 
Chinese, the United States, are at the table, none of the 
nations most directly impacted by the Iranian threat, meaning 
none of our Arab allies, not Israel, none of them, are at the 
negotiating table? None of them were involved in this process.
    And quite frankly, in the case of Israel, they oppose it. 
And in the case of many of our Arab allies, while their use of 
polite diplomatic language to describe it, there is no 
enthusiasm in the Arab world for this deal.
    Ambassador Burns. Well, the reason why the P5 was the 
negotiating entity, that was a decision made by the Bush 
administration. I was part of that in 2005 and 2006. We felt it 
was important to get the permanent five countries and Germany, 
the major powers, to face Iran across the table.
    And I would say that the consequences of the United States 
walking away, that was the issue you were talking to Mr. 
Dubowitz about, I think the real-world consequences will be, if 
we walk away, that the Europeans will not be with us because 
they agree with this deal. And Iran will be strengthened, 
Senator, if we walk away. And the sanctions will dissipate and 
the restrictions will fall, which leads me to support the 
administration.
    Senator Rubio. I want to touch on that point, but let me go 
back one step further before that, and that is, what does it 
say that none of the countries in the region that are most 
directly impacted by Iran's threat immediately are not 
enthusiastic about it, as opposed to the way the Japanese and 
South Koreans were, even though that did not work out?
    In essence, is it not concerning that the nations that know 
Iran the best, who live next door to them, are, in fact, not 
enthusiastic about this deal? Should that alone tell us 
something about this deal and about its construct?
    Ambassador Burns. Well, first, I would say, we absolutely 
have to focus on American interests here first and the American 
perspective all the time. Second, I think that the opinion in 
the Arab world is very much divided on this. There are some who 
oppose it. There are some who will support it, if we will also 
be tough-minded in pushing back against the Iranians and the 
Iranian use of conventional force in the region.
    Certainly, Israel is adamantly opposed. You are right about 
that.
    Senator Rubio. Okay. So then going back to the point you 
raised a second ago, I still do not understand this argument. 
So the Europeans have lifted sanctions, and they are going to 
lift sanctions on Iran with or without us, right, at this 
point?
    Ambassador Burns. They have not lifted sanctions yet.
    Senator Rubio. But they will.
    Ambassador Burns. They will not until we do, once Iran, if 
it does implement----
    Senator Rubio. So if Congress rejects this deal, the 
Europeans are going forward. We will be out alone, as Secretary 
Kerry has said. They are moving forward. The other nations, the 
other five are moving forward and the international Security 
Council and the European Community are all going to move 
forward to lift the sanctions with or without us, if we reject 
this, correct?
    Ambassador Burns. Absent some surprise development, some 
revelation about Iran's activities, I think that is correct, 
that the Europeans, the Chinese, and the Russians will go 
ahead. They will go ahead in lifting sanctions, but then the 
restrictions on Iran's program would be lifted because the 
agreement would fall apart.
    Senator Rubio. And that is what I do not understand. So 
what you are saying is the Europeans and these other countries 
are willing to say we are going to lift the sanctions with or 
without you, and if Iran decides then to violate the deal 
because America walked away, we are still going to lift the 
sanctions.
    Ambassador Burns. The practical consequence would be if we 
walked out unilaterally----
    Senator Rubio. Right?
    Ambassador Burns [continuing]. And turned on a dime against 
the agreement the administration has just negotiated. The 
practical consequence of that is that the deal would 
effectively not be in force. So Iran would have the dual 
benefit of new trade with the rest of the world and yet no 
restrictions. That is the problem.
    Senator Rubio. But why would they have that dual benefit? 
Why would the rest of the world allow Iran to get away with 
violating the deal they signed with them too?
    Ambassador Burns. So I am, obviously, here not to defend 
the rest of the world. I am just trying to interpret behavior, 
and I used to be part of these negotiations on behalf of the 
Bush administration. We are in a situation, I think, where if 
we walk away, the consequence of this will be that no one will 
be supporting us. And therefore, the ultimate winner will be 
Iran. Iran is going to be strengthened, and we will be in a 
weaker position.
    Senator Rubio. I do not understand that argument, because 
the argument basically is----
    Ambassador Burns. It is real-world diplomacy.
    Senator Rubio. Yes, but it is not. What it is basically 
saying is that these countries, no matter what happens, they 
are lifting sanctions because they want to do business in Iran. 
And it will be great if Iran complies with the deal, it will be 
really great if the United States is part of it because then it 
guarantees in their mind that Iran will comply with the deal, 
but no matter what, even if Iran violates this deal that they 
have made what the rest of the countries, it does not matter 
because we are lifting sanctions no matter what.
    That tells me why it is then that we should not tie our 
foreign policy to countries that have already made a decision 
that they are interested in doing business in Iran, and they 
are willing to live with a nuclear Iran. That is what it sounds 
like to me, if you are saying that in the real world, they are 
willing to accept violations of the deal and still leave the 
sanctions off.
    Ambassador Burns. No, I would not interpret my own views 
that way. I would just say this, and we were talking with the 
chairman about this before, the way, as I understand this--I am 
not part of the administration--this deal has been constructed, 
the United States has obligations, if Iran implements the deal, 
that we have to fulfill----
    Senator Rubio. We have obligations of the U.S. Congress.
    Ambassador Burns [continuing]. Lifting of the sanctions. 
And so, therefore, if the United States walks away unilaterally 
and the other parties have honored the agreement, I think Iran 
emerges tactically strengthened. I do not want to see that, 
which is one reason I support this agreement.
    Senator Rubio. Well, if Iran does not honor its agreement, 
then Europe should not honor its part of the agreement either. 
And that is what you are saying is going to happen, unless we 
are a part of it. I just do not understand that.
    The Chairman. I do hope we can flesh that out because that 
is quite a dichotomy. Maybe in the next round.
    Senator Shaheen.
    Senator Shaheen. Thank you, Mr. Chairman.
    Mr. Dubowitz, I understood you to say that you thought if 
sanctions were lifted as part of this agreement, they would be 
lifted on human rights and terrorism violations by Iran. Did I 
misunderstand you?
    Mr. Dubowitz. Yes, you did, Senator.
    Senator Shaheen. So those sanctions will remain in place?
    Mr. Dubowitz. The terrorism and human rights sanctions will 
remain in place.
    Senator Shaheen. Okay. Thank you.
    Mr. Dubowitz. But could I just clarify one thing? The 
economic sanctions, which are most important to Congress 
because Congress plays such instrumental roles, most of the 
economic sanctions are not linked to human rights and very few 
of them are actually linked to terrorism. So fundamentally, 
what we are doing is giving up the economic sanctions. The fact 
that we still have terrorism and human rights sanctions will 
not give us economic leverage in the way that Congress, I 
think, has intended.
    Senator Shaheen. Well, do you want to speak in greater 
detail to what those sanctions do with respect to Iran?
    Mr. Dubowitz. With respect to the terrorism and human 
rights sanctions, the human rights sanctions, I think, are 
hopefully self-explanatory, but they have no economic import. 
We are essentially going to be sanctioning individuals who are 
involved in human rights violations in Iran with no economic 
impact.
    The terrorism sanctions, for the most part, we will be 
sanctioning individuals involved in terrorist acts. To the 
extent that we find a financial institution facilitating a 
terrorist activity, that one financial institution would be 
designated. But since Iran will have at least 46 financial 
institutions back on the SWIFT system, it will still have 45 
financial institutions, including the Central Bank of Iran, to 
facilitate its economic activities.
    So it would have no economic impact.
    Senator Shaheen. But if we found that there were 10 out of 
the 42 who were involved in supporting terrorist activities, 
they would also be sanctioned. Is that correct? That was my 
understanding from Secretary Lew's testimony that there would 
be some economic impact with respect to those sanctions, 
because they would involve other entities that are involved in 
economic activities with respect to supporting terrorism.
    Mr. Dubowitz. So there would still be 32 banks left on 
SWIFT, including the Central Bank of Iran, which would be more 
than enough banks for Iran to continue its economic activity.
    And the second thing, I think what you are pointing to, 
Senator, which is important, is what you are really asking is: 
Are there going to be sanctions that are going to be of such 
profound economic consequence that it would help us restore the 
leverage or maintain the leverage, particularly in the later 
years of this agreement? And, I would say to that that I am 
deeply skeptical that we will ever reimpose sanctions on 
terrorism grounds that have that kind of significant economic 
impact, because the Iranians will then say it is a violation of 
the clauses of the agreement that I suggested.
    They will use their nuclear snapback threat, particularly 
against the weakest link, which is the Europeans. And if they 
are able to convince the Europeans not to engage in a 
transatlantic economic snapback, then we have effectively 
neutralized our economic pressure.
    Senator Shaheen. Well, let me just make sure I understand 
what I think the deal does with respect to the snapback of 
sanctions. It is my understanding, and I would agree with 
Ambassador Burns, that part of what brought Iran to the table 
was not just the congressional sanctions, which were very 
important, but it was also the international community. But if 
Iran violates the deal, those sanctions would come back into 
place, and they would come back into place both for the United 
States and for the European Community. Is that everybody else's 
understanding?
    Mr. Dubowitz. Well, it depends which sanctions. If they are 
nuclear sanctions----
    Senator Shaheen. The nuclear sanctions. I think my 
understanding is that we are talking about nuclear sanctions, 
with respect to the agreement.
    Mr. Dubowitz. Right. But practically speaking, my concern 
is that--let us talk practically. If you try to reimpose 
sanctions on the Central Bank of Iran, expel 46 Iranian banks 
from SWIFT----
    Senator Shaheen. No, I heard your concern about that, and I 
appreciate that. But I guess what seemed to be implicit in that 
was a belief that the European Community, the other parties to 
the agreement, would not also be concerned about Iran's 
violation of what they had agreed to as part of the deal and, 
therefore, would not be willing to come back in.
    Do you share that concern, Ambassador Burns?
    Ambassador Burns. Well, I think this is a really difficult 
area to think about. And in my earlier testimony, I said I 
think there are clear benefits. I support this. But there are 
some risks here.
    On the sanctions, I think that Mark is right to suggest it 
may depend on the nature of the violation. If there is a 
fundamental violation in the next 3 or 4 years, I think the 
Europeans will be with us and most of the rest of the world. If 
they test us with small violations, sometimes countries will 
say let us just overlook that, we cannot. We have to have an 
exacting standard.
    And Chairman Corker asked this earlier. The really 
difficult one is if there are covert actions by the Iranians 
and we uncover them, will we be able to reassemble a solid 
sanctions regime. I do not think it is impossible. It will 
really depend on the nature of the violation. But it is going 
to be a hurdle for us. I do not want to minimize that.
    Senator Shaheen. Well, are there other interim measures 
that we could take either independently or with the European 
Community as we have in the past when some of these kinds of 
issues have occurred, that would give us some leverage before 
that extreme, overt violation of what Iran has agreed to do? I 
guess, based on some of the testimony that we have heard, I 
have assumed that we ought to be thinking about not just other 
actions we should be taking in the region with respect to 
supporting our allies there, but also other measures that we 
could take with respect to Iran, should Iran violate the 
agreement in some minor or major way. And are there examples in 
the past that you can think of where that has occurred?
    Ambassador Burns. Right. Obviously, if you look back at the 
failure of some of the North Korea negotiations, in adequate 
oversight, inadequate inspection and verification. So lot is 
going to depend on the IAEA.
    Diplomatically, for this administration and the successor, 
having a private understanding with the Europeans on exactly 
how we are going to react together at that small transgression 
level, when you really have to come back at the Iranians with 
an unyielding attitude, that is strategic deterrence. That is 
also why I think that the President needs to reaffirm that we 
are on a diplomatic path but he is willing to use military 
force if there is a clear violation and Iran races toward a 
nuclear weapon.
    I think all of this is important in creating the kind of 
intimidation of the Iranians that we should want to have in our 
policy.
    Senator Shaheen. And my time is up but I would just point 
out that I just came from the Armed Services Committee where 
General Dempsey was asked very directly if there was anything 
in this agreement that would deter our ability to take military 
action against Iran and he testified that there was not.
    The Chairman. Senator Gardner.
    Senator Gardner. Thank you, Mr. Chairman.
    I just wanted to get into some of the things that just 
happened today on the Hill. There is a Senate Armed Services 
Committee hearing today, and Senator Ayotte asked Chairman 
Dempsey again about lifting of the ballistic missile embargo. 
And the question was, from Senator Ayotte, ``Just to be clear, 
when you came before the committee then,'' talking to comments 
that Chairman Dempsey had made earlier this month, ``you said 
under no circumstances should we relieve pressure on Iran on 
those issues,'' talking about the arms embargo. ``So was it 
your military recommendation that we not agree to lifting those 
sanctions?'' And Dempsey's response was, ``Yes, and I used the 
phrase `as long as possible,' and that was the point at which 
the negotiations continue. But yes, that was my military 
advice.''
    Mr. Dubowitz, in the conversations you have had and the 
information that you have seen, was the advice of the 
Department of Defense, the Chairman of the Joint Chiefs of 
Staff, completely ignored throughout this deal?
    Mr. Dubowitz. Well, I cannot answer that with respect to 
what happened internally. I have seen the public statements, 
and I think that the record is clear. The advice was ignored 
because the arms embargo and the ballistic missile sanctions 
are going to be lifted at year 5 and year 8, which suggests to 
me that is a complete contradiction of what the military 
leaders had recommended.
    Senator Gardner. Can you just lay out some of the concerns 
that Chairman Dempsey is basing that decision on, because we 
know it. We have heard it. But what, in your mind, does the 
arms embargoes lifting mean?
    Mr. Dubowitz. Well, it means that Iranians are going to be 
able to buy advanced weaponry, including attack helicopters and 
battle tanks and fighter jets. I mean, I always look at it from 
the Iranian perspective. I really do try to figure these things 
out from how they look at it. And if you think about the way 
they structured the deal, it is brilliant because early years 
they get all the economic sanctions relief. Then the arms 
embargo lifts, so they have money to pay for it. Now they are 
bolstering their conventional military power. By year 8, now 
they will be able to fully develop their ICBM program and 
procure technologies from Europe, not just Russia and China. 
Year 8.5, advanced centrifuge R&D sunsets. By year 10, the file 
is out of the U.N. Security Council, and they are legitimized 
as a nuclear power. And then all of the restrictions start 
sunsetting on their nuclear program.
    So the way they have structured this deal is front-load 
with relief, buy all the heavy weaponry you can, cause chaos in 
the Middle East, build up your ICBM program. You are still in 
compliance with the deal. Amazing. You are still in compliance 
with the deal. And only then, just wait patiently for the 
restrictions on the nuclear program to sunset, then get to the 
year 10 to 15 year period. And now you have an industrial-sized 
program with an ICBM conventional military power and an economy 
hardened against our economic sanctions.
    It was brilliant the way that Iran structured this deal in 
terms of the phasing of it.
    Senator Gardner. Ambassador Burns, would you agree that the 
advice, the testimony, of Chairman Dempsey was not taken into 
account during these discussions?
    Ambassador Burns. I have no way of knowing that. I would 
not want to comment. But I would like to address your question 
very briefly.
    I think this is a concern. This is one of the risks in the 
agreement, the fact that ballistic missiles and the 
conventional arms prohibitions will be lifted. I would rather 
have that not have taken place. But we have options.
    The United States can maintain bilateral sanctions on the 
Iranians, of course, which we will. They are in place, and we 
should continue them. We can lead a coalition of countries to 
try to prohibit countries from selling arms to the Iranians and 
trying to block the Iranians on conventional arms, providing 
arms to nefarious terrorist groups in the United Middle East.
    The Iranians have been violating these provisions, by the 
way, for years in their export of arms to Hezbollah and Hamas.
    So a lot will depend on us. We are not without options. I 
am trying to make the best of a bad situation here. I would 
rather these restrictions have been kept in place. We will now 
have to cobble together a separate regime to try to impinge 
upon Iran's actions.
    Senator Gardner. I find that interesting because every time 
we talk about the United States continuing to push for a 
tougher deal, and that we could try to assure that we kept the 
sanctions, that we increased our sanctions, that we made a 
tougher deal, the response is that the United States cannot go 
it alone, that we stand alone and that will not work and it 
will not be effective. But when it comes to the arms embargo, I 
am always surprised that the response is that the United States 
can go it alone and we will create a tough response on the arms 
embargo.
    So I think the proponents of the agreement have an 
interesting argument that they have made. When it comes to 
other sanctions, we can go it alone. But when it comes to the 
arms embargo sanctions, we can go it alone and everything will 
be just fine.
    Mr. Dubowitz.
    Mr. Dubowitz. In other words, Senator, we can lose Russia 
and China on the arms. Not to worry, because we will have 
secondary sanctions and a coalition of the willing. But we have 
to keep Russia and China with us on the economic sanctions. 
Otherwise, everything gets dismantled.
    I am not sure I understand the logic of that. Either you 
need Russia or China in order to enforce all of this, or you 
can afford to lose Russia and China.
    My concern is that if you lose Russia and China, the arms 
embargo is being lifted at year 5, when effectively, there is 
no longer U.N. cover for an arms embargo. Now if the argument 
is you always need U.N. cover and a multilateral sanctions 
regime for sanctions to work, then that argument is internally 
inconsistent.
    So the notion that somehow we are going to be able to keep 
having weaponry out of the arms of Iran and its surrogates, 
when an arms embargo is now being lifted and we can do that 
through the power of U.S. secondary sanctions, well, if you 
accept that argument, then you need to accept the argument that 
we can do the same thing on the economic side.
    Senator Gardner. That is exactly right. I think that is 
well-stated and exactly my point, in pointing out one of the 
greater problems with the logic of the agreement, the argument 
of the proponents.
    When we had our hearing with Secretary Lew, I asked about 
the individuals who received relief under the agreement, and I 
mentioned, in particular, Mr. Fakhrizadeh, who has been 
described by some as the father of the Iranian nuclear program. 
When I asked why this relief was given, I think Secretary Lew's 
response was something to the effect of that it shows that if 
you do bad acts, if you do bad things, then you will have 
consequences.
    Well, to me, the consequence of this deal is that you are 
going to get your sanctions lifted. Could you explain what this 
kind of treatment, reaction, to people like Fakhrizadeh means 
in terms of other negotiations that will take place in the 
future with other nations and other actors who are the fathers 
of nuclear programs for other rogue and terrorist regimes?
    Mr. Dubowitz. It is an amazing message to me that we are 
effectively lifting sanctions on A.Q. Khan, Robert Oppenheimer, 
the Los Alamos Laboratory, and by the way, a South African 
German who is the right-hand man of A.Q. Khan.
    I would make one other point. The U.S. Government, in 6 
months to 12 months, is lifting sanctions on Ali Khamenei's $95 
billion financial empire. I mean, there has been no discussion 
of that. It is amazing to me.
    We talk a lot about the $100 billion in oil escrow funds. 
Ali Khamenei was designated in 2013, his EIKO, the Execution of 
Imam Khomeini's Order, $95 billion holding company. In 6 to 12 
months, OFAC is lifting the designation.
    Now what does that mean, practically speaking? I think we 
need to examine the consequences. Does that mean Ali Khamenei 
can move $95 billion in liquid assets around the world through 
the formal financial system, including SWIFT? I mean, to me, 
that is quite an extraordinary consequence. I am just not sure 
why Treasury decided to lift the designation essentially on Ali 
Khamenei and his $95 billion empire. It was my surprise of the 
week.
    Senator Gardner. Thank you, Mr. Chairman.
    The Chairman. Thank you.
    Senator Markey.
    Senator Markey. Thank you, Mr. Chairman, very much.
    After the Israelis bombed the Osirak reactor outside of 
Baghdad in 1981, I wrote a book called ``Nuclear Peril: The 
Politics of Proliferation'' on that raid and all of the other 
proliferation issues that were related to it--that is, the 
United States and U.S.S.R., Ronald Reagan, et cetera. They were 
just engaged in crazy vertical arms race, where we were not 
making each other safer. We were making each other less safe, 
MX, Pershing, all the way down the line. And the Soviets were 
building the same weapons. And it was crazy.
    And the point that the Israelis were making was that we 
should focus on the fact that the IAEA is an inadequate 
safeguard, and that the Iraqis at the time were using a 
civilian nuclear power plant as a cover for a nuclear bomb 
program. And they were correct in their evaluation of the 
strength of the IAEA and the real protections, which they can 
build.
    So the test here is, have we strengthened the IAEA 
sufficiently? Have we given them the tools that they need? Are 
we going to be able to rely upon it as an agency? Because if 
that is the case, whether we like it or not, that is what the 
Non-Proliferation Treaty calls for. I do not like it, but we 
have a system, and we just have to ensure that there are, in 
fact, adequate safeguards in place.
    So, Ambassador Burns, as you look at these safeguards and 
look out to the 2020s and the 2030s, as Iran has an ever-
growing civilian, ``peaceful'' nuclear program, how do you view 
the IAEA and its ability to be able to detect violations going 
forward?
    Ambassador Burns. I have listened carefully to Secretary 
Moniz, who is a fellow resident of our State, and I think that 
he is right in making a convincing case that we are going to 
have an effective line of sight on existing facilities. I would 
answer your question by saying that the IAEA needs to be 
strengthened for that second role, which is after the 15 years 
has expired, 2030, where the danger will be a covert program 
that Iran could elect, not will elect, but could elect to 
follow.
    I think the IAEA will need more resources, a greater number 
of skilled, experienced inspectors, contributions from nations. 
There is no question that has to happen.
    Senator Markey. So that is a test then for the P5+1 and 
every other country in the world. Are we going to give the 
resources to the IAEA in order to be able to do its job, 
especially as the years expire, and the initial focus, 
interest, of the world begins to recede a little bit.
    So what confidence do you have that the P5+1 and others are 
going to be able to keep their focus and put those resources in 
place.
    Ambassador Burns. It is going to be a test of American 
leadership. My experience when we created the P5+1 in December 
2005, when I was at the Bush administration, we were 
effectively the leader of it. We had the greatest interest. We 
kind of drove that organization.
    In an odd sort of way, the Russian Government never 
deviated from the P5+1, because it does not want Iran to become 
a nuclear weapons power. China is somewhat disinterested. It is 
kind of on the margin. So we need to rely on the Russians. That 
is difficult. And we need to rely on the Europeans to 
strengthen that organization.
    Senator Markey. Yes, and that is always a big question, 
because President Reagan actually instructed Jeane Kirkpatrick 
and the U.N. to vote to condemn Israel for what it did, Ronald 
Reagan and Jeane Kilpatrick. And then they sided with Iraq 
against Iran in the Iraq-Iran war within just a couple years.
    So you are right. Going through the years, you have to have 
some kind of confidence that you are going to be able to keep a 
coalition together and keep our eye on the IAEA ball so that we 
are, in fact, looking at the real issue, this horizontal 
proliferation, not vertical, horizontal proliferation.
    Send could you comment on that, Ambassador Burns?
    Ambassador Burns. I would. And I think this is the key 
issue, for me at least. And, Senator, before you came in, I 
just painted a picture. I think there are real benefits and 
there are some risks.
    I think this is a close call. I think the benefits outweigh 
the risks. But what I am worried about is, can we be effective 
in implementing the deal? And a lot of that will come down to 
the inspection and verification regime. Some of it, nation-
states can do. Most of it, the IAEA has to do. And the agency 
needs financial support, and it needs an increase in its 
budget. And that is an agency that actually operates on behalf 
of American interests in trying to sustain the nonproliferation 
regime.
    Senator Markey. I agree with you, because otherwise if it 
is ineffective, we wind up spending a hundred times more money 
to deal with the consequences of its lack of real teeth. It 
just becomes a paper tiger, and we wind up spending more money 
with the collateral consequences of that.
    So if we can, I would like you to expand a little bit more 
on what potentially we could do for Israel, for Turkey, for 
other countries in a regional defense posture to deal with this 
issue of what Iran might be thinking about and what, in your 
opinion, the United States should be prepared to do from a 
conventional perspective in order to ensure that this does not 
result in a so much more muscular Iran that the price was too 
high to pay. What would we have to do here in order to make 
sure that that was not the case?
    Ambassador Burns. Some of the supporters of a nuclear deal, 
not so much in the administration, but outside, have said we 
should normalize, in effect, our relationship with Iran, so we 
can work with Iranians on the Islamic state and other issues.
    I see it very differently. I think as we pursue the nuclear 
deal, and I think we should, we need to push back against the 
Iranians. Two things we can do.
    President Obama has already started a strengthening of the 
gulf cooperation countries, their military capacity, air 
defense, that kind of thing. We should continue that. The 
Saudis will be critical and Emiratis as well, in this regard.
    Secondly, very important with Israel, I think we have to 
close the political gap. There is a big public division and it 
is incumbent upon our government as well as Israeli 
Government--we are not going to end the disagreement, but try 
to put it out of public glare because it is weakening both of 
us.
    Israel needs a qualitative military edge. It needs advanced 
military technology. I fear that the Iranians will enable 
Hezbollah and Hamas to test the Israelis again in northern 
Israel. And some of those Hezbollah missiles can hit any city 
in Israel, as well as Hamas in Gaza. We have to defend Israel 
and help it defend itself.
    The 10-year United States-Israel military assistance 
agreement is about to expire in 2 years. I know it is now being 
renegotiated. I think we should accelerate those talks and 
really try to narrow the distance between us and give Israel 
the support it needs.
    Senator Markey. I agree with you. I think we have to again 
evaluate this deal, looking at the advantages and the defects 
that may exist, and then try to make the best judgment. But no 
matter what, we have to make sure that Iran fears Israel, that 
Hezbollah fears Israel, that Hamas fears Israel.
    We all have to agree on a bipartisan basis that no matter 
what happens, that that is the one nonnegotiable on this issue, 
because that ultimately is how we will negotiate from strength 
in trying to resolve these regional issues where we are pushing 
people toward the table to find a peaceful resolution of these 
historic, oftentimes religious-driven, differences.
    And so that is, from my perspective, what we have to 
evaluate as we are going forward. I think we can accomplish 
that latter goal.
    And I thank you, Mr. Dubowitz, for your work as well. The 
chairman was good enough to have you come in and talk to us for 
2 hours, so I apologize for not asking you a question because I 
had that opportunity in private.
    But we thank both of you for your service.
    And we thank you, Mr. Chairman.
    The Chairman. Thank you.
    My sense is that Senator Cardin and Senator Menendez have 
additional questions. I am just going to ask one, I think.
    I just want to give you a chance to rethink, Mr. 
Ambassador, the answer that you gave to Senator Rubio earlier. 
And that is: Do you really believe that if Congress kept in 
place the sanctions that we now have, that the other countries 
that are involved in this will lift their sanctions, regardless 
of whether Iran complied with this deal or not? That did not 
ring true to me, but that is what you said, I think. I just 
wonder if you want to clarify that to some degree.
    Ambassador Burns. Thank you, Mr. Chairman. Of course, we 
are talking about hypothetical situations here.
    The Chairman. But we have to kind of judge this, in many 
ways, on hypotheticals, right? That is, unfortunately, the 
character of this.
    Ambassador Burns. You are right. I understand that. You 
have to play out these options.
    First, I think we agree, I agree with Mark, that the human 
rights and terrorism sanctions should be kept on. There is no 
question about it.
    The Chairman. No, that is not the question. The question 
is, if we keep the congressionally mandated sanctions we have 
in place on the nuclear deal--in other words, the United States 
cannot fully implement, I think what you said earlier was that 
the sanctions regime would fall apart, and even if Iran did not 
comply with the nuclear deal, the other countries again would 
allow their sanctions regime to fall apart.
    That does not make any sense to me. So you were saying they 
would be the winner because they could go on with their nuclear 
program, but the sanctions would be relieved. I just asked the 
question: Why would the other countries alleviate their 
sanctions if Iran does not comply? That does not make any sense 
to me.
    Ambassador Burns. I was answering a question--there were a 
couple hypothetical questions asked of me--if the United States 
did not fulfill its requirements, if the Obama administration 
did not, because Congress was not willing to lift the nuclear-
related sanctions, then we would not be in compliance with this 
agreement.
    The Chairman. Right. I got that.
    Ambassador Burns. I think the practical impact of that 
would be that the sanctions regime would weaken and atrophy. 
And some countries would not adhere to it. And the unity of the 
P5 I think would be weakened considerably. And the agreement 
would never go into force, and that would mean that the 
restrictions on Iran's nuclear program would not be in place.
    So that is the scenario that I thought I was responding to, 
that is a very negative scenario for us.
    The Chairman. Would you want to respond to that, Mark?
    Mr. Dubowitz. Senator Corker, I am having a bit of a 
difficult time trying to square the circle here.
    So on one hand, Russia and China are at the table for their 
own strategic interests because they do not want to see a 
nuclear-armed Iran. In addition, we need Russia and China to 
help strengthen the IAEA so that they are an effective check 
against Iranian nuclear breakout or sneak-out.
    So the Russian and Chinese are committed to stopping Iran 
from developing a nuclear weapon, but if Congress votes to 
disapprove, Russia and China are going to walk away, go back to 
business, and allow the Iranians to break out or escalate their 
nuclear program. I am having a hard time reconciling that 
internal contradiction.
    So to reconcile it, you have to accept one of two 
arguments. Either the Russians and Chinese do not care about a 
nuclear-armed Iran and have only been at the table because this 
diplomacy for them has just been a way to help build up Iranian 
strength, build up the Iranian nuclear program, and get back to 
business, in which case they have not been great P5+1 partners. 
Or the Russians and Chinese are committed to stopping Iran from 
developing a nuclear weapon and fundamentally do not want the 
Iranians to escalate.
    Now my view on Russia and China is that I actually believe 
Russia and China are going to go back to some business with 
Iran. I do. I have never actually thought that our sanctions 
regime depends on Russia and China. The Chinese and Russians 
have been violating our sanctions for the past 10 years. And I 
can walk you through chapter and verse on why that is the case.
    I would get back to first principles on sanctions. The most 
important sanctions are the U.S. sanctions, the secondary 
sanctions. The second most important sanctions are the 
executive branch sanctions, the designations of key entities. 
The third most important sanctions are the EU sanctions. So 
that is really the fulcrum of the debate.
    Will we retain secondary sanctions? Yes. If we have a 
President willing to enforce executive branch sanctions, will 
we retain that? Yes.
    So then the real question is Europe. When it comes to 
Europe, we are only talking about three essential countries 
that are three essential economies. Will the Brits or the 
French and the Germans to be with us, in these scenarios? And 
my view is, on the diplomatic side of this, I find it difficult 
to believe that our three closest allies in Europe are going to 
walk away from us and facilitate an Iranian nuclear expansion 
and breakout. I also find it difficult to believe that German, 
French, and British financial institutions are going to take 
the risk of secondary sanctions from the United States by 
getting back to business with Iran.
    I think that the history of the sanctions has shown these 
financial institutions as market actors respond to market 
risks. And if they perceive that they can get sanctioned, 
fined, and shut out of the United States financial system if 
they go back to business with Iran, I do not believe they go 
back to business with Iran.
    So again, just walking through the logic of this, I 
believe, yes, Senator Corker, my long answer I would summarize 
as this: I believe we will retain the Germans, the French, and 
the Brits in a transatlantic sanctions regime. It will fray 
around the edges. We may lose the Russians and Chinese with 
respect to upstream energy investment and some of these other 
things. But we will have the essential elements of the 
sanctions regime in place because it is underpinned by powerful 
U.S. financial sanctions affecting market actors that respond 
to risk and want to avoid the kind of punishments that have 
been levied by the U.S. Government, the Department of Justice, 
and other actors. I am sorry for my long answer.
    The Chairman. That is all right. Thank you both. We respect 
to both.
    It is just that I find it hard to believe that other 
countries would lift their sanctions and allow Iran to go on 
with a nuclear program. That is a scenario I just do not 
believe would be the case. But again, we all have to make those 
judgments. And we very much appreciate the input of both of 
you.
    Senator Cardin.
    Senator Cardin. Again, thank you. I thank both the 
witnesses. I really appreciate this discussion, because this 
is, I think, the most challenging part of the equation. What 
happens if Congress rejects the agreement? And what is the 
likely response of our European allies? I happen to think they 
are going to want to keep Iran from becoming a nuclear weapon 
power. I think they will work with the United States, but there 
will be a period in which the United States is going to be 
isolated.
    And it does put Iran in a position of being able to test 
international resolve again. They are going to be individual 
country responses that are hard for us to judge.
    I agree, Mark, with your comments that the most significant 
sanctions are the United States sanctions, both the 
legislatively imposed and executive-initiated sanctions, and 
then Europe comes second. Therefore, what happens in Europe is 
going to be of most significance. But there will be individual 
countries and there will be leakage and there will be an 
impact.
    I want to get to the reimposing of sanctions that are 
waived under the JCPOA for nonnuclear activities. We got into a 
pretty good discussion, and there were three categories here. 
One is, can we reimpose against an institution that has 
received relief under the JCPOA? Second, can we do sectorial 
sanctions in sectorial areas that have been given relief under 
the JCPOA? And the third is, can we extend our own law that 
Senator Menendez was commenting on?
    Each of those questions were specifically asked of 
Secretary Lew during the hearing last Thursday. And in case one 
and two, he said very clearly the answer is, ``Yes, we can, if 
the circumstances justify that.'' That was his response.
    On the third, he gave a very interesting response. He said 
it depends on timing. I do not know what that means. He said if 
we were to try to do it now, it would be a breach of the 
agreement. But if we wait closer to the 2016 date, it would be 
understood. At least that is my interpretation of the answer I 
got from Secretary Lew.
    But then we read the agreement and we see clauses in the 
agreement that give us reason for concern. We are supposed to 
normalize our trade relations with Iran. We are not supposed to 
reimpose the sanctions that we took off. So it is not quite as 
clear in the document.
    Now, I must tell you, I do not pay a lot of attention from 
the point of view of the legal significance of what Iran says 
in its communications. It is interesting to read, and it just 
shows we cannot trust them. We have to make sure that we have 
enforceable documents. But the question that is very important, 
that the chairman raised at the Thursday hearing, that Senator 
Menendez and I have both raised, and is that it is fine to know 
what the United States intends to do, but do we have five of 
the eight votes? How is Europe going to respond to what the 
United States does?
    We know that China and Russia are going to be difficult. We 
know that Iran is going to be opposed. But what type of 
international support and what type of intimidation will there 
be to U.S. initiatives to impose sanctions when terrorist 
activities escalate as a result of Iran's increased capacity?
    Here, Mr. Chairman, I really do think we need 
clarification. As I said, we are on day 9. We still have some 
time left. I really do think we need clarification from the 
administration and our negotiating partners as to what our 
options are.
    Let me just say, I do not think there will be any 
hesitation by Congress to enhance sanctions against Iran, if 
their terrorist activities increase. There may be some 
reluctance by any administration. We know that. In diplomacy, 
there is always negotiations with our partners and stakeholder 
interests in what we do.
    But I do think we should look for a way to clarify this 
point with not just comments from our administration, but from 
our negotiating partners.
    Mr. Chairman, I hope we can figure out a way that we can 
perhaps follow through on that point.
    The second point I want to make, Ambassador Burns, I 
thought you raised a very important point about the regional 
security commitments by the United States, and we should not 
wait. We really should be talking about how we underscore the 
security needs of Israel and the Gulf States that we have 
strategic partnerships with. That should be pretty specifically 
clarified, so that there is no misunderstanding at all in the 
region as to what our security commitments will be. And Iran 
needs to know that up front. So I think that was a very 
important point. And I may want to follow up with some specific 
suggestions that you made as to how we can perhaps follow up on 
that particular point.
    The Chairman. Senator Menendez and Senator Johnson.
    Senator Menendez. Thank you, Mr. Chairman.
    I would agree with the ranking member's assessment, except 
I would have a different view as to the conclusion with 
Secretary Lew. I think I did test the proposition with the 
administration, because I actually said at one point, so you 
want the sanctions to lapse? He never said, no, that is not 
what we want. And when I asked him about, specifically, you 
either have the right to reauthorize them or you do not. Timing 
is maybe a question for political or other purposes, but either 
you have the right to reauthorize existing sanctions or you do 
not. And from my perspective, and the language--yes, it is a 
letter and it is not the agreement. But what I was reading the 
day we had the hearing was the agreement. I did not know about 
this letter then.
    So I look at the agreement and the wording of the agreement 
is what flagged for me the concern that led to that line of 
questioning.
    It was pretty clear to me that he never said, yes, at some 
point, we need to reauthorize this. When I suggested it lapsed, 
he could have said no, no, no, I am not agreeing that we should 
let it lapse.
    So I think the composite of that testimony, and of the 
Joint Comprehensive Plan of Action language, and now I further 
buttress it with the letter on the Iranian intent, and it says 
to me, we have a problem as it relates to continuing existing 
sanctions.
    Now those sanctions could be suspended by the 
administration. I am not talking about altering the nature of 
the existing sanction regime we have. I am talking about just 
taking it and reauthorizing it. Some people would want to 
actually diminish the President's waiver authorities. I am not 
even talking about that. I am just simply saying taking what it 
is.
    And I read both the agreement and the statements of the 
Secretary to say that they do not support that. That is a 
problem, because you have to snap back to something.
    The other thing that I am concerned about, I look at what 
this committee did when we authorized the use of force for the 
issue of Syria, as it relates to its chemical weapons. We 
heralded it and heard the administration--as a matter of fact, 
in March, Secretary Kerry said we cut a deal and we were able 
to get all the chemical weapons out of Syria in the middle of 
the conflict.
    Well, I am concerned that 1 year after that celebration of 
removing Syria's arsenal, that United States intelligence 
agencies have concluded that the regime did not give up all the 
chemical weapons it was supposed to and that the whole process 
by which inspectors were allowed to pursue, again, is going to 
be a narrative of what we are going to have as it relates to 
our ability to have inspectors pursue Iran in this case.
    Syria specified that it would give access to its declared 
weapon sites, much as Iran is expected to give U.N. inspectors 
unfettered access to its own declared sites. But for any 
undeclared sites, inspectors could request access provided they 
furnish information of their suspicions, giving the regime 
plenty of time to move, deceive, and hide.
    You listen to one of the inspectors in Syria and they said 
they could not afford to antagonize their hosts in order to not 
lose access to all the sites.
    So this is a recent past as prologue. So it concerns me 
about our enforcement mechanism moving forward.
    Then finally, what I do want to pick your brains on, and 
you have both been very in-depth with your thoughts, and I 
appreciate it, but let me ask you this. Let us assume, for 
argument's sake, that the deal had not been consummated. Would 
we be going to war right now?
    Mr. Dubowitz. I think the answer to that is, you should ask 
the administration, if you can, to provide to you in disclosure 
what their contingency plan was when they went into the 
negotiations, what alternatives they were considering, and how 
they had fully developed those alternatives. Because to go into 
negotiation without fully developing your alternatives would be 
a mistake, I think we would all agree. I am sure the 
administration has done a lot of work and has fully developed 
alternatives, Senator Menendez, apart from war.
    So if they had not developed alternatives, I think we 
should be disturbed. If they had developed alternatives, we 
should find out if those alternatives only included war. And if 
they did not only include war, then the administration, in 
claiming now that there is no alternative to this deal but war, 
is actually contradicting the very contingency plans that they 
built into the negotiation.
    Senator Menendez. Ambassador Burns, would we be going to 
war?
    Ambassador Burns. I do not think that war is an inevitable 
consequence of the deal falling apart. I know some people have 
made the argument, if the deal falls apart, or if Congress 
disapproves, we are going to get war. I do not follow that 
logic. It all depends on what the Iranians decide to do. I 
think they are smarter than to try to provoke a military attack 
by the United States or Israel.
    So I would think, if the deal fell apart, if Congress 
disapproved, if a veto was overridden, I would think we would 
probably end up with Iran as a nuclear threshold state. They 
would go ahead on their uranium and plutonium, but I am not 
sure they cross the line toward a nuclear weapon and, 
therefore, almost assuredly invite a response by either Israel 
or the United States.
    And very quickly, Senator, I think you are right to focus 
on the IAEA. In a way, the real enforcement arm is the United 
States. If there is a clear violation, if there is a covert 
facility detected by the IAEA, the only country that can do 
anything about it is the United States and maybe a few of our 
allies.
    Senator Menendez. And I am concerned about that because 
another independent witness, David Albright, has been before 
the committee several times, and I think the chairman has 
invited him back. He has said at different times, every time 
that Iran has had a violation, we seem to find a way to excuse 
it. And Iran has a history here of deceit, deception, delay 
that has brought us to this point that we are now accepting 
things, those who believe the agreement is the right agreement, 
that we are now accepting things we would have never envisioned 
accepting.
    So the one thing I took away, among other things, from you, 
Ambassador Burns, is that having a very strong response to 
violations is going to be critically important. But so far our 
precedent here on that has not been particularly strong.
    You know, if you can argue a case both ways, it is 
fantastic, if you can get away with it. But it is either one or 
the other.
    Now the Secretary was here and said in Iran the Ayatollah 
has issued a fatwa, which is basically a religious decree that, 
in fact, there can be no nuclear arms because that is a 
violation of their religious beliefs. Iran has consistently 
argued that they have been and are only interested in a 
peaceful civilian nuclear program.
    So if that is the case, and the Secretary is advocating as 
part of his overall argument about the fatwa and mentions it as 
part of the element, then why would we presume that Iran is 
going to rush to a nuclear weapon immediately if there is not a 
fulfillment of the agreement, as envisioned?
    So I think, I do not buy the proposition, and I appreciate 
the honest answers from both of you, that war is necessarily 
automatic, because that is the proposition that is being 
painted.
    Finally, I would say, basically, we think about the out-
years. The reality is that in about a year, Iran is going to 
get most of its sanctions relief, assuming they comply with the 
initial implementation. So in year 2, 3, or 4, forget about, 8, 
10, or 15, the regime determines that whatever is happening in 
the gulf region, that they, in fact, that preservation of the 
revolution and the regime is best ensured by having a nuclear 
weapon. So let us say that they decide to break the agreement 
and move forward, just for argument's sake.
    At that point, though, what we will be facing are the same 
choices that we allegedly have today. And the reality is, 
however, I do not think it is quite the same choice, Mr. 
Chairman, because you will have an Iran that is economically 
resurgent, an Iran that will have taken care of some of its 
domestic, not all, but some of its domestic challenges, an Iran 
that will have $100 billion to $150 billion.
    Let us assume that it is not all going to be spent on 
terrorism. But take 5 percent of it. If an Iran that is reeling 
from economic sanctions today and falling oil prices is willing 
to engage with Houthis in Yemen, Hezbollah in Lebanon, in 
propping up Assad in Syria, and creating mischief in Iraq far 
different than our national interests in Iraq, with the 
resources they have now, when they are flush with money, when 
we talk about war, I am really concerned about a regional 
conflict that emanates from that.
    So it is in this balance of things that I think--what I do 
not care for is the proposition that it is either this or war, 
because you cannot argue it both ways.
    I appreciate the opportunity to explore that with the 
witnesses.
    Mr. Dubowitz. Senator Menendez, just one point. I actually 
do think there will come a point in time where our only option 
will be military force. I mean, I am going to be as bold to 
suggest that. This is, again, scenario planning, and I have 
tried, to the best of my ability in my written testimony, which 
is excessively long, I apologize for that, but in the 43 pages, 
I have tried to work through these scenarios to try and 
understand this. And it would be useful to work through these 
scenarios, I think, with others.
    But my worst-case scenario is that, as you have described, 
a much stronger Iran, a much more economically resilient Iran, 
an Iran with conventional and regional power, and an Iran with 
an industrial-sized nuclear program and near-zero breakout, 
with an easier clandestine sneak-out, where breakout time is 
now a matter of days. I have a very hard time figuring out how 
you use economic sanctions to stop that Iran.
    If you do not have economic sanctions to stop that Iran, 
then you really only have military force, or you concede.
    So my concern with this deal is that the very structure of 
the deal, the way it is architected, positions Iran at that 
point where we will actually have to use military force against 
an Iran that will be much stronger. And the consequences will 
be much more severe.
    That is why, again, just pointing out for maybe the fifth 
time, and I apologize, for me, this is not about walking away 
from the deal. This is not about blowing up the deal. This is 
not about going back to no enrichment. This is about some 
simple amendments to the deal. I say ``simple.'' I understand 
how complicated they will be to negotiate.
    But one of the fundamental amendments is on the sunset 
provision. I give Ambassador Burns a lot of credit. He helped 
negotiate U.N. Security Council Resolution 1737, which is the 
policy of the U.S. Government. In that resolution, it 
specifically prohibits a sunset provision. It is very 
interesting language. At that point, under the Bush 
administration, they made it very explicit that there would not 
be an artificial time-delineated sunset.
    So, yes, this is complicated. It is messy. But we should 
insist on that one amendment, the way Henry Jackson in the 
1970s insisted on amendments, the way that the U.S. Congress 
has insisted on amendments for its history.
    I think that would make a fundamental difference. And if it 
did, we may not be in the position where we are going to have 
to use military force against a hardened target and a massive 
nuclear program.
    The Chairman. I know Senator Johnson is about ready to roll 
here and has been waiting a while. But if you want to make one 
comment, Ambassador Burns, but I am turning it over to Johnson 
and his time will start after you finish.
    Ambassador Burns. Thank you, Mr. Chairman. Very briefly, 
and excuse me, Senator Johnson.
    I just want to say, I agree that we cannot argue that war 
is a logical consequence if Congress disapproves. I agree with 
that. I also do not think, however, we can just assume that war 
is inevitable at the end of the 15 years. Much will depend on 
us.
    There are strategic threats. There are deterrents that the 
United States has a lot of history in being involved in. We are 
going to be skillful with that.
    So I do not want to accept that somehow war is the only 
consequence of this deal. I do not agree with that.
    The Chairman. Thank you.
    Senator Johnson. Thank you, Mr. Chairman.
    If Senator Menendez would stick around for 2 seconds, I 
want to put a few numbers to the stronger Iran. I will ask Mr. 
Dubowitz about this later, but we hear somewhere between $50 
billion and $150 billion. Now here in America, that does not 
seem like very much.
    But $50 billion is 12 percent of Iran's economy right now. 
That would be the equivalent of over $2 trillion pumped into 
our own economy. For the $150 billion level, that is 36 
percent. That would be like $6.3 trillion of the American 
economy.
    So right now, Iran's economy is about $415 billion, and we 
see the instability they are sowing in the region at that 
level. This is an enormous boost to their economy. That is why 
we are concerned about a stronger Iran with this deal.
    Anyway, I just wanted to put some numbers on that for you.
    Mr. Dubowitz, the first time we met, we talked about the 
Iranian sanctions. I came away from that initial meeting 
understanding that these sanctions were putting a real hurt on 
Iran, but that they were nowhere near as strong as they were 
talked about or, certainly, what you would be recommending.
    Can you just talk about that? The number I have is that, in 
2013, Iran's economy was about $558 billion. In 2014, it was 
$415 billion. That is a 25-percent drop. That is a lot of hurt.
    Can you talk about back then, and we will start moving 
forward from there?
    Mr. Dubowitz. The key number that we have been focused on 
is Iran's foreign-exchange reserves and their ability to 
withstand a severe balance of payment crisis. It was our 
assessment in the middle of 2013 that Iran was 4 to 6 months 
away from a severe balance of payments crisis--in other words, 
the kind of economic crisis that in notional terms could have 
collapsed the economy. Why Iran avoided that was because the 
administration blocked, at the time, the Menendez-Kirk bill, 
de-escalated the sanctions pressure, and then entered into the 
JPOA negotiations and gave $11.9 billion in direct relief, as 
well as sparking a modest economic recovery.
    Again, in terms of numbers, we focus on the $100 billion, 
$150 billion, which we can talk about. Under this deal, Iran 
will be able to sell oil. If they return to presanctions levels 
of 2.5 million barrels a day, they will make $40 billion a year 
just selling oil. So over the lifetime of the agreement, the 
years we are concerned about, that is $400 billion by year 10. 
That is $600 billion by year 15.
    When you talk about how Iran will restore its economy, I 
think we need to look at those numbers.
    I would just say one final point. Iran will not spend its 
money just on terrorism. Iran will not spend its money just on 
economic growth. Iran will spend its money ensuring economic 
resilience. They will not make the mistake they made last time. 
They will have a rainy day fund of foreign-exchange reserves. 
If I were Iran, it would be of sufficient size that it would 
provide me an ability to withstand any kind of sanctions 
pressure you can throw at me in the future.
    Senator Johnson. So we really are strengthening Iran.
    We started this discussion thinking it is about $150 
billion. The administration came back and said no, it is really 
$59 billion, $56 billion. What is your evaluation of what the 
initial injection is, just based on when they first meet that 
requirement?
    Mr. Dubowitz. First of all, I do not understand the 
administration's logic here. What they are saying is that there 
is approximately $100 billion in these escrow accounts, but a 
certain percentage of that China has committed to upstream 
energy projects. I do not know if I remember the numbers but 
$20 billion or so. But the administration is saying Iran is 
going to spend the $100 billion on strengthening its economy.
    Well, what is an investment in an upstream energy project? 
It is strengthening your economy. So why are you excluding the 
$20 billion when your own logic suggests that that is to be 
used to strengthen the economy? So you have to add that money 
back, if that is your logic.
    If your argument is that they are going to spend it on 
terrorism, then you are right. The $20 billion is not available 
for terrorism because it is available for Chinese investment. 
But they are saying their money will not be spent terrorism.
    So once again, I am having a hard time squaring the circle 
and the logic here, Senator.
    Senator Johnson. I have been reasonably vocal in saying 
that this administration lost these negotiations really before 
they ever began by, first of all, acknowledging Iran's right to 
enrich uranium when I think U.N. resolutions are pretty clear 
that, no, in order for a sanction to be lifted, Iran has to 
suspend or halt its uranium enrichment.
    The whole point of the negotiation really should have been 
to require them to dismantle, as it was required of South 
Africa and Libya.
    So you acknowledge that right, and then you also start 
lifting the sanctions, which really starts getting everybody in 
the world pretty excited about being able to start investing in 
Iran, to start selling them dollars.
    So I do not know. Where do you go with the negotiation, at 
that point in time? How do you win that one, when you virtually 
have given Iran what they wanted, again, not all of the 
sanctions relief, but a pretty clear path that you are 
signaling that they are going to get it? That is my evaluation. 
Is that kind of how you saw the thing as well?
    Mr. Dubowitz. Sure. That is why you end up with a short-
term nuclear suspension for a long-term economic sanctions 
dismantlement, which is what this deal is. I mean, if you give 
up your most valuable concession at the beginning of the 
negotiation on enrichment, and then you spend all your time 
negotiating the number of IR-1 centrifuges that are going to be 
left at Natanz, then the Supreme Leader is going to flip that 
on you. He is going to finally give up on the number of IR-1 
centrifuges at Natanz, but he is going to do that only in 
exchange for his most valuable concessions: dismantle 
sanctions. I want sunset provisions so the restrictions 
disappear. I want advanced centrifuge R&D, because I never 
really cared about IR-1s, even though I pretended I did. And I 
am going to end up negotiating the kind of deal the Supreme 
Leader negotiated, where essentially he has taken a concession 
that we thought was so valuable to him, because he overvalued 
it in public, and he did that so that he could trade it away at 
the end for the concessions that actually were most valuable to 
him.
    So that was the problem with the negotiations, and it is a 
problem with the fundamental architecture of this deal.
    Senator Johnson. So the very sanctions that this 
administration resisted, that they in the end gave credit to 
for bringing Iran to the table and producing this deal, they 
definitely opposed.
    They did bring Iran to the table, but they were relaxed 
right away. You just testified that Iran was very close to 
truly being put in a position where they would have had to 
negotiate in good faith. Can you describe that?
    Mr. Dubowitz. Well, Senator, I am not sure if they would 
have negotiated in good faith, but I am suggesting that if Iran 
was facing a severe balance of payments crisis, where they were 
literally on the verge of economic collapse, I think it is fair 
to say that the United States would have had more leverage. 
Now, whether we would have translated that leverage into a 
better deal, I cannot say. It is counterfactual history.
    I am suggesting that I think, and I think the U.S. Congress 
has been very clear on this over the past couple years, I think 
that we made a mistake in not ratcheting up the pressure and 
increasing our leverage.
    And my fear is that the Iranians came to the table for one 
fundamental reason. Yes, they were under pressure. They came to 
the table because we offered them a huge concession to come to 
the table. And the huge concession, Senator, is exactly the one 
you underscored. It was that we abandoned decades of U.S. 
policy and we gave them an enrichment capability.
    Senator Johnson. My point is that is the position they were 
in. I agree with you. That would not guarantee they come in 
good faith. We, certainly, had a whole lot more leverage. We 
were in a far better negotiating position then than we were at 
the tail end of this deal.
    Is there any way we can get ourselves back to that 
negotiating position? My evaluation is no. I just want to hear 
your comment on that. In other words, snapback sanctions, that 
is a fantasy, is it not?
    Mr. Dubowitz. Well, snapback sanctions are a fantasy. Can 
we get back to the same negotiating position we were 2 years 
ago, or 2.5 years ago? Not immediately. I mean, in the 
scenarios that I lay out, I am not trying to look at this with 
rose-colored glasses.
    My whole approach to the Middle East is expect the worst 
and be surprised on the upside. Do not expect the best and then 
be devastated on the downside. So I am trying to be realistic 
in the scenario planning.
    It will be messy, I think, as Ambassador Burns and I both 
acknowledge. But I do think that we have the ability to retain 
sufficient leverage. And if past is prologue, and the cold war, 
I think, serves as a good example, we are capable of 
negotiating better agreements, amended agreements, with 
hardened adversaries.
    When I look at Iran and I compare today's Iran to the 
Soviet Union with thousands of nuclear-tipped missiles aimed at 
U.S. cities, Senator Jackson was willing to go back to the 
Nixon administration and say I want a better deal. There are 
countless examples of that in the cold war.
    Senator Johnson. But, again, with investment dollars 
starting to flow in from our negotiating partners, it is going 
to be pretty difficult to get them on board with another round 
of sanctions that would actually put ourselves back at the 
point where we could actually do a good deal, where we could 
actually demand dismantlement, where we could actually force 
Iran to be less dangerous.
    Mr. Dubowitz. As I have testified, I think that we will 
maintain the efficacy of U.S. secondary sanctions, executive 
branch sanctions, and I do not believe we are going to lose the 
Europeans. I believe on the essential core sanctions, the 
financial sanctions that Europe has passed with us and more 
importantly that Europe fears from us, we will maintain that 
leverage.
    Will we maintain it right away? Will we have the same 
leverage right away? No, it will take another President working 
closely with Congress to restore our leverage and enhance the 
leverage over time. But to me, that is a better alternative, 
Senator, than ultimately providing a patient pathway to a near-
zero nuclear breakout and a clandestine sneak-out, and just to 
reiterate, an Iran that will be hardened against that kind of 
snapback in 10 to 15 years, where I fear, maybe more than 
Ambassador Burns, that we will only have the ability to use 
military force to stop this program.
    Now, maybe we disagree. I believe in preemption, not 
containment. If we are in containment mode, then we are in a 
whole different universe. But I still believe it is the policy 
of the U.S. Government to prevent Iran from developing a 
nuclear weapon.
    Senator Johnson. Thank you, Mr. Chairman.
    The Chairman. Thank you.
    I want to thank you both for your testimony and for being 
here so long and waiting for us while we voted.
    Without objection, the record will be open until Friday, if 
you would please respond as rapidly as you can to those 
questions.
    But we respect both of you very much. I know that both of 
you understand the complexities of this. And one of you has 
ended up on one side and one on the other. It is the type of 
testimony that you have given today that I think makes this a 
difficult decision for many. So thank you very much for being 
here.
    [Whereupon, at 1:32 p.m., the hearing was adjourned.]
                              ----------                              


              Additional Material Submitted for the Record

                Responses of Mark Dubowitz to Questions 
                  Submitted by Senator Johnny Isakson

    Question. How can the P5+1 hold Iran accountable for small, or 
potentially incremental infractions as well as major ones? What 
consequences are there for small infractions of the JCPOA?

    Answer. If the United States believes that Iran has violated the 
deal, Washington can refer Iran to the Joint Commission, which consists 
of the P5+1, Iran, and an EU representative. If the issue cannot be 
resolved by consensus within the Joint Commission, after a process of 
35 days, the United States can then unilaterally refer the issue to the 
U.N. Security Council. The Security Council must then pass a resolution 
(which the United States can veto) to continue the current sanctions 
relief. If that resolution is not passed within another 30 days, the 
previous U.N. sanctions will be reimposed. The ``snap'' in ``snapback'' 
therefore takes more than 2 months. The mechanism in the JCPOA also 
does not provide for any unilateral reimposition of sanctions, nor does 
the U.N. Security Council Resolution 2231, which endorsed the JCPOA. 
The avenue to address Iranian noncompliance is through the Joint 
Commission's dispute resolution mechanism.
    However, this mechanism is not built to address incremental 
infractions. Resolution 2231 states that the snapback mechanism is for 
issues of ``significant nonperformance,'' implying that it would not 
likely be used for incidents of incremental cheating. The Iranian 
regime has previously been inclined to cheat incrementally, not 
egregiously, even though the sum total has been egregious. Iran is 
incentivized to continue to engage in incremental violations of the 
agreement because there is no enforcement mechanism to punish 
incremental cheating.
    The bigger problem is that the nuclear deal grants Iran a ``nuclear 
snapback.'' The nuclear agreement explicitly contemplates in paragraphs 
26 and 37 of the main text that Iran will walk away from the deal if 
sanctions are reimposed in response to an Iranian nuclear violation. I 
call these Iran's ``nuclear snapbacks,'' because a straightforward 
reading of this text indicates that Tehran will threaten nuclear 
escalation if the world powers try to force it back into compliance 
with the agreement.
    We have lost our ability to use peaceful economic leverage to 
enforce a nuclear agreement. If Iran violates the agreement, the United 
States will be faced with the choice of acquiescing to Iranian cheating 
or engaging the sanctions snapback and risking dissolving the agreement 
``in whole or in part.'' Iran can cheat incrementally, daring us to 
respond. No President will use military force against incremental 
cheating, and Iran will have the ability not just to break out or sneak 
out to a bomb, but to inch out to a bomb.

    Question. What is the incentive for Iran to continue to comply with 
conditions of the JCPOA beyond the 10-year window, if sanctions are not 
snapped back and are ultimately relieved altogether? Iran has already 
stated it will reject a plan put forward by the P5+1 about potentially 
extending them for 5 years.

    Answer. When discussing the nuclear deal with Iran, its timeframe 
is usually discussed as a 10-15 year deal. However, I would argue a 
better way to examine the deal is not exclusively through the prism of 
nuclear physics but also accounting for Iranian economic, conventional, 
and military power.
    The benefits to Iran are frontloaded: Iran will receive immediate 
sanctions relief on Implementation Day and will be permitted back into 
the formal financial system. On the front end of this agreement, the 
deal effectively dismantles the sanctions regime. That means that Iran 
is going to get hundreds of billions of dollars to spend, not only 
building its economy, but also building economic resilience against 
future economic pressure. Then, after 5 years, the U.N. arms embargo 
will be lifted. Then ballistic missile restrictions will disappear. 
Iran will be able to fortify its regional presence and terrorist 
proxies. Then, when restrictions on Iran's nuclear activities begin to 
lapse, Iran will be stronger financially, militarily, and regionally. 
Iran's breakout time will begin dropping after 10 years and fall to as 
short as a few weeks after 15 years.
    The JCPOA provides Iran a patient pathway to a nuclear weapon. If 
Iran abides by the terms of the agreement, it can emerge in 10 to 15 
years with a massive nuclear program, a short path to a nuclear bomb, 
intercontinental ballistic missiles, and a strong economy immunized 
against sanctions pressure. At that time, Iran can choose to continue 
to abide by the few remaining terms of the JCPOA having already 
received significant benefits. Iran will be a regional power with a 
strong military and strong economy. If Iran chooses to violate the 
JCPOA at that stage, the United States may be left with only military 
options to prevent an Iranian nuclear bomb.

    Question. How does lifting the ballistic arms embargo after 8 years 
affect our sanctions against Iran's ballistic missiles program?

    Answer. Before reviewing the ballistic missile embargo, it is 
important to discuss the current state of the Iranian ballistic missile 
program. Even with the current sanctions in place, Iran reportedly has 
the largest and most diverse ballistic missile program in the Middle 
East. The U.S. Defense Department has repeatedly assessed that Iran's 
ballistic missiles could be ``adapted to deliver nuclear weapons.'' 
Last year, Director of National Intelligence James Clapper testified 
before Congress that if Iran chooses to make a bomb, Iran would choose 
``a ballistic missile as its preferred method of delivering nuclear 
weapons.'' According to Clapper, these missiles are ``inherently 
capable of delivering WMD.'' Under the JCPOA, restrictions on Iran's 
ballistic missile development will lapse. Notably, the JCPOA permits 
this to happen after 8 years or after the IAEA reaches a socalled 
``broader conclusion'' that Iran's program is entirely peaceful and 
contains no undeclared activities, ``whichever is earlier.'' (emphasis 
added). In short, whether or not the IAEA has determined that Iran's 
program is peaceful, Tehran will be permitted to engage in an expansion 
of its ballistic missile program after a maximum of 8 years. Why is 
Iran permitted to engage in ballistic missile development--the 
development of the likely delivery vehicle if Iran builds a nuclear 
warhead--before the international community is certain that Iran's 
existing nuclear program is peaceful?
    Even without that certainty, the arms embargo will expire in 5 
years, and ballistic missile restrictions will lapse in 8. With those 
expirations, Iran will be able to buy and sell heavy weaponry. Iran 
will also be able to develop long-range ballistic missiles, including 
intercontinental ballistic missiles (ICBMs). Iran may also be able to 
expand its intercontinental ballistic missile program under the guise 
of satellite testing. The U.S. Defense Department notes, ``Iran has 
publicly stated it may launch a space launch vehicle by 2015 that could 
be capable of intercontinental ballistic missile ranges if configured 
as a ballistic missile.''
    At the same time, under the nuclear deal, the administration has 
dismantled the economic sanctions regime by effectively 
recharacterizing nonnuclear sanctions as nuclear, including sanctions 
on Iran's ballistic missile program. One particular area that the deal 
impacts is ballistic missile financing. Prior to the administration's 
recharacterizing these sanctions as ``nuclear-related,'' they were 
considered a separate issue of illicit financial conduct. There are a 
number of designations of Iranian banks including the Central Bank of 
Iran for the financing of ballistic missiles. But Iran demanded in 
negotiations that a number of these entities be de-designated, 
including the Central Bank of Iran. And so the JCPOA has taken 
ballistic missile financing and recharacterized it as nuclear 
financing.
    Also under this deal, U.N., U.S., and EU ballistic missile 
sanctions will be terminated. The United Nations will lift ballistic 
missile sanctions on Iran in 8 years. The European Union will also lift 
its ballistic missile-related restrictions. At that time, the United 
States will retain its sanctions provisions under certain Executive 
orders and under the Iran, North Korea, and Syria Nonproliferation Act. 
There are two problems with this scenario: the first problem is that 
because U.S. sanctions and EU sanctions will not be aligned, the United 
States may confront a situation in which European banks and companies 
are engaged in activities that are legal under European law but a 
violation of U.S. law. Will the United States be willing to sanction 
these companies?
    The second problem is that the U.S. State Department is more than 3 
years behind schedule issuing reports mandated by INKSNA. According to 
a GAO study, the State Department has taken an average of 16 months to 
issue reports that have been due every 6. The last report, delivered to 
Congress in December 2014, covered the period through 2011. These 
reports must be published prior to the issuance of sanctions under 
INKSNA. Sanctions for activities in 2011 were not thus applied until 
2014. If this pattern continues, ballistic missile sanctions may remain 
on the books but be unenforced.

    Question. If the ``Roadmap for Clarification of Past and Present 
Outstanding Issues'' is not shared with Congress, do you think this 
deal is credible? What if it is not shared with other members of the 
P5+1?

    Answer. Many of the concerns regarding inspection and verification 
arise from the side agreements between Iran and the IAEA, including 
agreements related to the resolution of issues related to the possible 
military dimensions (PMDs) of Iran's nuclear program, including but not 
limited to the inspections of the Parchin facility. The leaked details 
of those agreements, if accurate, raise questions about the IAEA's 
ability to reach conclusions, with the requisite level of assurances 
and without undue hampering of the verification process.
    Following the announcement of the JCPOA, U.S. intelligence and 
public sources revealed that Iran may be engaged in cleanup efforts at 
the Parchin military facility where weaponization activities are 
suspected to have taken place. Iran's activities may result in the IAEA 
being unable to collect any useful information about a site which Iran 
has refused to allow the IAEA to access for more than a decade.
    Of grave concern, Under Secretary of State Wendy Sherman admitted 
during a Senate Banking Committee hearing that the IAEA may not get 
physical access into Parchin to ensure that Iran is not hiding covert 
activities. The Associated Press journalist George Jahn reviewed a 
draft of a confidential agreement between Iran and the IAEA and 
reported that Iranian inspectors will investigate the Parchin site 
themselves and provide environmental samples to the IAEA. According to 
this report, the IAEA itself will not collect the evidence and will not 
get physical access to Parchin; instead, inspectors will get video and 
photo information and only 
from areas that Iran deems are not off-limits because they don't have 
military significance.
    This is ``very unusual,'' according to Dr. Olli Heinonen, former 
deputy director general and head of safeguards at the IAEA. ``I find it 
really hard to understand why you would let someone else take the 
samples and only see through the camera.'' He noted that he could not 
think of any similar arrangements with other country in the past.
    Nuclear physicist and former weapons inspector David Albright 
assessed, ``It really is not normal, and you have to worry that this 
would set a bad precedent in the Iran context and in the context of 
other countries. . . . I don't know why they accepted it. I think the 
IAEA is getting a little desperate to settle this.'' He said, ``I think 
how this is settled could very well determine if the deal is ever 
implemented. This deal can only work if it can be verified, and it can 
only be verified if the inspectors have access to the suspect nuclear 
sites.'' As these experts warn, if this press report accurately 
reflects the agreement between Iran and the IAEA, it may establish a 
troubling precedent whereby Iran could deny physical access to IAEA 
inspectors to other suspicious facilities including military sites.
    To address concerns regarding Parchin and other aspects of the 
inspection and verification regime, the IAEA-Iran side agreements 
should be shared with the United States and with other members of the 
P5+1. While confidentiality is an important principle for the IAEA, it 
should not be used as a pretext to avoid addressing legitimate 
questions. Furthermore, similar agreements have not always historically 
been seen as confidential, and the IAEA has disclosed much-more 
detailed facility-specific approaches in the past. For example, in 
2007, the IAEA-Iran work plan to address outstanding issues was made 
available to all IAEA member states. As a member of the Board of 
Governors of the IAEA, the United States (both the Executive branch and 
Congress) could be provided access to the side agreements. The 
verification and inspection regime must be credible, and therefore 
concerns regarding the side agreements should be addressed rather than 
avoided.
                                 ______
                                 

               Prepared Statement of Hon. Nicholas Burns

    Mr. Chairman, Ranking Member Cardin, and members of the committee, 
thank you for this opportunity to testify on the international 
agreement to prevent Iran from becoming a nuclear weapons power.
    This is one of the most urgent and important challenges for our 
country, for our European allies as well as for Israel and our Arab 
partners in the Middle East. The United States must do whatever it 
takes to thwart Iran's nuclear weapons ambitions and its determination 
to become the dominant military power in the region.
    We should thus marshal our diplomatic, economic, and military 
strength to block Iran now and to contain its power in the region in 
the years ahead.
    With that strategic aim in mind, I support the Iran nuclear 
agreement and urge the Congress to vote in favor of it in September.
    This is, understandably, a difficult decision for many Members of 
Congress. It is an agreement that includes clear benefits for our 
national security but some possible risks, as well. It is also a 
painful agreement, involving tradeoffs and compromises with a bitter 
adversary of our country--the Government of Iran.
    I believe, however, that if it is implemented effectively, the 
agreement will restrict and weaken Iran's nuclear program for more than 
a decade and help to deny it a nuclear weapons capacity. That crucial 
advantage has convinced me that the Obama administration is right to 
seek congressional approval.
    I have followed the Iran nuclear issue closely for the last decade. 
From 2005 until 2008, I had lead responsibility in the State Department 
on Iran policy. During the second term of the George W. Bush 
administration, we worked hard to blunt Iran's nuclear efforts. We 
created in 2005 the group that has since led the global effort against 
Iran--the United States, the United Kingdom, France, Germany, Russia, 
and China (the P5+1). This group offered to negotiate with Iran in 2006 
and again in 2007. We were rebuffed on both occasions by the Iranian 
regime.
    When Iran accelerated its nuclear research program, we turned to 
sanctions. I helped to negotiate for the U.S. the first three United 
Nations Security Council Chapter VII sanctions resolutions to punish 
Iran for its actions. Led by the Treasury Department, we initiated U.S. 
financial sanctions and encouraged the European Union to do the same. 
We built a global coalition against Iran. While Iran became 
increasingly isolated, however, it chose to accelerate its nuclear 
research efforts in defiance of international law.
    When President Obama came into office in 2009, Iran had made 
considerable progress in advancing its uranium and plutonium programs. 
It made further progress in his first years in office and was on its 
way to become, in effect, a nuclear threshold state. In response, 
President Obama expanded the sanctions and coordinated an aggressive 
international campaign to punish and isolate the Iranian regime.
    Congress made a vital contribution by strengthening American 
sanctions even further. This increasingly global and comprehensive 
sanctions campaign weakened the Iranian economy and ultimately 
convinced the Iranian Government to agree to negotiate during the past 
18 months.
    The Obama and Bush administrations and the Congress acted together 
over 10 years to expand American leverage against Iran and to coerce it 
to accept negotiations. Despite these efforts, Iran was far along the 
nuclear continuum when negotiations began in earnest in 2013.
    Looking back, I believe the Obama administration was correct in 
launching negotiations in 2013 with our many partners on one side of 
the table and Iran alone on the other. We retained then, as we do now, 
the capacity and right to use military force to prevent Iran from 
achieving a nuclear weapon should that be necessary. But, diplomacy 
made more sense at that point. That judgment has paid off.
    The Joint Comprehensive Plan of Action (JCPOA) negotiated by 
Secretaries Kerry and Moniz is a solid and sensible agreement. It has 
many concrete advantages for the United States, some of which have been 
overlooked in the national debate so far.
    First, the agreement will essentially freeze Iran's nuclear 
research program. The restrictions the U.S. negotiated will effectively 
prevent Iran from producing fissile material for a nuclear weapon 
(either through uranium enrichment or the plutonium process) at its 
nuclear facilities for at least 10 to 15 years.
    The number of centrifuges at the Natanz plant will be reduced by 
two-thirds. Use of advanced centrifuges will not be permitted for a 
decade. Iran's store of enriched uranium will be restricted to levels 
below those needed for a nuclear device. In addition, there will be no 
enrichment at all at the Fordow plant for 15 years.
    The administration also succeeded in blocking Iran's plutonium 
program. The core of the Arak Heavy Water Reactor will be dismantled. 
The reactor will be transformed to make it impossible to produce 
sufficient quantities of plutonium for a nuclear device. Spent fuel 
will be transported out of Iran. There will be no reprocessing of fuel 
for at least 15 years.
    The most important advantage for the U.S. is that Iran's current 
breakout time to a nuclear weapon will be lengthened from 2 to 3 months 
now to roughly 1 year once the agreement is implemented. This is a 
substantial benefit for our security and those of our friends in the 
Middle East. It sets back the Iranian nuclear program by a significant 
margin and was a major concession by the Iranian Government in this 
negotiation.
    Significantly strengthened inspections of Iran's nuclear supply 
chain for the next 25 years is a second advantage of the nuclear 
agreement. Iran has also agreed to be subjected to permanent and 
enhanced IAEA verification and monitoring under the Additional 
Protocol. This will give the IAEA much greater insights into Iran's 
nuclear program and will increase substantially the probability of the 
U.S. detecting any Iranian deviations from the agreement.
    Third, sanctions will not be lifted until Iran implements the 
agreement in every respect. This could take up to 3 to 6 months. The 
U.S. and other countries should demand full and unambiguous Iranian 
implementation to deconstruct and modify its nuclear program according 
to the letter of the agreement. And, after sanctions are lifted, we 
must be ready and willing to reimpose them should Iran seek to cut 
corners, cheat, or test the integrity of the agreement in any way.
    A final advantage, Mr. Chairman, is that this agreement gives us a 
chance to prevent an Iranian nuclear weapon through diplomacy and 
negotiations, rather than through war. While the U.S. should be ready 
to use force against Iran if it approaches our redline of acquisition 
of a nuclear weapon, the smarter and more effective strategy at this 
point is to coerce them through negotiations. In this respect, I admire 
the commitment, energy and the achievements of Secretary Kerry, 
Secretary Moniz, and their team.
    While the benefits of this agreement for the U.S. are substantial, 
there are also risks in moving ahead. The most significant, in my 
judgment, is that while Iran's program will be frozen for a decade, the 
superstructure of its nuclear apparatus will remain intact, much of it 
in mothballs. Iran could choose to rebuild a civil nuclear program 
after the restrictions begin to end 10 to 15 years from now. This could 
give Tehran a base from which to attempt to build a covert nuclear 
weapons program at some point in the future.
    I differ with those critics, however, who believe that the 
expiration of the agreement will make Iranian acquisition of a nuclear 
weapon all but certain a decade or two from now. Much will depend on 
the Iranian leadership at that time. Will they want to risk another 
generation of international isolation and sanctions if they drive 
toward a nuclear weapon? Will they risk the possibility of an American 
or Israeli use of military force in response? A decision by Iran to 
turn back to a nuclear weapons ambition is a possibility, but by no 
means a certainty. The actions and resolve of the United States will 
have a major impact on Iran's calculations. It will be up to the 
President and Congress at that time to make clear to Iran that we will 
be ready to use any option available to us, including the use of 
military force, to prevent Iran from becoming a nuclear weapons power.
    The overall effectiveness of the agreement will thus require the 
Obama administration and its successors to maintain a very tough 
inspections regime and to be ready to reimpose sanctions if Iran seeks 
an illicit nuclear weapons program in the future.
    Congress is right to focus on these concerns and to require 
concrete assurances from the administration that they can be overcome. 
Specifically, the administration will need to focus hard on the 
possibility that Iran will cheat, as it has done so often in the past 
and attempt to construct covert facilities. Should this occur, the U.S. 
would need to ensure that the ``managed inspections'' set out in the 
agreement would work effectively. If Iran were to violate the 
agreement, American sanctions should be reimposed. Gaining broader 
international agreement for sanctions would be a more effective way to 
intimidate the Iranian authorities. This would be a priority, but also 
a challenging hurdle, for American diplomacy.
    On balance, however, I believe the nuclear deal will deliver more 
advantages than disadvantages to the United States. There are greater 
risks, in my judgment, in turning down the agreement and freeing Iran 
from the considerable set of restrictions it has now accepted.
    Most importantly, I do not see a more effective, credible, or 
realistic alternative that would give the U.S. a greater probability at 
this point of preventing an Iranian nuclear weapon. That is the key 
question Members of Congress should ask before you vote. Is there a 
more effective way forward than the one negotiated by the Obama 
administration?
    The most common criticism of the nuclear deal is that the U.S. 
should have walked away from the talks during the last year, sanctioned 
Iran further and attempted to negotiate a better and stronger 
agreement.
    But, this alternative would leave the U.S. weaker, rather than 
stronger, in confronting Iran's nuclear program. If the U.S. left the 
negotiations unilaterally, I do not believe it is likely that Russia 
and China and even the European allies and other key international 
economic powers would follow us. These countries are all strong 
supporters of the nuclear deal before the Congress today. The global 
coalition we spent the last 10 years building would likely fray and 
weaken over time. The sanctions regime would crumble along with it. We 
would lose the strong leverage that brought Iran to the negotiating 
table in the first place. While American sanctions were very important, 
it was the global nature of the sanctions with buy-in from nearly every 
major economy in the world, that made the critical difference in 
cutting off Iran from the international banking and financial system 
during the past few years. All of these benefits would be at risk after 
a U.S. walkout.
    Most importantly, the strong restrictions that have effectively 
frozen Iran's nuclear program since January 2014 would all be lifted if 
the negotiations are ended. Iran would be free to resume its advanced 
uranium enrichment and plutonium programs. We would lose the IAEA's 
insights into Iran's program as the inspections regime would weaken. 
Iran would not be 1 year away from a bomb under the Obama agreement but 
on the threshold of a nuclear weapons capability.
    While I don't agree necessarily that this ``No Deal'' scenario 
would lead inevitably to war, there is no doubt in my mind that it 
would leave the U.S. substantially weakened and worse off. How could 
this alternative be preferable to the real restrictions on Iran's 
program ensured by the nuclear deal?
    The nuclear deal is certainly not perfect but will freeze Iran's 
nuclear efforts for a decade or more and keep its government under the 
glare of a bright international spotlight for many years beyond. If it 
seeks to disapprove the President's policy, Congress should offer a 
realistic and effective alternative. But, I am unaware of any credible 
alternative that would serve our interests more effectively than the 
agreement proposed by the Obama administration and the other major 
countries of the world.
    Rather than vote to disapprove the President's policy, I hope 
members of both parties will work with the administration to strengthen 
our ability to implement the agreement successfully and to 
simultaneously contain Iranian power in the Middle East.
    We should create, in effect, a two-track American policy toward 
Iran in the future. On the one hand, we should work to ensure Iran 
implements the nuclear deal. On the other hand, we will need to 
construct a renewed effort with Israel, Turkey, and our friends in the 
Arab world to contain Iran's growing power in the region.
    Now that we are talking to Iran again after 35 years of minimal 
contact, there may be issues on which contact with Tehran will be in 
our interest. Protecting the Afghan Government from Taliban assaults is 
one such possibility. Convincing Iran to withdraw its support for 
President Assad in Syria is another.
    But, I do not believe we will experience anything approaching a 
normal relationship with the Iranian Government as some in our own 
country have suggested. This is not the time to restore full diplomatic 
relations with its government. There is too much that still separates 
us to justify such a decision. Our larger interests in the Middle East 
require the creation of a coalition of countries to oppose Iran as it 
makes an assertive push for power into the heart of the Sunni world in 
Iraq, Syria, Lebanon, and Yemen.
    With this in mind, there is more the Obama administration can do to 
ensure effective implementation of the nuclear deal and to push back 
against a more assertive Iranian policy in the region. Here are some 
concrete suggestions toward that end.

--A first-order diplomatic priority should be for the United States to 
    do everything in its power to maintain the ability to reimpose 
    sanctions on Iran, if necessary. Russia and, especially, China will 
    likely be weak and undependable partners in this regard. The U.S. 
    should thus focus on securing commitments from the European allies 
    that they will work with us to reimpose sanctions in the future, if 
    necessary. The administration should also convince Japan, South 
    Korea, India, and other major economies to be ready to curtail 
    commercial links to Iran should it violate the nuclear agreement;
--The United States should set a very high bar for Iran on 
    implementation of the agreement. Specifically, the U.S. should call 
    attention to even the most minor Iranian transgressions from the 
    start of the implementation process. If we do not set an exacting 
    standard, Iran may well diminish the integrity of the inspections 
    regime by cutting corners and testing its limits. Establishing a 
    tough-minded policy now is the right way to convince Iran there 
    will be immediate penalties should it not implement the deal fully;
--The United States should reaffirm publicly that we have vital 
    national interests in the Persian Gulf and that we will use 
    military force, if necessary, to defend them. That was the essence 
    of the Carter Doctrine of the late 1970s and has been the policy of 
    Republican and Democratic administrations since. President Obama 
    should continue the campaign he has already begun to assemble a 
    strong coalition of Gulf States to contain Iranian power in the 
    region. This will require accelerated military assistance to our 
    Arab partners and a strong, visible, and continuous American 
    military presence in the region;
--The United States should also try to close ranks with Israel and to 
    strengthen even further our long-standing military assistance 
    agreement that I led in negotiating in 2007 expires in 2 years. The 
    Obama administration could reaffirm our ongoing commitment to 
    Israel's Qualitative Military Edge (QME) over any potential 
    aggressor in the Middle East region. The administration should 
    accelerate military technology transfers to Israel to head off any 
    potential challenge to Israel from Iran or, as is more likely, from 
    its proxies, Hezbollah and Hamas.
--The United States and Israel should also make a renewed effort to 
    diminish their public divisions. President Obama should take steps 
    to work more effectively with Prime Minister Netanyahu. But, 
    repairing such a wide public dispute requires both leaders to make 
    it work. Prime Minister Netanyahu would be well advised to diminish 
    his excessive public criticism of the U.S. Government. I found in 
    my diplomatic career that allies work best when they work out their 
    differences privately rather than publicly.
--President Obama should reaffirm publicly and in the most unmistakable 
    terms, his readiness to deploy military force to strike Iran should 
    it obtain a nuclear weapon. This would help to create a more 
    durable American strategic deterrence to convince Iran that abiding 
    by the nuclear agreement is in its best interest.
--Finally, the United States should also press Iran to meet the 
    grievances of American families who lost their loved ones in 
    Iranian-inspired attacks on American citizens in past decades. This 
    includes, of course, the bombings of the U.S. Embassy in Beirut and 
    the U.S. Marine Barracks in 1983. It also includes the 
    assassination of Dr. Malcolm Kerr, President of the American 
    University of Beirut, in January 1984. His family has brought suit 
    against Iran in U.S. Federal Court as they believe Iran authorized 
    his murder through its proxies in Lebanon. There are many other 
    such civilian cases against Iran. Implementation of the nuclear 
    deal should not be made conditional on resolution of these cases, 
    in my judgment. But, we should not agree to resume full diplomatic 
    relations until Iran has agreed to settle them. By raising them 
    now, we would send Iran an unmistakable signal that we expect these 
    cases to be adjudicated fairly and with justice for the American 
    families in the future.
--At the same time, the administration must continue to press, as an 
    urgent priority, for the release of those Americans imprisoned or 
    missing in Iran.

    These steps would help to strengthen our ability to implement the 
Iran nuclear agreement and to put Iran on notice that it has a long way 
to go before it can resume a normal relationship with the United 
States.
    Successful implementation of the nuclear deal will require strong, 
self confident and determined American leadership. We are the 
indispensable center of the P5+1 group that negotiated the agreement. 
We have to insist on full Iranian implementation of the agreement. We 
must assemble an Arab coalition to contain Iran in the region. And we 
have to remain Israel's strong and faithful partner in a violent, 
turbulent, revolutionary era in Middle East history.
    Mr. Chairman, I urge Members of Congress to support this agreement. 
A vote of disapproval in the absence of a credible alternative, would, 
after 10 years of effort, be self-defeating for our country.
    If Congress votes to disapprove and manages to override the 
President's veto, it would very likely dismantle the agreement, lead to 
the disintegration of the global sanctions regime and remove all 
current restrictions on Iran's nuclear efforts. Such a result would 
leave Iran closer to a nuclear weapon. That is not a sensible course 
for our country.
    I also fear a vote of disapproval would weaken the effectiveness 
and credibility of the United States in the Middle East and around the 
world.
    There is another path open to Congress. Work with the President to 
strengthen America's position in the Middle East. Move forward with the 
nuclear deal. Push back against Iranian power in the region. A Congress 
that sought greater unity with President Obama would help to strengthen 
our country for the struggles that are inevitably ahead with Iran in 
the years to come.
                                 ______
                                 

                  Prepared Statement of Mark Dubowitz

    Chairman Corker, Ranking Member Cardin, members of the Senate 
Foreign Relations Committee, on behalf of the Foundation for Defense of 
Democracies and its Center on Sanctions and Illicit Finance, thank you 
for the opportunity to testify.
    I would like to address two areas in which the Joint Comprehensive 
Plan of Action (JCPOA) contains major design flaws: (1) the limitations 
(or lack thereof) on Iran's nuclear program, and (2) the precipitous 
sanctions relief disconnected from changes in Iranian behavior that 
prompted the sanctions. More specifically:

    1. The JCPOA provides Iran with a patient path to a nuclear weapon 
over the next decade and a half. Tehran has to simply abide by the 
agreement to emerge as a threshold nuclear power with an industrial-
size enrichment program; near-zero breakout time; an easier clandestine 
sneak-out pathway; an advanced long-range ballistic missile program, 
including intercontinental ballistic missiles (ICBMs); and hundreds of 
billions of dollars in sanctions relief to immunize its economy against 
future economic snapback sanctions, increase its conventional military 
power, and support terrorism and other rogue regimes.
    2. The JCPOA also creates an Iranian ``nuclear snapback'' instead 
of an effective economic sanctions snapback. This ``nuclear snapback'' 
provides Tehran with the ability to immunize itself against both 
political and economic pressure, block the enforcement of the 
agreement, and diminish the ability of the United States to apply any 
sanctions, including even nonnuclear sanctions, against the full range 
of Iran's illicit conduct;
    3. The JCPOA effectively dismantles the U.S. and international 
economic sanctions architecture, which, in key areas, was designed to 
address the full range of Iran's illicit activities. Iranian banks will 
be allowed back onto the SWIFT financial messaging system without 
evidence that their illicit conduct no longer poses risks to the global 
financial system. Once they return to SWIFT, it is difficult for me to 
image a scenario where they will again be expelled in great numbers, 
particularly given the deterrent power of Iran's nuclear snapback; and,
    4. The JCPOA also emboldens the most hardline element of the 
regime, Iran's Islamic Revolutionary Guard Corps (IRGC) and Supreme 
Leader Ali Khamenei's financial empire, which will be a major 
beneficiary of this agreement.

    After discussing the flaws in this JCPOA, I will provide 
recommendations on what Congress can do to improve the deal with Iran. 
This analysis, parts 3 and 4 of this testimony, begins on page 28. In 
these sections, I will discuss the precedents for congressional 
disapproval of treaties and executive agreements, analyze the likely 
outcomes of a congressional vote of disapproval of this nuclear deal 
with Iran, and provide recommendations for specific amendments to the 
JCPOA. I will conclude by discussing how Congress can defend the 
sanctions architecture against its precipitous unraveling under the 
JCPOA so that the U.S. can provide peaceful economic leverage to 
enforce this deal in the future.
                         part 1: nuclear flaws
Flawed Deal Construction: The Patient Pathways to a Bomb
    The Joint Comprehensive Plan of Action is fundamentally flawed in 
its construction. Even if Iran does not violate the JCPOA, over time, 
it will have patient pathways to nuclear weapons, an ICBM program, 
access to heavy weaponry, an economy immunized against sanctions 
pressure, and a more powerful regional position where it can continue 
its destabilizing and aggressive behavior. Even if Iran abides by the 
deal, it can reopen and expand each of the pathways to a nuclear bomb.
    Under the JCPOA, Iran will be permitted over the next 8.5 to 15 
years to expand its nuclear program. The deal allows certain 
restrictions on Iran's nuclear activities to lapse after 8.5 and 10 
years, and many additional restrictions to terminate after 15 years 
(see Figure 1). Additionally, once Iran has implemented its nuclear 
commitments under the JCPOA to reduce its operating centrifuges, reduce 
its low-enriched uranium stockpile, and modify the Arak heavy-water 
reactor, the international economic sanctions architecture will be 
nearly completely unwound (see Figure 2).









    The administration states that the goal of the nuclear deal is to 
cut off Iran's ``four pathways to a nuclear weapon'': the two uranium 
pathways through Natanz and Fordow, the plutonium pathway at the Arak 
reactor, and the clandestine pathway.\2\
    The JCPOA is fundamentally flawed in its design because if Iran 
abides by the deal, it can still reopen and expand each of these 
pathways.
    During the first 10 years, Iran can test advanced centrifuges in a 
way that does not accumulate enrichment uranium; however, after 8.5 
years, Iran can commence R&D and testing with uranium in up to 30 IR-
6's and IR-8's.\3\ After 10 years, Iran can increase the number and 
type of centrifuges operating at the Natanz facility, further reducing 
the limited restriction on this pathway.
    As restrictions on Iran's enrichment program lapse, Iran can 
operationalize an unlimited number of advanced centrifuges. These 
centrifuges can more easily be used in a clandestine program because 
they are more efficient than Iran's basic models, can enrich uranium to 
weapons-grade faster requiring a fewer number of machines, and can be 
housed in smaller, harder-to-detect facilities. Iran's breakout time--
the amount of time it takes to enrich enough uranium for one bomb to 
weapons-grade--will begin to drop below the 1-year breakout time after 
year 10 and hit near-zero breakout by year 13, according to President 
Obama.\4\ Even if there is a ``softer landing'' on breakout time after 
year 10 than the President predicted, Iranian breakout time will fall 
to near-zero after year 15 given the end of restrictions on the type 
and quantity of centrifuge deployment, the accumulation of low-enriched 
uranium, and the enrichment of uranium above 3.67 percent to 20 percent 
and 60 percent.\5\ As a result, Iran's nuclear program will no longer 
be at the 1-year breakout time that the Obama administration 
established as its benchmark.
    Additionally, after 15 years, Iran can build an unlimited number of 
advanced centrifuge-powered enrichment facilities.\6\ Iran will also be 
permitted to enrich uranium at its undergrounded facility at Fordow 
\7\--a facility possibly impenetrable to U.S. military strikes. Indeed, 
under the deal, Iran will be permitted to build multiple Fordow-type 
facilities. Thus, in a decade and a half, Iran will be on a path to an 
industrial-sized, widely dispersed nuclear program with an ICBM program 
and will have the capability to enrich very quickly to weapons-grade at 
hardened, buried under mountains, Fordow-type enrichment facilities.
    After 15 years, Iran can also build an unlimited number of heavy 
water reactors. The JCPOA prohibits Iran from building additional heavy 
water reactors for 15 years and after that, relies on a nonbinding 
Iranian intention to build only light water reactors. This intention 
might change.\8\ The deal also relies on Iranian intensions not to 
engage in spent fuel reprocessing,\9\ a process from which plutonium 
for a nuclear bomb can be recovered.
    The only permanent restriction on Iran's ability to use its heavy 
water reactors to reprocess plutonium for weapons purposes is the 
requirement to ship all spent fuel out of Iran ``for the lifetime of 
the reactor.'' \10\ When Arak is no longer operational, does this 
restriction also lapse? When Iran has multiple heavy water reactors and 
assesses that the United States has limited coercive options outside of 
military force to respond a violation of this ban, it may feel 
emboldened to retain spent fuel inside the country.
    While abiding by the terms of the JCPOA, Iran can exercise 
strategic patience and wait patiently to open up these multiple 
pathways to nuclear weapons while building up immunity against economic 
sanctions, leveraging its nuclear snapback to constrain Western 
retaliation to violations, and increasing its regional power.
    How would Iran achieve these objectives based on the JCPOA's deal 
terms?

    1. Do the bare minimum to address the PMD issue and fulfill the 
initial nuclear commitments.
    Iran is required to work with the International Atomic Energy 
Agency (IAEA) to resolve past and present issues of concern regarding 
the possible military dimensions (PMDs) of Iran's program.\11\ The IAEA 
will have tight deadlines to which it has to adhere in a politicized 
post-Iran deal environment. The IAEA will have limited time and space 
to resolve the outstanding issues. It remains unclear what will happen 
if the IAEA is not satisfied. What will be its path of recourse? Will 
Iran be required to make an expanded declaration of all of Iran's 
nuclear activities, including past activity, to set a credible baseline 
for monitoring and verification?
    Iran has reportedly already refused to allow certain scientists and 
facilities to be included in the list requested during the 
negotiations. The bilateral IAEA-Iran agreement may reportedly include 
only one visit to Parchin.\12\ Will the IAEA be able to interview all 
of the scientists, visit all of the sites, and see all of the documents 
to address their questions from the November 2011 IAEA report? What 
about questions that have arisen since that 2011 IAEA report? These 
appear not to be permitted under the ``Roadmap for Clarification of 
Past and Present Outstanding Issues.'' \13\

    2. Use sanctions relief to build economic resiliency and benefit 
the IRGC.
    After Iran completes specific, but reversible, nuclear steps, most 
EU and U.S. economic sanctions will begin to unwind, and Iran can 
increasingly immunize its economy against future economic pressure. The 
economic impact of sanctions relief is likely to be substantial, 
starting slowly after a deal and building over time.
    Economic forecasts prior to the announced deal based on 
expectations of the sanctions relief assessed that Iran's economic 
growth would likely stabilize around 2.6 percent in FY 2015/16, and 
then accelerate to about 4 percent in FY 2016/17. In the second half of 
the decade, Iran's economic growth would likely average 3.5-4 
percent.\14\ Depending on Iran's economic policy choices, in FY 2017/
18, growth might reach 5-6 percent.
    The IRGC will be a significant beneficiary of the sanctions relief. 
Combined with the delisting of IRGC officials and IRGC-linked entities, 
the relaxed banking standards will grant the Iranian regime the ability 
to move its money anywhere in the world. With EU sanctions also set to 
be lifted on major Iranian banks, Europe will become an economic free 
zone for Iran's most dangerous people and entities.

    3. Begin purchasing arms after the United Nations arms embargo 
terminates.
    According to the U.N. Security Council resolution, the arms embargo 
will end in 5 years.\15\ After 5 years, Iran can begin purchasing 
``battle tanks, armored combat vehicles, large caliber artillery 
systems, combat aircraft, attack helicopters, warships, [and] 
missiles.'' \16\ Iran can purchase these goods with the cash it has 
received through sanctions relief to build its own military capacities. 
Tehran may also illicitly provide these heavy arms to its allies and 
proxies.

    4. Develop a long-range ballistic missile system after the 
termination of the ballistic missile sanctions.
    U.N., U.S., and EU ballistic missile sanctions will be 
terminated.\17\ Notably, the JCPOA permits this to happen after 8 years 
or after the IAEA reaches a so-called ``broader conclusion'' that 
Iran's program is entirely peaceful and contains no undeclared 
activities, ``whichever is earlier.'' (emphasis added). In short, 
whether or not the IAEA has determined that Iran's program is peaceful, 
Tehran will be permitted to engage in an expansion of its ballistic 
missile program after a maximum of 8 years. Iran may also be able to 
expand its intercontinental ballistic missile program under the guise 
of satellite testing. The U.S. Defense Department notes, ``Iran has 
publicly stated it may launch a space launch vehicle by 2015 that could 
be capable of intercontinental ballistic missile ranges if configured 
as a ballistic missile.'' \18\
    Even with the current sanctions in place, Iran reportedly has the 
``largest and most diverse'' ballistic missile program in the Middle 
East.\19\ The U.S. Defense Department has repeatedly assessed that 
Iran's ballistic missiles could be ``adapted to deliver nuclear 
weapons.'' \20\ Last year, Director of National Intelligence James 
Clapper testified before Congress that if Iran chooses to make a bomb, 
Iran would choose ``a ballistic missile as its preferred method of 
delivering nuclear weapons.'' \21\ According to Clapper, these missiles 
are ``inherently capable of delivering WMD.'' \22\ Why is Iran 
permitted to engage in ballistic missile development--the development 
of the likely delivery vehicle if Iran builds a nuclear warhead--before 
the international community is certain that Iran's existing nuclear 
program is peaceful?

    5. Reap additional economic and military benefits when additional 
sanctions terminate and more entities are delisted by the United States 
and EU.
    Of the nearly 650 entities that have been designated by the U.S. 
Treasury Department for their role in Iran's nuclear and missile 
programs or for being owned or controlled by the Government of Iran, 
more than 67 percent will be delisted from Treasury's blacklists within 
6 to 12 months. After 8 years, only 25 percent of the entities that 
have been designated over the past decade will remain sanctioned.
    After 8 years--whether or not the IAEA has determined that Iran's 
nuclear program is entirely peaceful--additional significant EU 
sanctions will be lifted. These include sanctions on the IRGC, Quds 
Force, IRGC Air Force, and the Ministry of Defense. Additionally, the 
United States will lift sanctions on two central figures in Iran's 
nuclear development: Fereidoun Abbasi-Davani and Mohsen Fakhrizadeh. 
Abbasi-Davani is the former head of the Atomic Energy Organization of 
Iran. Fakhrizadeh is the A.Q. Khan of Iran's nuclear weapons 
development. The United States will also delist--among other entities 
involved in Iran's nuclear program--the Organization of Defensive 
Innovation and Research (SPND), an entity ``primarily responsible for 
research in the field of nuclear weapons development.'' \23\
    Additionally, Iran could argue that other ``nonnuclear'' sanctions 
should also be lifted under the JCPOA according to paragraph 26: ``The 
U.S. Administration, acting consistent with the respective roles of the 
President and the Congress, will refrain from imposing new nuclear-
related sanctions. Iran has stated that it will treat such a 
reintroduction or reimposition of the sanctions specified in Annex II, 
or such an imposition of new nuclear-related sanctions, as grounds to 
cease performing its commitments under this JCPOA in whole or in 
part.'' \24\
    Paragraph 29 of the preface states: ``The EU and its Member States 
and the United States, consistent with their respective laws, will 
refrain from any policy specifically intended to directly and adversely 
affect the normalization of trade and economic relations with Iran 
inconsistent with their commitments no to undermine the successful 
implementation of this JCPOA.'' \25\ (emphasis added)
    While paragraph 26 only refers to the imposition of new nuclear-
related sanctions, Iran may be able to argue that U.S. terrorism-
related sanctions to the extent they have any economic impact on Iran 
are in violation of the JCPOA because they block the normalization of 
trade and economic relations. For example, Iran could claim that the 
imposition of sanctions on Iranian banks for terrorist financing would 
impede normal trade and economic relations. Tehran also can threaten to 
use its ``nuclear snapback'' (described below) to persuade the EU and 
other countries not to comply with any new U.S. nonnuclear sanctions, 
complicating Washington's ability to constrain and deter the full range 
of Iran's illicit conduct.

    6. Transform from a nuclear pariah to a nuclear partner.
    After ten years, the United Nations will remove the Iranian nuclear 
file from its agenda and will ``no longer be seized of the Iran nuclear 
issue.'' At that time, Iran will no longer be under any Chapter 7 
resolutions and will have a legitimate and legal nuclear program. Iran 
can also build additional scientific knowledge because research and 
development restrictions will be lifted. Even prior to the lifting of 
restrictions on R&D, Iranian scientists can acquire knowledge and 
skills that can be used to move quickly to nuclear breakout at the time 
of Iran's choosing. Under the JCPOA, all parties also commit to 
cooperate on enhancing Iran's ability to respond to nuclear security 
threats ``including sabotage,'' \26\ which may limit the use of cyber 
and other tools to counter Iran's nuclear expansion or to respond to 
Iranian noncompliance.
    7. Use the threat of a ``nuclear snapback'' to ward off any attempt 
to use the sanctions snapback.
    The JCPOA explicitly states, ``Iran has stated that if sanctions 
are reinstated in whole or in part, Iran will treat that as grounds to 
cease performing its commitments under this JCPOA in whole or in 
part.'' \27\ In effect, Iran has given advance notice that using 
snapback sanctions may lead to cancellation of the JCPOA. If the United 
States or any of its partners insist on reimposing sanctions, Iran may 
simply walk away from the deal. If Iran cheats and gets caught, and the 
international community attempts to punish Iran, Iran can threaten to 
back out of the deal and expand its nuclear program. It is quite likely 
under such circumstances that the P5+1 will be reluctant to punish Iran 
for any violations short of the most flagrant and egregious violations. 
This would create a permissive environment for Iranian cheating and 
stonewalling of the IAEA.

    8. Build an advanced centrifuge-powered, industrial-size nuclear 
program.
    After 15 years, the significant restrictions on Iran's nuclear 
program will have lapsed. Iran will be permitted to have:

   Multiple enrichment facilities;
   A near-zero breakout time with faster advanced centrifuges;
   An easier clandestine sneak-out with fewer machines deployed 
        in smaller facilities;
   Plutonium reprocessing;
   A stockpile of enriched uranium to 20 or 60% levels; and,
   An expanded ballistic missile program.

    9. Stymie IAEA inspections.
    Throughout the duration of the JCPOA, Iran can delay IAEA 
inspections of suspected sites without facing consequences. The JCPOA 
creates a 24-day delay between a formal IAEA request to access a 
suspicious site and the date on which Iran must allow access. As former 
Deputy Administrator for Defense Nuclear Nonproliferation at the 
National Nuclear Security Administration, William Tobey, explains, ``24 
days . . . [is] ample time for Iran to hide or destroy evidence.'' \28\
    Former Deputy Director General for Safeguards at the IAEA, Dr. Olli 
Heinonen, explains that for small facilities, 24 days is enough time 
for Iran to ``sanitize'' suspected sites, including, for example, where 
Iran may be engaged in weaponization activities.\29\ Iran is also 
likely to have developed contingency plans to respond to IAEA demands 
to visit these sites. According to Dr. Heinonen, Tehran may only need 2 
days to remove nuclear equipment from a small facility \30\ and remove 
any traces of uranium, which even environmental sampling may be unable 
to detect. As Dr. Heinonen notes: ``Time for `scrubbing' takes on 
special salience in nuclear-related developments without nuclear 
material present. Some of the past concealment events carried out by 
Iran in 2003 left no traces to be detected through environmental 
sampling.'' \31\

    10. Become a threshold nuclear weapons state.
    While adhering to the letter of its commitments under the JCPOA, 
Iran will emerge in 15 years with multiple pathways to a nuclear 
weapon. Iran will have a powerful economy, immunized against sanctions 
pressure and increased military and regional power. Iran will likely be 
the dominant power in the region and a threshold nuclear weapons state. 
Iran will have achieved its goals through strategic patience by 
following the terms of the deal.
    The JCPOA does not prevent a nuclear-armed Iran; rather it provides 
multiple patient pathways for Iran.
The JCPOA's Iranian Nuclear Snapback
    The JCPOA contains a weak enforcement mechanism. Throughout the 
negotiations, Obama administration officials have explained that under 
a final deal, the United States and its allies would be able to 
reimpose sanctions quickly in order to punish Iranian noncompliance and 
bring Iran back into compliance with its nuclear commitments. This was 
the so-called ``snapback'' sanction.
    Even as originally conceived, this enforcement mechanism was flawed 
\32\ because there would likely be significant disagreements between 
the United States, European states, and members of the U.N. Security 
Council on the evidence, the seriousness of infractions, the 
appropriate level of response, and likely Iranian retaliation. In 
addition to this diplomatic hurdle, the snapback sanction mechanism was 
economically flawed because it took years to persuade international 
companies to exit Iran after they had invested billions of dollars; 
once companies reenter the Iranian market, it will be difficult to get 
them to leave again. Just the other day, Foreign Minister Mohammad 
Zarif noted that the ``swarming of businesses to Iran'' is a barrier to 
the reimposition of sanctions, and once the sanctions architecture is 
dismantled, ``it will be impossible to reconstruct it.'' Zarif boasted 
that Iran can restart its nuclear activities faster than the United 
States can reimpose sanctions.\33\
    Furthermore, sanctions impacted reputational and legal risk 
calculations of private companies evaluating potential business deals 
with an Iranian Government, economy, and entities that had consistently 
engaged in deceptive and other illicit conduct. The question of risk 
and the integrity of Iran's economy and financial dealings cannot be 
turned on and off quickly. The snapback sanction in the JCPOA also has 
an additional economic delay because it may grandfather in existing 
deals, providing an incentive for companies to move as quickly as 
possible to sign major long-term deals so that any existing contacts 
will not be subject to snapback sanctions.
    The JCPOA further undermines the snapback sanction--the United 
States only peaceful enforcement mechanism--through the dispute 
resolution mechanism, which is governed by a Joint Commission 
compromised of the United States, EU, France, U.K., Germany, China, 
Russia, and Iran. The mechanism creates a 60-plus day delay between the 
time that the United States (or another P5+1 member) announces that a 
violation has occurred and the time that United Nations sanctions may 
be reimposed.\34\
    If the United States believes that Iran has violated the deal, 
Washington will refer Iran to the Joint Commission, which consists of 
the P5+1, Iran, and an EU representative. If the issue cannot be 
resolved by consensus within the Joint Commission, after a process of 
35 days, the United States can then unilaterally refer the issue to the 
U.N. Security Council. The Security Council must then pass a resolution 
(which the United States can veto) to continue the current sanctions 
relief. If that resolution is not passed within another 30 days, the 
previous U.N. sanctions will be reimposed. The ``snap'' in ``snapback'' 
therefore takes more than 2 months. The mechanism also does not provide 
for any unilateral reimposition of sanctions, nor does the U.N. 
Security Council resolution, Resolution 2231, which the Obama 
administration pushed forward to a vote despite congressional requests 
to delay until after Congress had thoroughly reviewed the deal.\35\
    Furthermore, the resolution states that the snapback mechanism is 
for issues of ``significant nonperformance,'' implying that it would 
not likely be used for incidents of incremental cheating. The Iranian 
regime has previously been inclined to cheat incrementally, not 
egregiously, even though the sum total of its incremental cheating has 
been egregious. The snapback provision incentivizes Iran to continue 
this behavior because there is no enforcement mechanism to punish 
incremental cheating.
    More importantly, the JCPOA has armed Iran with its own nuclear 
``snapback'' against attempts to reimpose U.N. sanctions in response to 
Iranian nuclear violations. The JCPOA explicitly states, ``Iran has 
stated that if sanctions are reinstated in whole or in part, Iran will 
treat that as grounds to cease performing its commitments under this 
JCPOA in whole or in part.'' \36\
    This nuclear snapback also is included in text relating to both EU 
and U.S. economic snapbacks: ``The EU will refrain from reintroducing 
or reimposing the sanctions that it has terminated implementing under 
this JCPOA without prejudice to the dispute resolution mechanism 
provided for under this JCPOA. There will be no new nuclear-related 
U.N. Security Council sanctions and no new EU nuclear-related sanctions 
or restrictive measures.'' \37\
    In addition: ``The U.S. Administration, acting consistent with the 
respective roles of the President and the Congress, will refrain from 
reintroducing or reimposing the sanctions specified in Annex II that it 
has ceased applying under this JCPOA, without prejudice to the dispute 
resolution process provided for under this JCPOA . . . [and] will 
refrain from imposing new nuclear-related sanctions. Iran has stated 
that it will treat such a reintroduction or reimposition of the 
sanctions specified in Annex II, or such an imposition of new nuclear-
related sanctions, as grounds to cease preforming its commitments under 
this JCPOA in whole or in part.'' \38\ (emphasis added)
    Finally, the JPCOA contains an explicit requirement for the EU and 
the United States to do nothing to interfere with the normalization of 
trade and economic relations with Iran: ``The EU and its Member States 
and the United States, consistent with their respective laws, will 
refrain from any policy specifically intended to directly and adversely 
affect the normalization of trade and economic relations with Iran 
inconsistent with their commitments not to undermine the successful 
implementation of this JCPOA.'' \39\ (emphasis added)
    Iran can use these provisions to argue that any reimposition of 
sanctions, even if implemented on nonnuclear grounds ``adversely 
affects the normalization of trade and economic relations'' and will 
challenge attempts by the EU or United States to reinstate sanctions on 
nonnuclear grounds. Iran will threaten to simply walk away from the 
deal and expand its nuclear program.
    Even while incrementally cheating on its commitments, Iran could 
force the United States and Europe to choose between not strictly 
enforcing the agreement and abrogating the whole agreement. Given the 
normal political and diplomatic environment, which encourages parties 
not to undermine existing agreements, it is highly likely that the 
United States and Europe would choose not to address incremental 
cheating. Iran is likely to get away with small- and medium-sized 
violations, since both the United States and Europe are heavily 
invested in this deal and would only abrogate it for a major violation. 
The JCPOA's language also provides Iran with an opening to insist that 
other nonnuclear sanctions measures, including Iran's inclusion on the 
state sponsor of terrorism list, hinders trade. and therefore should be 
terminated.
    The JCPOA is flawed in its design; it contains no peaceful, 
effective means to enforce the deal and explicitly provides Iran with 
an opening for a nuclear snapback that it can use to characterize 
itself as the aggrieved party if the EU or U.S. reimposes sanctions. 
This nuclear snapback could be particularly effective against the 
Europeans, who will be loath to do anything that leads to Iranian 
nuclear escalation, and on whose support the United States needs on the 
Joint Committee, at the U.N. Security Council, in a coordinated 
transatlantic snapback scenario of EU and U.S. sanctions, or, at a 
minimum, to comply with U.S. secondary sanctions. To neutralize the 
effectiveness of economic snapbacks, Iran could target Europe as the 
weakest link through threats of nuclear escalation or through 
inducements of substantial investment and commercial opportunities. And 
we must bear in mind that Iran needs only to move one of the three 
European nations in the talks or shake the EU consensus in order to 
undermine this enforcement mechanism.
                     part 2: sanctions relief flaws
JCPOA & Challenge to Conduct-Based Financial Sanctions
    The JCPOA also dismantles the international economic sanctions 
architecture which was designed to respond to the full range of Iran's 
illicit activities, not only the development of Iran's illicit nuclear 
program. The United States has spent the last decade building a 
powerful yet delicate sanctions architecture to punish Iran for its 
nuclear mendacity, illicit ballistic missile development, vast 
financial support for terrorist groups, backing of other rogue states 
like Bashar al-Assad's Syria, human rights abuses, and the financial 
crimes that sustain these illicit activities. More broadly, a primary 
goal of the sanctions on Iran, as explained by senior Treasury 
Department officials over the past decade, was to ``protect the 
integrity of the U.S. and international financial systems'' from 
Iranian illicit financial activities and the bad actors that 
facilitated these.\40\
    The goal of sanctions was to provide the President with the tools 
to stop the development of an Iranian nuclear threshold capacity and 
also to protect the integrity of the U.S.-led global financial sector 
from the vast network of Iranian financial criminals and the recipients 
of their illicit transactions. This included brutal authoritarians, 
terrorist funders, weapons and missile proliferators, narcotraffickers, 
and human rights abusers.
    Tranche after tranche of designations issued by the Treasury, 
backed by intelligence that often took months, if not years, to 
compile, isolated Iran's worst financial criminals. And designations 
were only the tip of the iceberg. Treasury officials traveled the globe 
to meet with financial leaders and business executives to warn them 
against transacting with known and suspected terrorists and weapons 
proliferators.\41\ This campaign was crucial to isolating Iran in order 
to deter its nuclear ambitions and also to address the full range of 
its illicit conduct.
    Following years of individual designations of Iranian and foreign 
financial institutions for involvement in the illicit financing of 
nuclear, ballistic missile, and terrorist activities,\42\ Treasury 
issued a finding in November 2011 under Section 311 of the USA PATRIOT 
Act that Iran, as well as its entire financial sector including the 
Central Bank of Iran (CBI), is a ``jurisdiction of primary money 
laundering concern.'' \43\ Treasury cited Iran's ``support for 
terrorism, pursuit of weapons of mass destruction,'' including its 
financing of nuclear and ballistic missile programs, and the use of 
``deceptive financial practices to facilitate illicit conduct and evade 
sanctions.'' \44\ The entire country's financial system posed ``illicit 
finance risks for the global financial system.'' \45\ Internationally, 
the global antimoney laundering and antiterror finance standards body 
the Financial Action Task Force (FATF) also warned its members that 
they should ``apply effective countermeasures to protect their 
financial sectors from money laundering and financing of terrorism (ML/
FT) risks emanating from Iran.'' \46\
    As recently as June 26, 2015, FATF issued a statement warning that 
Iran's ``failure to address the risk of terrorist financing'' poses a 
``serious threat . . . to the integrity of the international financial 
system.'' \47\
    The Section 311 finding was conduct-based; it would be appropriate, 
therefore, to tie the lifting of sanctions on all designated Iranian 
banks, especially the legislatively designated Central Bank of Iran, 
and their readmission onto SWIFT and into the global financial system, 
to specific changes in the conduct of these Iranian entities across the 
full range of Iran's illicit financial activities. However, the JCPOA 
requires the lifting of financial sanctions--including the SWIFT 
sanctions--prior to a demonstrable change in Iran's illicit financial 
conduct.
    In the past, Washington has given ``bad banks'' access to the 
global financial system in order to secure a nuclear agreement. In 
2005, Treasury issued a Section 311 finding against Macau-based Banco 
Delta Asia,\48\ and within days, North Korean accounts and transactions 
were frozen or blocked in banking capitals around the world. North 
Korea refused to make nuclear concessions before sanctions relief and 
defiantly conducted its first nuclear test.\49\ The State Department 
advocated for the release of frozen North Korean funds on good 
faith,\50\ and ultimately prevailed. As a result, however, Washington 
lost its leverage and its credibility by divorcing the Section 311 
finding from the illicit conduct that had prompted the finding in the 
first place. Undeterred, North Korea moved forward with its nuclear 
weapons program while continuing to engage in money laundering, 
counterfeiting, and other financial crimes.
    Compromising the integrity of the U.S. and global financial system 
to conclude a limited agreement with North Korea neither sealed the 
deal nor protected the system. The JCPOA appears to repeat this same 
mistake by lifting financial restrictions on bad banks without 
certifications that Iran's illicit finance activities have ceased.
    The JCPOA stipulates that of the nearly 650 entities that have been 
designated by the U.S. Treasury for their role in Iran's nuclear and 
missile programs or for being owned or controlled by the Government of 
Iran, more than 67 percent will be delisted from Treasury's blacklists 
within 6-12 months. This includes the Central Bank of Iran and most 
major Iranian financial institutions. After 8 years, only 25 percent of 
the entities that have been designated by Treasury over the past decade 
will remain sanctioned. A number of the banks that are to be 
dedesignated originally were designated for multiple reasons, not just 
nuclear, including for financing Iran's missile program (e.g., Bank 
Sepah), providing banking services to those banks designated for 
missile financing (e.g., Post Bank of Iran, EIH) or, in the case of the 
Central Bank of Iran, for multiple financial crimes as discussed above.
    Many IRGC businesses that were involved in the procurement of 
material for Iran's nuclear and ballistic missile programs will be 
delisted as will some of the worst actors involved in Iran's nuclear 
weaponization activities. Even worse, the EU will lift all of its 
counterproliferation sanctions on Iran. Although human rights-related 
sanctions will remain, and terrorism and Syria-related sanctions will 
remain on notorious Quds Force commander Qassem Soleimani,\51\ 
sanctions against the Quds Force itself will be lifted (although 
certain Syria-related sanctions will remain).
    What is especially notable about the lifting of designations is 
that the Obama administration has provided no evidence to suggest that 
these individuals, banks, and businesses are no longer engaging in the 
full range of illicit conduct on which the original designations were 
based. What evidence, for example, is there for the dedesignation of 
the Central Bank of Iran, which is the main financial conduit for the 
full range of Iran's illicit activities, and how does a nuclear 
agreement resolve its proven role in terrorism and ballistic missile 
financing, money laundering, deceptive financial activities, and 
sanctions evasion? In other words, with the dismantlement of much of 
the Iran sanctions architecture in the wake of a nuclear agreement, the 
principle upon which Treasury created the sanctions architecture--the 
protection of the global financial system--is no longer the standard.
Swift: Case Study in the JCPOA's Precipitous Sanctions Relief
    The sanctions relief provided to Iran through its readmission into 
the SWIFT financial messaging system is a case study in the scale of 
precipitous sanctions relief afforded to Iran under the JCPOA. It is 
also a cautionary study in how difficult it will be to snap back the 
most effective economic sanctions.
    The JCPOA obligates the United States, European Union, and United 
Nations to lift sanctions at two specific intervals: On 
``Implementation Day'' when the IAEA verifies that Iran has implemented 
its nuclear commitments under the JCPOA to reduce its operating 
centrifuges, reduce its low-enriched uranium stockpile, and modify the 
Arak heavy water reactor, among other requirements; and on ``Transition 
Day'' in 8 years or when the IAEA has reached a ``broader conclusion'' 
that Iran's nuclear program is entirely peaceful, whichever comes 
first. This last clause is critical: Even if the IAEA cannot verify the 
peaceful nature of Iran's program, Iran will receive additional 
sanctions relief.
    The JCPOA will provide Iran with more than $100 billion in 
sanctions relief, if you include the funds reportedly tied up in oil 
escrow accounts, and as much as $150 billion based on figures quoted by 
President Obama,\52\ which presumably includes funds that are legally 
frozen and those to which banks have been unwilling to provide Iran 
free access, even though they were not under formal sanctions. These 
funds could flow to the coffers of terrorist groups and rogue actors 
like Hezbollah, Hamas, Palestinian Islamic Jihad, Iraqi Shiite 
militias, the Houthis in Yemen, and Syrian President Bashar al-Assad's 
regime in Damascus. President Obama has claimed the money would not be 
a ``game-changer'' for Iran.\53\ As Supreme Leader Ali Khamenei, 
however, stated in a speech less than 1 week after the JCPOA 
announcement, ``We shall not stop supporting our friends in the region: 
The meek nation of Palestine, the nation and government of Syria . . . 
and the sincere holy warriors of the resistance in Lebanon and 
Palestine.'' \54\ This infusion of cash will relieve budgetary 
constraints for a country, which had only an estimated $20 billion in 
fully accessible foreign exchange reserves prior to November 2013 \55\ 
but was spending at least $6 billion annually to support Assad.\56\
    The real prize for Iran in the JCPOA sanctions relief package is 
regaining access to SWIFT, (the Society for Worldwide Interbank 
Financial Telecommunication) a little-known, but ubiquitous banking 
system that has been off-limits to the country since March 2012. Iran's 
successful negotiation of the lifting of this sanction is a case study 
in how the JCPOA provides precipitous sanctions relief to Iran prior to 
a demonstrable change in Iranian financial practices.
    SWIFT is the electronic bloodstream of the global financial system. 
It is a member-owned cooperative comprising the most powerful financial 
institutions in the world, which allows more than 10,800 financial 
companies worldwide to communicate securely.\57\
    By 2012, SWIFT represented one of Tehran's last entry points into 
the global financial system, as the United States and the European 
Union had sanctioned scores of banks, energy companies, and other 
entities under the control of the IRGC. In March 2012, SWIFT 
disconnected 15 major Iranian banks from its system in 2012 after 
coming under pressure from both the United States and the European 
Union.\58\ It was a substantial blow to Tehran since SWIFT was not only 
how Iran sold oil but also how Iranian banks moved money. According to 
SWIFT's annual review, Iranian financial institutions used SWIFT more 
than 2 million times in 2010.\59\ These transactions, according to The 
Wall Street Journal, amounted to $35 billion in trade with Europe 
alone.\60\
    As a result of congressional legislation targeting SWIFT,\61\ EU 
regulators instructed SWIFT to remove specified Iranian banks from the 
SWIFT network.\62\ It was congressional pressure, and an unwillingness 
by Congress to accept arguments advanced by Obama administration 
officials that such action would undercut the multilateral sanctions 
regime, which finally persuaded the Obama administration and EU 
officials to act.
    Today, the JCPOA explicitly calls for the lifting of sanctions on 
the ``[s]upply of specialized financial messaging services, including 
SWIFT, for persons and entities . . . including the Central Bank of 
Iran and Iranian financial institutions.'' \63\ EU will lift SWIFT 
sanctions for the Central Bank of Iran and all Iranian banks \64\ 
originally banned from SWIFT.\65\
    The nuclear deal also lifts U.S. sanctions on 21 out of the 23 
Iranian banks designated for proliferation financing--including both 
nuclear and ballistic missile activity.\66\ The designation of Bank 
Saderat for terrorist financing will remain in place, but the sanctions 
against the Central Bank of Iran will be lifted. Twenty-six other 
Iranian financial institutions blacklisted for providing financial 
services to previously designated entities (including NIOC which is 
being delisted on Implementation Day) or for being owned by the 
Government of Iran will also be removed from Treasury's blacklist.\67\
    The Obama administration is assuming that the SWIFT sanctions (and 
other economic sanctions) can be reconstituted either in a snapback 
scenario or under nonnuclear sanctions like terrorism. However, the 
JCPOA notes that Iran may walk away from the deal and abandoned its 
nuclear commitments if new sanctions are imposed: ``Iran has stated 
that if sanctions are reinstated in whole or in part, Iran will treat 
that as grounds to cease performing its commitments under this JCPOA in 
whole or in part.'' \68\ This gives Iran an effective way to intimidate 
the United States, and in particular, Europe into not reinstating 
sanctions, except for the most severe violations.
    The threat of this ``nuclear snapback'' will prevent a response to 
technical and incremental violations for fear that Iran will walk away 
from the agreement and escalate its program, provoking a possible 
military crisis. It will also be used to make it very difficult for the 
United States and EU to ever reimpose SWIFT sanctions, which the 
Iranian Government is likely to see as an act of economic or financial 
war, and will threaten to retaliate accordingly. This nuclear snapback 
will be discussed in greater detail in a subsequent section.
The IRGC: The JCPOA's Big Winner
    The IRGC stand to be the greatest beneficiary from the economic 
relief granted under the JCPOA through both an improvement in Iran's 
overall macroeconomic environment and through the dominance of the 
Revolutionary Guards in key strategic areas of the Iranian economy. 
Already, the sanctions relief provided as part of the Joint Plan of 
Action (JPOA) enabled Iran to move from a severe economic recession to 
a modest recovery. During the JPOA negotiations, Iran received $11.9 
billion in direct sanctions relief, including on major sectors of 
Iran's economy such as the auto and petrochemical sectors, permission 
to trade in gold, and President Obama's decision to deescalate the 
sanctions pressure by blocking new congressional sanctions, rescued the 
Iranian economy and its rulers, including the IRGC, from a rapidly 
deteriorating balance of payments.\69\
    In 2014, Iran's exports to Europe increased 48 percent year over 
year. Overall, between March 2014 and February 2015, Iran's nonoil and 
gas exports increased 22 percent.\70\ The JPOA facilitated imports from 
the EU through a relaxation of the bloc's banking restrictions which 
increased the authorization thresholds for ``nonsanctioned trade'' 
tenfold, from =40,000 to =400,000. Iran had better access to European 
goods, including spare parts for its automotive industry. The JPOA also 
suspended petrochemical sanctions; these exports rose 32 percent to 
$3.17 billion.\71\
    Economic forecasts prior to the announcement of the JCPOA based on 
expectations of the sanctions relief assessed that Iran's economic 
growth would likely stabilize around 2.6 percent in FY 2015/16, and 
then accelerate to about 4 percent in FY 2016/17.\72\ In the second 
half of the decade, Iran's economic growth would likely average 3.5-4 
percent. Depending on Iran's economic policy choices, in FY 2017/18, 
growth could reach 5-6 percent.
    In addition to the improvement in Iran's macroeconomic picture, 
which reduces threats to the political survival of the regime, the big 
winner from the unraveling of European and American sanctions will be 
the IRGC, which will earn substantial sanctions relief. The IRGC not 
only directs Iran's external regional aggression, its nuclear and 
ballistic missile programs, and its vast system of domestic repression; 
the Guards also control at least one-sixth of the Iranian economy.\73\ 
Their control over strategic sectors of the Iranian economy--banking, 
energy, construction, industrial, engineering, mining, shipping, 
shipbuilding, amongst others--means that any foreign firms interested 
in doing business with Iran will have to do business with the IRGC.
    In anticipation of the sanctions relief in a final nuclear deal, 
President Rouhani's 2015 budget rewards the IRGC. It includes a 48-
percent increase on expenditures related to the IRGC, the intelligence 
branches, and clerical establishment. Iran's defense spending was set 
to increase by one-third, to $10 billion annually--excluding off the 
books funding.\74\ The IRGC and its paramilitary force, the Basij, are 
set to receive 64 percent of public military spending, and the IRGC's 
massive construction arm Khatam al-Anbiya (which will be delisted by 
the European Union and is the dominant player in key strategic sectors 
of Iran's economy) will see its budget double. Rouhani's budget also 
included a 40-percent increase ($790 million) for Iran's Ministry of 
Intelligence.\75\ Iran's latest 5-year plan, announced days before the 
JCPOA, calls for an additional increase in military spending to 5 
percent of the total government budget.\76\ With access to additional 
revenue around the corner and with the termination of the arms embargo 
just over the horizon, Iran knows how it will spend its new cash.
    My colleagues at the Foundation for Defense of Democracies Emanuele 
Ottolenghi and Saeed Ghasseminejad have done an extensive review of the 
sanctions relief and the entities that will be delisted under the 
JCPOA.\77\ The following is based on their analysis.
            Access to Europe and the delisting of IRGC entities
    With the lifting of EU sanctions under the JCPOA, Europe will 
increasingly become an economic free zone for Iran's most dangerous 
people and entities. In addition to the lifting of specific types of 
economic and financial sanctions, the JCPOA requires the United States 
and Europe to remove numerous IRGC-linked entities from their sanction 
lists.
    Europe will delist significant IRGC entities and persons including 
the Quds Force. Some of these delistings will occur on Implementation 
Day, but many more will fall off after 8 years (assuming that they are 
even enforced over the next 8 years).
    Khatam al-Anbiya (KAA), a massive IRGC conglomerate, was designated 
by the United States as a proliferator of weapons of mass 
destruction.\78\ It is Iran's biggest construction firm and, according 
to my colleagues' estimates, ``may be its largest company outright, 
with 135,000 employees and 5,000 subcontracting firms.'' \79\ The value 
of its current contracts is estimated to be nearly $50 billion, or 
about 12 percent of Iran's gross domestic product.\80\ KAA has hundreds 
of subsidiaries in numerous sectors of Iran's economy including its 
nuclear and defense programs, energy, construction, and engineering. 
The company is also involved in ``road-building projects, offshore 
construction, oil and gas pipelines and water systems.'' \81\ EU 
sanctions against the company will be lifted after 8 years, whether or 
not the IAEA concludes that Iran's nuclear program is peaceful.
    Similarly, the IRGC Cooperative Foundation (a.k.a. Bonyad Taavon 
Sepah), the IRGC investment arm, was designated by the U.S. Treasury as 
a proliferator of weapons of mass destruction,\82\ but is slated to be 
delisted by the EU after 8 years as a result of the JCPOA. It is not 
listed among the entities that the United States will delist. The 
portfolio of IRGC Cooperative Foundation controls more than 20 percent 
of the value of the Tehran Stock Exchange.\83\
    Ansar Bank and Mehr Bank, which are both IRGC-linked and were 
designated by the Treasury for providing financial services to the 
IRGC,\84\ will also be delisted by the EU (but not by the United 
States). They will be allowed back onto the SWIFT system and may open 
branches, conduct transactions, and facilitate financial flows for the 
IRGC.
    Other IRGC-linked banks, like Bank Melli,\85\ will be delisted by 
both the United States and Europe upon Implementation Day and allowed 
back onto SWIFT.
    The Quds Force, the IRGC's external arm, will also be a beneficiary 
of sanctions relief. In addition to the EU delisting, the JCPOA will 
lift both U.S. and EU sanctions on Iran's commercial airline, Iran Air, 
on which the Quds Force depends to ``dispatch weapons and military 
personnel to conflict zones worldwide. . . . The Quds Force will have 
access to newer, larger, and more efficient planes with which to pursue 
its strategic objectives.'' \86\
    The JCPOA also delists several IRGC military research and 
development facilities. For example, EU sanctions on the Research 
Center for Explosion and Impact will be lifted after 8 years. This 
entity was designated by the EU for connection to the possible military 
dimensions of Iran's nuclear program.\87\ Whether or not the IAEA has 
reached a broader conclusion that Iran's program is peaceful and this 
center is not engaged in weapons-related activities, the sanctions will 
be lifted.
    In 8 years, United States will also lift sanctions on central 
pillars of Iran's nuclear and weaponization activities. Two central 
individuals, Fereidoun Abbasi-Davani and Mohsen Fakhrizadeh, will be 
delisted. Abbasi-Davani is the former head of the Atomic Energy 
Organization of Iran.\88\ Fakhrizadeh is the A.Q. Khan of Iran's 
nuclear weapons development and, according to the U.S. State 
Department, ``managed activities useful in the development of a nuclear 
explosive device'' and designated ``for his involvement in Iran's 
proscribed WMD activities.'' \89\
    The United States will also delist the Organization of Defensive 
Innovation and Research (SPND), an entity ``primarily responsible for 
research in the field of nuclear weapons development,'' according to 
the U.S. State Department. The organization was designated less than a 
year ago, during the P5+1 negotiations with Iran, and was created by 
Fakhrizadeh.\90\ The EU will also delist SPND and Abbasi-Davani and 
Fakhrizadeh at the same time.
    Additionally, the United States will delist Aria Nikan Marin 
Industry, which sources goods for Iran's nuclear program and whose 
customers include Khatam al-Anbiya; \91\ Iran Pooya, which supplies 
material for centrifuge production; \92\ and the Kalaye Electric 
Company, which was designated as a proliferator in 2007 for its 
involvement in Iran's centrifuge research and development efforts.\93\ 
Kalaye Electric was a site of centrifuge production in 2003. When the 
IAEA requested access and the ability to take environmental samples, 
Iran delayed granting access and, according to experts, took 
``extraordinary steps to disguise the past use and purpose of this 
facility.'' \94\
    Jahan Tech Rooyan Pars and Mandegar Baspar Kimiya Company will also 
be delisted. These two entities were involved in illicit procurement of 
proliferation-sensitive material.\95\
JCPOA Benefits Khamenei's Network of Corruption
    My colleagues Emanuele Ottolenghi and Saeed Ghasseminejad have also 
studied the sanctions relief scheduled to be provided to Supreme Leader 
Ali Khamenei under the JCPOA. As they explain, the delisting of these 
entities ``will pump tens of billions of dollars into the Supreme 
Leader's personal coffers, helping him secure his grip on the Iranian 
people, and bolstering Iran's ability to promote its agenda abroad.'' 
\96\ The following is based on their analysis.
    Khamenei controls a network of foundations reportedly worth $95 
billion.\97\ At the top, sits the Execution of Imam Khomeini's Order 
(EIKO) or Setad. The U.S. Treasury Department designated this 
organization and its subsidiaries in June 2013 and noted at the time 
that the purpose of EIKO was ``to generate and control massive, off-
the-books investments, shielded from the view of the Iranian people and 
international regulators.'' \98\
    Then-Under Secretary for Terrorism and Financial Intelligence David 
S. Cohen further explained: ``Even as economic conditions in Iran 
deteriorate, senior Iranian leaders profit from a shadowy network of 
off-the-books front companies. While the Iranian Government's 
leadership works to hide billions of dollars in corporate profits 
earned at the expense of the Iranian people, Treasury will continue 
exposing and acting against the regime's attempts to evade our 
sanctions and escape international isolation.'' \99\
    An overview of the EIKO's holdings reveals the extent of its 
control of the Iranian economy. The value of EIKO's real estate 
portfolio totals nearly $52 billion; its stakes in publicly traded 
companies total nearly $3.4 billion (in 2013);\100\ and Khamenei 
controls more than 5 percent of publicly traded companies on Tehran's 
Stock Exchange.\101\
    EIKO's investment arm, Rey Investment Company is worth $40 billion, 
according to the U.S. Treasury.\102\ Tadbir Group, EIKO's investment 
arm on the Tehran Stock Exchange, controls (among other entities) 
Parsian Bank and Karafarin Bank--valued at $900 and $830 million 
respectively.\103\ EIKO also controlled a factory in Germany that may 
have provided Iran with critical dual-use technology for its nuclear 
program.\104\
    The United States is scheduled to delist Khamenei's financial 
empire on Implementation Day (in about 6-12 months) despite the fact 
that none of these entities were designated for nuclear proliferation. 
Instead, EIKO and the companies it controls were designated under 
Executive Order 13599 which blocks the property of the Government of 
Iran (GOI) or any subdivision, instrumentality or agency of the 
Government of Iran as well as any person owned or controlled by, or 
acting for or on behalf of, the GOI. Executive Order 13599 builds on 
the Section 311 of the USA PATRIOT Act finding that Iran is a 
jurisdiction of primary money laundering concern.\105\
    These entities were involved in illicit financial practices 
including government corruption, and there is no indication that this 
conduct has changed. They continue to pose risks to the integrity of 
the global financial system and to engage in illicit and corrupt 
business practices. Yet, it appears that they will be granted a clean 
bill of health as a result of the JCPOA.
            List of companies controlled by EIKO scheduled to be 
                    delisted by the United States:
   Behsaz Kashane Tehran Construction Co.;
   Commercial Pars Oil Co.;
   Cylinder System L.T.D.;
   Dey Bank;
   Execution of Imam Khomeini's Order (EIKO);
   Ghadir Investment Company;
   Ghaed Bassir Petrochemical Products Company;
   Golden Resources Trading Company L.L.C.;
   Hormoz Oil Refining Company;
   Iran & Shargh Company;
   Karafarin Bank;
   Mahab Ghodss Consulting Engineering Compan;y
   Marjan Petrochemical Company;
   MCS Engineering;
   MCS International Gmbh;
   Modaber;
   Omid Rey Civil & Construction Company;
   One Class Properties (Pty) Ltd.;
   One Vision Investments 5 (Pty) Ltd.;
   Pardis Investment Company;
   Pars Oil and Gas Company;
   Pars Oil Co.;
   Parsian Bank;
   Persia Oil & Gas Industry Development Co.;
   Polynar Company;
   Rey Investment Company;
   Rey Niru Engineering Company;
   Reyco Gmbh.;
   Rishmak Productive & Exports Company;
   Royal Arya Co.;
   Sadaf Petrochemical Assaluyeh Company;
   Sina Bank;
   Sina Shipping Company Limited;
   Tadbir Brokerage Company;
   Tadbir Construction Development Company;
   Tadbir Economic Development Group;
   Tadbir Energy Development Group Co.;
   Tadbir Investment Company;
   Tosee Eqtesad Ayandehsazan Company; and
   Zarin Rafsanjan Cement Company.
               part 3: alternatives to the current jcpoa
    Discussions of disapproving this current JCPOA quickly turn to 
questions of the alternative to this agreement. Those who support this 
JCPOA present a false choice between this agreement and war, and 
portray those who question this agreement as having no proposed 
alternative. As the liberal public intellectual Leon Wieseltier 
eloquently explains: ``But what is the alternative? This is the 
question that is supposed to silence all objections. It is, for a 
start, a demagogic question. This agreement was designed to prevent 
Iran from acquiring nuclear weapons. If it does not prevent Iran from 
acquiring nuclear weapons--and it seems uncontroversial to suggest that 
it does not guarantee such an outcome--then it does not solve the 
problem that it was designed to solve. And if it does not solve the 
problem that it was designed to solve, then it is itself not an 
alternative, is it? The status is still quo. Or should we prefer the 
sweetness of illusion to the nastiness of reality? For as long as Iran 
does not agree to retire its infrastructure so that the manufacture of 
a nuclear weapon becomes not improbable but impossible, the United 
States will not have transformed the reality that worries it. We will 
only have mitigated it and prettified it. We will have found relief 
from the crisis, but not a resolution of it.'' \106\
    There is an alternative to this current JCPOA. It is an amended 
JCPOA. Congress should require the administration renegotiate certain 
terms of the proposed JCPOA and resubmit the amended agreement for 
congressional approval. The amended JCPOA should much more effectively 
``cut off every single one of Iran's pathways'' \107\ to a nuclear bomb 
and retains tools of effective and peaceful sanctions enforcement 
against Iranian illicit behavior on multiple fronts. President Obama 
and his Cabinet have repeatedly said, ``No deal is better than a bad 
deal.'' \108\ In making this commitment, the President had an 
acceptable alternative path in mind or he would not have threatened to 
walk away from the table.\109\ It is reasonable to assume that no 
President would enter negotiations, especially over something as 
fundamental to American national security as preventing Iran from 
developing nuclear weapons, unless that President had a well-developed 
best alternative to a negotiated agreement.
    As I discuss below, it is not unprecedented for Congress and a U.S. 
administration to work together to renegotiate the terms of a treaty or 
nonbinding agreement. Congress can use this precedent to encourage the 
strengthening of the deal on its technical and conceptual merits. 
Congress should insist on an alternative to this deeply flawed deal and 
keep the President to his commitment that such alternatives always 
did--and continue to--exist. An agreement that gives Iran patient 
pathways to a nuclear weapon, access to heavy weaponry and ICBM 
technology, while enriching the leading state sponsor of terrorism, and 
its most hardline elements the IRGC and Iran's Supreme Leader with 
hundreds of billions of dollars in sanctions relief, should be 
unacceptable. An agreement that undermines the use of peaceful economic 
leverage should be unacceptable. An agreement that leaves military 
force as the only effective option for a future President to stop 
Iran's nuclear weapons development should be unacceptable.
    The current JCPOA legitimizes Iran's nuclear program, provides 
significant sanctions relief prior to a demonstrable change in the 
conduct that prompted the sanctions, and risks spurring nuclear 
proliferation in the Middle East. No deal is better than this current 
JCPOA, and a better alternative is achievable.
Precedents of Congressional Rejection or Modification of International 
        Agreements
    Throughout American history, Congress has rejected or required 
amendments to more than 200 treaties and international agreements (of 
which about 80 were multilateral).\110\ This includes major bilateral 
and multilateral arms control and nuclear agreements during and after 
the cold war. My colleague at the Foundation for Defense of Democracies 
Orde Kittrie, professor of law at Arizona State University and former 
lead attorney for nuclear affairs at the State Department, has studied 
the issue of congressional review of international agreements. The 
following is based on his research as well as the analysis of other 
experts.
    During the cold war, Congress played an active role in the 
negotiation and renegotiation of critical arms control agreements. 
Democratic Senator Henry ``Scoop'' Jackson took a leadership role in 
this respect in opposition to the Nixon administration. Following the 
Strategic Arms Limitation Talks (SALT I), Jackson authored an amendment 
to the resolution of approval that required future strategic arms 
control negotiations to set American strategic arms at parity with 
those of the Soviet Union. The Jackson amendment provided criteria for 
future agreements and ``emphasize the disquiet of many Members of 
Congress . . . concerning the terms'' of the agreement.\111\ It 
expressed a Sense of Congress that, ``urges and requests the President 
to seek a future treaty that, inter alia, would not limit the United 
States to levels of intercontinental strategic forces inferior to the 
limits provided for the Soviet Union.'' \112\ On September 11, 1972, 
the Senate passed the Jackson amendment by a vote of 56 to 35. This 
amendment laid the predicate for Senator Jackson's later critique that 
the Carter administration did not meet this standard in the SALT II 
Treaty.\113\
    The Threshold Test Ban Treaty (TTBT) of 1974 was also initially 
blocked by the Senate because of concerns over Soviet compliance. TTBT 
was not submitted to the Senate for approval for 2 years after signing 
and was not ratified until after the United States and Soviet Union 
reached agreement 14 years later on additional provisions to enhance 
America's ability to verify Soviet compliance.\114\
    Republicans and Democrats in the Senate also expressed disapproval 
of SALT II in a letter to President Carter in 1979. After the Soviet 
invasion of Afghanistan, Carter withdrew the treaty from Senate 
consideration.\115\ President Reagan withdrew from voluntary adherence 
when the treaty expired in 1985, and then began negotiating the 
Strategic Arms Reduction Treaty (START) and working on the Strategic 
Defense Initiative (SDI).\116\
    During the Presidency of Bill Clinton, Congress and the 
administration engaged in a 4-year-long discussion over the 
ratification of the Chemical Weapons Test Ban Treaty. It was only 
approved by Congress after the inclusion of 28 conditions in the 
resolution of ratification.\117\ This treaty included 87 participating 
countries. The 1997 resolution of ratification of the Conventional 
Forces in Europe also contained 14 conditions. Congressional input 
derailed neither treaty.
    At the end of the George W. Bush administration, the United States 
and United Arab Emirates negotiated a civil nuclear cooperation 
agreement (called a 123 agreement). However, then-Chairman of the House 
Foreign Affairs Committee Howard Berman (D-CA) objected that the 
agreement did not ensure that the UAE would not engage in enrichment 
and reprocessing.\118\ In response to congressional pressure, the 
treaty was not submitted for approval, but instead, the incoming Obama 
administration reopened the negotiations. The amended agreement then 
included a binding commitment from the UAE not to engage in domestic 
enrichment or reprocessing. In short, Congress expressed concerns about 
specific components of an agreement; the administration listened to 
Congress and renegotiated a stronger agreement.
    In these examples, Congress played a significant role in rejecting 
or modifying important national security treaties or agreements. In 
some cases, like SALT I, TTBT, and SALT II, these were arms control 
agreements negotiated with the Soviet Union, a much more formidable 
adversary than Iran, in possession of thousands of nuclear tipped 
missiles where the risk and consequences of war were much greater. In 
the case of the Chemical Weapons Ban Treaty, this was a complicated 
multilateral negotiation involving 87 countries as compared to the six 
countries involved in the Iran negotiations. In the example of the 123 
agreement, this was a complicated agreement that set a ``gold 
standard'' for civil nuclear cooperation that barred enrichment or 
reprocessing that is being overturned by the JCPOA. In several of the 
above examples, these were treaties that were legally binding as 
opposed to the nonbinding political agreement that is the JCPOA.
Likely Scenarios if Congress Rejects this Current JCPOA
    If Congress passes a Joint Resolution of Disapproval of the JCPOA 
and overrides a Presidential veto, there are three likely scenarios 
that will result. None is good, but each is preferable to the current 
JCPOA, which provides Iran with multiple pathways to a nuclear bomb and 
provides the international community with no peaceful means to enforce 
the agreement.
            Scenario 1: Iranian faithful compliance
    In this scenario, despite the rejection of the JCPOA by Congress, 
Iran could decide to implement its commitments in good faith. The 
implementation of Iran's nuclear commitments would then trigger U.N. 
and EU sanctions relief under the terms of the JCPOA.
    In this case, the President would have two options:
    (A) Rebuff Congress and wield Executive authority to the extent 
possible to neutralize the Corker-Cardin statutory sanctions block and 
proceed with the deal, In this case, the President could provide a 
substantial amount of the sanctions relief committed under the JCPOA by 
dedesignating Iranian entities on Treasury's Specially Designated 
Nationals list,\119\ working with the Europeans to permit most Iranian 
financial institutions back onto the SWIFT financial messaging system, 
and dedesignating the Central Bank of Iran and permitting Iranian oil 
exports to increase. He would do this by following his signing 
statement where he declared section 1245 of the National Defense 
Authorization Act of 2012 (which imposed the legislative designation of 
the CBI and the legislative scheme to grant exceptions only to 
countries buying Iranian oil which ``significantly reduced'' these 
purchases) to be ``nonbinding'' if it ``conflicts with [his] 
constitutional authorities'' to ``conduct foreign relations''; \120\ 
or,
    (B) Accept the results of the Joint Resolution of Disapproval 
passed by Congress and undertake efforts to persuade our partners to 
join the U.S. in demanding that key parts of the agreement be 
renegotiated on better terms.
    Scenario 1B would be the preferable outcome as it would maintain 
U.S. economic leverage and also lead to a renegotiation of the most 
troubling elements of the agreement (some of these are outlined below 
as examples). Even Scenario 1A would be preferable to the current JCPOA 
because although the United States would be providing certain sanctions 
relief, congressional disapproval would temper the markets. Western 
companies and banks, which are hesitant about reentering the Iranian 
market because of market and counterparty risks--would be even less 
likely to enter into new business transactions. International banks are 
likely to take a wait-and-see approach before doing business with 
Iran--especially given the market-based risks, continued financial 
sanctions that target the IRGC and terrorism activities, and their 
uncertainties of what a new American administration would do with 
respect to the JCPOA and sanctions enforcement.
    Foreign companies and financial institutions are likely to be 
cautious even if a vote of disapproval fails. They will be even more 
cautious if it succeeds. The U.S. financial sanctions regime will still 
retain its powerful deterrent effect even if Congress requires the 
administration to renegotiate the JCPOA. However, over time, under the 
JCPOA, market risks will diminish, banks will grow more confident about 
the counterparty risks, and political pressure will applied to finance 
the investment and trade that their home-country energy and industrial 
companies are seeking. The U.S. will never have greater economic 
leverage than it has now to renegotiate a better deal.
            Scenario 2: Iranian walk away
    If Congress disapproves of the JCPOA, Iran could decide to abandon 
its commitments and walk away from the JCPOA. The new U.N. Security 
Council resolution would not be implemented and the existing U.N. 
sanctions and arms embargo and ballistic missile restrictions would 
remain. If past is prologue, Iran will escalate its nuclear program 
incrementally not massively to avoid crippling economic sanctions or 
U.S. military strikes. Iranian nuclear escalation historically has 
involved incremental increases with the goal of avoiding a U.S. massive 
response.
    For example, based on the IAEA reports from December 2008, February 
2013 and November 2013, during the approximately 5-year period of the 
most intense sanctions escalation during President Obama's term, Iran's 
nuclear program expanded as follows:

   Increase from 3,936 IR-1 operational centrifuges (5,412 
        total installed) in the December 2008 IAEA report to 9,146 IR-1 
        operational centrifuges (15,748 total installed) in the 
        November 2013 IAEA report at the Natanz enrichment facility;

        Increase of 1,042 IR-1 operational centrifuges per year,
        Increase of 2,067 IR-1 installed centrifuges per year.

   Increase from zero IR-1s at Fordow in December 2008 to 696 
        IR-1 operational centrifuges (2,710 total installed) in 
        November 2013;

        Increase of 139 IR-1 operational centrifuges per year,
        Increase of 542 IR-1 installed centrifuges per year.

   Increase from 180 IR-2m centrifuges partially or fully 
        installed in February 2013 at Natanz to 1,008 IR-2ms fully or 
        partially installed in November 2013;
        Increase of 828 IR-2m partially or fully installed 
            centrifuges in 9 months.

   Increase from 630 kg of Iran's low-enriched 3.5 percent 
        stockpiles in November 2008 to 10,357 kg in November 2013;

        Increase of 1,945 kg of 3.5% LEU per year.

   Increase from zero kg of Iran's low-enriched 19.75% 
        stockpiles in November 2008 to 410 kg in November 2013;

        Increase of 82 kg of 19.75% LEU per year.

    While this increase was concerning, Tehran was careful not to 
engage in massive nuclear escalation that could trigger more crippling 
economic sanctions or military strikes. Despite President Hassan 
Rouhani's statement that if the West does not provide Iran with the 
nuclear deal it wants, Iran ``will go back to the old path, stronger 
than what they [the West] can imagine,'' \121\ Iran has moved 
cautiously.
    Iran is unlikely to rapidly move to rapid nuclear breakout because 
this would risk war (which despite the U.S. aversion to war, Iran 
understands it would ultimately lose). Rapid breakout would also likely 
unify Europe and the United States (and perhaps even Russia and 
China)--the opposite of what Iran seeks to achieve. All the P5+1 
countries, including Russia and China, have been committed to stopping 
an Iranian nuclear weapon because of their own self-interest. This was 
even true of Russia, which faced U.S. and EU sanctions during the Iran 
negotiations over their invasion of Crimea and eastern Ukraine.
    In this scenario, the President would use the power of secondary 
sanctions to persuade the Europeans to join a U.S.-led effort to 
isolate Iran again. EU sanctions would likely hold or, at a minimum, 
European companies and banks would be reluctant to reenter Iran. China, 
India, Japan, South Korea, and Turkey would be unlikely to release the 
$100 billion in oil escrow funds for fear of U.S. sanctions. 
Furthermore, these sanctions require Iran to spend the funds on goods 
from those countries so it is advantageous to those countries to keep 
the funds in escrow. It is a boon to their exports. Why would they 
release the funds so that Iran can spend the money elsewhere?
    If Iran were to massively escalate, for example to 15,000 
operational IR-1 centrifuges or deploy its existing 1,000 IR-2m 
centrifuges plus thousands more in a break-out scenario, the U.S. would 
be forced to respond with crippling sanctions or military force.
    In addition to the reimposition of sanctions suspended under the 
JPOA, these crippling sanctions could include the following new 
sanctions measures:

   Designating all remaining Iranian financial institutions and 
        instructing SWIFT to expel all remaining financial institutions 
        from the SWIFT messaging system;
   Sanctioning any U.S. or foreign financial institution that 
        provides Iran access to, or use of, any of its funds except for 
        humanitarian-related transactions;
   Dramatically reducing permissible imports of Iranian crude 
        products;
   Banning countries buying Iranian crude from using oil escrow 
        funds to export all nonhumanitarian commercial goods to Iran;
   Blacklisting additional sectors of the Iranian economy owned 
        or controlled by the Government of Iran and/or the IRGC, 
        including the mining, engineering, and construction sectors;
   Reimposing and vigorously enforcing gold sanctions to deny 
        Iran access to gold to replenish its FX reserves;
   Imposing tighter sanctions on nonoil Iranian commercial 
        exports;
   Expanding the definition of crude oil sanctions to include 
        all oil products; and,
   Imposing additional sanctions against the holdings of Iran's 
        bonyads and investment funds, and entities owned and or 
        controlled by the IRGC, the Quds Force, the Supreme Leader and 
        other entities.

    The credibility of the U.S. threat to use crippling sanctions or 
military force is critical to deterring Iran from crossing U.S. 
redlines, which need to be clearly set by this or the next President.
            Scenario 3: Divide the P5+1
    In the third scenario, Iran could implement certain nuclear 
commitments but choose not to implement others, thus creating 
diplomatic ambiguity. Iran could then try to use diplomatic leverage to 
divide the Russians and Chinese from the West, and the Europeans from 
the United States. Iran's compliance with certain commitments might 
still trigger U.N. and EU sanctions relief, but Iran could exploit the 
P5+1 discord to demonstrate obstinacy on their JCPOA commitments, 
including on inspections, resolution of PMD issues, and the pace of 
nuclear compliance, among others.
    This would be a messy scenario because of the divisions between the 
P5+1 partners, but ultimately, if all of the members were united around 
the goal of preventing an Iranian nuclear weapons, the situation may 
not reach a point of critical escalation--either in tensions between 
the U.S. and its partners and Iranian nuclear escalation. The President 
could threaten the use of new sanctions to keep countries and companies 
from normalizing with Iran and work to persuade the Europeans to join 
the United States in demanding that key parts of the agreement be 
renegotiated on better terms.
    If we take the Secretary of State at his word, and he feels he 
would have no credibility in negotiating a new agreement, the Obama 
administration can leave the issue of negotiations to the next 
administration. We would survive the period of time until a new 
administration (Democratic or Republican) takes office because Iran 
would not want to trigger major U.S. retaliation by engaging in massive 
nuclear escalation (see above).
Continue Economic and Diplomatic Pressure on Iran
    None of the above scenarios is ideal but they are not likely to be 
disasters, either. And they are better than this deal. These options 
ultimately depend on the power of American coercive diplomacy, economic 
sanctions, and the credibility of the American military option.
    The alternative to the current JCPOA depends on American coercive 
diplomacy: (1) leveraging the power of U.S. secondary sanctions to 
persuade international financial institutions and companies to stay out 
of Iran; (2) the use of military power, either directly or through the 
support of allies, against Iranian regime interests in Syria, Iraq, 
Yemen; and (3) the credible threat of conventional and cyber-enabled 
strikes against Iran's nuclear program, which is likely to increase 
after January 2017.
    If the President believes that the United States has an effective 
economic snapback a decade or more in the future after companies have 
invested billions of dollars in the Iranian economy, then U.S. 
sanctions remain strong today. The international sanctions architecture 
is not yet crumbling, and Iran's economy is still fragile.
    If the President believes, however, that the multilateral sanctions 
regime cannot withstand the fallout of the above scenarios, how will 
the United States have economic leverage in the future? If multilateral 
sanctions will not hold in the face of a renewed commitment to 
negotiate an improved agreement, then United States does not have 
sufficient peaceful economic leverage to enforce this agreement in the 
future when Iran's nuclear program will be much bigger, Iran can 
leverage its ``nuclear snapback'' against the reimposition of 
sanctions, Iran's economy will be much stronger, and America's P5+1 
partners will have made significant investments that they will be 
loathe to lose.
    Furthermore, if the P5+1 unity and the international sanctions 
architecture would have held when the United States was prepared to 
walk away from the table during the negotiations, it can hold now. It 
is better to test the strength of international sanctions and U.S. 
secondary sanctions now rather than in a future breakout or sneak-out 
scenario when Iran's nuclear program and economy are greatly expanded.
    Even if the international community lifts all other sanctions, the 
world would merely revert to a pre-2010 dynamic in which the Washington 
imposed unilateral sanctions and presented foreign companies with a 
choice of doing business in the United States or Iran. Washington would 
have difficult conversations with its allies about sanctions 
enforcement, but given the power of U.S. markets and the dominance of 
the U.S. dollar, foreign companies are likely to keep Iran at arm's 
length.
Amendments to Improve the JCPOA
    The JCPOA can be improved by returning to the principles that 
Congress has laid out and that are contained in six U.N. Security 
Council Resolutions. These include:

          (1) Sufficient dismantlement to insure Iran cannot build a 
        nuclear weapon;
          (2) Gradual sanctions relief and an agreement of sufficient 
        duration tied to Iranian performance;
          (3) Serious inspection regime that combines short-notice 
        surprise inspections with extensive monitoring of declared 
        sites; and,
          (4) Maintenance of sufficient economic leverage to peacefully 
        enforce the agreement against Iranian noncompliance.

    This current JCPOA can be improved in key areas. The following 
section provides a few examples of the specific changes that should be 
made. This is not an exhaustive list but is provided as an illustration 
of how Congress could require reasonable modifications to the 
agreement. The President should to be able to build consensus with U.S. 
allies that these (and other) amendments strengthen the deal and that 
congressional support is critical for a durable agreement.
1. Include a sunset clause that must be voted on every 10 years.
    If it is currently unacceptable for Iran to obtain a nuclear 
weapons capacity, what is the reason for an arbitrary 10 and 15 year 
sunset of the limitations on Iran's nuclear activities? Instead, the 
agreement could be structure in such a way that the limitations only 
sunset upon an affirmative vote of the United Nations Security Council.
2. Permanently require excess uranium to be shipped out of Iran.
    In the current JCPOA, Iran is required to ship out spent fuel from 
the Arak reactor for the lifetime of this facility. A similar 
requirement should be included that requires that excess enriched 
uranium above 300 kg be shipped out from Iran. During the Joint Plan of 
Action (JPOA) interim agreement, Iran failed to abide by its commitment 
to convert all excess uranium into uranium dioxide. Rather than leave 
open the possibility that Iran may be unable to fulfill its commitments 
regarding conversion of excess uranium, it could simply be required to 
be exported. In addition, there should be a permanent ban on Iran's 
ability to produce highly enriched uranium (HEU) and a permanent ban on 
reprocessing and reprocessing R&D.
3. Limit Iran's enrichment to IR-1 centrifuges and prohibit advanced 
        centrifuge R&D.
    Iran has no need for advanced centrifuges to meet its practical 
needs for civilian energy. These advanced models, once operational, 
reduce Iranian breakout time, and given a much easier clandestine sneak 
option. The JCPOA permits this capability beginning in year 8, 
accelerates in after year 10, and permits unlimited and industrial-
scale deployment after year 15. Breakout time drops after year 10 from 
1-year, the Obama administration's benchmark for an adequate time to 
mount a diplomatic, economic, and military response, to perhaps 
``almost down to zero'' by year 13, according to President Obama.\122\ 
Once restrictions disappear at year 15 on full-scale deployment of 
advanced centrifuges, enrichment about 3.67 percent and the 
accumulation of stockpiles of LEU about 300 kg, Iran will be at near-
zero breakout. With high-powered centrifuges capable of reaching 
enrichment targets at much greater efficiency, Iran also will need far 
fewer machines; this makes it easier for Iran to hide these centrifuges 
in a heavily fortified Fordow enrichment facility (which it will be 
able to use for enrichment or to build multiple Fordow-type facilities 
after year 15)--and enable an easier clandestine sneak-out option to a 
nuclear weapon. An amended agreement would ban the use of, and R&D 
into, these advanced centrifuges.
4. Require an invasive inspections regime that allows go anywhere, 
        anytime access to places, personnel, and paperwork. The 
        inspections regime should be modeled on the South Africa 
        experience.
    Former IAEA Deputy Director General for Safeguards, Olli Heinonen, 
was recently asked by a Member of Congress to rate the JCPOA 
verification and inspection regime on a scale of one to 10. He 
responded that:

          HEINONEN: Thank you, Mr. Congressman. And I perhaps use this 
        opportunity also to clarify my rating, which Ranking Member 
        Lynch asked earlier today. He asked me to rate the deal with a 
        scale from one to 10. And as you see from my testimony, I 
        actually have divided this testimony in three parts.
          One part is the declared facilities with declared materials; 
        one is the rights and provisions to access undeclared 
        activities, where I raised those concerns; and then there is a 
        third category, which I mentioned in my written statement, 
        which are some other activities which are proscribed, like 
        activities related to acquisition of computers software to 
        design nuclear explosive devises, to certain multipoint 
        detonation systems.
          When I look the rating from--for each of those I think it's 
        better to look each of those and you'll make your own risk 
        assessment on that. The first one, when I said a rating seven 
        to eight, this is for declared facilities, the way I see. And 
        why it is not higher is because there is this dispute 
        settlement process, which you miss in 24--after 24 days or even 
        more. But then if you ask me to give the rating for this access 
        to suspected sites, undeclared sites, I don't think that I 
        would give more than five, if we use this--this rating. And 
        then if you ask my opinion with other possibilities to find 
        these computer codes and someone using them, and there is 
        actually even not really an inspection procedure for that, I 
        think it's a zero. It's not even one. So I think that this 
        clarifies and answers to your concerns. (emphasis added) \123\

    Elsewhere, Dr. Heinonen has written: ``The IAEA verification regime 
must go further than the Additional Protocol (AP). Contrary to what is 
commonly understood, the AP does not provide the IAEA with unfettered 
access. Currently, the IAEA does not have access to Iran's sensitive 
nuclear information. For years, inspectors have been stonewalled. A 
verifiable agreement would require unfettered access to all key 
facilities, personnel, documentation, and other information being 
sought. The AP, by itself, does not fully oblige this.'' \124\
    Dr. Heinonen argues that this ``AP-plus'' verification and 
inspection regime must be permanent: ``AP-plus verification activities 
cannot end upon the expiration of an arbitrary period of time, but 
rather only when the IAEA has concluded that all nuclear material and 
activities in Iran are in peaceful use, that there are no undeclared 
activities, and the U.N. Security Council is able to conclude that Iran 
has fully restored international confidence in the peaceful nature of 
its nuclear program.'' \125\
    There is precedent for the IAEA to carry out additional 
verification measures alongside the Additional Protocol. Dr. Heinonen 
writes: ``South African authorities adopted, in the early 1990s, an 
open, completely transparent policy of IAEA inspections ``any time--any 
place, with a reason.'' Although South Africa ratified the AP in 2002, 
the IAEA continued to conduct such additional transparency measures 
parallel to its implementation of the AP until South Africa was given a 
clean bill of health in 2010. The rationale for the approach and 
extended monitoring was that enrichment and weapons-related know-how 
remained after the dismantlement of the actual infrastructure.\126\
5. Require upfront ratification of the Additional Protocol.
    Under the JCPOA, Iran is not required to ratify the Additional 
Protocol until 8 years into the agreement. Iran is only required to 
provisionally and voluntarily implement it. Iran signed the Additional 
Protocol in 2003 and provisionally implemented it while negotiating 
with the EU3.\127\ But after the IAEA referred Iran to the U.N. 
Security Council for noncompliance with the NPT Safeguards Agreement, 
Iran suspended its voluntary implementation.\128\ Iran has in the past 
used these ``voluntary'' measures to avoid complete and consistent 
implementation. Since the Additional Protocol plays a role in the 
verification regime, Iran should be required as part of the final deal 
to ratify the Additional Protocol up front. As discussed, verification 
and inspection requirements must go beyond the AP and must be 
permanent.
6. A Proper resolution of the PMD Issue.
    The ``Road-Map for the Clarification of Past and Present 
Outstanding Issues Regarding Iran's Nuclear Program,'' is of great 
concern both because of the expedited timeframe and the fear that this 
process will not address sufficiently the many outstanding questions 
that the IAEA and the U.S. intelligence community has about the 
possible military dimensions of Iran's nuclear weapons program. For 
Congress to judge that the PMD issue has been resolved sufficiently, 
according to William Tobey, the former Deputy Administrator for Defense 
Nuclear Nonproliferation at the National Nuclear Security 
Administration, the IAEA must confirm that:

   It has a complete and correct understanding of the full 
        extent of Iran's nuclear activities, including any military 
        dimensions;
   It has found no indication that Iran is engaged in any 
        military dimensions;
   It has found no indication of the diversion of declared 
        nuclear material from peaceful activities nor any indication of 
        undeclared nuclear material or activities; and,
   It can monitor the people, facilities, sites, equipment, and 
        materials involved in any military dimensions to ensure timely 
        detection of any resumption of this work.\129\
7. Tie sanctions relief to concrete changes in the conduct, which 
        prompted sanctions.
    As explained in the next section, the sanctions relief in the 
amended JCPOA should link the lifting of sanctions with concrete 
changes in the conduct that prompted sanctions in the first place. The 
P5+1 could provide certain temporary relief without lifting 
sanctions.\130\ Such a model would provide immediate economic relief to 
the Iranian people while retaining international economic leverage to 
enforce the agreement and address the range of Iranian illicit conduct 
that sanctions were aimed at addressing.
      part 4: congressional defense of the sanctions architecture
    In addition to working with the administration to renegotiate the 
most concerning components of the JCPOA, Congress can also act 
unilaterally and with the administration to ensure that the sanctions 
architecture is not precipitous unraveled. This defense of the 
sanctions architecture will provide peaceful economic leverage to 
enforce a better deal.
Tie Sanctions Relief to Demonstrable Changes in Iranian Conduct
    Since sanctions snapbacks are a flawed mechanism, the lifting of 
sanctions should be tied to changes in Iran's conduct that prompted the 
sanctions in the first place. The provision of sanctions relief should 
only occur after Iran meets specific, verifiable nuclear and illicit 
finance benchmarks.
    Congress should require that the Obama administration renegotiate 
the terms of the sanctions relief. The administration and Congress 
should work together to create a more effective sanctions relief 
program that deters and punishes Iranian noncompliance and supports the 
monitoring, verification, and inspection regime. The United States 
should also make it clear to Iran that Washington will continue to 
impose sanctions and target Iran's support for terrorism and its abuse 
of human rights, and particularly the dangerous role played by the IRGC 
across a range of illicit activities.
    The following recommendations outline how Congress can defend the 
conduct-based sanctions architecture. These recommendations are aimed 
at providing a more effective mechanism for sanctions relief under an 
amended JCPOA.
1. Develop a rehabilitation program for designated Iranian banks that 
        puts the onus on Tehran to demonstrate that the banks are no 
        longer engaged in illicit financial conduct.
    While U.S. financial sanctions are implemented and enforced by the 
Treasury Department, Congress can play a crucial role by legislating 
the terms of a rehabilitation program for designated Iranian banks and 
by laying out specific benchmarks that must be met prior to the 
suspension of financial sanctions.
    Congress should require that Treasury submit a financial sanctions 
rehabilitation program plan that includes specific benchmarks that 
institutions must meet before Treasury suspends or terminates key 
designations. The rehabilitation program should focus on industry 
standards of financial integrity. Congress should also require Treasury 
to include a certification, subject to periodic reviews, that will be 
published in the Federal Register prior to dedesignation.
2. Work with the Obama administration on licenses to foreign financial 
        institutions and foreign companies engaging in business 
        transactions with Iran.
    Given the significant presence of the IRGC in key strategic sectors 
of Iran's economy,\131\ including the financial sector, it will be very 
difficult for foreign financial institutions to confirm that their 
counterparts on any transaction are not connected to the IRGC. Only 
those institutions with the strictest compliance procedures may be able 
to differentiate between upstanding Iranian corporations and corrupt 
firms. Western banks, especially those that have previously run afoul 
of U.S. sanctions, may be hesitant to reenter the Iranian financial 
market and reportedly only considering financing non-Iranian firms 
working in Iran.\132\
    The United States can incentivize the implementation of strict due 
diligence and ``know your customer'' procedures by granting special 
licenses to companies to operate in Iran, but only for transactions not 
connected to the IRGC and not in support of terrorism, ballistic 
missile development, and human rights abuses. Even those foreign 
financial institutions will face significant risks from IRGC, ballistic 
missile, terrorism, and human rights sanctions; from lawyers seeking to 
collect on tens of billions of dollars in judgments on behalf of 
victims of Iranian terrorism; and from the reputational damage from 
association with repressive and dangerous regime elements. Buyer and 
seller beware will likely still be the operating principle for heads of 
global compliance of these banks long after a nuclear deal is 
concluded.
3. Legislate criteria for the suspension of sanctions on the Central 
        Bank of Iran and the lifting of the Section 311 finding.
    The suspension of sanctions against the Central Bank of Iran, even 
more than the dedesignation of individual Iranian banks, will provide 
significant relief to Iran and should therefore also be tied to 
verifiable changes in Iranian behavior. Lawmakers could require the 
President to certify to Congress, prior to suspending sanctions against 
the CBI and prior to the lifting of the Section 311 finding, that Iran 
is no longer a ``jurisdiction of primary money laundering concern'' and 
that the CBI, as the central pillar of Iran's illicit financial 
activities, is no longer engaged in ``support for terrorism,'' 
``pursuit of weapons of mass destruction,'' including the development 
of ballistic missiles, or any ``illicit and deceptive financial 
activities.'' Congress should stipulate that Treasury must certify that 
the entire country's financial system no longer poses ``illicit finance 
risks for the global financial system.'' Congress should consider 
enshrining the Section 311 finding in legislation and making the 
lifting of the 311 subject to specific termination criteria relating to 
Iranian illicit conduct.
4. Legislate under what circumstances funds in escrow accounts can be 
        released.
    An estimated $100 billion in Iranian oil revenues have accumulated 
in semirestricted escrow accounts and can only be spent on 
nonsanctionable goods in the countries where they are accumulating or 
on humanitarian goods from a third country. Between January 2014 and 
June 30, 2015, under the JPOA, Iran received $11.9 billion in 
installments from these escrow accounts.\133\ Instead of allowing the 
repatriation of the funds to Iran, Congress should amend the Iran 
Threat Reduction Act (ITRA) to create a mechanism for the release of 
specific amounts in installments if Iran is complying with its 
commitments. However, these funds should not be repatriated to Iran and 
be moved to escrow accounts where Iran can spend them on 
nonsanctionable European goods and where they can be more easily 
recaptured in a snapback scenario (European banks are more likely to 
comply than Chinese banks, for example). None of these escrowed oil 
funds should be repatriated back to Iran until Treasury certifies that 
Iran is no longer a ``primary money laundering concern'' and a state 
sponsor of terrorism and Congress approves this certification.
5. Enforce and expand designations of IRGC-affiliated entities.
    Even an amended JCPOA will not address Iran's support for 
terrorism, threatening, and destabilizing behavior toward its 
neighbors, and systematic human rights abuses. As such, Congress should 
require Presidential certifications that no sanctions relief will go to 
the IRGC or IRGC-affiliated entities.
    Congress could clarify that it expects that no sanctions on IRGC-
linked entities, whether based on nuclear, ballistic missile, or 
terrorism activities, will be lifted against any entity or financial 
institution until the President certifies that Iran is no longer a 
state sponsor of terrorism and the IRGC no longer meets the criteria as 
a designated entity under U.S. law. Congress should go further and 
designate the IRGC in its entirety under Executive Order 13224 for its 
role in directing and supporting international terrorism (it is 
currently only designated under Executive Order 13382 for proliferation 
purposes; the Quds Force is designated under EO 13224).
6. Enforce and expand IRGC, terrorism- and human rights-related 
        designations.
    Iran's continued support for global terrorism requires that U.S. 
terrorism sanctions be maintained and expanded. Iran's human rights 
record has, by numerous expert accounts, deteriorated under President 
Hassan Rouhani.\134\ Congress should work with the Obama administration 
to enhance terrorism sanctions, particularly focused on the IRGC and 
Quds Force and its various officials, entities, and instrumentalities. 
Congress should work with the Obama administration to significantly 
expand U.S. human rights sanctions against any and all Iranian 
officials, entities, and instrumentalities engaged in human rights 
abuses. The penalties for both of these sanctions should go beyond 
travel bans and asset freezes and target the sectors, entities, and 
instrumentalities that provide revenues to fund Iranian terrorism 
activities and/or human rights abuses.
                               conclusion
    As a result of the sunset of restrictions on Iran's nuclear program 
and ballistic missile program and the access to heavy weaponry, Iran 
over time will be permitted not only to maintain its current nuclear 
capacity, but also to develop it further to an industrial-size nuclear 
program with a near-zero breakout time, an easier-to-hide and more 
efficient advanced-centrifuge-powered clandestine sneak-out pathway, 
and multiple heavy water reactors. Iran will be able to buy and sell 
heavy weaponry with the expiration of the arms embargo, bolstering IRGC 
military capabilities, and arming the most destabilizing and dangerous 
regimes and terrorism organizations. Iran will also be able to access 
key technologies to further develop its long-range ballistic missile 
program, including for the building of an ICBM that threatens the 
United States.
    At the same time, the JCPOA dismantles much of the international 
sanctions architecture, while abandoning the core principles of the 
conduct-based sanctions regime that the Obama and George W. Bush 
administrations had built up for more than a decade. The unraveling of 
the U.S. and EU sanctions regimes leaves Iran as a growing economy 
increasingly immunized against future economic sanctions snapbacks. It 
provides Iran with $150 billion in early sanctions relief and hundreds 
of billions of dollars in future relief with which the leading state 
sponsor of terrorism can continue to fund its dangerous activities. Of 
great concern, the JCPOA provides Iran with a ``nuclear snapback'' to 
intimidate Europe, the United States, and other countries, to refrain 
from using sanctions as an effective mechanism to enforce the nuclear 
agreement and to target the full range of its illicit conduct including 
its support for terrorism.
    The JCPOA is a fundamentally flawed deal in its inherent design. 
Rather than block Iran's pathways to a nuclear bomb, it provides a new 
path, the ``patient path.'' Congress should require the Obama 
administration to renegotiate and fix the major flaws of the agreement 
and resubmit an amended JCPOA to Congress for review. Throughout 
American history, Congress has rejected or required amendments to more 
than 200 treaties and international agreements (of which about 80 were 
multilateral). This includes major bilateral and multilateral arms 
control and nuclear agreements during and after the cold war.
    This testimony provides examples of reasonable and modest 
amendments to the current JCPOA. These amendments would create an 
agreement that improves the chances of permanently blocking all of the 
Islamic Republic of Iran's pathways to a nuclear bomb. Simultaneously, 
Congress should defend the economic sanctions architecture it helped 
create and tie all future sanctions relief to verifiable changes in 
Iranian conduct that prompted the sanctions in the first place.

----------------
Notes

    \1\ ``Transcript: President Obama's Full NPR Interview on Iran 
Nuclear Deal,'' NPR, April 7, 2015.
    \2\ Ernest Moniz, ``A Nuclear Deal that Offers a Safer World,'' The 
Washington Post, April 12, 2015.
    \3\ ``Joint Comprehensive Plan of Action,'' Vienna, July 14, 2015, 
Annex I, paragraphs 32, 37, 38.
    \4\ ``Transcript: President Obama's Full NPR Interview on Iran 
Nuclear Deal,'' NPR, April 7, 2015.
    \5\ The JCPOA notes that Iran will only enrich to 3.67 percent for 
15 years but does not specify the restrictions after that. Iran's 
enrichment levels after 15 years will be governed by its ``voluntary 
commitments'' in its long-term enrichment and enrichment R&D plan, 
submitted to the IAEA. There are nonmilitary uses for 20 percent and 60 
percent enriched uranium, and therefore Iran may argue that it needs to 
enrich to those higher levels after 15 years. ``Joint Comprehensive 
Plan of Action,'' Vienna, July 14, 2015, Annex I, paragraphs 28 and 52.
    \6\ ``Joint Comprehensive Plan of Action,'' Vienna, July 14, 2015, 
Annex I, paragraph 31.
    \7\ Ibid., paragraph 45.
    \8\ Ibid., paragraph 16.
    \9\ Ibid., paragraphs 18-19.
    \10\ Ibid., paragraph 11.
    \11\ Ibid., paragraph 66.; International Atomic Energy Agency, 
Press Release, ``IAEA Director General's Statement and Road-Map for the 
Clarification of Past & Present Outstanding Issues Regarding Iran's 
Nuclear Program,'' July 14, 2015.
    \12\ Louis Charbonneau & Arshad Mohammed, ``Exclusive: Draft Deal 
Calls for U.N. Access to All Iran Sites--Source,'' Reuters, July 13, 
2015.
    \13\ International Atomic Energy Agency, Press Release, ``IAEA 
Director General's Statement and Road-Map for the Clarification of Past 
& Present Outstanding Issues Regarding Iran's Nuclear Program,'' July 
14, 2015.
    \14\ Mark Dubowitz, Annie Fixler, & Rachel Ziemba, ``Iran's 
Economic Resilience Against Snapback Sanctions Will Grow Over Time,'' 
Foundation for Defense of Democracies & Roubini Global Economics, June 
2015.
    \15\ United Nations Security Council, ``Resolution 2231 (2015),'' 
July 20, 2015, Annex B, paragraph 5, page 100.
    \16\ Ibid.
    \17\ ``Joint Comprehensive Plan of Action,'' Vienna, July 14, 2015, 
Annex V, paragraphs 19 and 20.1.; United Nations Security Council, 
``Resolution 2231 (2015),'' July 20, 2015, Annex B, paragraph 3, page 
99.
    \18\ U.S. Department of Defense, ``Unclassified Report on Military 
Power of Iran,'' January 2014, page 1.
    \19\ Michael Elleman, ``Iran's Ballistic Missile Program,'' The 
Iran Primer, accessed August 25, 2014.
    \20\ U.S. Department of Defense, ``Unclassified Report on Military 
Power of Iran,'' April 2010, page 10. U.S. Department of Defense, 
``Unclassified Report on Military Power of Iran,'' April, 2012, page 1.
    \21\ James R. Clapper, ``Statement for the Record: Worldwide Threat 
Assessment of the U.S. Intelligence Community'' Testimony before the 
Senate Select Committee on Intelligence, January 29, 2014, page 6.
    \22\ Ibid.
    \23\ Department of State, Media Note, ``Additional Sanctions 
Imposed by the Department of State Targeting Iranian Proliferators,'' 
August 29, 2014.
    \24\ ``Joint Comprehensive Plan of Action,'' Vienna, July 14, 2015, 
paragraph 26.
    \25\ Ibid., paragraph 29.
    \26\ ``Joint Comprehensive Plan of Action,'' Vienna, July 14, 2015, 
Annex III, paragraph 10.2.
    \27\ ``Joint Comprehensive Plan of Action,'' Vienna, July 14, 2015, 
paragraph 37.
    \28\ William Tobey, ``The Iranian Nuclear-Inspection Charade,'' The 
Wall Street Journal, July 15, 2015.
    \29\ Bill Gertz, ``Ex-IAEA Leader: 24-Day Inspection Delay Will 
Boost Iranian Nuclear Cheating,'' The Washington Free Beacon, July 21, 
2015.
    \30\ Michael R. Gordon, ``Provision in Iran Accord Is Challenged by 
Some Nuclear Experts,'' The New York Times, July 22, 2015.
    \31\ Olli Heinonen, ``The Iran Nuclear Deal and its Impact on 
Terrorism Financing,'' Testimony Before the House Financial Services 
Committee, Task Force to Investigate Terrorism Financing, July 22, 
2015.
    \32\ For more detail on the challenges of the ``snapback'' 
sanction, see ``The `Snapback' Sanction as a Response to Iranian Non-
Compliance,'' Iran Task Force, January 2015.
    \33\ ``Foreign Investments in Iran to Serve as Barrier for 
Sanctions Snapback--FM,'' Voice of the Islamic Republic of Iran, Radio 
Farhang (in Persian), July 21, 2015 (accessed via BBC Worldwide 
Monitoring).
    \34\ ``Joint Comprehensive Plan of Action,'' Vienna, July 14, 2015, 
paragraphs 36-37.
    \35\ Steny Hoyer, Press Release, ``Hoyer: U.N. Security Council 
Vote Should Wait for Congressional Review Period,'' July 17, 2015. 
House Committee on Foreign Affairs, Press Release, ``Chairman Royce, 
McCaul to President on Iran Deal: U.N. Security Council Should Wait 
Until Congressional Review is Complete,'' July 16, 2015. ``Congress 
Leaders Ask White House To Delay U.N. Vote on Iran Deal,'' JTA, July 
17, 2015.
    \36\ ``Joint Comprehensive Plan of Action,'' Vienna, July 14, 2015, 
paragraph 37.
    \37\ Ibid, paragraph 26.
    \38\ Ibid.
    \39\ Ibid, paragraph 29.
    \40\ David Cohen, ``The Law and Policy of Iran Sanctions,'' Remarks 
before the New York University School of Law, September 12, 2012.
    \41\ Robin Wright, ``Stuart Levey's War,'' The New York Times, 
November 2, 2008.
    \42\ Treasury designated 23 Iranian and Iranian-allied foreign 
financial institutions as ``proliferation supporting entities'' under 
Executive Order 13382 and sanctioned Bank Saderat as a ``terrorism 
supporting entity'' under Executive Order 13224. U.S. Department of the 
Treasury, Press Release, ``Treasury Cuts Iran's Bank Saderat Off from 
U.S. Financial System,'' September 8, 2006. Department of the Treasury, 
Press Release, ``Treasury Designates Major Iranian State-Owned Bank,'' 
January 23, 2012.
    \43\ U.S. Department of the Treasury, Press Release, ``Finding That 
the Islamic Republic of Iran is a Jurisdiction of Primary Money 
Laundering Concern,'' November 18, 2011.
    \44\ 44 Ibid.
    \45\ U.S. Department of the Treasury, Press Release, ``Fact Sheet: 
New Sanctions on Iran,'' November 21, 2011.
    \46\ The Financial Action Task Force, Public Statement, ``FATF 
Public Statement 14 February 2014,'' February 14, 2014.
    \47\ The Financial Action Task Force, Public Statement, ``FATF 
Public Statement 26 June 2015,'' June 26, 2015.
    \48\ U.S. Department of the Treasury, Press Release, ``Treasury 
Designates Banco Delta Asia as Primary Money Laundering Concern Under 
USA PATRIOT Act,'' September 15, 2005.
    \49\ David E. Sanger, ``North Koreans Say They Tested Nuclear 
Device,'' The New York Times, October 9, 2006.
    \50\ Juan Zarate, Treasury's War: The Unleashing of a New Era of 
Financial Warfare, (New York: Public Affairs, 2013), page 258.
    \51\ The Council of the European Union, ``Council Implementing 
Regulation (EU) No 611/2011 of 23 June 2011 Implementing Regulation 
(EU) No 442/2011 Concerning Restrictive Measures in View of the 
Situation in Syria,'' Official Journal of the European Union, June 24, 
2011. The Council of the European Union, ``Council Implementing 
Regulation (EU) 790/2014 of 22 July 2014 Implementing Article 2(3) of 
Regulation (EC) No 2580/2001 on Specific Restrictive Measures Directed 
Against Certain Persons and Entities with a View to Combating 
Terrorism, and Repealing Implementing Regulation (EU) No 125/2014,'' 
Official Journal of the European Union, July 23, 2014.
    \52\ Jeffrey Goldberg, `` `Look . . . It's My Name on This': Obama 
Defends the Iran Nuclear Deal,'' The Atlantic, May 21, 2015.
    \53\ Barack Obama, ``Press Conference by the President,'' 
Washington, DC, July 15, 2015.
    \54\ ``Iran Press Review 20 July,'' Foundation for Defense of 
Democracies, July 20, 2015.
    \55\ Mark Dubowitz & Rachel Ziemba, ``When Will Iran Run Out of 
Money?'', Foundation for Defense of Democracies & Roubini Global 
Economics, October 2, 2013.
    \56\ Eli Lake, ``Iran Spends Billions to Prop Up Assad,'' 
Bloomberg, June 9, 2015.
    \57\ ``Company Information,'' SWIFT Web site, accessed July 20, 
2015.
    \58\ SWIFT, Press Release, ``SWIFT Instructed to Disconnect 
Sanctioned Iranian Banks Following EU Council Decision,'' March 15, 
2012.
    \59\ ``Annual Review 2010,'' SWIFT Web site, accessed January 9, 
2012, page 29.
    \60\ ``Swift Sanctions on Iran,'' The Wall Street Journal, February 
1, 2012.
    \61\ Senator Robert Menendez, Press Release, ``Menendez Hails 
Banking Committee Passage of Iran Sanctions Legislation,'' February 2, 
2012.
    \62\ ``Payments System SWIFT to Expel Iranian Banks Saturday,'' 
Reuters, March 15, 2012.
    \63\ ``Joint Comprehensive Plan of Action,'' Vienna, July 14, 2015, 
paragraph 19(iv).
    \64\ On Implementation Day, the EU will lift sanctions on the 
Central Bank of Iran and Bank Mellat, Bank Melli, Bank Refah, Bank 
Tejarat, Europaische-Iranische Handelsbank (EIH), Export Development 
Bank of Iran, Future Bank, Onerbank ZAO, Post Bank, and Sina Bank. On 
Transition Day, the EU will also lift sanctions on Ansar Bank, Bank 
Saderat, Bank Sepah and Bank Sepah International, and Mehr Bank. See 
Attachment 1, parts 1 and 2 and Attachment 2, parts 1 and 2.
    \65\ The Council of the European Union, ``Council Regulation (EU) 
No 267/2012 of 23 March 2012 Concerning Restrictive Measures against 
Iran and Repealing Regulation (EU) No 961/2010,'' Official Journal of 
the European Union, March 24, 2012.
    \66\ U.S. sanctions on Ansar Bank and Mehr Bank are scheduled to 
remain in place. Sanctions on Arian Bank, Banco International de 
Desarollo, Bank Kargoshaee, Bank of Industry and Mine, Bank Melli, Bank 
Mellat, Bank Refah, Bank Sepah, Bank Tejarat, Europaisch-Iranische 
Handelsbank, Export Development Bank of Iran, First East Export Bank, 
First Islamic Bank, Future Bank, Iranian-Venezuela Bi-National Bank, 
Kont Investment Bank, Moallem Insurance Company, Persia International 
Bank, Post Bank, Sorinet Commercial Trust Bankers, and Trade Capital 
Bank (aka Bank Torgovoy Kapital ZAO) as well as the Central Bank of 
Iran (a.k.a. Bank Markazi Jomhouri Islami Iran) will be lifted on 
``Implementation Day.'' See Attachment 3.
    \67\ Over the past decade, the Treasury Department has designated 
51 banks and their subsidiaries inclusive of the 23 banks designated as 
proliferators, Bank Saderat which was designated for financing 
terrorism, and the Central Bank of Iran. With the exception of Bank 
Saderat, Ansar Bank, and Mehr Bank, all Iranian financial institutions 
will be delisted on implementation day. Note, there is an inconsistency 
in Attachment 3. The Joint Iran-Venezuela Bank is listed as the same 
entry as Iran-Venezuela Bi-National Bank. On the SDN list, the two are 
listed with unique entries and different designations. FDD assumes, 
however, that both banks are being delisted.
    \68\ ``Joint Comprehensive Plan of Action,'' Vienna, July 14, 2015, 
paragraph 37.
    \69\ Jennifer Hsieh, Rachel Ziemba, & Mark Dubowitz, ``Iran's 
Economy: Out of the Red, Slowly Growing,'' Foundation for Defense of 
Democracies & Roubini Global Economics, October 2014. Jennifer Hsieh, 
Rachel Ziemba, & Mark Dubowitz, ``Iran's Economy Will Slow but Continue 
to Grow Under Cheaper Oil and Current Sanctions,'' Foundation for 
Defense of Democracies & Roubini Global Economics, February 2015.
    \70\ Emanuele Ottolenghi & Saeed Ghasseminejad, ``Iran Sanctions 
Relief Sparks Growing Trade with Europe, Asia,'' Foundation for Defense 
of Democracies, March 27, 2015.
    \71\ Ibid.
    \72\ Mark Dubowitz, Annie Fixler, & Rachel Ziemba, ``Iran's 
Economic Resilience Against Snapback Sanctions Will Grow Over Time,'' 
Foundation for Defense of Democracies & Roubini Global Economics, June 
2015.
    \73\ Parisa Hafezi & Louis Charbonneau, ``Iranian Nuclear Deal Set 
to Make Hardline Revolutionary Guards Richer,'' Reuters, July 6, 2015.
    \74\ Emanuele Ottolenghi & Saeed Ghasseminejad, ``Iran's Repressive 
Apparatus Gets a Raise,'' The Wall Street Journal, December 22, 2014.
    \75\ Ibid.
    \76\ Abbas Qaidaari, ``More Planes, More Missiles, More Warships: 
Iran Increases Its Military Budget By A Third,'' Al-Monitor, July 13, 
2015.
    \77\ Emanuele Ottolenghi & Saeed Ghasseminejad, ``The Nuclear 
Deal's Impact on Iran's Revolutionary Guards,'' Foundation for Defense 
of Democracies, July 17, 2015.
    \78\ Department of State, Office of the Spokesman, ``Fact Sheet: 
Designation of Iranian Entities and Individuals for Proliferation 
Activities and Support for Terrorism,'' October 25, 2007.
    \79\ Parisa Hafezi & Louis Charbonneau, ``Iranian Nuclear Deal Set 
to Make Hardline Revolutionary Guards Richer,'' Reuters, July 6, 2015. 
Emanuele Ottolenghi & Saeed Ghasseminejad, ``The Nuclear Deal's Impact 
on Iran's Revolutionary Guards,'' Foundation for Defense of 
Democracies, July 17, 2015.
    \80\ Benoit Faucon & Asa Fitch, ``Iran's Guards Cloud Western 
Firms' Entry After Nuclear Deal,'' The Wall Street Journal, July 21, 
2015.
    \81\ Ibid.
    \82\ Department of the Treasury, Press Release, ``Fact Sheet: 
Treasury Designates Iranian Entities Tied to the IRGC and IRISL,'' 
December 21, 2010.
    \83\ Emanuele Ottolenghi & Saeed Ghasseminejad, ``The Nuclear 
Deal's Impact on Iran's Revolutionary Guards,'' Foundation for Defense 
of Democracies, July 17, 2015.
    \84\ Department of the Treasury, Press Release, ``Fact Sheet: 
Treasury Designates Iranian Entities Tied to the IRGC and IRISL,'' 
December 21, 2010.
    \85\ Department of the Treasury, Press Release, ``Fact Sheet: 
Designation of Iranian Entities and Individuals for Proliferation 
Activities and Support for Terrorism,'' October 25, 2007.
    \86\ Emanuele Ottolenghi & Saeed Ghasseminejad, ``The Nuclear 
Deal's Impact on Iran's Revolutionary Guards,'' Foundation for Defense 
of Democracies, July 17, 2015.
    \87\ The Council of the European Union, ``Council Implementing 
Regulation (EU) No 1245/2011 of 1 December 2011 Implementing Regulation 
(EU) No 961/2010 on Restrictive Measures against Iran,'' Official 
Journal of the European Union, December 2, 2011.
    \88\ Department of State, Press Statement, ``Increasing Sanctions 
Against Iranian Nuclear Proliferation Networks Joint Treasury and State 
Department Actions Target Iran's Nuclear Enrichment and Proliferation 
Program,'' December 13, 2012.
    \89\ Department of State, Media Note, ``Additional Sanctions 
Imposed by the Department of State Targeting Iranian Proliferators,'' 
August 29, 2014.
    \90\ Ibid.
    \91\ Department of State, Press Statement, ``Increasing Sanctions 
Against Iranian Nuclear Proliferation Networks Joint Treasury and State 
Department Actions Target Iran's Nuclear Enrichment and Proliferation 
Program,'' December 13, 2012.
    \92\ Ibid.
    \93\ Department of the Treasury, Press Release, ``Treasury Targets 
Iranian Companies for Supporting WMD Proliferation,'' February 16, 
2007.
    \94\ ``ISIS Imagery Brief: Kalaye Electric,'' Institute for Science 
and International Security, March 31, 2005.
    \95\ Department of State, Media Note, ``Additional Sanctions 
Imposed by the Department of State Targeting Iranian Proliferators,'' 
August 29, 2014.
    \96\ Emanuele Ottolenghi & Saeed Ghasseminejad, ``Under Iran 
Agreement, U.S. Will Delist All Entities Controlled by Supreme 
Leader,'' Foundation for Defense of Democracies, July 27, 2015.
    \97\ Steve Stecklow, Babak Dehghanpisheh & Yeganeh Torbati, 
``Khamenei Controls Massive Financial Empire Built on Property 
Seizures,'' Reuters, November 11, 2013.
    \98\ Department of the Treasury, Press Release, ``Treasury Targets 
Assets of Iranian Leadership,'' June 4, 2013.
    \99\ Ibid.
    \100\ Steve Stecklow, Babak Dehghanpisheh & Yeganeh Torbati, 
``Khamenei Controls Massive Financial Empire Built on Property 
Seizures,'' Reuters, November 11, 2013.
    \101\ Emanuele Ottolenghi & Saeed Ghasseminejad, ``Who Really 
Controls Iran's Economy,'' The National Interest, May 20, 2015.
    \102\ Ibid.
    \103\ Emanuele Ottolenghi & Saeed Ghasseminejad, ``The Bank of 
Ayatollah,'' National Post (Canada), December 18, 2013. The net worth 
of Parsian Bank and Karafarin Bank is calculated from the Tehran Stock 
Exchange.
    \104\ Michael Birnbaum & Joby Warrick, ``A Mysterious Iranian-Run 
Factory in Germany,'' The Washington Post, April 15, 2013.
    \105\ ``Executive Order 13599,'' Federal Register, February 8, 
2012. U.S. Department of the Treasury, Press Release, ``Treasury 
Targets Assets of Iranian Leadership,'' June 4, 2013. ``New U.S. 
Sanctions on the Government of Iran and Iranian Financial 
Institutions,'' Steptoe & Johnson, LLP, February 7, 2012.
    \106\ Leon Wieseltier, ``The Iran Deal and the Rut of History,'' 
The Atlantic, July 27, 2015.
    \107\ Barack Obama, ``Press Conference by the President,'' The 
White House, Washington, DC, July 15, 2015.
    \108\ For example, Barack Obama, ``Remarks by the President in a 
Conversation with the Saban Forum,'' Willard Hotel, Washington, DC, 
December 7, 2013. John Kerry, ``Interview With Martha Raddatz of ABC 
This Week,'' Washington, DC, March 1, 2015. Susan Rice, ``Remarks As 
Prepared for Delivery at AIPAC Annual Meeting,'' Washington, DC, March 
2, 2015.
    \109\ For example, June 30, 2015, President Obama said that he 
would ``will walk away from the negotiations if, in fact, it's a bad 
deal.'' Barack Obama, ``Remarks by President Obama and President 
Rousseff of Brazil in Joint Press Conference,'' The White House, 
Washington DC, June 30, 2015.
    \110\ For an analysis of the period prior to 1900, see R. Earl 
McClendon, ``The Two-Thirds Rule in Senate Action Upon Treaties, 1789-
1901,'' The American Journal of International Law, Vol. 26, No. 1 
(Jan., 1932), pages 37-56.
    \111\ Michael Krepon, ``The Jackson Amendment,'' Arms Control Wonk, 
August 6, 2009. ``Congress Approves SALT Offensive Arms Agreement.'' 
Congressional Quarterly, 1973.
    \112\ Ibid.
    \113\ Ibid.
    \114\ ``The Treaty on the Limitation of Underground Nuclear Weapon 
Tests (TTBT),'' United States of America--Union of Soviet Socialist 
Republics, July 3, 1974.
    \115\ ``Milestones: 1969-1976: Strategic Arms Limitations Talks/
Treaty (SALT) I and II,'' U.S. Department of State Web site, accessed 
July 27, 2015.
    \116\ Ibid.
    \117\ Jonathan B. Tucker, ``U.S. Ratification of the Chemical 
Weapons Convention,'' National Defense University Press, December 2011.
    \118\ Interview with former State Department arms control expert, 
July 23, 2015.
    \119\ ``Specially Designated National List,'' U.S. Department of 
the Treasury Web site, July 23, 2015.
    \120\ The White House, Press Release, ``Statement by the President 
on H.R. 1540,'' December 31, 2011.
    \121\ ``Iran's Rouhani Says the West Should Remain Committed to a 
Final Nuclear Deal: IRNA,'' Reuters, June 30, 2015.
    \122\ ``Transcript: President Obama's Full NPR Interview on Iran 
Nuclear Deal,'' NPR, April 7, 2015.
    \123\ For more details, see Olli Heinonen, ``Testimony on The Iran 
Nuclear Deal and its Impact on Terrorism Financing,'' Testimony before 
the Committee on Financial Services Task Force to Investigate Terrorism 
Financing, July 22, 2015.
    \124\ Olli Heinonen, ``Verifying Iran for the Long Term,'' Iran 
Task Force Memo, March 2015.
    \125\ Ibid.
    \126\ Ibid.
    \127\ International Atomic Energy Agency, Press Release, ``Iran 
Signs Additional Protocol on Nuclear Safeguards,'' December 18, 2003.
    \128\ Semira N. Nikou, ``Timeline of Iran's Nuclear Activities,'' 
United States Institute of Peace, accessed July 27, 2015.
    \129\ William Tobey, ``The Hollow Core of the Iran Nuclear Deal,'' 
Iran Task Force, June 2015.
    \130\ For a model on how such sanctions relief could be structured, 
see Mark Dubowitz & Richard Goldberg, ``Smart Relief After an Iran 
Deal,'' Foundation for Defense of Democracies, June 2014.
    \131\ Emanuele Ottolenghi & Saeed Ghasseminejad, ``Who Really 
Controls Iran's Economy,'' The National Interest, May 20, 2015. Ali 
Alfoneh, ``Sanctions Relief and the IRGC,'' FDD Policy Brief, June 4, 
2015.
    \132\ Martin Arnold, Simond Kerr, & Ben McLannahan, ``Post-Deal 
Iran an Opportunity but Legal Minefield Too,'' Financial Times, July 
19, 2015.
    \133\ U.S. Department of the Treasury, ``Frequently Asked Questions 
Relating to the Extension of Temporary Sanctions Relief through June 
30, 2015, to Implement the Joint Plan of Action between the P5+1 and 
the Islamic Republic of Iran,'' November 25, 2014, pages 5-6.
    \134\ ``Iranian Nobel Laureate: Human Rights As Bad As Under 
Ahmadinejad,'' Associated Press, November 12, 2014. Sangwon Yoon, 
``Iran Leader Fails to Deliver on Rights Promises, U.N. Says,'' 
Bloomberg, October 27, 2014.


                               __________

                       SANCTIONS AND THE JCPOA

                              ----------                              


                        THURSDAY, JULY 30, 2015

                                       U.S. Senate,
                            Committee on Foreign Relations,
                                                    Washington, DC.
    The committee met, pursuant to notice, at 10:02 a.m., in 
room SD-419, Dirksen Senate Office Building, Hon. Bob Corker 
(chairman of the committee) presiding.
    Present: Senators Corker, Rubio, Flake, Gardner, Perdue, 
Isakson, Cardin, Menendez, Shaheen, Coons, Udall, and Kaine.

             OPENING STATEMENT OF HON. BOB CORKER, 
                  U.S. SENATOR FROM TENNESSEE

    The Chairman. The Senate Foreign Relations Committee will 
come to order. Today's hearing is the third in a series of 
hearings we are holding to evaluate the nuclear agreement 
reached between Iran and the six major world powers.
    We have heard from the administration and from private 
witnesses about evaluating the agreement as a whole. Today's 
hearing gives us an opportunity to look closely at one of the 
key aspects of the agreement, sanctions relief. Next week, we 
will have an opportunity to hear from experts on the nuclear 
aspects of the deal, but today we have two well-respected 
experts on sanctions.
    We thank you both for being here.
    It is worth noting that real questions about sanctions 
relief remain. On the same day the U.N. passed the resolution 
endorsing the deal and setting up the snapback mechanism, Iran 
wrote a letter to the U.N. saying that they would treat use of 
the snapback as grounds to walk out of the agreement.
    Again, I think you all know this passed in about 90 seconds 
last Monday. And at that moment, Iran sent a letter refuting 
the ability to use snapback.
    That same letter outlines that extension of current 
sanctions would be in violation of the agreement. I know we had 
an exchange the other day where it was asked if we had some 
sanctions that are rolling off in 2016, if we just extended 
those so there would be something to snap back to. I know 
Senator Menendez has made a strong point about this--that that 
itself would be a violation, and Iran would consider any 
imposition of new sanctions with the nature and scope identical 
or similar to those that were in place prior to the 
implementation date, irrespective of whether new sanctions are 
introduced on nuclear aid, or other grounds.
    We have a number of very powerful sanctions that are being 
alleviated. Most of us have felt that if for some other reason 
Iran was out of order, we could reapply those sanctions against 
terrorism, human rights, or other activities. I think there is 
a major debate over whether that could happen. As a matter of 
fact, Iran has said that it could not.
    I will also say that our partners in the West very strongly 
told me the same thing. Recently, they have been backing off of 
that a little bit. So I do not know exactly where that stands.
    Those statements, the agreement itself, and the lack of 
clarity from our administration have left Senators with 
unresolved questions. Those include questions about the 
efficacy of U.S. secondary sanctions, if Congress disapproves 
the deal, a very important factor for us to be considering. 
There are also remaining questions about whether or not the 
United States can reimpose sanctions lifted in the agreement 
should we need to use them for terrorism purposes.
    I am very honestly surprised to say, but there are 
remaining questions about whether or not extending the Iran 
Sanctions Act would constitute a violation of the agreement, as 
I mentioned earlier. I see no reason why simply extending 
existing authority, which could be waived, would be in 
violation of the agreement, but Secretary Lew and the Iranians 
seem to think otherwise.
    I hope our witnesses will address these questions as well 
as expand on what you might see as the current climate for 
doing business in Iran.
    Both of you have spent time with the companies affected by 
these sanctions, and if you could, I would appreciate hearing 
any valuable takeaways.
    It is important to note that the sanctions this Congress 
put in place are responsible for bringing Iran to the 
negotiating table. In exchange for suspension of virtually all 
of our economic leverage, Iran will, over time, get to develop 
an industrial-scale, internationally legitimate nuclear 
program.
    While this agreement is not intended to address terrorism, 
many of us worry that the agreement will prevent the United 
States from using economic tools to counter Iranian regional 
aggression.
    Our witnesses have extensive experience in both economic 
coercion and combating terrorism. I would appreciate your 
perspective on how this agreement could affect our ability to 
use sanctions in response to terrorism.
    Secretary Kerry said last week we are free to adopt 
additional sanctions as long as they are not a phony excuse for 
just taking the whole pot of past ones and putting them back. I 
worry that Iran will not agree with our definition of phony and 
that through this agreement the administration could 
inadvertently be hampering its own ability to combat Iranian 
terrorism.
    In September, we will have the opportunity to vote to 
approve or disapprove the agreement. At its core, that choice 
is whether or not this agreement merits Congress voting to lift 
those sanctions.
    Thank you very much for appearing before our committee.
    I turn to our distinguished ranking member for his comments 
and look forward to a very good hearing.

         OPENING STATEMENT OF HON. BENJAMIN L. CARDIN, 
                   U.S. SENATOR FROM MARYLAND

    Senator Cardin. Mr. Chairman, thank you for arranging this 
hearing to deal with the sanctions aspects of the JCPOA.
    I thank both our witnesses, two experts in this area, for 
sharing their thoughts and engaging our committee in a 
discussion, so that we can better understand the impact of the 
JCPOA as it relates to sanctions.
    Yesterday, we had, I thought, a very helpful hearing that 
dealt with the overall effect of the agreement. I think we 
spent a good deal of time looking at the alternatives. If 
Congress effectively rejects the JCPOA, what would the 
consequences be?
    In that discussion, we did talk about sanctions. And I 
think today we want to concentrate on the sanction aspects of 
the agreement.
    Ultimately, the members of this committee, the Members of 
the United States Senate and House, are going to make a 
decision whether the benefits of the agreement outweigh the 
risks or whether the risks of the agreement outweigh the 
benefits.
    That is our test, and the sanctions have a major impact on 
our evaluation of those issues.
    Let me first deal with an issue I have raised since day 
one, and that the chairman raised again in his opening 
comments. I hope that we will get your views on this. And that 
is, it has been stated very clearly by this administration that 
we are not relieving sanctions related to terrorism and human 
rights or their missile program. It has also been stated, and I 
asked the direct question at the hearing last Thursday, if we 
have credible information that Iran has violated our policies 
on terrorism, can we reimpose sanctions on the specific 
organizations that received relief under the JCPOA, or the 
economic sectors that were affected, such as the crude oil 
sales by Iran? Could we reimpose those types of sanctions?
    And Secretary Lew said fairly directly the answer is 
``Yes,'' depending on the circumstances, if we can demonstrate, 
in fact, that it is related to terrorism.
    Mr. Chairman, I asked similar questions to the 
representatives of Europe that were here this week because we 
know that it is going to require, ultimately, five of the eight 
votes in the commission that oversees this. And their response 
was pretty similar to what Secretary Lew said, in all fairness. 
I am just relaying what they said to me.
    But I am tempered by the language of the JCPOA. After all, 
that is what we agreed to. I said frequently, I am more 
interested in what is in the JCPOA than what the Iranians say 
about what is in the JCPOA or, for that matter, our own 
administration's words, because we are bound by the language in 
the JCPOA, if we go forward with it.
    It says in Section 29, the EU and its member states, the 
United States, consistent with the respective laws, will 
refrain from any policy specifically intended to directly and 
adversely affect the normalization of trade and economic 
relations with Iran. Then it says in paragraph 30 that the EU+3 
will not apply sanctions or restrictive measures to persons or 
entities for engaging in activities covered by the lifting of 
sanctions provided for in this JCPOA. Then there are some 
qualifications in the JCPOA.
    So what I would hope to discuss today is would we be out of 
compliance with the JCPOA if we reimposed sanctions for 
nonnuclear activities of entities or economic activities that 
were relieved from sanctions under the JCPOA?
    And secondly, what type of pressure would there be on the 
United States if we wanted to go forward? Would there be 
international pressure for us not to be as aggressive as 
perhaps the Congress or the administration wants to be?
    And we were told yesterday by both of our witnesses that we 
should be very aggressive in holding Iran to high standards, if 
this agreement goes forward. What type of pressure would there 
be on us effectively being able to impose the type of sanctions 
to prevent Iran from their nonnuclear nefarious activities?
    That is one set of questions I hope we can get into today.
    The second is, how effective would snapback sanctions be? 
After they are lifted and during that period of time before 
they are repealed, if any of the negotiating partners felt that 
there was a material breach to the point of snapping back all 
or part of the sanctions that were relieved by the U.N., EU, 
and/or the United States, how effective and how quickly can we 
reimpose sanctions that will require Iran to rethink its 
behavior? I would be interested in your views in that regard.
    Then a last point I would like to have you respond to, and 
that is, if we do not approve the agreement, if we reject it, 
and the United States sanctions remain in place, how effective 
will those sanctions be if we do not have the support of the 
international community to cooperate with us in a sanctions 
regime?
    I think these are important questions for the Members of 
the Congress to understand. And I just look forward to our 
discussion today.
    The Chairman. I do want to say again I know when I met with 
our Western partners, they were very explicit in agreeing with 
Iran. They did get back with us since that time, and since 
there may have been some reach-out from the administration, 
they moderated their views much in line with what you may be 
saying.
    I want to also say the ranking member and I asked Mr. Amano 
to testify before us next week, just so we could get an 
understanding of the IAEA issues that we have been concerned 
about, whether we do that in a classified setting or someplace 
else. We have been turned down. So I do want to make people 
aware of that.
    Obviously, there are a lot of concerns about the agreement 
that we have not seen. What we do know about it, I think we all 
know is, at best, very questionable. So I am sorry to say we 
are not going to have the benefit of their testimony to help 
clear up some of the concerns that we have.
    So with that, we have two outstanding witnesses today that 
will be very helpful.
    Our first witness is Hon. Juan C. Zarate, chairman of the 
Financial Integrity Network and chairman of the Center on 
Sanctions and Illicit Finance at the Foundation for Defense of 
Democracies. Mr. Zarate previously served as Deputy Assistant 
to the President and Deputy National Security Adviser for 
Combating Terrorism. In addition, Mr. Zarate was the first-ever 
Assistant Secretary of the Treasury for Terrorist Financing and 
Financial Crimes.
    You have not been very successful in that regard.
    Just kidding. Thank you.
    Our second witness today is Mr. Richard Nephew, program 
director for the Economic Statecraft, Sanctions and Energy 
Markets at the Center for Global Energy Policy. Previously, Mr. 
Nephew served as Principal Deputy Coordinator for Sanctions 
Policy at the Department of State and the lead sanctions expert 
for the U.S. team negotiating with Iran. He has also served as 
the director for Iran on the National Security staff.
    Thank you both for being here. We are excited about you 
being here. If you would sort of abbreviate your comments, you 
are going to have lots of questions. Your written testimony, 
without any opposition, will be made part of the record.
    Thank you, both. You can start in whichever order you wish.

   STATEMENT OF THE HON. JUAN C. ZARATE, CHAIRMAN AND SENIOR 
 COUNSELOR, CENTER ON SANCTIONS AND ILLICIT FINANCE (CSIF) AT 
   THE FOUNDATION FOR DEFENSE OF DEMOCRACIES, WASHINGTON, DC

    Mr. Zarate. Mr. Chairman, thank you very much for that kind 
introduction. Ranking Member Cardin, distinguished members of 
this distinguished committee, thank you for this privilege and 
opportunity to speak to you about the sanctions implications of 
the JCPOA. I am honored, privileged, so thank you very much.
    I am also grateful to be here next to Mr. Richard Nephew. I 
am going to pass all the difficult questions to him. But I do 
want to thank him in all honesty for his service to the U.S. 
Government, to the State Department, and on the issues related 
to sanctions.
    I take this responsibility before you today incredibly 
seriously, given the gravity and implications of this 
agreement. I appreciate the questions you have already posed, 
which are nuanced and important. I am happy to answer any 
others that you pose.
    But I come to this issue with views borne from relevant 
experience dealing with Iran from both the Treasury Department 
and National Security Council. I know that all involved have 
been working incredibly hard toward a peaceful solution to the 
Iranian nuclear program, through painstaking strategies of 
coercion, sanctions, and diplomacy.
    Indeed, the financial and economic constriction campaign 
built methodically over the course of a decade helped bring 
Iran to the table. In the words of President Rouhani, the 
sanctions threatened to drive Iran back into the Stone Age.
    These efforts have also been designed to constrain and 
isolate rogue Iranian behavior--its support of terrorism, the 
Assad regime, proliferation, human rights abuses, and other 
dangerous activity--as well as to protect the integrity of the 
U.S. and international financial systems.
    I will, based on your invitation, focus my testimony on the 
sanctions relief framework in the JCPOA.
    Mr. Chairman, I will tell you the framework in the JCPOA is 
flawed. The relief is too front-loaded. It does not account for 
the increased risks stemming from Iranian commercial and 
financial activity. And the JCPOA, as you have alluded to, 
broadly constrains the U.S. Government's ability to use 
effective financial power against Iranian nonnuclear national 
security risks.
    There are structural problems in the JCPOA that undermine 
the ability of the United States to use these powers to affect 
Iranian behavior. The snapback framework itself proves 
problematic and is a blunt instrument. It will only be applied 
if the most egregious violations can be proven openly and 
convincingly to all parties.
    If new contracts signed are grandfathered, as is suggested 
in some of the text of the U.N. resolution and discussions 
around the JCPOA, the snapback loses its real-world effect to 
ensure compliance. Instead, it has the potential to create a 
gold rush incentive for commercial actors to get into the 
Iranian market quickly.
    The Iranians maintain a heckler's veto on any reimposition 
of nuclear sanctions and can simply walk away from the 
agreement.
    With the appellate processes, any U.S. sanction or related 
action to which Iran objects would be subject to review by the 
other parties, including Iran, China, Russia, creating a whole 
new paradigm for how the United States reviews and issues its 
sanctions.
    The JCPOA unwinds sanctions bluntly, encompassing issues of 
proliferation and weaponization without addressing the 
underlying conduct. This creates real risks, and it does damage 
to the ability to use the very same tools against Iranian 
individuals and entities in the future.
    This proves highly problematic with the delisting of 
Iranian banks, for example, Bank Sepah, the Central Bank of 
Iran, and transport companies, like IRISL, which have been used 
not just to facilitate the nuclear program but also for 
proliferation and sanctions evasion.
    Though nonnuclear sanctions were supposedly off the table, 
the spirit and letter of the agreement may actually neuter U.S. 
ability to leverage one of its most powerful tools. The 
normalization of economic relations with Iran, which is 
embedded in paragraph 29 of the preface to JCPOA and also 
further ensconced in the new U.N. Security Council resolution, 
does grave damage to that ability and to those powers.
    Mr. Chairman, from the start of negotiations, as you know, 
what the Iranians wanted most was the ability to do business 
again, unfettered and plugged back into the global financial 
and commercial system. With a commitment to the reintegration 
of the Iranian economy on the back of the nuclear deal, the 
administration effectively put all sanctions on the table.
    To understand this, one needs to appreciate why these 
financial and commercial measures were so effective in the 
first instance. These were not the sanctions of old.
    The financial constriction campaign, which began against 
Iran in 2005, has proven effective over the past decade not 
because Iran was hermetically sealed with naval blockades or 
classic trade embargoes, but because it was unplugged from the 
elements of the global financial and commercial order.
    The regime has needed access to banking, shipping, 
insurance, and new technologies, and connectivity to the oil 
and global economic markets to maintain and sustain the regime.
    That is what they lost over the past decade. That appears 
to be what they have gained and guaranteed in this deal.
    Now, Mr. Chairman, in addition, the United States will need 
to amplify its use of financial measures aggressively against 
key elements of the Iranian economy to deal with increased 
risks based not just on this deal but also Iranian foreign 
policy. It is not at all clear to me that this is well 
understood by all parties or that this is part of our strategy.
    The risks from Iran are real and will increase. Iran will 
get a massive infusion of capital from initial sanctions 
relief, with some of the estimates up to $150 billion. No doubt 
some of this will go to support terrorist and militant groups 
from the Golan to Yemen.
    With the allowance of an Iranian nuclear program, the deal 
will likely increase, not decrease, the risk of proliferation. 
The regime will use its control of the economy not only to 
further enrich itself, but to suppress internal opposition 
brutally and ensconce its rule.
    The concerns over human rights abuses and regime 
kleptocracy will grow. And the reality and risks of Iranian 
sanction evasion, money laundering, and other financial crimes 
will increase, not decrease, over time.
    The United States, therefore, will need to use the same 
types of financial strategies and campaigns to isolate rogue 
Iranian activity, which will necessarily affect the trade, 
commerce, and economy of Iran.
    Mr. Chairman, I think there are three critical principles 
for Congress to demand related to sanctions and the JCPOA. 
Congress, I think, should ensure there is clarity in the JCPOA 
and in the execution of any sanctions unwinding plan or 
framework. It should ensure that the United States maintains as 
much financial and economic power and leverage as possible. 
Congress should as well mitigate the risks attendant to an 
enriched and emboldened regime in Tehran.
    These principles then could help inform the basis of a new 
strategy to address the real and dangerous risks stemming from 
Iran. The United States should adopt a financial constriction 
campaign focusing on the IRGC, Quds Force, and core elements of 
the regime that engage in terrorist financing, proliferation of 
weapons and nuclear technology, and support of militias. This 
could include the use of secondary sanctions.
    There should be a recommitment to the elements of a 
nonproliferation regime and a dedicated strategy focusing on 
the proliferation risks attendant to any deal with Iran. This 
would include tighter export control enforcement, 
interdictions, and financial restrictions tied to suspect 
Iranian actors and activities, including Iranian banks.
    The elements of the PATRIOT Act Section 311 action against 
Iran and the Central Bank of Iran should be reiterated and 
reinforced with a designation of primary money laundering 
concern against the class of transactions involving any Iranian 
bank.
    This, Mr. Chairman, could be amplified with a program, 
perhaps led by the European Union, to create a monitoring 
system through SWIFT, the bank messaging system, akin to what 
we built in the Terrorist Financing Tracking Program, to track 
and analyze suspect Iranian banking transactions.
    Mr. Cardin, the Global Magnitsky Human Rights 
Accountability Act could be used expansively to target the 
finances and holdings of the Iranian regime and those involved 
in gross human rights violations on its behalf. Senator, I know 
this is of deep concern for you.
    Mr. Chairman, these are just some of the measures that 
could be taken to confront the risks from Iran. But, of course, 
undertaking these types of steps in whatever form will likely 
be seen by diplomats from whatever country as interfering with 
the JCPOA or any deal, for that matter.
    Instead, they should be seen as necessary steps to enable 
any nuclear deal, temper market enthusiasm for doing business 
with a dangerous regime and jurisdiction, and preserve, 
importantly, a key element of America's power and leverage 
against Iran and other rogues.
    Mr. Chairman, when the Iranians came back to the table 
after President Rouhani's election to negotiate over the 
nuclear agreement, one Western diplomat based in Tehran told me 
in confidence, ``You have won the war using economic sanctions 
and financial pressure.'' But he then asked, ``Can you win the 
peace?''
    I think and hope we can still win the peace, but it will 
require using and leveraging the very same powers and 
authorities that helped bring the regime to the table. We must 
ensure that the JCPOA has not inadvertently empowered the 
regime in Tehran while taking one of America's most potent 
powers off the table.
    Thank you, Mr. Chairman.
    [The prepared statement of Mr. Zarate follows:]

                  Prepared Statement of Juan C. Zarate

    Chairman Corker, Ranking Member Cardin, and distinguished members 
of the Senate Foreign Relations Committee, I am honored to testify 
before your committee to discuss the sanctions implications of the 
recently announced Joint Comprehensive Plan of Action (JCPOA) between 
the P5+1 and Iran. I am especially privileged to speak to the 
sanctions-related elements and dimensions of the JCPOA.
    I take this responsibility seriously given the gravity, stakes, and 
implications of this agreement and Congress' role in reviewing the 
JCPOA on behalf of the American people. The question of a nuclear-armed 
Iran is a critical security issue for the United States, our allies, 
the broader Middle East, the global nonproliferation regime, and has 
serious implications for the potential and future use of American power 
in all its forms.
    I come to this issue with views born from relevant experience--as 
the first-ever Assistant Secretary of the Treasury for terrorist 
financing and financial crimes until May 2005, and then as the Deputy 
Assistant to the President and Deputy National Security Advisor for 
combating terrorism (2005-2009). While in these positions, we shaped 
the financial constriction campaign against Iran starting in 2005, and 
confronted the world's leading state sponsor of terror.
    I also come to this issue now as an outside expert, having written, 
taught, and spoken extensively about the use of sanctions and financial 
power in national security; counterterrorism and transnational threats, 
strategy, and policies; and legal principles and constructs in national 
security decisionmaking, including in our coercive statecraft and 
diplomacy.
    The task of negotiating a deal of this nature and complexity--with 
multiple parties and against an avowed enemy of the United States--has 
been a daunting and lengthy task. I know that those involved from the 
United States Government--from multiple agencies and across two 
administrations--have worked tirelessly on this issue.
    And I know that all involved have been seeking a peaceful solution 
to the Iranian nuclear problem--through painstaking strategies of 
coercion, sanctions, and diplomacy. The financial and economic 
constriction campaign has been built methodically over the course of a 
decade to help drive the Iranian regime to the table and change the 
course of their nuclear program. Indeed, these efforts built on over 
three decades of sanctions against the Iranian regime for its support 
of terrorism, quest for a nuclear program, human rights abuses, and 
other dangerous activities.
    These efforts have also been designed to constrain and isolate 
rogue Iranian behavior and protect the integrity of the U.S. and 
international financial systems. This was a monumental task, and there 
is no silver bullet that will get us everything we want in a deal.
    Unfortunately, this is a flawed agreement. I have not been asked 
today to delineate all the gaps, problems, or challenges in the JCPOA, 
nor would I be qualified to do so. But I do want to point out three 
fundamental problems with the JCPOA that frame my analysis:

    1. Problematic End State: Iran as a Nuclear Power. The JCPOA does 
not ultimately constrain the Iranian nuclear program, but instead helps 
to expand and to legitimize it. The JCPOA moves fundamentally away from 
the agreed-upon baseline restrictions and demands of Iran that were 
long the basis of U.N. Security Council Resolutions (UNSCRs). 
Ultimately, the JCPOA stalls, enables, and then validates an Iranian 
nuclear program. After 10 years, the program will not be subject to any 
United Nations Chapter 7 scrutiny, and after 15 years, many of the key 
restrictions imposed will end. The provisions enabling advanced 
research and development, uranium enrichment activities, evolution 
toward the use of more sophisticated centrifuges, and the sunset 
provisions embedded in the agreement all contribute to a legitimated 
Iranian nuclear program.
    These provisions are agreed absent clarity on Iran's prior attempts 
at militarization--``possible military dimensions'' (PMDs)--and without 
a stricter inspection protocol or the allowance for American inspectors 
to be included on international inspection teams. Moreover, the arms 
and ballistic missile sanctions are scheduled to be lifted 
automatically after 5 and 8 years, respectively, on the back of the 
JCPOA without account for Iran's belligerence, proliferation, or other 
dangerous behaviors now or later.
    With strategic patience, Iran can march toward a weaponized program 
with greater capabilities, breakout capacity, and more economic 
resources, resilience, and connectivity to the global oil markets and 
commercial system. Even if Iran complies with all elements of this 
deal, Iran will end up with an unfettered opportunity to break out and 
weaponize its nuclear program, overtly or covertly, along with an 
ability to arm itself and its allies more openly and aggressively. The 
end state of the agreement takes us far afield from the declared goal 
of successive administrations at the start of negotiations.
    2. Problematic Construct: Iran as Co-Equal. The presumptions and 
processes of the JCPOA embed and define Iran as an equal party in 
pursuit of a peaceful nuclear program. Though a negotiating party 
should be treated fairly and with respect, it does not mean that the 
construct of the agreement should treat the parties equally. Iran has 
been the suspect party in the eyes of the international community, 
subject to strict UNSCRs and caught on several occasions in the past 
hiding elements of its nuclear program and its weaponization efforts. 
Iran should be required to prove the peaceful nature of its program and 
activities whenever challenged. It also does not mean that Iran should 
be treated as an aggrieved party when restrictions are placed on its 
program or questions asked. Instead, it should remain the suspect party 
in the eyes of the world's powers for the purposes of any deal.
    Iran has been given a right to object, question, and stall any 
challenge to its nuclear program or application of sanctions. For 
example, it must be presented with evidence by the International Atomic 
Energy Agency (IAEA) and others if an inspection is requested; it can 
interrogate the information or object to ``reimposition'' of sanctions; 
it sits on the new JCPOA appellate body, the ``Joint Commission,'' and 
can use procedural hurdles to delay; and it has the agreed-upon right 
to walk away from the deal unilaterally based on its perception that 
the JCPOA is not being honored.
    Iran should be required to present information to answer legitimate 
questions and rebut reasonable assertions. The burden of persuasion and 
proof should always lie with Iran. The United States and her partners 
should not be put in the position of having to prove ab initio its 
concern or the basis for its question, having then to calculate whether 
and how to reveal sensitive information and intelligence to Iran (along 
with China and Russia). The structure, processes, and nature of this 
agreement give Iran the benefit of the doubt that it is pursuing a 
peaceful program, when the onus should remain with Iran throughout to 
prove the peaceful nature of its program, as constructed in the 
relevant UNSCRs. Importantly, Iran should not be given the unilateral 
right to withdraw from the deal when the world powers' actions are 
subject to review and appeal under the JCPOA.
    3. Problematic Sanctions Relief: Constraints on U.S. Financial and 
Economic Power. The sanctions relief provided is too front-loaded, does 
not account for the increased risks stemming from Iranian commercial 
and financial activity, and broadly constrains the U.S. Government's 
ability to use effective financial power against Iranian ``nonnuclear'' 
national security risks. Despite the attempts to phase out various 
sanctions lists and retain a ``snapback'' provision, the JCPOA 
contemplates early relief by allowing for frozen Iranian funds (upward 
of $150 billion) to be released after Implementation Day without 
constraint and for many of the financial, oil, and commercial sanctions 
and restrictions to be lifted.
    Though there will be reticence by legitimate actors to jump back 
into Iranian markets too quickly, the sanctions architecture that has 
been put in place methodically over the course of many years will be 
unwound in swaths and will be difficult to maintain once momentum grows 
to do business with and in Iran. Instead of targeted unwinding and 
control of related risks, the sanctions unwinding framework appears to 
be driven by a desire to help reintegrate and rehabilitate the Iranian 
economy. The cost of this deal was the dismantling of the sanctions 
architecture and the defanging of America's financial and economic 
power against Iran.

    I will focus my testimony on this sanctions relief framework and 
why this presents a fundamental flaw in the structure of the JCPOA. 
Fundamentally, the JCPOA sacrifices the ability of the United States to 
use its financial and economic power and influence to isolate and 
attack rogue and problematic Iranian activity--beyond the nuclear 
program. Beyond simple sanctions relief, we have negotiated away one of 
our most important tools of statecraft--the very financial and economic 
coercion that helped bring the Iranian regime to the table.
         taking u.s. financial and economic power off the table
    In terms of sanctions relief, the most troubling question for 
Congress to consider is whether we have negotiated away the ability to 
use U.S. financial and economic power aggressively against the Iranian 
regime and economy--even to constrain ``nonnuclear'' activities that 
present real and increasing threats.
    Though ``nonnuclear'' sanctions were supposedly off the table, the 
spirit and letter of the agreement may actually neuter U.S. ability to 
leverage one of its most powerful tools--its ability to exclude rogue 
Iranian actors and activities from the global financial and commercial 
system.
    Paragraph 29 of the preface commits the parties to the following:

        The EU and its Member States and the United States, consistent 
        with their respective laws, will refrain from any policy 
        specifically intended to directly and adversely affect the 
        normalization of trade and economic relations with Iran 
        inconsistent with their commitments not to undermine the 
        successful implementation of this JCPOA. (Emphasis added) \1\

    This provision, which appears in the section related to sanctions, 
clearly expresses the intent of the JCPOA to help normalize trade and 
economic relations with Iran as a cost of the deal. This text 
incorporated directly--along with the entire JCPOA--into the new U.N. 
Security Council Resolution (2231) passed unanimously on July 20, 2015, 
and the intent is reiterated explicitly in the preamble:

        Emphasizing that the JCPOA is conducive to promoting and 
        facilitating the development of normal economic and trade 
        contacts and cooperation with Iran, and having regard to 
        States' rights and obligations relating to international 
        trade.\2\

    Ultimately, this means that the deal shields Iran's economy from 
any efforts to exclude it from the global commercial and financial 
order. This power is at the heart of U.S. strategies post 9/11 to use 
financial and economic power to exclude rogue actors and illicit 
activities from the global order. With this constraint, the United 
States appears to have bound itself to restrict the type of effective 
tools it will use to affect Iranian behavior.
    From the start of negotiations, what the Iranians wanted most was 
the ability to do business again--unfettered and plugged back into the 
global financial and commercial system. With a commitment to the 
reintegration of the Iranian economy on the back of the nuclear deal, 
the administration effectively put all effective sanctions on the 
table--those that can be used against Iranian support for weapons and 
technology proliferation, terrorism, human rights abuses, support for 
Assad, and even cyber attacks.
    To understand this, one needs to appreciate why these financial and 
commercial measures were so effective in the first instance. These are 
not the ``sanctions'' of old. The financial constriction campaign which 
began against Iran in 2005, has proven effective over the past decade 
not because Iran has been hermetically sealed with naval blockades or 
particular individuals in the regime have been designated by the United 
Nations but because the United States--with help from its allies and 
the private sector--helped unplug Iran from the global financial and 
commercial system.
    This campaign was not built on the principles of classic trade 
embargoes. In this new construct, it did not matter if Iranians could 
buy Wrigley chewing gum on 
the streets of Tehran. Instead, the U.S. Government, through the U.S. 
Treasury mounted a targeted financial campaign against key elements of 
the Iranian economy, which they needed to be able to do business 
effectively and give global reach to their activities. This began by 
targeting Iran's banks. The Iranians' use of their financial and 
commercial system to advance their nuclear weapons program and to 
support their military and intelligence operations was their Achilles' 
heel.
    Like a hunter's trap, the financial campaign squeezed Iran's 
ability to access the international financial system in stages--
actually feeding off of Iran's attempts to evade the program's 
heightened scrutiny. This approach took time, patience, and 
coordination within the U.S. Government and with allies. The driving 
principle would be the same as what had been driving the isolation of 
illicit financial activity since 9/11--protecting the integrity of the 
international financial system.
    This campaign unfolded in stages, and the international environment 
would need to be conditioned to reject doing business with Iran. It 
would not be a financial shock-and-awe campaign. Instead, it took time, 
using a series of coordinated steps to isolate key elements of the 
Iranian economy, starting with its banks, then shipping, then 
insurance, and finally its oil sector. If anything, this campaign 
looked more like a financial insurgency than a traditional sanctions 
program. The Iranians themselves called it the ``hidden war.''
    The U.S. Treasury targeted Iran's banks by using Iran's own 
conduct--its proliferation activity, support for terrorist groups and 
Shia militias, and lack of anti-money-laundering controls, as well as 
the secretive and corrupt nature of the regime itself--as the 
cornerstone of the campaign. Iran's suite of suspect activities and 
attempts to avoid international scrutiny spurred the private sector to 
stop doing business with Iran. No reputable bank would want to be 
caught facilitating Iran's nuclear program or helping it make payments 
to Hezbollah terrorist cells around the world. If they did, they would 
be caught and sanctioned, with enormous reputational and business 
consequences.
    This was a virtuous cycle of isolation that would reduce Iranian 
access to the international financial system more and more over time. 
The more the Iranians tried to hide their identities or evade 
sanctions, the more suspect their transactions would appear and the 
riskier it would become for banks and other financial institutions to 
deal with them. Over time, bank accounts, lines of credit, and 
correspondent accounts were shut down. Like prey caught in a boa 
constrictor's lethal embrace, Iran's own actions to avoid scrutiny and 
obfuscate transactions would lead to greater financial constriction.
    The Iranians deepened their greatest vulnerability. They were 
blending legitimate business transactions with illicit ones by 
funneling them through similar conduits. The Iranian regime often tried 
to hide the nature of its transactions and the identities of the 
Iranian Government entities involved. They used front companies, 
cutouts, and businessmen to acquire items and goods abroad that were 
hard to acquire, sanctioned, or tied to their nuclear ambitions or 
their weapons programs.
    At the same time, the Iranian military was taking greater control 
of the nation's economy. Importantly, the predominant economic player 
was Iran's Islamic Revolutionary Guard Corps (IRGC), the elite military 
and security unit founded in 1979. The IRGC had gained more power and 
influence over time as the protector and exporter of the revolution and 
reported directly to the Supreme Leader, Ayatollah Ali Khamenei.
    The IRGC--with its vast network--has embedded itself into more 
industries within Iran, ultimately building what has been called a 
veritable business empire.\3\ The regime and the IRGC's control of 
``charitable'' foundations--known as bonyads--with access to billions 
of dollars of assets in the form of mortgages and business interests 
for veterans of the Iranian military--served as the baseline of its 
economic power, along with its ability to construct infrastructure 
through a corps of engineers. The reach of the IRGC's economic empire 
now extends to majority stakes in infrastructure companies, shipping 
and transport, beverage companies, and food and agriculture 
companies.\4\
    In 2006, the IRGC acquired control of the Iranian 
telecommunications sector, and it began to control more elements of the 
nation's energy sector, including the development of pipelines and the 
valuable South Pars oil field. Some estimates note that the IRGC 
controls between 25 and 40 percent of Iran's gross domestic product 
(GDP).\5\ The IRGC is deeply involved in building Iran's 
infrastructure, pursuing projects such as deep-water ports and 
underground facilities important to Iran's defense and economy. These 
projects and industries give the IRGC political power and access to 
profits and capital, which has grown over time.
    The IRGC is an economic juggernaut, with responsibilities relating 
to the development of weapons of mass destruction, missile systems, and 
overseas operations. It is deeply involved in the Iranian nuclear 
program, and its international arm, the Quds Force (IRGC-QF), is 
responsible for providing support to terrorist proxies and exporting 
the Iranian Revolution. Between them, the IRGC and its Quds Force are 
responsible for all the activities--weapons proliferation, terrorist 
support, and militant activity--for which Iran has been sanctioned in 
the past.
    From the U.S. perspective, this blend of activities created the 
ultimate vulnerability, particularly the blurred lines between 
legitimate industry and support for Iran's nuclear program and 
terrorist groups. Wire transfers to terrorist groups and front 
companies flowing money into the coffers of the Revolutionary Guard 
were actions seen to threaten not only international security but also 
the integrity of the financial system. The nefarious nature of the 
activities, tied with the IRGC's attempts to hide its hand in many of 
its economic dealings and operations, made Iran's financial activity 
inherently suspect. Iran was making itself a prime target for the kind 
of financial isolation that fed off of the suspect conduct of rogue 
individuals, companies, and countries.
    This constriction campaign would focus not on squeezing or 
punishing the Iranian people, but instead on the financial 
infrastructure of the IRGC and the regime's profits. This was not an 
embargo intended to punish Iran for political delicts. The financial 
campaign targeted suspect Iranian financial and commercial activity in 
order to protect the international financial system from Iran's illicit 
financial activity.
    As part of this effort, an argument was made directly to banks and 
companies around the world that it was too risky to do business with 
Iran, since no one really knew who was lurking behind corporate veils, 
pulling the strings, and accessing bank accounts and funding in Tehran. 
Would a bank be willing to risk its reputation by doing business, even 
inadvertently, with the IRGC or the Quds Force? Could their compliance 
officers guarantee that they knew who was behind their Iranian 
customers and transactions? Was trade with Iran worth the risk of 
access to American markets and banks?
    All of this was amplified by parallel national legislation, UNSCRs, 
greater scrutiny from authorities around the world, and enforcement 
actions, led by the United States. The U.S. created a layered sanctions 
regime, with overlapping Executive orders, designations, and eventually 
legislation, focused on the key elements of the Iranian regime and 
economy facilitating illicit and dangerous behavior. Each U.S. action 
spurred private sector and allied responses. The effects of this 
suspicion and isolation--driven by the private sector's risk calculus 
and government actions--had a real world impact.
    Iranian banks, including its Central Bank, could no longer access 
the international financial system; its shipping lines could not 
traverse ports easily or obtain insurance to operate; and--thanks to 
congressional and international action--its oil sales and revenues were 
suspended. Iran had to create workarounds, evasion schemes, and 
bartering arrangements to continue to do business.
    The regime was affected by cascading isolation, and the pressure 
was increasing--especially as the price of oil began to drop. The 
pressure was increasing--belying the notion that the United States has 
been facing a cracking sanctions coalition and system. Quite the 
opposite was occurring. The ayatollahs' concern over the strangulation 
of the Iranian economy and ultimately the regime--in concert with 
lingering fears of the ghosts of the Green Movement--is what brought 
them to the negotiating table and launched them on the charm offensive 
that allowed them to turn the tables on the West. The sanctions 
pressure was not sustainable for the regime. President Rouhani admitted 
that these measures threatened to drive Iran into an economic ``the 
Stone Age.''
    The regime has needed access to capital, new technologies, and 
connectivity to the global economy and oil markets to maintain and 
sustain their regime. That is what they lost over the past decade. That 
appears to be what they have gained and guaranteed in this deal.
    In essence, the U.S. and her negotiating partners appear to have 
agreed to immunize Iran from any effective future financial or economic 
pressure--precisely the type that brought the regime to the table. And 
our negotiating partners--most champing at the bit to do business with 
Iran again--were willing to take advantage of this offering. Even 
during negotiations, China, which rejects the use of America's global 
financial power and sanctions, and Russia, chafing under the weight of 
U.S. and EU sanctions, were all too willing to undermine U.S. economic 
leadership. China named Iran a founding member of its Asian 
Infrastructure Investment Bank (AIIB), and Russia quickly renewed its 
deal to sell SA-300 missiles to Tehran and then supported Iran's demand 
to lift the arms and missile embargo.
    We appear to be giving up this power by intending to ``normalize'' 
economic relations. This is a commitment we should not be making. This 
is highly problematic if the U.S. hopes to maintain any ability to use 
financial and economic power and suasion to affect Iranian behavior in 
the future--either to ensure compliance with any agreement or confront 
other elements of Iranian behavior. We will need to rely on sanctions 
and economic constriction campaigns even more aggressively to keep Iran 
honest in any deal and check its aggressive revolutionary agenda. 
Though administration officials assure that it was clear at the table 
that all ``nonnuclear'' sanctions would remain in effect, the United 
States will need to amplify its use of financial measures aggressively 
against key elements of the Iranian economy to deal with the increased 
risks of Iranian activity. It is not at all clear that this is well 
understood by all parties or part of our strategy.
    Unfortunately, we have already begun this process of unwinding by 
agreeing to lift international sanctions under previous UNSCRs, without 
clarity on what restrictions will be placed on Iran moving forward in 
any new UNSCR. Once gone, the international architecture built via the 
UNSCRs will be difficult, if not impossible, to replace. This matters 
because the UNSCRs set the baseline for legal obligations for all 
member states to use various national laws and authorities against 
Iranian illicit behavior, including those that have been reluctant to 
confront Iranian activity. It also matters because the new UNSCR 
commits the United States to others' review of U.S. financial and other 
measures that may impact the Iranian economy. In this sense, it risks 
that the United States may appear isolated in any future action to 
sanction Iranian behavior outside the bounds of existing UNSCRs--and 
could have the Joint Commission established under the JCPOA reject U.S. 
actions against Iran.
    If the United States now commits to the normalization of economic 
and trade relations, it may also be committing to a rehabilitation of 
the Iranian regime in the eyes of the global financial and commercial 
community. This proves highly problematic and undermines U.S. 
credibility and power internationally if this is done without concern 
for the underlying concerns that drove its isolation in the first 
place--proliferation, support for terrorism, and development of 
weaponry and programs of concern controlled by the IRGC. These concerns 
will remain and increase even under the JCPOA.
    This fundamental constraint of American financial power and 
economic influence against Iran in the JCPOA is exacerbated by 
structural, substantive, and other challenges enshrined in the 
unwinding framework.
Structural Problems with the Sanctions Relief Framework
    There are structural problems in the JCPOA sanctions unwinding 
framework that undermine the ability of the United States to use 
sanctions to constrain Iranian behavior and monitor Iranian compliance.
    The ``snapback'' framework itself proves problematic and does not 
preserve U.S. and international ability to leverage effectively the 
sanctions regime against Iran. Initially, the snapback is a blunt 
instrument. Given that ``snapback'' would reimpose the international 
sanctions regime and potentially threaten any deal, there will be a 
great deal of reluctance to trigger this provision. In addition, 
pursuant to UNSCR 2231, paragraph 11, the snapback provision applies 
only to ``significant nonperformance of commitments under the JCPOA.'' 
\6\ This provision would not be seen as a tool to be used frequently or 
initially, and the incentive will be to negotiate away apparent or 
proven violations, even if deemed material yet not ``significant.'' The 
international community may have left itself no real recourse or 
sanction for incremental violations, which are likely and in line with 
past Iranian behavior. Realistically given the construct and 
consequences, only the most egregious violations that could be proven 
openly and convincingly to all parties would be subject to an 
international snapback.
    How the snapback would work also affects its utility. If the 
snapback provisions allow the ``grandfathering'' of contracts signed 
before any snapback, the ``snapback'' loses its real-world effect to 
ensure compliance. Instead, such a provision might have the opposite 
impact intended by creating a ``gold rush'' incentive for commercial 
actors to get into the Iranian market and sign contracts as soon as 
possible. UNSCR 2231 seems to provide for such grandfathering in 
paragraph 14, noting that application of previous resolutions triggered 
by the UNSCR ``do not apply with retroactive effect to contracts signed 
between any party and Iran or Iranian individuals and entities prior to 
the date of application. . . .'' \7\ Clarity on this question is 
critical to understand whether any ``snapback'' procedure will even 
prove useful.
    Importantly, in the notion of ``snapback,'' there has always been 
an assumption that the financial pressure could simply be turned on and 
off like a light switch--perhaps informed by a now-outdated view of 
sanctions. Unfortunately, the kind of global constriction campaign 
launched against the Iranians needed to be maintained and managed--like 
a garden infested with weeds. To maintain the pressure, the environment 
had to be tended to--with continual actions (quiet and public) against 
a set of Iranian financial and commercial targets that would try to 
find a way to access the international system
    The financial argument at the heart of Iran's isolation has been 
that Iran is engaged in a host of nefarious and illegal activities that 
have been facilitated by its interactions with the international 
financial system. It is the threat to the international financial 
system of the illicit and suspect flows of money that is the baseline 
for Iran's isolation. If the perception is that this suspicion is gone 
and normalization is to follow, then the ability to use this kind of 
financial suasion to isolate Iran--even with snapback provisions that 
work--will be weakened.
    The JCPOA also creates an Iranian snapback--a heckler's veto on any 
reimposition of ``nuclear'' sanctions. The JCPOA explicitly states, 
``Iran has stated that if sanctions are reinstated in whole or in part, 
Iran will treat that as grounds to cease performing its commitments 
under this JCPOA in whole or in part.'' \8\
    Thus, if the United States attempts to trigger the ``snapback'' 
procedures or imposes any new sanctions, Iran could object to the 
reimposition of ``nuclear'' related sanctions and simply walk away from 
the agreement. The broad definition of ``nuclear'' sanctions as used in 
the JCPOA context to include proliferation-related concerns adds to the 
concern that Iranian objections could be broad and used often to temper 
aggressive use of any snapback. If Iran cheats and gets caught, and the 
international community attempts to punish Iran, Iran can threaten to 
back out of the deal and expand its nuclear program. This may create 
reluctance to punish Iran for any violations short of the most flagrant 
and egregious violations and create a permissive environment for 
Iranian cheating and stonewalling of the IAEA.
    With the appellate processes in the agreement--to include the Joint 
Commission and the Working Group on Implementation of Sanctions 
Lifting--any U.S. sanction or related action to which Iran objects 
would be subject to review by the other parties--including Iran, China, 
Russia, and Europe. This could become a venue to constrain American 
financial power--especially if it implicates national commercial 
interests that are intertwined with Iranian interests. This process 
creates a geoeconomic incentive for Iran to entangle the economic 
interests of the parties--so as to use economic investments and 
interests as both a sword and a shield against future financial and 
economic pressure. In this regard, the Iranians would take a page out 
of Saddamussein's playbook in fracturing the international sanctions 
regime by picking commercial winners and losers from key countries in 
the Oil-for-Food Program.
Conduct-Based Sanctions and Concerns in the Unwinding Architecture
    The JCPOA sanctions unwinding framework does damage to the conduct-
based sanctions and measures that have been so effective and driven 
most of the listings and designations by the United States and the 
international community. Though the international sanctions 
architecture has been built largely around concerns about the Iranian 
nuclear program, there are key elements of this regime--and especially 
in the United States--that relate to other serious international 
security concerns, including WMD and weapons proliferation, grave human 
rights abuses, support for terrorism and militia groups causing 
instability in countries like Yemen, and money laundering, corruption, 
and illicit financial activity facilitating these activities. This is 
not just a U.S. construct, but one embedded in other national and 
international sanctions and measures.
    The JCPOA attempts to unwind sanctions tied to the nuclear file, 
but the unwinding is difficult and complicated given the interconnected 
nature and effects of such sanctions. In some instances, the unwinding 
can be managed. For example, the Obama administration has tied the 
taint of Iranian and Syrian activity together. The Iranian and Syrian 
Governments collaborate to support terrorism, proliferate weapons, and 
to crack down on political opposition and civilian populations. The 
U.S. Government has taken actions to designate Iranian entities and 
individuals for supporting the Assad regime. Helpfully, the European 
Union followed suit on August 24, 2011, by designating the Quds Force 
for supporting Syrian security services to repress civilians. On 
October 12, 2011, the Treasury designated Mahan Air for helping the 
Quds Force to ship weaponry--especially to Syria. Though these kinds of 
sanctions will remain in place, others that touch on Iranian illicit 
activity will not.
    In many other cases, the unwinding schedule and some of the 
scheduled delistings implicate actors and activities beyond the nuclear 
file. The planned delisting of some key Iranian entities that have 
facilitated a range of Iranian illicit activities and the cessation of 
sanctions prohibitions against them, especially financing, raises 
serious questions and challenges to U.S. ability to affect Iranian 
behavior of concern.
    The reintegration of Iranian banks into the global financial 
system, including via the SWIFT bank messaging system, presents perhaps 
the most concerning issue. For example, Bank Sepah, scheduled to be 
delisted after Implementation Day (listed in Annex II, Attachment 3), 
has been designated under U.S. authorities not simply because of its 
facilitation of the Iranian nuclear program and procurement but also 
its role in financing arms and missile deals, activities that should 
remain a concern and are subject to U.N. sanctions.
    The Central Bank of Iran (CBI) itself has been designated in part 
because of broader sanctions evasion facilitation on behalf of the 
Iranian banking system. Treasury issued a finding in November 2011 
under Section 311 of the USA PATRIOT Act that Iran, as well as its 
entire financial sector including the CBI, is a ``jurisdiction of 
primary money laundering concern.'' \9\ Treasury cited Iran's ``support 
for terrorism,'' ``pursuit of weapons of mass destruction,'' including 
its financing of nuclear and ballistic missile programs, and the use of 
``deceptive financial practices to facilitate illicit conduct and evade 
sanctions.'' \10\ The entire country's financial system posed ``illicit 
finance risks for the global financial system.'' \11\ Those concerns 
persist and are not alleviated by the JCPOA.
    The concerns about the integrity of the Iranian financial system 
are international in nature. The Financial Action Task Force (FATF), 
the global standard setting and assessment body for antimoney 
laundering, counterterrorist financing, and counterproliferation 
financing, has labeled Iran--along with North Korea--``a high risk and 
noncooperative jurisdiction.'' FATF has called on its members to 
``apply effective countermeasures to protect their financial sectors 
from money laundering and financing of terrorism (ML/FT) risks 
emanating from Iran.'' \12\
    As recently as June 26, 2015, FATF issued a statement warning that 
Iran's ``failure to address the risk of terrorist financing'' poses a 
``serious threat . . . to the integrity of the international financial 
system.'' \13\
    Overall, the JCPOA lifts U.S. sanctions on 21 out of the 23 Iranian 
banks designated for proliferation financing--including both nuclear 
and ballistic missile activity.\14\ The designation of Bank Saderat for 
terrorist financing will remain in place, but the sanctions against the 
Central Bank of Iran, which included concerns over sanctions evasion, 
will be lifted. Twenty-six other Iranian financial institutions 
blacklisted for providing financial services to previously designated 
entities (including the National Iranian Oil Company (NIOC) which is 
being delisted on Implementation Day) or for being owned by the 
Government of Iran will also be delisted by the U.S. Treasury.\15\
    The JCPOA explicitly calls for the lifting of sanctions on 
``[s]upply of specialized financial messaging services, including 
SWIFT, for persons and entities . . . including the Central Bank of 
Iran and Iranian financial institutions.'' \16\ The European Union will 
lift SWIFT sanctions for the Central Bank of Iran and all Iranian banks 
\17\ originally banned from SWIFT.\18\
    By allowing most of the Iranian banks back into the international 
financial order without dealing with their underlying conduct or 
controls, the United States is assuming the good faith of the Iranian 
regime and perhaps allowing the Iranian banking system to be used by 
the regime to finance and facilitate other issues of significant 
national security concern.
    This concern applies similarly in the transportation sector. The 
delisting of the various elements of the Islamic Republic of Iran 
Shipping Lines (IRISL) and the National Iranian Tanker Company (NITC) 
removes a significant restriction on Iran's ability to proliferate 
weapons and evade existing or future sanctions. Many IRGC businesses 
that were involved in the procurement of material for Iran's nuclear 
and ballistic missile programs will be delisted as will some of the 
worst actors involved in Iran's nuclear weaponization activities. 
Problematically, the EU will lift all of its counterproliferation 
sanctions on Iran. The future delisting of individuals tied to the 
Iranian nuclear program, procurement, and likely proliferation adds to 
the concern that underlying proliferation issues and concerns have been 
left aside in the wake of the nuclear deal.
    The delisting of these individuals and entities that present risks 
related to proliferation as well as the nuclear program underscores 
additional risk to U.S. national security and the integrity of the 
financial system. It also calls into question whether the United States 
and international community are concerned about the integrity of the 
financial system and will defend it.
    There is no question trying to unwind any effective and global 
sanctions regime is difficult. Unwinding intertwined, conduct-based 
sanctions for a regime that uses its economy and system for various 
dangerous and problematic activities of international security concern 
is incredibly challenging. But tearing down sanctions bluntly--
encompassing issues of proliferation and weaponization--without 
addressing the underlying conduct creates real risks and does damage to 
the ability to use the very same tools against Iranian individuals and 
entities in the future. Under the JCPOA construct, those tools against 
delisted entities may no longer be available.
Heightened Risks Under the JCPOA Sanctions Unwinding
    The risks from Iran are real and will increase in an environment of 
sanctions unwinding under the JCPOA for a variety of reasons.
    In the first instance, the unfettered return of funds to the 
Iranian regime will allow Tehran the flexibility to fund its allies and 
proxies and flex its muscles in the region. Iran will get a massive 
infusion of capital from initial sanctions relief, with estimates up to 
$150 billion from frozen oil proceeds. The administration has admitted 
that some of this will go to support terrorist and militant groups, 
like Hezbollah, HAMAS, Iraqi Shia militias, and the Houthis in Yemen. 
Iran could even use its capital to support the Taleban and al-Qaeda, 
with which Iran has maintained a relationship and provided support in 
the past.
    With Iran expanding its reach and presence throughout the Middle 
East, witnessing IRGC commanders and proxies positioned from the Golan 
to Yemen, there will be more concern about Iran's misuse of the 
economy, the benefits of sanctions relief, and the international 
financial and commercial system for dangerous and illicit activities. 
This infusion of cash will relieve budgetary constraints for a country 
that had only an estimated $20 billion in fully accessible foreign 
exchange reserves prior to November 2013 \19\ but was spending at least 
$6 billion annually to support Assad.\20\
    The regime itself, and its core institutions like the Ministry of 
Intelligence and the IRGC, will benefit most immediately and deeply. 
Iran is a theocratic regime that controls the key elements of the 
economy, with the IRGC controlling the nation's largest construction 
company, much of its telecommunications sector, strategic sectors like 
shipping, and a large portion of the value on the Tehran Stock 
Exchange.
    Economic forecasts prior to the announcement of the JCPOA based on 
expectations of the sanctions relief assessed that Iran's economic 
growth would likely stabilize around 2.6 percent in FY 2015/16, and 
then accelerate to about 4 percent in FY 2016/17.\21\ In the second 
half of the decade, Iran's economic growth would likely average 3.5-4 
percent. Depending on Iran's economic policy choices, in FY 2017/18, 
growth could reach 5-6 percent.
    The IRGC has used the nation's banks, oil industry, infrastructure 
projects, and other nodes of the Iranian economy to profit, strengthen 
its hand, and repress internal threats to the regime. The mullahs have 
used their control of the economy--through bonyads and the Supreme 
Leader's vast financial network, known as Setad or EIKO, worth tens of 
billions of dollars to enrich themselves and exert more control over 
the country.
    Despite the notion that the JCPOA resolves all ``nuclear-related'' 
concerns, it does not address real concerns over continued Iranian 
proliferation, to include missile and arms trade. With the allowance 
for an Iranian nuclear program, infrastructure, and research, the deal 
will likely increase (not decrease) the risk of proliferation--with 
potential Iranian trade and exchange with rogue third countries like 
North Korea.
    The JCPOA delists several IRGC military research and development 
facilities. For example, EU sanctions on the Research Center for 
Explosion and Impact will be lifted after 8 years. This entity was 
designated by the EU for connection to the possible military dimensions 
of Iran's nuclear program.\22\ Whether or not the IAEA has reached a 
broader conclusion that Iran's program is peaceful and this center is 
not engaged in weapons-related activities, the sanctions will be 
lifted.
    The JCPOA will lift both U.S. and EU sanctions on Iran's commercial 
airline, Iran Air, on which the Quds Force depends to ``dispatch 
weapons and military personnel to conflict zones worldwide. . . . The 
Quds Force will have access to newer, larger, and more efficient planes 
with which to pursue its strategic objectives.'' \23\ Without financial 
constrictions or checks, Iran Air and other elements of the Iranian 
economy can be used to proliferate weapons and support the 
revolutionary activities of the regime beyond its borders.
    The lifting of the arms and missile embargoes at the end of 8 years 
exacerbates these concerns and serious risks. Whether or not the IAEA 
has determined that Iran's program is peaceful, Tehran will be 
permitted to engage in an expansion of its ballistic missile program 
after a maximum of 8 years. Iran may also be able to expand its 
intercontinental ballistic missile program under the guise of satellite 
testing.
    There will need to be vigilance--within the context of the JCPOA 
and outside its bounds--to the real potential of illegal and suspect 
Iranian procurement activities, which has been a part of Iranian 
evasion in the past. Counterproliferation concerns--and the financing 
that supports these activities--will actually increase over time.
    With the IRGC in control of more of the Iranian economy, including 
its infrastructure, telecommunications, and oil sector, risks of doing 
business in and with Iran will increase. The regime will use its 
control of the economy not only to further enrich itself but also to 
suppress internal opposition brutally and ensconce its rule. The 
concerns over human rights abuses and regime kleptocracy will grow.
    The IRGC intervenes in Iran's economy through three principal 
channels: The IRGC Cooperative Foundation (its investment arm), the 
Basij Cooperative Foundation, and Khatam al-Anbiya Construction 
Headquarters. The Khatam al-Anbiya (KAA), a massive IRGC conglomerate, 
was designated by the United States as a proliferator of weapons of 
mass destruction.\24\ It is Iran's biggest construction firm and, 
according to my colleagues' estimates, ``may be its largest company 
outright, with 135,000 employees and 5,000 subcontracting firms.'' \25\ 
The value of its current contracts is estimated to be nearly $50 
billion, or about 12 percent of Iran's gross domestic product.\26\ KAA 
has hundreds of subsidiaries in numerous sectors of Iran's economy 
including its nuclear and defense programs, energy, construction, and 
engineering. The company is also involved in ``road-building projects, 
offshore construction, oil and gas pipelines and water systems.'' \27\ 
EU sanctions against the company will be lifted after 8 years, whether 
or not the IAEA concludes that Iran's nuclear program is peaceful.
    These three holding companies are direct shareholders of almost 300 
known businesses. My colleagues at the Foundation for Defense of 
Democracies have created a database of these companies and board 
members and provided it to the U.S. Government.\28\ As a result of the 
IRGC's control of the economy--which has grown over time--and sanctions 
relief, the risk of regime control over the economy will grow. In 
addition, the reality and risks of Iranian sanctions evasion, money 
laundering, the lack of transparency, and other financial crimes--the 
subject of international concern and U.S. regulatory action against 
Iran under the Patriot Act Section 311--will increase, not decrease 
over time.
    Sanctions relief will increase risks over time, and Iranian foreign 
policy will continue to challenge and threaten U.S. interests. This 
makes the preservation and use of financial and economic power all the 
more important, with or without the JCPOA.
the need for economic and financial tools to ``push back'' against iran
    The dangers, challenges, and risks from Iran on a regional and 
global scale will only increase over time. In the wake of the JCPOA, 
Secretary of State Kerry has stated that we will need to ``push back'' 
against Iran's provocative and dangerous policies and tactics. CIA 
Director John Brennan has said that the United States will ``keep 
pressure on Iran'' and ``make sure that it is not able to continue to 
destabilize a number of the countries in the region.'' \29\
    Indeed, the United States will need to push back, especially 
against increasing risks and threats from Iran. To do this, the United 
States will want to use its financial and economic tools and strategies 
to make it harder, costlier, and riskier for Iran to threaten the 
United States and our allies. This will mean devising and deploying 
aggressive strategies to exclude key elements of the Iranian regime and 
the IRGC, Quds Force, Ministry of Intelligence from the global 
financial and commercial system.
    In many ways, the use of financial power and the strategies of 
financial and economic isolation, which have dominated the post 9/11 
period, have become the national security tools of choice. This is 
especially the case in cases where there are no military or kinetic 
solutions available and the United States needs to influence behavior 
and shape the environment well beyond its borders.
    The United States has expanded the use of sanctions and preventive 
financial measures (like Section 311) in recent years to address a 
wider range of national security threats and risks--terrorist 
financing, proliferation, corruption/kleptocracy, organized crime, 
human rights abuses, money laundering, and most recently malicious 
cyber attacks. Iran, the leading state sponsor of terror, presents a 
special case where all of these risks apply and U.S. interests are 
threatened.
    As noted above, the JCPOA does not alleviate these risks--and in 
fact, some of these threats will likely increase over time due to the 
loosening of financial and commercial restrictions on the regime in 
Tehran. Most would recognize that we must be able to use these 
sanctions against Iran and that the JCPOA cannot mean that Iran can use 
the JCPOA as a shield against such measures in the future. We certainly 
cannot have negotiated ``most favored nation'' status to avoid the 
aggressive use of sanctions and financial measures to address growing 
threats from Iran. And it should not be that we have unilaterally 
disarmed by taking effective financial measures and strategies of 
economic exclusion off the table.
    We must be sure of this. The United States will need to use the 
same types of financial strategies and campaigns to isolate rogue 
Iranian activity. If done well, this will inherently and necessarily 
affect the trade, commerce, and economy of Iran. If the intent is to 
maintain existing sanctions without enforcing them or to use symbolic 
designations as a foreign policy tool, then we will have given up one 
of our most important and innovative national security tools. If there 
is not clarity, we may find our tools more limited, we may exacerbate 
divides in policy and approach between Europe and the United States, 
and we could find ourselves isolated as we attempt to use America's 
continued economic and global economic reach for national security 
purposes.
    Indeed, we can and should use these tools aggressively moving 
forward and should ensure that the JCPOA does not represent a 
functional surrendering of this power. Pushing back against Iran by the 
international community and the United States will mean the United 
States using financial tools aggressively to impact the Iranian regime. 
If based on core international principles and underlying Iranian 
illicit and dangerous conduct, there will be inherent international and 
market support. Congress should ensure that these authorities and 
power--to isolate Iran financially and commercially when necessary--are 
preserved and leveraged against Iran's illicit conduct and attendant 
risk.
          congressional action: leveraging u.s. financial and 
             economic power to address the risks from iran
    There are three critical principles for Congress to pursue, demand, 
and ensure related to sanctions and the JCPOA:

    1. Clarify the Deal. Congress should ensure there is clarity in the 
JCPOA and in the execution of any sanctions unwinding plan. Most 
importantly, the United States needs to make clear to its negotiating 
partners and Iran that it will continue to use its financial and 
economic power aggressively to address real and perceived risks 
stemming from underlying suspect Iranian activity and actors. Many of 
the actions may overlap with prior ``nuclear'' sanctions and 
designations, and there must be a seriousness of enforcement of 
sanctions and vigilance against sanctions evasion, proliferation, and 
terrorist support. This will impact Iran's economy and trade, if done 
properly and with effect, and it is important for all parties to 
understand this now before the JCPOA is agreed and implemented.
    2. Maintain U.S. Power. Congress should ensure the United States 
maintains as much financial and economic power and leverage as 
possible. If any deal is to succeed, the Iranians need to know that the 
United States can and will wield its financial and economic power 
aggressively to police compliance with the agreement. We should do what 
we can now to maintain our ability to use U.S. financial and economic 
reach to isolate rogue behavior and protect the integrity of the 
financial system. This not only allows us to make it harder, costlier, 
and riskier for Iran to engage in provocative, dangerous, and 
suspicious activity, but it could be the only tool available to the 
United States to counter a more aggressive Iran around the world.
    3. Confront Risks. Congress should mitigate the risks attendant to 
an enriched and emboldened regime in Tehran. This includes the real and 
admitted risks that the flow of unfrozen funds and the business deals 
and investments will be used by the regime to fund terrorist and 
militant proxies, prop up Assad and his brutality, further repress 
human rights in the country, fill the coffers of the mullahs and the 
Revolutionary Guard Corps, and continue a provocative and violent 
revolutionary agenda well beyond its borders. This may be seen as a 
perceived cost of any deal, but the attendant risks are not acceptable 
and must be confronted and mitigated. This will need to be done with a 
full suite of national powers and authorities, including our ability to 
isolate rogue Iranian activity from the global financial and commercial 
order.

    With these three principles at the heart of the next steps, 
Congress and the administration should consider aggressive steps and 
measures that leverage U.S. financial power and economic influence, 
based on accepted and adopted international standards. This could form 
the basis of a new strategy to address the real and dangerous risks 
stemming from Iran.
    The U.S. should adopt a financial constriction campaign focusing on 
the IRGC, the Quds Force, and the core elements of the regime that 
engage in terrorist financing, proliferation of weapons and nuclear 
technology, and support to militias and activities that destabilize 
countries like Syria, Lebanon, Iraq, and Yemen. There will likely be 
overlap between prior nuclear sanctions and new sanctions and 
preventive measures, but doing this will test the notion that all 
parties understand that these kinds of measures were not on the table. 
Such an approach could also take from elements of key Iran sanctions 
legislation, like the Comprehensive Iran Sanctions, Accountability, and 
Divestment Act (CISADA), to leverage the potential for secondary 
sanctions against those companies or individuals who decide to do 
business with designated Iranian actors. We would need to be prepared 
to designate third country companies willing to choose to do business 
with Iran over the United States.
    There should be a recommitment to the elements of a 
nonproliferation regime and a dedicated strategy, focusing on the 
proliferation risks attendant to any deal with Iran and the continued 
challenges with North Korea. This is critical in the context of the 
increased risk of proliferation and the ongoing crisis in Syria and the 
brutality of the Assad regime, which reportedly continues to use 
chemical weapons despite the international agreement that supposedly 
emptied his stockpiles and ended his programs. This would include 
tighter export control enforcement, interdictions, and financial 
restrictions tied to suspect Iranian actors and activities--including 
Iranian banks. This would also require a recommitment to the 
application of Executive Order 13382 for those engaged in proliferation 
finance as well as the foreign sanctions evader program under Executive 
Order 13608.
    The increased risk of corruption, money laundering, and illicit 
financial activity should also be addressed explicitly. The elements of 
the Section 311 action against Iran and the CBI should be reiterated 
and reinforced with a designation of ``primary money laundering 
concern'' against the class of transactions involving any Iranian bank. 
This will ensure that the global financial system accounts for the 
increased risks of Iranian banks being misused by the regime for a 
whole host of dangerous activities and movement of money.
    This could be amplified with a program--led by the European Union--
to create a monitoring system through SWIFT (akin to the Terrorist 
Financing Tracking Program) to track and analyze suspect Iranian 
banking transactions. Instead of the blunt unwinding measure of 
plugging all Iranian banks (minus a few) back into the global banking 
messaging system, a monitoring program could provide a ``halfway'' 
house for reintegration of Iranian banks over time while managing the 
risk of more Iranian money traversing the banking system.
    The Global Magnitsky Human Rights Accountability Act could be used 
expansively to target the finances and holdings of the Iranian regime 
and those involved in gross human rights violations on its behalf. This 
would entail holding elements of the regime accountable for human 
rights violations (to include the investigation of the murder of 
Argentine prosecutor Alberto Nisman) but also might include a 
preemptive asset recovery venture against the mullahs and IRGC 
leadership for kleptocracy and embezzlement of the Iranian people's 
assets. This could be done in concert with key authorities and 
governments in Europe, where human rights are a major concern, and with 
global financial organizations like Transparency International, 
Interpol, and the World Bank Stolen Asset Recovery Initiative.
    These are just some of the measures that could be taken to confront 
the risks from Iran, clarify the contours of the JCPOA, and ensure the 
preservation of American leadership to protect both national security 
and financial integrity. Undertaking these types of steps--in whatever 
form--will likely be seen by diplomats as interfering with JCPOA or any 
deal. Instead, they should be seen as necessary steps to enable any 
nuclear deal, temper market enthusiasm for doing business with a 
dangerous regime and jurisdiction, and preserve a key element of 
America's power and leverage against Iran and other rogues.
    Effective sanctions and financial measures rely on accepted 
international norms, a dedication to the principles of financial 
integrity, and the reputational and real risks attendant to touching 
tainted goods, money, or actors. These measures--often relying simply 
on suasion instead of enforcement--depend on the psychology of markets 
and the expectations of legitimate actors. Regulation and enforcement--
most often coming from the United States--can shape environments and 
reduce the resources, reach, and impact of our enemies.
    The United States has been behind sanctions enforcement globally 
for the past two decades--whether with respect to countries like Iran 
and Sudan or illicit conduct like terrorist financing, money 
laundering, and kleptocracy. The world will continue to rely on this 
reality, and global banks, multinational companies, and market actors 
will respond to legitimate U.S. actions to identify and isolate rogue 
activity.
    Importantly, we should stop undermining the perception of our 
financial and economic power. We cannot argue in the same breath that 
the ``snapback'' sanctions as constructed offer a real Sword of 
Damocles to be wielded over the heads of the Iranians for years while 
arguing that there is no way now for the U.S. to maintain the crippling 
financial and economic isolation which helped bring the Iranians to the 
table. We can still wield our financial and economic power. Others will 
follow our lead.
                               conclusion
    When the Iranians came to the table after President Rouhani's 
election to negotiate over the nuclear agreement, one Western diplomat 
based in Tehran told me in confidence, ``You have won the war [using 
economic sanctions and financial pressure].'' But he then asked, ``Can 
you win the peace?''
    I think and hope we can still ``win the peace,'' but it will 
require using and leveraging the very same powers and authorities that 
helped bring the regime to the table. We must ensure that we have these 
financial and commercial authorities and suasion available in an era 
where such tools are critical to national security. We must also ensure 
that the JCPOA has not inadvertently empowered the regime in Tehran and 
taken one of America's most potent powers off the table.

----------------
Notes

    \1\ ``Joint Comprehensive Plan of Action,'' Vienna, July 14, 2015, 
paragraph 29.
    \2\ United Nations Security Council, ``Resolution 2231 (2015),'' 
July 20, 2015, page 2.
    \3\ Frederic Wehrey, Jerrold D. Green, Brian Nichiporuk, Alireza 
Nader, Lydia Hansell, Rasool Nafisi, & S. R. Bohandy, The Rise of the 
Pasdaran: Assessing the Domestic Roles of Iran's Islamic Revolutionary 
Guards Corps (Washington, DC: RAND Corporation, 2009).
    \4\ Emanuele Ottolenghi, The Pasdaran: Inside Iran's Islamic 
Revolutionary Guard Corps (Washington, DC: Foundation for Defense of 
Democracies, 2011), pages 44-45.
    \5\ Ibid., page 43.
    \6\ United Nations Security Council, ``Resolution 2231 (2015),'' 
July 20, 2015.
    \7\ United Nations Security Council, ``Resolution 2231 (2015),'' 
July 20, 2015.
    \8\ ``Joint Comprehensive Plan of Action,'' Vienna, July 14, 2015, 
paragraph 37.
    \9\ U.S. Department of the Treasury, Press Release, ``Finding That 
the Islamic Republic of Iran is a Jurisdiction of Primary Money 
Laundering Concern,'' November 18, 2011.
    \10\ Ibid.
    \11\ U.S. Department of the Treasury, Press Release, ``Fact Sheet: 
New Sanctions on Iran,'' November 21, 2011.
    \12\ The Financial Action Task Force, Public Statement, ``FATF 
Public Statement 14 February 2014,'' February 14, 2014.
    \13\ The Financial Action Task Force, Public Statement, ``FATF 
Public Statement 26 June 2015,'' June 26, 2015.
    \14\ U.S. sanctions on Ansar Bank and Mehr Bank are scheduled to 
remain in place. Sanctions on Arian Bank, Banco International de 
Desarollo, Bank Kargoshaee, Bank of Industry and Mine, Bank Melli, Bank 
Mellat, Bank Refah, Bank Sepah, Bank Tejarat, Europaisch-Iranische 
Handelsbank, Export Development Bank of Iran, First East Export Bank, 
First Islamic Bank, Future Bank, Iranian-Venezuela Bi-National Bank, 
Kont Investment Bank, Moallem Insurance Company, Persia International 
Bank, Post Bank, Sorinet Commercial Trust Bankers, and Trade Capital 
Bank (aka Bank Torgovoy Kapital ZAO) as well as the Central Bank of 
Iran (aka Bank Markazi Jomhouri Islami Iran) will be lifted on 
``Implementation Day.'' See Attachment 3.
    \15\ Over the past decade, the Treasury Department has designated 
51 banks and their subsidiaries inclusive of the 23 banks designated as 
proliferators, Bank Saderat which was designated for financing 
terrorism, and the Central Bank of Iran. With the exception of Bank 
Saderat, Ansar Bank, and Mehr Bank, all Iranian financial institutions 
will be delisted on Implementation Day.
    \16\ ``Joint Comprehensive Plan of Action,'' Vienna, July 14, 2015, 
paragraph 19(iv).
    \17\ On Implementation Day, the EU will lift sanctions on the 
Central Bank of Iran and Bank Mellat, Bank Melli, Bank Refah, Bank 
Tejarat, Europaische-Iranische Handelsbank (EIH), Export Development 
Bank of Iran, Future Bank, Onerbank ZAO, Post Bank, and Sina Bank. On 
Transition Day, the EU will also lift sanctions on Ansar Bank, Bank 
Saderat, Bank Sepah and Bank Sepah International, and Mehr Bank. See 
Attachment 1, parts 1 and 2 and Attachment 2, parts 1 and 2.
    \18\ The Council of the European Union, ``Council Regulation (EU) 
No 267/2012 of 23 March 2012 Concerning Restrictive Measures against 
Iran and Repealing Regulation (EU) No 961/2010,'' Official Journal of 
the European Union, March 24, 2012.
    \19\ Mark Dubowitz & Rachel Ziemba, ``When Will Iran Run Out of 
Money?,'' Foundation for Defense of Democracies & Roubini Global 
Economics, October 2, 2013.
    \20\ Eli Lake, ``Iran Spends Billions to Prop Up Assad,'' 
Bloomberg, June 9, 2015.
    \21\ Mark Dubowitz, Annie Fixler, & Rachel Ziemba, ``Iran's 
Economic Resilience Against Snapback Sanctions Will Grow Over Time,'' 
Foundation for Defense of Democracies & Roubini Global Economics, June 
2015.
    \22\ The Council of the European Union, ``Council Implementing 
Regulation (EU) No 1245/2011 of 1 December 2011 Implementing Regulation 
(EU) No 961/2010 on Restrictive Measures against Iran,'' Official 
Journal of the European Union, December 2, 2011.
    \23\ Emanuele Ottolenghi & Saeed Ghasseminejad, ``The Nuclear 
Deal's Impact on Iran's Revolutionary Guards,'' Foundation for Defense 
of Democracies, July 17, 2015.
    \24\ Department of State, Office of the Spokesman, ``Fact Sheet: 
Designation of Iranian Entities and Individuals for Proliferation 
Activities and Support for Terrorism,'' October 25, 2007.
    \25\ Parisa Hafezi & Louis Charbonneau, ``Iranian Nuclear Deal Set 
to Make Hardline Revolutionary Guards Richer,'' Reuters, July 6, 2015. 
Emanuele Ottolenghi & Saeed Ghasseminejad, ``The Nuclear Deal's Impact 
on Iran's Revolutionary Guards,'' Foundation for Defense of 
Democracies, July 17, 2015.
    \26\ Benoit Faucon & Asa Fitch, ``Iran's Guards Cloud Western 
Firms' Entry After Nuclear Deal,'' The Wall Street Journal, July 21, 
2015.
    \27\ Ibid.
    \28\ Iranian Official Journal, accessed July 20, 2015.
    \29\ ``CIA Director Says U.S. Will Keep Pressure on Iran over 
Nuclear Capabilities No Matter Outcome of Ongoing Talks,'' Fox News, 
March 23, 2015.

    The Chairman. Mr. Nephew.

    STATEMENT OF RICHARD NEPHEW, PROGRAM DIRECTOR, ECONOMIC 
   STATECRAFT, SANCTIONS AND ENERGY MARKETS CENTER ON GLOBAL 
                  ENERGY POLICY, NEW YORK, NY

    Mr. Nephew. Thank you, Chairman Corker, Ranking Member 
Cardin, and other distinguished members of this committee for 
inviting me to speak today. It is a privilege and an honor to 
speak to you about a subject to which I have dedicated my 
professional life, the Iranian nuclear program and sanctions, 
and with Juan, who pioneered a lot of the work we will be 
discussing today.
    I would like to begin by extending my personal gratitude to 
the members of the U.S. negotiating team. Regardless of how one 
evaluates this deal, we are all most fortunate that this 
country produces diplomats, civil servants, and experts like 
those who worked on this deal.
    In my opinion, the deal that they negotiated is a very good 
one, especially compared to the most realistic alternatives, 
and any negative consequences can be managed.
    It satisfies the two most important national security 
objectives for Iran's nuclear program, first, lengthening the 
time Iran would need to produce enough nuclear material for one 
nuclear weapon; and second, ensuring that any such attempt 
could be quickly detected. In doing so, it creates a 10-to-15-
year band of time in which fears of an Iranian nuclear weapon 
will be much reduced.
    Some may argue that the sunset key provisions renders the 
deal unacceptable. I disagree that these concerns are worth 
killing the deal.
    The argument against sunset presupposes either that there 
is no point in time in which Iran could be trusted with a 
nuclear program, requiring regime change, or that negotiations 
could possibly have delivered a longer sunset. Having been in 
that room, I believe the length is as long as was achievable.
    In any event, after key restrictions lapse, the United 
States is also free to declare that Iran's nuclear program 
remains a concern. Getting international support to do 
something about it will require effective diplomacy, but it is 
an option for a future President.
    A principal complaint and main subject for today is on the 
nature of sanctions relief in the deal. Some have argued that 
it provides Iran with far too much relief and that the 
practical effect of increasing trade with Iran will render 
snapback ineffective.
    First, it is a blunt reality that Iran was not going to 
accept major restrictions in invasive monitoring on the cheap. 
The administration did the right thing in leveraging sanctions 
relief for maximum early nuclear steps. Iran is now under every 
incentive to take the steps required of it as soon as possible, 
which the IAEA will verify before Iran gets an extra dollar.
    Of course, the sanctions relief provided by the United 
States does not equate with unilateral sanctions disarmament. 
The United States retains a number of sanction authorities that 
will continue to exact consequences for Iranian violations of 
human rights and damage Iran's ability to engage in terrorism 
financing, though I personally believe that fears about the 
extent of new Iranian spending in this regard are overblown, 
and according to the L.A. Times, anyway, so does the CIA.
    But foremost of our tools include secondary sanctions. The 
United States will still be able to pressure banks and 
companies into not doing business with the IRGC, Quds Force, 
Qassem Solemani, and Iran's military and missile forces, as 
well as those who facilitate their business.
    Even if the EU and U.N. remove some of these from their 
list, these bad actors and Iran generally will find business 
stymied until they correct their own behavior in the eyes of 
the United States. This is both due to the direct risk of U.S. 
sanctions and the improvement in international banking 
practices since 9/11, a bipartisan effort begun under George 
Bush and Juan and continued under Barack Obama.
    The United States will also retain its ability to impose 
sanctions on those trading with Iran in conventional arms, as 
well as with respect to ballistic missiles, even after U.N. 
restrictions lapse.
    The United States can also trigger snapback of existing 
sanctions. Even just one JCPOA participant can trigger a UNSC 
review and a vote on a UNSC resolution to continue with relief. 
The U.S. veto power in the U.N. Security Council gives us the 
ultimate free hand to reimpose these sanctions. And snapback 
can be less draconian to deal with lesser violations, as 
Secretary Lew has testified.
    This could come with political costs. Many skeptics point 
to these costs as likely meaning that no such snapback would 
ever be triggered. But international reaction to U.S. actions 
will always depend on the context. If the rationale for doing 
so is credible, then chances for success will always be higher.
    Iran, too, would have much to lose if snapback were to be 
triggered. Iran's leaders would therefore have to carefully 
evaluate the costs and benefits of any course of action that 
threatens the integrity of the nuclear deal. These costs will 
grow as Iran's economy grows. Some may see this as resilience, 
but I see it as Iran having more to lose.
    A critic once referred to this deal as a Marshall Plan for 
Iran. While the analogy is very far from perfect, it is 
interesting. The Marshall Plan was intended in part to prevent 
the spread of radicalism in Europe after the Second World War 
in recognition of the effect that harsh sanctions had on German 
politics in the 1920s and 1930s, and the liberalizing benefits 
of trade and growth. In fact, the Soviets refused to 
participate, fearing the effect that economic openness would 
have on their population.
    As the President has outlined, one potential benefit of the 
deal is the possible transformation of Iranian society, and, 
over time, government policy. This may not happen. But at a 
minimum, Iran's leaders will have to wrestle with the benefits 
of economic openness and the risk of losing control as a result 
of this deal, as well as the threat of returning sanctions if 
they break its terms. This will be a challenge for them and 
possibly an existential one.
    To conclude, though it is not a perfect deal, I believe the 
nuclear deal reached by the United States, its P5+1 partners, 
and Iran meets our needs, preserves our options, and possibly 
lays a path to a better future.
    I urge the Congress to make the right choice and to support 
it. Thank you, sir.
    [The prepared statement of Mr. Nephew follows:]

                  Prepared Statement of Richard Nephew

    Thank you, Chairman Corker, Ranking Member Cardin, and other 
distinguished members of this committee for inviting me to speak here 
today. It is a privilege and an honor to speak to you on a subject to 
which I have devoted nearly 12 years of my professional life as a civil 
servant at the Department of Energy, Department of State, and National 
Security Council. In my current position at the Center on Global Energy 
Policy at Columbia, I have continued my study of the use of sanctions 
for foreign policy reasons, with Iran as the centerpiece.
    I would like to begin by extending my personal gratitude to the 
members of the U.S. negotiating team, all of whom set aside personal 
commitments large and small in the pursuit of the agreement reached in 
Vienna on July 14. Regardless of how one evaluates this deal, one 
cannot contest that the people who worked so hard and diligently to 
conclude it did so with anything other than the intention of addressing 
a profound threat to U.S. national security. These men and women, many 
of whom I can call friends, are dedicated to stopping Iran from 
acquiring a nuclear weapon. Some of them have pursued this goal for 
decades. We are all most fortunate that this country produces 
diplomats, civil servants, and experts like these.
    I would like to offer here my evaluation of the Iran nuclear deal 
first as a general matter and then focus specifically on the sanctions 
relief portion of the deal. In doing so, I will describe what the deal 
itself has achieved, the consequences of this achievement, and the 
alternatives that would be facing us absent the deal. I come to the 
conclusion that, compared to the most realistic alternatives, this deal 
is a very good one.
    The agreement reached 2 weeks ago will prevent Iran from having a 
credible opportunity to produce weapons-grade nuclear material for use 
in a bomb for at least 10 years and likely beyond that. It does this 
through a combination of restrictions and monitoring that will ensure 
Iran faces a long path to weapons-acquisition, which can be detected 
almost as soon as it begins. In this respect, President Obama and his 
successors will have the time they need to evaluate Iranian compliance 
with the agreement, and to take any necessary decisions to address 
Iranian deficiencies.
    This includes the use of military force. President Obama has not 
taken this off of the table through this deal, nor would any President. 
Instead, President Obama has ensured that if such a decision is ever 
needed, it can be undertaken with greater time and clarity as to 
Iranian intentions.
                          setting the context
    To some degree, Iran has been at the precipice of a nuclear weapons 
capability since it first began operating centrifuges at the 
underground Natanz plant in 2007. Both Presidents Bush and Obama have 
had to consider regularly whether the Iranian nuclear program was 
getting out of hand, growing too large to be addressed through 
diplomacy.
    In my opinion, we were reaching just such a dangerous crossroads in 
2013. Iran's nuclear program had grown to involve over 20,000 installed 
centrifuges, nearly 7,000 kilograms of up to 5-percent enriched uranium 
gas (enough for multiple weapons), nearly 200 kilograms of up to 20-
percent enriched uranium gas (nearly enough for one weapon), and a 
reactor at Arak that was nearly finished. Moreover, Iranian cooperation 
with inspectors at the International Atomic Energy Agency (IAEA) was 
stagnant, with access granted to confirm only that declared nuclear 
material was where it ought to be. While important, outstanding 
questions about Iran's past nuclear program remained unaddressed and 
with little prospect of answers or access forthcoming.
    At the same time, sanctions were beginning to run out of steam. 
International oil prices were over $100 a barrel and prospects for 
taking away further Iranian oil revenues were slim. Despite aggressive 
diplomatic efforts, including at the Presidential level, we were 
getting fewer returns on our demands for oil reductions. Iran was the 
worse for our sanctions, suffering a GDP contraction of 6.6 percent 
between 2012-2013 according to the World Bank.\1\ Unemployment was 
high, as was inflation. But, still, Iran was continuing to expand its 
nuclear program and engage in all manner of destabilizing activities in 
the region.
---------------------------------------------------------------------------
    \1\ World Bank data, downloaded on July 20, 2015, and available at: 
http://data.worldbank.org/country/iran-islamic-republic?
---------------------------------------------------------------------------
    This was leading to calls both within the United States and from 
our partners to consider military action. The problem was that no one 
could articulate a theory of such action that would be decisive in 
stopping Iran from ever getting a nuclear weapon without involving 
regime change.
    Faced with this situation, the United States decided to test the 
proposition that newly elected President Rouhani was committed to 
fulfilling his campaign promise to seek removal of sanctions and a new 
relationship with the international community. Talks began in secret to 
see if a first step arrangement could be concluded that would, if not 
step back from the brink of military confrontation or an Iranian 
nuclear weapon, at least hold us at the lip. Such an arrangement would 
require--and did elicit in the end--major nuclear concessions from the 
Iranians. They would be forced to halt their progress, something they 
had sworn never to do, and even roll the program back in key respects. 
Sanctions relief would need to be part of it, in order to create 
incentives to keep Iran negotiating for a final deal. It had to promise 
Iran a return on its investment but not make a final deal meaningless.
    The result was the Joint Plan of Action (JPOA), a much derided 
document at the time of its announcement but one that I think even 
critics would grudgingly agree has served these purposes well.
    Iran made clear during the negotiations on the JPOA that they would 
not be able to accept it as a permanent arrangement; the sanctions 
still in place were too severe and political pressure would prove toxic 
for Rouhani if talks went on too long. So, they wanted to complete the 
deal faster. Unfortunately, a similar desire to speed up the 
negotiations also emerged from the United States and some of our 
partners, despite the fact that Iran gave up much in its nuclear 
program for a modest amount of relief. This was the first time, but not 
the last, that opponents of the deal in the United States and Iran 
share a common view. Unfortunately, a similar desire to speed up the 
negotiations on a comprehensive deal emerged from the United States and 
some of our partners, despite the fact that--for a modest amount of 
relief--Iran gave up much. It was the first time, but not the last, 
that opponents of a deal in both the United States and Iran were in 
full agreement.
    As a direct consequence, deadlines were established that Iran 
sought to use as leverage against the United States. Iran came to 
believe that the deadlines put in place were more important for U.S. 
negotiators than for themselves, leading to inevitable delays in 
Iranian decisionmaking and extended talks.
    Still, the United States did not rush into a deal. Had it done so, 
talks would not have been extended first in July 2014, then in 
November, and then multiple times at the end of June and into July 
2015. Instead, the U.S. negotiators demonstrated time and again that, 
as Secretary Kerry said, ``we will not rush and we will not be 
rushed.''
    In the end, the administration successfully demonstrated to Iran 
that, if it wished to conclude a nuclear deal, then it would have to 
make a number of concessions on issues that no less an authority than 
the Supreme Leader had established as redlines. Admittedly, this did 
not surprise me. Iranian negotiating style often involves brinksmanship 
and some degree of exaggeration. It is only through testing and 
prodding such redlines that the real limits of Iran's negotiating room 
could be established. For this reason, key redlines--like the 
requirement that immediate sanctions relief be furnished before any 
nuclear changes could be implemented or that R&D continue without 
restriction or even that Iran would require 190,000 centrifuges in the 
near term--were broken by Iran in the final deal.
               evaluating the nuclear aspects of the deal
    The result of these negotiations is a deal that, in my view, 
satisfies U.S. national security objectives. I define these as being:
          1. Lengthening the time that Iran would need to produce 
        enough nuclear material for one nuclear weapon; and,
          2. Ensuring that, during this time, any such attempt could be 
        quickly detected, such that the entire length of the breakout 
        time is available for response.
    With respect to the first objective, the deal manifestly delivers.
    The deal negotiated by the P5+1 will create a 1-year, or longer, 
breakout timeline for Iran's declared nuclear program for the first 10 
years of the implementation phase of the deal. And, that's just for 
uranium; for plutonium, the breakout timeline is far longer, 
potentially measurable in decades. Why?
    With respect to uranium, the deal restricts Iran's installed 
centrifuges to just over 6,000 IR-1 type machines for 10 years. Iran 
will be able to do some small scale enrichment using advanced machines 
at the end of this time period, but in numbers far too modest to 
contribute to breakout. This limitation will also hold back the 
progress of Iran's enrichment program. One does not go immediately from 
small scale enrichment on small numbers of centrifuges to installing 
and operating thousands of machines. Iran will have to spend time 
perfecting these machines and it is unreasonable to expect that they 
will achieve perfection in a few months of work. Iran has spent nearly 
20 years working on the IR-1 centrifuge, 1970s technology that it 
bought outright, and only managed to operate this centrifuge at roughly 
half of its design capacity.
    Iran will also be limited to solely 300 kilograms of 3.67 percent 
U-235 in any form for 15 years. This restriction alone would hold Iran 
back from quick breakout because 60-70 percent of the work required for 
a bomb is in the initial period of enrichment from natural levels to 8 
4 percent.
    But, combined with the centrifuge limits, Iran will be a year away 
for at least 10 years--until 2025--and anywhere from 6-12 months away 
for another 5 years beyond that. It is also important to note that, 
during this time, inspectors will have continuous, online enrichment 
monitoring of Iran's centrifuges. So, if a move to breakout were to 
take place, it could be detected almost immediately through a system of 
sophisticated, secure sensors.
    After that, it is true that breakout probably will narrow. But, 
only with respect to the declared uranium path. For plutonium, the 
breakout timeline is multiple years long and will not shrink for a 
considerable length of time. The Arak reactor's modification will 
render it incapable of producing such plutonium, essentially 
permanently because of difficulty of modifying the reactor core of a 
once-operated reactor. Iran's agreement to not engage in reprocessing 
R&D, to construct a reprocessing facility, or to construct a reactor 
capable of producing weapons-grade plutonium in useful quantities will 
last until 2030. But the impact of this decision will go farther: 
having been stymied in this work for so long, it is unreasonable to 
expect a rapid improvement in Iran's capabilities or physical capacity. 
Judging by how long Iran has been building the Arak reactor (i.e., 
since 2007), it is reasonable to argue that it would be 2035 at least 
before Iran could have another such reactor, let alone spent fuel 
reprocessing capabilities.
    Breakout is not the sole measure of a deal. But, compared to the 
status quo--2-3 months to breakout for uranium, with 1-2 weapons worth 
of plutonium being produced per year at Arak--we are far better off 
with the deal than without it.
    The deal also offers much by way of timely detection. Daily access 
to Iran's most sensitive nuclear sites remains possible. But, 
continuous monitoring--including through use of sophisticated new 
safeguards technology--may make this unnecessary. The right to utilize 
advanced monitoring technology is perhaps one of the most important if 
unsung elements of the deal, reducing cost and labor burdens while also 
dealing with problems of immediate access that would have constantly 
raised questions as to whether Iran was cheating at any particular 
moment.
    Beyond the declared facilities, there is an impressive array of 
monitoring provisions with respect to all of the key aspects of the 
nuclear fuel cycle. From uranium production through centrifuge 
manufacturing, the IAEA will have the right to monitor what Iran is 
doing to ensure that it cannot be diverted to a covert path. Similarly, 
Iran will be forced to utilize a procurement channel that enables the 
United States to have a vote on what Iran can procure and end use 
verification by exporters and, in some cases, the IAEA. Some of these 
provisions lapse at the 10-year mark but others--including the 
important provisions on centrifuge manufacturing and uranium 
production--continue for 20 and 25 years respectively. This means that 
the world will have visibility into Iran's nuclear program beyond the 
international norm, even enhanced by the Additional Protocol, until 
2040. And, of course, the access Iran is required to provide under its 
Comprehensive Safeguards Arrangement and Additional Protocol will 
continue so long as Iran is adhering to those treaties; a decision to 
withdraw from either would, naturally, trigger an international 
response.
    Some may argue that the time available to the President is far less 
than promised, seeing as there is now a dispute resolution process that 
participants are obliged to observe if there are difficulties with 
JCPOA implementation. This process could take perhaps as long as 80 
days. But, within a 1-year breakout time, that is still enough time to 
seek new diplomatic action, based on the reapplication of pressure via 
the snap-back mechanisms that would be triggered at the end of that 
process as well as additional sanctions.
    Moreover, we must bear in mind that any contingency that requires 
less time than 80 days is also probably not one that sanctions would 
have addressed in any event. Exposure of an ongoing, near-breakout and 
covert Iranian nuclear weapons program would prompt consideration of 
military options more than sanctions, and I personally believe that use 
of force would be the best course of action in this instance. At the 
same time, more modest actions prompting snap-back also would be less 
likely to shrink the breakout time by any discernible degree. Discovery 
that Iran has 100 more kilograms of 3.67 percent enriched uranium would 
be a problem. But, it would not shorten breakout below the snap-back 
threshold.
    In my view, therefore, any discussion of snap-back and the dispute 
process needs to be based on a thorough evaluation of likely scenarios 
and responses. Doing so results in different expectations for the risk 
created by any particular Iranian violation.
                            after the sunset
    Even some skeptics may agree that, within a 10-15-year band of 
time, the deal may work as designed. However, this is distinct from the 
concerns that exist about what would happen after the deal's main 
restrictions end in 2030. Some, most notably Prime Minister Netanyahu, 
have alleged that it is in this fashion that the deal paves the way to 
an Iranian nuclear weapon.
    I disagree. First, the argument against sunset presupposes that 
there is either no point in time in which Iran could be trusted with a 
nuclear program--or, anyway, the Islamic Republic of Iran--or that 
negotiations could possibly have delivered a sunset far longer than 
what is in the deal. Having experienced these talks personally, I can 
vouch for the fact that there was no scenario in which Iran would 
accept voluntarily the absence of a serious nuclear program for 
decades. If the Iranian negotiators had delivered such a deal, people--
including important people in the security services--would be right to 
ask why Iran endured sanctions for as long as it did. Moreover, Iran 
has become an advocate for the entire nonnuclear world in its defense 
of a nuclear program including enrichment. Expecting Iran to back away 
from that role, even in return for sanctions relief, went beyond what 
negotiations could achieve.
    Some would argue in response that this does not mean that sunset of 
10 years is acceptable. Certainly, I too would have preferred a multi-
decade-long set of restrictions. But, it is legitimate to question why 
that would be necessary as well as to ask how many years would be 
enough to build confidence. Given that, taken in combination, the 
restrictions and access provisions extend in some respects for 15-25 
years, it is reasonable to argue that sunset will be a prolonged 
affair.
    During this time period, of course, the United States is also free 
to abrogate the agreement and to declare that Iran's nuclear program, 
at the time, remains a concern. Successful execution of this step will 
require effective diplomacy and the right context at the time. But, it 
is achievable if a future President decides that no other options would 
work. And, of course, a future President could also decide that Iran's 
nuclear program must be met with force.
                       but what about sanctions?
    The other major complaint about the nuclear deal is that it 
provides Iran with far too much sanctions relief and that the practical 
effect of increasing trade with Iran will render snap-back ineffective.
    First, on the issue of scale, it is a blunt reality that Iran was 
not going to accept major restrictions on its nuclear program and 
invasive monitoring on the cheap. No one in the United States 
Government would disagree that Iran should take these steps without 
compensation, seeing as it is Iran that stands in violation of its 
international obligations. But, in the real world, this is not a 
sustainable argument. Just as Iran could not scrap its nuclear program 
to make a deal work, Iran could also not accept nuclear steps being 
taken without reciprocation. De-escalation of the nuclear program 
required de-escalation of sanctions.
    Faced with this reality, the administration did the right thing in 
leveraging sanctions relief for maximum, early nuclear steps. Instead 
of debating whether one sanction was worth 10 centrifuges, the 
administration cut Iran a deal: in exchange for big nuclear steps, big 
sanctions relief could be given. Iran is now under every incentive to 
take the steps required of it as soon as possible (and, arguably, would 
be even now removing centrifuges if the Iran Nuclear Agreement Review 
Act had not been passed, mandating the present 60-day review period). 
The United States insisted, and Iran agreed, that no such sanctions 
relief could be enacted until the IAEA verifies that Iran has done its 
part. As a result, we will be able to see--and have the IAEA report--
that Iran has done everything required of it before any relief flows.
    But, the sanctions relief provided by the United States does not 
equate with unilateral sanctions disarmament. The United States retains 
a number of sanctions authorities that will continue to damage Iran's 
ability to engage in terrorism financing, as well as to exact 
consequences for violations of Iranian human rights and other 
destabilizing activities. This includes the all-too-important tool of 
secondary sanctions through the Comprehensive Iran Sanctions, 
Accountability and Divestment Act or CISADA. With this tool, the United 
States will still be able to pressure banks and companies against doing 
business with the IRGC, Quds Force, Qassem Solemani, and Iran's 
military and missile forces. The EU and U.N. decisions to remove some 
of these entities from their own sanctions list is therefore important 
to Iran mainly as a symbolic step; practically, these entities and 
individuals will find their international business activities stymied 
due to the centrality of the United States in global finance until they 
correct their own behavior in the eyes of the United States.
    Moreover, the United States will retain its ability to impose 
sanctions on entities and individuals trading with Iran in conventional 
arms and ballistic missiles, even after U.N. restrictions in this 
regard lapse in 5 and 8 years respectively. The U.N.'s provisions were 
important in terms of setting international approval and backstopping 
for U.S. unilateral efforts. But, they were conditioned, even as early 
as 2006 and 2007, on Iran's failure to fulfill its nuclear obligations. 
Even the earliest UNSC resolutions laid out a package in which these 
sanctions would be terminated when Iran satisfied the P5+1 and IAEA on 
the nuclear issue. Further, it is the consequence of U.S. sanctions on 
these targets that can best deter bad behavior. Similarly, 
international export controls governing transfers of these types will 
remain fully in force.
    Second, on the issue of snap-back, Iran's growing international 
economic integration will cut both ways. Certainly, it is possible that 
the politics around future Iran sanctions will be prejudicial to rapid 
snap-back. However, the structure of the dispute process gives even 
just one country the right to insist that the UNSC consider whatever 
matter is in question with respect to compliance with the deal. And, 
the deal structures the snap-back of UNSC sanctions such that the P5 
veto power only works to end sanctions relief. In other words, though 
the process may need to be navigated, in the end, even acting alone, 
the United States can bring existing UNSC sanctions back into 
operation.
    As noted, this could come with political costs. Many skeptics point 
to these costs as likely meaning that no such snap-back would ever be 
triggered. But, many of these same skeptics also argue that it is 
theoretically possible to end the deal now and keep international 
partners moving forward with the imposition of sanctions. This is out 
of joint with reality and practical experience. Simply put, 
international reaction to U.S. actions now or in the future will always 
depend on the context and narrative. If the rationale for doing so is 
credible and the context demands action, then chances for success will 
always be higher.
    Additionally, Iran too would have much to lose if snap-back were to 
be triggered. Iran's leaders would therefore have to carefully evaluate 
the costs and benefits of any course of action that threatens the 
integrity of the nuclear deal. These costs will grow as Iran's economy 
recovers and grows. Explaining to Iran's people why a civil nuclear 
program has gone out of alignment with any practical needs, prompting 
reversion of sanctions, would prove a difficult conversation for 
Tehran, maybe as difficult as the one the United States would need to 
have with partners about the imperative of reapplying sanctions.
    Putting these issues aside, there is the matter of what Iran will 
do with the money. I believe that fears that Iran will take all of the 
proceeds of sanctions relief, including the $100-$150 billion in 
restricted assets held abroad, and plow them into terrorism and other 
bad acts are overblown.
    It is certainly true that Iran will continue to support terrorism 
and activities that we oppose throughout the region. No level of 
sanctions could stop them from doing so. This is a government that has, 
after all, funded and armed radical elements since the fall of the Shah 
of Iran in 1979, through the Iran-Iraq war, and after the 
intensification of crippling sanctions in 2010. Tehran continued to 
invest in the Assad regime, despite the immediate loss of over a 
quarter of its 2012 oil revenues from sanctions imposed in December 
2011, and $60 billion in potential revenues from that point forward. 
Likewise, Iran has assisted Shiite militants in Iraq, the Taliban in 
Afghanistan, and is now supporting the Houthis in Yemen, despite major 
economic crisis at home.
    But Iran's population as well as its leaders know how much money is 
at stake, and how it can be used. It is implausible that, after the 
Supreme Leader allowed Rouhani to be elected President in 2013 on a 
platform pledging economic recovery--in part, through promises of 
sanctions relief--either man would support initiatives that leave the 
Iranian population in the cold in order to protect foreign groups and 
leaders like Assad. To do so would be to risk the very instability and 
threat to the regime that the Iranian Government has sought to prevent 
by seeking sanctions relief through this deal.
    Since the international community intensified sanctions against 
Iran in 2010, Iran has only grown more desperate. For example, the 
country's oil sector now needs anywhere from $50 to $100 billion in 
investment to improve production, a point that Iranian officials, 
including Oil Minister Bijan Namdar Zanganeh, have emphasized 
repeatedly over the past 2 years. External investment was cut off by 
sanctions, and Iran has not had the spare capital to maintain, much 
less improve, its facilities. Nor has it enjoyed access to new 
technologies that could enhance oil field productivity.
    Oil is, of course, only one part of Iran's economy, which includes 
struggling industries like automobile and domestic manufacturing. To 
avoid an overdependence on global oil markets, Iran has also made it 
state policy to build a diversified export economy. Given the 
prevailing low global oil prices, Iran is likely to continue trying to 
strengthen other sectors to maximize its growth potential and limit its 
vulnerability to an uncertain market.
    Lest observers assume that Iran would have turned its entire 
economy into a terrorism-financing machine if only it had the money, 
consider the fact that the most intensive sanctions on the country are 
only 3 years old. Before January 2012, oil sales were bringing in 
nearly $88 billion a year, money that Tehran largely spent as any 
government would: on domestic and foreign-policy priorities--not solely 
to back anti-Western interests.
    As with the effort to wean its economy off oil, Iran has also 
sought to reduce costly subsidies on everything from food, to housing, 
to energy, in order to improve the economy's efficiency, reduce waste, 
and spur competitiveness. But sanctions targeting Iranian oil revenues 
hampered that effort, as the country lacked the hard currency--and 
political will--to forge ahead with subsidy reform, at least until 
Rouhani's election. It is now struggling to complete this project, one 
that sanctions relief would undoubtedly boost by providing Iran with 
fresh revenue and reducing its citizens' dependence on government 
handouts. This is particularly important for Rouhani, who will be 
looking to shore up domestic support in the runup to parliamentary 
elections in February 2016 and to win reelection in 2017.
    But beyond this, any rosy expectations for Iran's economy must be 
tempered by the reality that oil, still its primary economic driver, is 
worth less today than in years past and is predicted to stay that way 
for the foreseeable future. Iran simply won't have as much money coming 
in on an annual basis, due to global economic conditions, until the 
rest of its economy picks up speed. Even if Tehran had wanted to spend 
$100 billion on nefarious side projects a few years ago (and let's be 
clear: given $100 billion was more than the entire annual oil export 
revenue for Iran at the time, even when prices were high, this would 
hardly be credible), it makes even less sense today.
    Consequently, it is much more likely that only a portion of the 
liberated $100 billion and any future revenues will go to support 
Tehran's regional adventurism. No one knows how much, but experts have 
made some educated guesses, suggesting that the regime has spent 
anywhere from $3.5 to $20 billion a year in Syria, figures that pale in 
comparison to annual military spending by the United States and the 
Gulf Cooperation Council.\2\
---------------------------------------------------------------------------
    \2\ Stockholm International Peach Research Institute, ``SIPRI 
Military Expenditures Database,''1Ahttp://www.sipri.org/research/
armaments/milex/milex--database.
---------------------------------------------------------------------------
    In any event, even if Iran does wish to sink all of its newfound 
relief into terrorism, it will have to deal with residual U.S. and 
international sanctions inhibiting it. As mentioned earlier, this 
includes sanctions that preserve the secondary application of U.S. 
sanctions on foreign businesses and banks. But, beyond this, since 
9/11, the international banking system has adopted new standards and 
helped create intergovernmental groups like the Financial Action Task 
Force to crack down on money laundering and terrorism financing. Banks 
monitor their business far more aggressively now than ever before to 
detect and prevent such activities, in part by using the best practices 
and guidelines developed by FATF. Banks are also under greater scrutiny 
by their national regulators----and, in fact, by the U.S. Treasury 
Department--to keep their systems from being used by terrorists and 
their financiers for illicit acts.
    Moreover, if need be, Washington and its partners can always 
augment sanctions to deal with specific Iranian threats, such as Iran's 
conventional arms market. These could be modeled on an existing 
authority, like sanctions covering the manufacture, shipping, and 
financing of weapons of mass destruction. Rather than completely 
abandoning sanctions as part of the nuclear deal, the United States 
could use them as an effective deterrent in this regional context. 
Care, however, will have to be taken to avoid giving Iran a pretext to 
argue that the United States is undermining the very sanctions relief 
that made a nuclear deal possible in the first place.
    In sum, I believe that the United States has tools to combat 
Iranian regional adventurism beyond sanctions, and that it does not 
need to jettison the nuclear deal to preserve sanctions. Regardless of 
the conflicting views of the nuclear deal itself, there is near-
universal agreement that it will benefit Iran economically. And there 
is a convincing body of information and analysis to support the 
position of President Barack Obama's administration that Tehran will 
use sanctions relief to generate economic stability at home. If the LA 
Times is to believed, this is a conclusion that CIA has itself reached.
                               conclusion
    I believe that the nuclear agreement reached by the United States, 
its P5+1 partners, and Iran is a good deal. It is not a perfect deal. 
There are things that, in a perfect world, would be changed, starting 
with the fact that--ideally--Iran would not be permitted to engage in 
enrichment, reprocessing or heavy water activities in perpetuity. And, 
such an Iran would also be forced to change into a better actor in the 
region and beyond.
    But, we do not have the luxury of that world. Instead, we face two 
options. We can either accept the deal that has been negotiated. Or, we 
can turn our backs on it. To do so is to go in an ill-defined 
alternative scenario. Some argue that in this scenario, sanctions can 
be intensified in order to achieve a better deal. Still others argue 
that military action could be undertaken. But, each of these courses of 
action would require taking significant risks that either they would 
not be successful and, in the attempt, that we would lose the support 
of the international community. An Iran strategy based on ``going it 
alone'' is not a recipe for success.
    Moreover, while pursuing such an alternative, Iran would either 
wait expectantly for the sucker punch to be delivered that would 
complete the job of undoing global support for U.S. efforts, or march 
forward on its nuclear program, beginning the operations of thousands 
of new centrifuges and constructing the Arak reactor in its original, 
bomb-factory design.
    For, at this point, there is no magical middle ground to be 
occupied. If the United States rejects the deal now, it will not be 
possible to negotiate a new one and certainly not before Iran 
undertakes a potentially dramatic expansion of its nuclear program. 
This is because of both the politics that will be associated with doing 
so in Iran--whose leaders would convincingly argue ``if the United 
States is not going to fulfill this deal, what is to say they would 
fulfill a future one?''--and because the JPOA would collapse at the 
same time as the Joint Comprehensive Plan of Action. Some argue that 
Iran could continue to observe its JPOA commitments and so could the 
United States. But, U.S. law now makes that impossible. Under the terms 
of the Iran Nuclear Agreement Review Act (INARA), if a joint resolution 
of disapproval is passed by Congress, the JPOA can no longer be 
observed by the United States as a legal matter. The law states that 
the President is no longer permitted to provide relief from sanctions 
established by congressional action. So, waivers could not be extended 
under the statutory authorities in place.
    As such, the executive branch would have to restart efforts to 
reduce Iranian oil exports--paused under the JPOA--and impose sanctions 
for the movement of Central Bank of Iran funds. It is inconceivable 
that, even if Iran wished to keep the JPOA afloat, Iran would accept 
U.S. efforts to reduce Iran's oil exports by holding steady on the 
nuclear program. So, even if new laws are not adopted by Congress or 
the executive branch, U.S. sanctions under the JPOA would again be 
active and in need of enforcement.
    Would international partners join us in this effort? It is highly 
doubtful and certainly not with the vigor needed to be effective. And, 
as such, the United States would be brought into confrontation with key 
trading partners.
    So, Congress must make the choice that it asserted was essential in 
the passage of INARA and decide if the alternative to the JCPOA is 
worth it. Leadership and vision from Congress, as the President has 
shown in pursuing this deal, is now needed. I urge Congress to make the 
right choice, and to support this deal.

    The Chairman. Thank you, both. We can see from these two 
witnesses why this is a difficult decision for people to make, 
so we thank you so much.
    So that I can reserve my time for various interjections 
along the way and not dominate in any way, I will turn to our 
ranking member for questions, and then move on down the line. 
Thank you.
    Senator Cardin. Let me also join the chairman in thanking 
you both for your presence here today and for your testimony.
    Let me give you a hypothetical. It is a year from now, and 
Iran complied with all of the preliminaries required, and they 
have received the sanction relief from both the United States, 
through the waivers being exercised by the administration on 
sanctions, as well as the U.N. and Europe. We get clear 
evidence that Iran has used crude oil sales to directly finance 
terrorist activities in Lebanon and Yemen. They have done it 
through the Central Bank of Iran. We have clear evidence of 
that.
    The U.S. Congress passes a statute that says that we will 
impose sanctions against Iran for their support of terrorism 
against the Central Bank of Iran and crude oil sales.
    First, if that were to occur, are we in compliance with the 
JCPOA? And secondly, what pressure would there be on the 
administration to implement such a statute, if Congress were to 
pass it? Any thoughts?
    Mr. Zarate. Senator, it is an astute hypothetical because 
it points out the difficulty of disentangling the sanctions 
regime, with respect to a country and a regime that controls 
key elements of the economy, strategic elements like the 
banking system, and when they are still engaged in some of the 
underlying activity that is subject to, at a minimum, U.S. 
sanctions. So it certainly is within the Congress' right and I 
would argue, certainly, it should be a focus of the 
administration to go after the financial conduits that the 
Iranian regime or any other state uses to support destabilizing 
activity or to support terrorist groups anywhere around the 
world. So it would be wholly justified.
    To Richard's point, I think in the context of any action 
taken in the penumbra of the JCPOA context, it would depend on 
what information and evidence we have. The problem I have with 
the JCPOA framework, as I laid out in both my submitted 
testimony and orally this morning, is that we have now 
established and placed ourselves into a framework where we 
ourselves are going to have to submit or potentially have to 
answer to other parties justifying why we are using U.S. 
national power with respect to these other types of challenges 
and risks.
    So under the agreement, the Iranians, for example, could 
object, could threaten to walk away. And perhaps even, in the 
view of some, legitimately say you are simply trying to 
reimpose sanctions that were just lifted under another name. Of 
course, the administration is saying and we would argue, all of 
us, that these are different sanctions, and they should be 
imposed and they can be imposed. But there would be a question 
in the context of the JCPOA and probably a process triggered, 
if it were a significant enough action, that would call into 
question whether or not we could take the action.
    Ultimately, we may prevail. But it would put us into a 
completely new venue and into a new process to have to explain 
ourselves, demonstrate evidence to parties like the Chinese and 
Russians, and ultimately justify our action in the contours of 
the JCPOA. I just do not think that is an acceptable outcome.
    Mr. Nephew. Thank you, Senator. I would agree with much of 
what Juan said, but I would add two important, I think, caveats 
or conditions to it.
    The first is we always had to justify and explain our 
secondary sanctions. You have to bear in mind that the 
sanctions you are referring to govern the trade activity of 
foreigners with foreigners. To get them to do things, we have 
to explain why, and we have to explain in what context it is 
appropriate.
    I think that going after the hypothetical that you brought 
up would be complicated because the Chinese, for instance, or 
other importers of Iranian oil would say that we have known for 
a long time that Iran supports these groups. That is a given. 
It was a given when we were writing the JCPOA. So what changed 
that made you have to do this?
    I think this points to the second problem. The hypothetical 
you brought up will happen, because oil is a primary revenue 
stream for Iran, and it is a primary way in which they support 
groups that we believe are terrorists and that we engage as 
terrorists. I think the bigger question to my mind is, is that 
the most effective way of curtailing Iranian terrorism? In my 
view, no. We have had very crushing oil sanctions on Iran for 
the last 3 years, and they still supported Assad. They have 
still supported the Houthis. They have still supported 
Hezbollah. That is because, frankly, the scope and scale of 
that support does not have to be oil-revenue-worthy. It can be 
much smaller, and it is something the Iranians believe in 
strongly.
    So I would argue that rather than go for an oil embargo-
type sanction, we actually have to think of a better policy 
response to deal with the terrorist issue that we have 
identified.
    Senator Cardin. Do we have the flexibility to do that? You 
may very well be right. We may choose other ways. The reason I 
use those two examples is because they were lifted by the 
sanctions. Absolutely.
    Here I guess is the question. Yesterday, we heard from both 
witnesses that the United States should be pretty aggressive in 
making sure Iran complies with everything it said in this 
agreement and be prepared to start taking action. Iran's past 
activities show that they test us. They try to push the 
envelope as far as they can. So they will interpret some of the 
JCPOA differently than we do, and they will do things we think 
are wrong.
    How aggressive should we be? Can we get our partners to 
agree with us on less than major violations? Will we be able to 
do that?
    Mr. Nephew. Sir, I would argue again that it depends on the 
context. If we go with a good case and we are able to justify 
why we are doing it, then we can be very effective, as we were 
from 2011 to 2013 with respect to the oil embargo.
    On the other hand, if we are seen as acting capriciously 
and if the Iranian response is to say ``we are walking away 
from the nuclear deal,'' that will be a challenge. Ultimately, 
we need to be aggressive, but we also need to be mindful that 
the nuclear deal, again, in my view, is something that is worth 
preserving.
    So I do not think that precludes our use of sanction tools 
in a very aggressive way, but just like we have already done, 
we are going to have to be careful about the unintended 
consequences of those acts.
    Senator Cardin. Lastly, let me point out, if we have to 
snap back, if there is a substantial violation that we have to 
take to the international community and maybe exercise our 
veto, how quickly can they bite strong enough to affect Iranian 
behavior?
    Mr. Nephew. Senator, I would say that if we are able to get 
snap back and in a context that is conducive to people imposing 
swift sanctions, we can start biting the Iranian economy 
quickly. The oil embargo that we were just talking about 
started having dramatic economic effects on Iran within 2 or 3 
months of being imposed, starting in January 2012.
    So again, I think with the right context, with cooperation, 
we can start to really have an impact on the Iranian economy.
    Senator Cardin. I would just point out you were a little 
bit inconsistent on oil. You said at one time that would not be 
effective to stop them from financing terrorism if we impose a 
sanction, but now you are saying that could bite quickly.
    Mr. Nephew. Sir, what I would say is: I am not saying it 
would not bite the economy. My point on terrorism is that 
biting the economy does not necessarily preclude Iranian 
support for terrorism.
    So you can have damaging impact on the Iranian economy, but 
will that translate into stopping Iranian terrorism? In my 
view, the history suggests not.
    Mr. Zarate. Senator, if I could address this question of 
strategy and the use of these tools. Our tool kit is not 
expansive. We have limited tools to address whether it is 
terrorism, human rights abuses, et cetera. The use of financial 
power and the power to exclude from the global system is one of 
our principal if not most effective tools.
    So I take Richard's point, which is an important one, which 
is that we have to have a comprehensive strategy. We have to 
use all tools of national power. No doubt. But the reality is, 
at the end of the day, these tools are the ones that prove to 
be most effective.
    And as I said in my testimony, I actually think the risks 
to the international financial system go up with this deal or 
any other deal with respect to Iranian activity. So we are 
going to have to, if we are honest about what is happening in 
the international financial commercial order, we are going to 
have to crack down on Quds Force front companies, IRGC funding 
flows, and contracts run by the Ministry of Intelligence. That 
is the nature of the Iranian economy and the way that they do 
business and the way that they have reach--precisely what we 
have cut off that harmed them so much.
    So you have asked a very astute set of questions, because I 
think at the heart of this is, have we given up too much of our 
power to deal with all these other risks that Iran presents 
that will actually go up over time?
    Senator Cardin. Thank you.
    Thank you, Mr. Chairman.
    The Chairman. Before I move to Senator Flake, just since 
you guys have somewhat different views, I wonder if we could 
get consensus.
    It would be fair to say, on the other hand, that in 9 
months when most people believe all the sanctions will be gone, 
and then Iran has, in essence, the nuclear snapback, that 
people are going to be somewhat reticent to put sanctions in 
place if Iran cheats by inches because of the things that you 
are saying. Iran does have the ability to say at that moment, 
well, we are out of the program.
    Would you agree? I think both of you are shaking your head 
up and down, that that does create a dilemma? I will take that 
as a yes.
    Mr. Nephew. Yes, Senator. Incrementalism is a risk here.
    The Chairman. Senator Flake, thank you.
    Senator Flake. Thank you. I want to thank the chairman and 
ranking minority member for putting these hearings together.
    Hearing your testimony today, each on one side of this in 
terms of whether you favor the agreement or not, I think 
demonstrates that the only thing that is certain is this is no 
easy call. For those who stand and say that it is, I think they 
have not examined the agreement or the broader foreign policy 
context in which this is going to be implemented. So I 
appreciate the testimony and the way you have gone about it.
    And I appreciate the question from the ranking minority 
member, and I think all of us will have some variant of the 
same kind of questions, because we have asked administration 
witnesses. We have been assured that we have not diminished our 
tool kit, that we can distinguish between nuclear and 
nonnuclear sanctions. But when you read the plain text of the 
agreement, that seems to conflict with the assurances that we 
have received.
    Let me just turn to the financial sanctions. I could not 
agree more and I have always felt that that is what really 
finally bit, because it is more difficult with these financial 
tertiary or secondary sanctions for the Russians, the Chinese, 
or others to help Iran evade, which is easier to do with just 
crude oil sanctions or other petroleum sanctions.
    But if we find that Iran is linked directly to terrorism, 
and we want to punish and go in, when I look at the agreement, 
it seems difficult to do that.
    On the financial sanctions, if we decide to do so, how 
effective will that be if our European allies are not with us? 
I would like your assessment. I hear conflicting testimony and 
discussion from others about whether or not we can lead on that 
and that our European partners will eventually have to follow, 
or if they can go their merry way and we are left with 
unilateral sanctions, which rarely work.
    What is your assessment on the financial sanctions? Is this 
something we can we lead our partners back to be with us? Do 
they have to be with us, given the nature of these sanctions, 
whether people choose to do business with a $17 trillion 
economy or $1 trillion economy?
    What do you make of that, Mr. Zarate, first?
    Mr. Zarate. Senator, again, another very astute question. I 
think the financial sanctions have been led by the United 
States because the United States is the dominant economic and 
financial center of the world. The U.S. dollar is the reserve 
currency. And we have the moral and strategic suasion to be 
able to affect what others do, both governments and the private 
sector.
    I want to emphasize the last point. I do think we should 
not undervalue or undercut the power of our financial 
sanctions. In many ways, U.S. unilateral sanctions that affect 
the financial community--in the first instance here, Iranian 
banks--are global by definition. There is no unilateral U.S. 
financial sanction. What the United States says in terms of how 
to interact with U.S. financial institutions and U.S. markets 
is a global standard and, in fact, is applied as such by the 
private sector.
    This goes to a time dimension of this issue. One of the 
interesting things here, I think, is that there is still a 
major opportunity to shape the environment and the risk 
calculus of the private sector. In many instances, the major 
global banks, non-American banks around the world, are 
derisking enormously. They are making decisions not to do 
business in Iran, perhaps not to do business in Cuba, 
regardless of where our sanctions policy is going, almost in an 
opposite direction.
    And so what Congress says, what the United States does, 
what the U.S. Treasury may put out in advisories or 
designations, has an enormous power and capability to shape the 
market. So I do not want anything I say here to undercut that 
reality.
    But in the context of this deal and the way it is framed, 
that diminishes over time, because the international sanctions 
architecture in the U.N., in the EU directives, really does 
enable countries that may not be quite as enthusiastic about 
this risk calculus to participate in the sanctions regime.
    But I would say that if we wanted to affect the global 
financial system, if we wanted to isolate Iranian banks, based 
on legitimate concerns that are demonstrable, that we can put 
out in registries, that we can put out and show to our allies, 
that has enormous power and capability to isolate the Iranians.
    Would that be accepted by the Iranians? Based on the 
reading of the deal, probably not. That is why I am so 
concerned about the constraint on our power, based on the 
agreement.
    Senator Flake. Mr. Nephew.
    Mr. Nephew. Senator, I would actually agree with what Juan 
had to say. I think the only thing I would add is, again, this 
concept of the context matters.
    If we are going after an Iranian bank because of very clear 
evidence of support for terrorism, a direct facilitation for 
payment of terrorism, then I think our ability to go to 
European countries to say ``you need to impose sanctions 
against this bank'' will be quite strong. It has been in the 
past.
    If on the other hand, we are seen as capricious, then I do 
not think that is going to have the same kind of impact.
    That does not mean we will not have financial companies and 
financial institutions cooperate. This is an important point I 
want to note. It may be that we are able to influence banks and 
company behavior even if their governments are not supportive. 
Frankly, this is what we did from 2005 until 2010 in Europe. 
But the danger of that is that you start to have European 
governments or the Japanese Government or anybody else pass 
laws that say you are not allowed to comply with United States 
sanctions. That is what happened in 1996 with the Iran 
Sanctions Act originally.
    So I think there is still United States unilateral power we 
can use in the financial sector, but with that power comes the 
responsibility to wield it, I think, effectively and carefully, 
lest we court a challenge ourselves with the WTO, and so on and 
so forth.
    Senator Flake. I think the concern that we have is that the 
leverage point actually goes to Iran. If we find that they are 
engaged in nefarious activities that we want to impose 
sanctions on, and given the multilateral nature of this 
agreement, and the fact that we would have to submit to the 
body that we believe that Iran has violated good behavior and 
we want to impose sanctions, given the interlocking nature of 
these financial sanctions and how it affects banks, private 
companies, and governments, that it might be even more 
difficult to get them to agree to allow us to impose those 
sanctions if that is what we have to do. If we go it alone, 
then that is a whole different can of worms.
    My time is done, but I appreciate the answers, and I am 
sure this will be touched on later.
    Thank you, Mr. Chairman.
    The Chairman. Thank you.
    Before going to Senator Menendez, there was another 
question Senator Flake asked in a previous setting that I am 
going to use part of my time to follow up on.
    We sent out a nine-page summary of about 13 documents to 
kind of help everybody understand quickly what the deal was. In 
that, we talked about contracts that were entered into, in 
other words, if you lift sanctions, contracts that you are 
entered into. The way we read it, those contracts are 
grandfathered. In other words, you can continue to do business 
under those contracts even if sanctions are put in place after.
    We had some pushback. And obviously, we do not want to be 
accused of sending something out that has fault, so we asked 
the White House for red lines. We never got that. And then we 
started to send out something to qualify. Actually, I think we 
did. But candidly, as we sat down and talked with the experts 
that we typically rely upon for these kinds of things, they are 
telling us that, in fact, we were right in the first place, 
that contracts that are entered into when sanctions are lifted 
are grandfathered.
    Could you give us some clarification as to whether that is 
or is not the case, Mr. Zarate?
    Mr. Zarate. Mr. Chairman, it is a great question.
    I read paragraph 14 of the new U.N. Security Council 
resolution which creates some sort of a grandfather provision. 
Now, this is not a typical paragraph in these kinds of 
sanctions regimes.
    Now, of course, this is related to a snapback provision, 
which is not usual in these types of regimes anyway. But I read 
that to open the door for some sort of grandfathering 
provision. So you could read it in a way to say, look, there is 
no application of the snapback to contracts that are signed 
between the lifting of the sanctions and the snapback. That 
creates the potential gold rush effect that I talked about.
    If you read this to say that contracts that do not have 
anything to do with prior sanctions, then you say, ``look, if 
there is a contract with the IRGC or some other element that is 
now relisted, that has to be nullified,'' perhaps.
    But I would say in the interpretation of any of these 
sanctions, whether they are related to Iran or North Korea, 
there has always been slippage of interpretation, especially 
when talking to the Chinese or Russians, about what some of 
these provisions mean. So I would imagine at a minimum there 
would be a fight, diplomatically, over what this provision 
means and what contracts with Chinese banks, Chinese companies, 
Russian banks, Russian companies would ultimately mean.
    I would say, Mr. Chairman, it is interesting that the 
Russians are a part of this commission in part because they are 
chafing under the sanctions regime led by the United States and 
European Union. So they are going to have every interest to 
undermine any capability of thwarting commercial relations that 
affect their economy as well.
    The Chairman. Can I get you again to try to reach at least 
a degree of agreement? Would you say at a minimum that it is 
highly unusual that a clause like that would be in an agreement 
like this when typically it is very clear that there is no 
ambiguity? It is an unusual clause to have in an agreement like 
this.
    Go ahead, Mr. Nephew.
    Mr. Nephew. Senator, if I can, I think this is an unusual 
agreement in a lot of respects, so I would not necessarily call 
that particular provision the most unusual.
    I would disagree with the idea that this immunizes long-
term contracts. I think the intent here is basically to assure 
people that if they invest in Iran and snapback is triggered, 
that we will not impose sanctions for the plant that was built 
or for the business that was conducted. The intent is to say 
that business will not be sanctioned, but that does not stop us 
from saying you now have to stop performing the business under 
the contract.
    So it is less an issue of ``does it nullify or protect 
contracts.'' It is more that the performance of the contract 
from snapback forward cannot occur, very similar to what we did 
with the special rule under the CISADA.
    The Chairman. If BP built $1 billion facility to produce 
oil in Iran, so they invested that $1 billion, so they are 
performing under that contract, they are producing X barrels a 
day, and they did that after the sanctions were lifted, could 
they continue under that contract or not?
    Mr. Nephew. Senator, my understanding is no, that at the 
moment snapback is triggered, the BP staff and whatever 
financing is still going on or whatever technical assistance is 
still going on has to be stopped, but that the U.S. Government 
will now not sanction them for having built the plant in the 
first place.
    The Chairman. You agree with that, Mr. Zarate?
    Mr. Zarate. I am not so sure. I think this is a question as 
to how this gets executed and who is interpreting it. I think 
this can be affected by the nature of the snapback. If there is 
a tailored snapback, this could be impacted. This could be 
impacted by the nature of the contract itself. There could be 
special purpose vehicles created to contend with this provision 
to make sure that there could be continuity of the actions.
    I think you could have parties at the U.N., the Permanent 
5, arguing that as long as the continued activities are not 
furthering the activities that are sanctioned, if you can 
assure that they are clean, for example, or productive, that 
they should not fall under this provision.
    So I am not convinced yet that there is clarity as to how 
this would apply.
    The Chairman. Thank you very much.
    Senator Menendez.
    Senator Menendez. Thank you, Mr. Chairman.
    Mr. Chairman, before I get to the issue that our witnesses 
are here for, I want to comment on your and the ranking 
member's request to the IAEA. I am deeply, deeply disappointed 
of their unwillingness to come in any session, public or 
classified, to have a discussion.
    This whole agreement rests upon, if you support it, the 
concept of inspection and verification by whom? By the IAEA. We 
are putting an enormous part of the national security of the 
United States and of our allies in the region in the IAEA, a 
U.N. organization for which we pay membership dues. Maybe they 
fear questions on Parchin, which they can allege and take the 
position that is private and we are not going to talk about 
that.
    But the entire inspection regime, the entire verification 
regime, depends upon the IAEA. And not to be able to question 
the IAEA about how they are going to go about it, about their 
abilities to do so, about the budgetary realities that they may 
need in order to accomplish what we want them to accomplish, I 
do not know how one can come to a conclusion on this agreement 
without understanding from the agency that is involved. The 
most critical element of this agreement is them.
    Forget about the sanctions, because sanctions only come 
into play if they are not performing. We have to know whether 
they are performing, in the first instance, in the 
implementation. And then we have to know, subsequently, if they 
are performing afterward.
    So I would hope that we would find a mechanism, whether 
that is a letter from you and the ranking member, I applaud for 
having done that, or every member of this committee, whether 
that is a resolution of the U.S. Senate that could be quickly 
passed calling upon the IAEA to engage in consultations with 
the Senate.
    You cannot advise and consent, in a sense, to something for 
which you are going in the blind on pure faith without knowing 
the wherewithal as to how that agency, essential to this 
agreement, if one believes in it, is ultimately going to do its 
job, and for which we are going to depend upon our interests 
for.
    It is amazing to me. So I would urge the chair and the 
ranking member, and I would be happy, and I am sure many other 
members would agree, to engage with you in any way possible to 
bring that about. If it does not, that is a critical material 
issue for me. So I just want to speak to that.
    Let me thank both of you for not only your testimony but 
your service to our country. It has been both exceptional.
    I look at this whole question of sanctions vis-a-vis 
incrementalism, and it is a very poignant question. Why? How 
did Iran get to where we are today? Through incrementalism, 
through deceit, deception, delay, through notwithstanding U.N. 
Security Council resolutions in the world saying you cannot, 
you shall not, but they did.
    Each step of the way, we were collectively reticent to do 
what was necessary to stop them, until it got to a certain 
point that both the world and, to be very honest with you, 
Congress drove some of the most critical elements, despite the 
opposition of administrations.
    So when I think about the context of potential violations 
and looking at the agreement and thinking about what is 
substantial or not substantial, I see a history. If you go by 
the Archives building here in Washington, over its portal it 
says what is past is prologue. And you have a 20-year history 
here of getting to the point of being a threshold nuclear state 
by everything that Iran did.
    So you give it a little bit and give it a little bit, 
because you want to preserve the agreement, and you do not, as 
some of our witnesses yesterday, including those who support 
it, give it a quick--say no, no, no, this agreement is not for 
you to play with. We are not going to give you a little bit. We 
are not going to give you a little bit more. We are going to 
come down heavy now.
    But I am concerned, based upon other iterations, at our 
unwillingness at times to engage in the type of sanctions 
regime that are necessary. I look at how hard it has been on 
the Magnitsky list to get people listed. I look at how hard it 
is, despite congressional legislation signed into law, on 
Venezuela. I look at how hard it is in Russia and the Ukraine 
to pursue additional sanctions to try to get them to deter 
their actions. I look at how difficult it is as it relates to 
Syria, where we still have not gotten all the chemical weapons.
    So the concern for me is if you want the deal so bad and 
you hope that it will work so well that you are willing to 
overlook elements that may seem small at the time but begin to 
grow collectively, and then collectively have a point in time 
which you say, oh, my God, which is where we are at right now.
    So I think that those are critical questions.
    Now, Mr. Zarate, I want to understand something. I am 
pretty convinced of it, but I want to make sure I have not just 
self-convinced myself because I want to be convinced.
    On page 26 of the agreement, it says the U.S. 
administration, acting consistent with the respective roles of 
the President and the Congress, will refrain from reintroducing 
or reimposing the sanctions specified in Annex 2, which is 
basically the congressionally mandated sanction, that it has 
ceased complying under the JCPOA without prejudice to the 
dispute resolution.
    So I tried to get from Secretary Lew a very clear, 
definitive view. You either have the right to reimpose ISA 
sanctions that expire next year or you do not. You can maybe 
argue about the timing, but you either have the right or you do 
not.
    Now, I did not get a clear answer from him. If anything, I 
suggested that, well, it sounds like you want the sanctions to 
expire. He did not oppose that view, did not say, yes, that is 
what I want. But he did not say, no, I was absolutely wrong. 
When I pursued, why should we not reauthorize those sanctions 
so that if deterrence is in part by the virtue of consequences, 
which is that there is an actionable activity, there is an 
actionable consequence to an activity you take that is in 
violation of the agreement, you have to think twice about it, 
which is a lot of what your discussion was, why we should we 
not have those sanctions in place with all the same provisions 
in the President's waiver options? And secondly, do you read 
this agreement to suggest that we cannot do that or we will be 
in violation of the agreement?
    Mr. Zarate. Senator, I think I am in full agreement with 
you. It appears that reimposition would put us in violation of 
the JCPOA or at minimum would subject any action by Congress in 
that regard to reimpose the Iran Sanctions Act as----
    Senator Menendez. Actually, it is not only reimposition. 
Reimposition could suggest that you are actually imposing the 
sanctions. It says reintroducing.
    Mr. Zarate. I think that is exactly right, which raises the 
question as to whether or not the waiver provision is good 
enough as a safeguard. I think this goes to the larger point 
that we were discussing earlier about whether or not this 
framework itself, the way it is structured, actually takes away 
the ability of the U.S. Government to dictate how it is going 
to frame the use of these powers, whether it is in deterrent 
mode or whether it is in application.
    The other part of this, Senator, that we have already 
discussed is the problem that if you begin to impact those same 
elements of the economy of Iran that are implicated by ISA in 
some other way, that that too could potentially be viewed as a 
violation of that provision.
    So I just think that the construct as laid out puts too 
much power in the hands of Iran and those who might object to 
what it is that we are trying to impact, either in deterrent 
mode or in effect.
    Senator Menendez. Let me ask two other questions. One is an 
observation.
    It seems to me that the burden is shifting here, that under 
the Joint Comprehensive Plan of Action, it is almost like we 
have to prove our case versus that, look, you are in violation. 
And, of course, we should say why a country is in violation, 
right? We should not just arbitrarily or capriciously do it. 
But the burden of proof seems to shift. We all talk about 
violations in the short term. What about in the long term when 
Iran has become a more significant nuclear, potentially 
industrial-sized, the dual use potentials of that will be far 
harder to make the case on than it will under its present 
circumstances.
    Is that a fair statement?
    Mr. Zarate. I would say you are absolutely right in terms 
of the framework of the JCPOA. In my written testimony 
submitted to the committee, what I suggest is that this is one 
of the fundamental problems of the JCPOA. Putting aside the 
sanctions issue, it is the fact that Iran has suddenly become 
an equal partner in this framework and the United States, along 
with other parties, is now on equal footing with Iran in terms 
of how each presents evidence and information.
    The burden of persuasion and proof, which all along under 
the U.N. Security Council resolutions had been on Iran as the 
suspect actor, has now shifted. I think that is part of the 
problem with the process, whether it is with respect to the 
nuclear delicts or with respect to sanctions. I think we have 
moved into a different frame of reference diplomatically, which 
does get harder over time. You are absolutely right.
    Senator Menendez. My final point, Mr. Chairman, as my time 
has expired, is that one of the things I grapple with, and it 
came to me again when Mr. Nephew was responding to one of your 
questions, is the hope here that the Iranians enter into a deal 
that changes the course of their country's conduct.
    But you know, the whole focus, at least as I see it up to 
now with their actions, is the ayatollah trying to think about, 
``How do I preserve the regime and the revolution?'' And it 
would be a unique thought to think that they are entering into 
an agreement that would mean the end of the regime and 
revolution. Certainly, if they are doing that, certainly, I do 
not think it is their intent. And hopefully, if this all passes 
and happens, it will be the consequence. But I do not think 
they are entering into it with the intent of the thinking that 
this will end the revolution or the regime.
    Thank you, Mr. Chairman.
    The Chairman. Thank you.
    Senator Perdue.
    Senator Perdue. Thank you, Mr. Chairman.
    I would like to read just a few sentences here and lead to 
a quick question.
    Thank you, guys, for your careers and your help. This is 
very helpful today.
    I am encouraged because so far this committee has really 
addressed this issue in a nonpartisan, I am not going to use 
bipartisan, but a nonpartisan issue. This is the security of 
our country and, indeed, I think the security of the world.
    But this is from the JCPOA: ``This historic JCPOA will 
ensure that Iran's nuclear program will be exclusively 
peaceful. Iran reaffirms that under no circumstances will Iran 
ever seek, develop, or acquire any nuclear weapons. This JCPOA 
will allow Iran to move forward with an exclusively peaceful, 
indigenous nuclear program in line with scientific and economic 
considerations.''
    I have just one question on the whole process. We started 
in the beginning and allowed them to have enrichment in the 
very beginning. There are 18 countries. We talked about this 
yesterday. There are 18 countries, out of 180-plus countries in 
the Non-Proliferation Treaty. There are 32 countries that have 
peaceful nuclear programs. There are only 18 that have civil 
programs but can enrich--18. So there are only about 14 
countries that have the combination. Only nine countries have 
the bomb. Five countries have civil programs that can enrich, 
countries like Germany and Japan.
    So my question is, if you look at this thing historically, 
we did a similar deal with North Korea, and it did not work out 
so well. I think we might have been naive, looking at it back 
in historical terms.
    The problem with this deal that I can see so far, and I am 
still trying to look at it in a measured way, truthfully, is 
that this deal in my mind does not preclude Iran from becoming 
a nuclear weapons state even though we just saw the intent of 
the agreement was to do that.
    I think, Mr. Nephew, even this morning you said, over time, 
we talked about sunsets and so forth. This deal, over some 
period of time certainly gives them an opportunity to have a 
nuclear weapon.
    So when I look at this thing, it comes down to, do we have 
a false choice to accept this deal or war? And I do not accept 
that.
    My question this morning leads to that. But initially, when 
we did this enrichment and allowed them to go that way, in my 
mind, it violates the very issue that we have here. A peaceful, 
indigenous nuclear program does not require enrichment, 
although we have now taken that up as a presumption. And I 
challenge that, but that is historical. It is given. In this 
agreement, they are allowed to enrich.
    So I have a question. If we have to go it alone, let's just 
say--I am trying to understand, is there an alternative to the 
position we are in right now?
    I would like both of you to address it. In my opinion, I am 
a business guy. I am outside of this process. You do not 
sanction countries. You sanction companies. So when you look at 
the financial industry and their energy industry and you 
sanction, from our $18 trillion economy, and you start 
sanctioning businesses, you can have a lot of teeth. We do not 
need any other sanctions, in my opinion, to really have a 
dramatic impact on this regime.
    And we know from past history, recent history, just in the 
last 5 years, under this administration, when they doubled down 
on those sanctions, it brought them to the table. In my 
opinion, we gave in too early.
    My question to both of you this morning, do we have an 
alternative we have not talked about in detail, another 
alternative to war or this deal as it is?
    Mr. Nephew.
    Mr. Nephew. Senator, I think that is a very important 
question. I do not know that you will like my answer.
    My view is that----
    Senator Perdue. Why would you say that?
    Mr. Nephew. I think, at the end of the day, while it is 
certainly true that it would be our preference that Iran not 
have an enrichment program, there is nothing in the Non-
Proliferation Treaty, that goes back the late 1960s, that 
precludes countries from having one.
    The way in which we were able to mount all this pressure 
and all these sanctions on Iran is because, as Senator Menendez 
was describing, they engaged in years of cheating on that 
program.
    Senator Perdue. I am sorry to interrupt, but they went back 
and said we need to have enrichment because we cannot secure a 
consistent flow of material, and yet 18 countries do that. So I 
push back a little bit on the presupposition.
    Mr. Nephew. But, sir, those 18 countries were not subjected 
to the kinds of pressures and sanctions campaign and----
    Senator Perdue. They were not violators of NPT laws like 
this regime has been either.
    Mr. Nephew. That is correct. That is why I would never 
apologize for what we have done.
    But the practical reality is that Iran in 2015 faces a 
history in which we attempted to strangle the nuclear program 
in the cradle as often as we possibly could, including 
throughout the 1990s and even going back beyond that.
    From the Iranian perspective, they could not sign onto a 
deal that did not enshrine their ability to have an indigenous 
nuclear energy program, including enrichment. While that 
certainly would not have been my preference going into this 
conversation, I started my job as the guy going after Iranian 
enrichment efforts, the practical reality is we faced a country 
that was not relinquishing this capability.
    Senator Perdue. I am going to run out of time. Address the 
idea of is there an alternative to what we are doing now? In 
other words, we have to consider that. If we don't agree with 
this deal, do we have an alternative?
    Mr. Nephew. Sir, my view is that if we do not agree to this 
deal, the Iranians are going to start installing more 
centrifuges. And if we get back to the table, we are going to 
be dealing with 30,000 centrifuges and a completed reactor.
    Senator Perdue. Specifically, though, would sanctions 
unilaterally have impact? That is really what it comes down to.
    Mr. Nephew. I do not believe United States sanctions would 
stop Iran's enrichment program permanently.
    Senator Perdue. Okay, thank you.
    Mr. Zarate.
    Mr. Zarate. Senator, I think U.S. financial power and 
influence is enormous and would have an impact. Would it stop a 
nuclear program alone? I do not think so. I have argued for a 
long time that the use of financial power and influence has to 
be part of a broader strategy of influence and leverage against 
the regime to bring them to the table and also to get them to 
stop movement toward a nuclear program.
    Senator Perdue. You are experts in this, both of you. Do 
you believe that they have to have enrichment capability in 
order to have a peaceful nuclear program in Iran?
    Mr. Nephew. Absolutely not.
    Mr. Zarate. No. I am not a nuclear physicist, but my 
understanding----
    Senator Perdue. I know it is not your field.
    Mr. Zarate. But it raises an interesting point. You talk 
about that having been a concession up front. The other problem 
with the structure is we may be conceding Most Favored Nation 
status in terms of a sanctions regime. Again, this is part of 
my problem with the structure.
    Given the structure, we are now allowing Iran a process and 
a vehicle to challenge the use of U.S. financial power and, oh, 
by the way, we put it in a context where the Chinese and the 
Russians, which are no fans of and not in favor of United 
States power, financial power, in particular, have a voice and 
a vote.
    So I think the very structure of that is debilitating, not 
just with respect to Iran but more broadly to the use of our 
power for these other issues that we care about.
    So it goes to this question of, have we given Iran Most 
Favored Nation status in terms of how we negotiated this deal?
    Senator Perdue. Mr. Chairman, I am out of time, but I want 
to echo Senator Menendez's point. I am very troubled by the 
side deals. I know that side deals are deals directly done 
between IAEA inspectors and individual countries as normal 
practice. This is not normal practice.
    We are signing a deal for the future of America. And it 
assumes that those deals are part of this deal, the way I read 
this document. And in this document, those special deals are 
not mentioned. And I am really troubled that we are not going 
to be able to get the best advice from those people.
    I just do not know how we can make a decision without that, 
frankly. I would encourage more pressure to be put on the IAEA 
to come before us to explain that. There may be very good 
explanations.
    But when I hear the types of inspection processes that are 
going to be done at places like Parchin, which are not 
mentioned in this document at all, I am very troubled by that.
    The Chairman. I think almost everything that has occurred 
in this committee since Chairman Menendez was chairman and I 
became chairman and Senator Cardin became ranking member has 
been done in a strong, bipartisan way. So we are going to craft 
a letter for everyone, if they wish, to sign that will be 
crafted in such a way that it will not hopefully affect 
anybody's sensibilities, urging them to reconsider that and to 
come before us next week. So that is under way right now.
    Certainly, I would like everybody to have the opportunity 
to sign that, if they wish.
    Senator Shaheen. Mr. Chairman, as long as we are making 
requests, I would also ask that we request a confidential, 
classified briefing by our intelligence agencies.
    The Chairman. Okay, we will do that. I appreciate it.
    Senator Coons.
    Senator Coons. Thank you, Chairman Corker, Ranking Member 
Cardin. Thank you for the spirit in which you are conducting 
these hearings. I think they are vitally important, and I would 
associate myself with the previous conversations about the IAEA 
and their centrality to the enforcement of this, and the 
importance of our understanding of their roles and their 
capabilities. Some of the concerns that have been raised I 
think are very central to our understanding of this agreement.
    Let me, if I might, gentlemen, just broadly touch on four 
different questions that I hope in the next 6 minutes we will 
get some response to.
    You had a vigorous disagreement about the grandfathering 
clause and what it means. Will it lead to a gold rush? As long 
as they are not explicitly furthering of the sanctioned 
activity, contracts entered into will either be allowed to 
continue to perform or, no, what it means is you will not be 
subject to sanctions for having entered into an agreement.
    I am a lawyer. Who decides the outcome of that dispute 
resolution? I have gotten both answers from folks in senior 
levels of this government, current and former. But the reality 
is this is an agreement, and it is a multilateral agreement. 
There are inevitably going to be disputes over this exact 
provision. And it raises the larger question about the extent 
to which we can rely on our allies in dispute resolution and 
the potential consequences of our ability to actually, 
meaningfully enforce. First.
    Second, Mr. Nephew, in a previous exchange, you were saying 
that a certain proposal involving sanctions was not the best 
policy response to restrain likely ongoing Iranian support for 
the Houthis, for Hezbollah, for Assad.
    What is the best policy response? I think there is very 
legitimate concern by all of our regional allies that sanction 
relief, whether it is $50 billion or $100 billion, will lead to 
a significant flow of funds into the Iranian Central Bank and 
then out regionally to support folks who we view as terrorists 
and who are significant bad players in the region.
    What would be the ideal policy response, whether sanctions, 
interdictions, or otherwise? If you were in a position to 
advise the administration, what would you do?
    Third, and I think this is an important question, if we go 
it alone, if we reject this deal and we rely on U.S. economic 
power to reimpose sanctions and seek to renegotiate tougher 
terms, what are the consequences for our role in the global 
financial system?
    The Chinese have made persistent efforts to suggest to 
others that our central role, the fact that the dollar is the 
reserve currency of the world system, the fact that the vast 
majority of financial transactions run through the United 
States, should be lessened or weakened.
    What are the longer term consequences? Will our allies 
really support us? Can we use the enormous leverage we have 
effectively and sustain it over time?
    And then last, any insights on the impact that those flows 
will have on Iran? Some suggest that the relief from sanctions 
they will overwhelmingly have to invest in restoring their own 
oil and gas sector. The oil sector has suffered a nearly 50 
percent drop in the per-barrel price of oil over the last year. 
How will that influence their ability to finance and sustain 
what I think is their enduring commitment to promoting 
terrorism in the region and to being a destabilizing force and 
a determined opponent of our objectives in the region and the 
world?
    So gentlemen, please, have fun.
    Mr. Nephew. I will be quick, to leave time.
    On the issue of grandfathering, sir, the decision on 
whether or not to impose sanctions with respect to the issue of 
grandfathering is with the United States. The United States 
gets to make the decision as to whether or not sanctions can be 
imposed under our own laws.
    Now that does not mean, though, that we are not going to 
have response from our partners. If we were to go and sanction, 
BP, Total, a number of other institutions, I think we can 
expect a reaction from that.
    So as we have done in previous instances, I imagine that 
there will be at least consultation and engagement with our 
partners, both to ensure that we deal with any particular 
concerns they have with the action as well as to protect our 
broader interests.
    But that does not mean we cannot, as we did in 2010, 
curtail the activities of partner companies in Iran, including 
with regard to the oil and gas sector, which we did with the 
use of the Comprehensive Iran Sanctions, Accountability, and 
Divestment Act.
    On going it alone, my view is that if we decide to reject 
this deal and just use our sanctions, we will have an effect, 
and we will have an effect on Iran. But I do not think it will 
be as strong, nearly as strong, as we would have if we had 
cooperation, particularly out of Europe.
    Long term, I am very concerned about overuse of U.S. 
sanctions removing it as a tool. You spoke to the idea of the 
Chinese and others looking for alternative financial systems. 
That is my fear. My fear is that if we go it alone here, as 
well as in other circumstances, we may actually invalidate the 
tool of financial sanctions in the future because people will 
just create systems that do not have to involve us.
    On the issue of flows in Iran and what they will do with 
them, my view is they will use a lot of them on domestic 
economic issues. As you pointed out, they have a lot of 
infrastructure problems there. I think that Rouhani was elected 
on the basis of solving those problems. He wants to be 
reelected.
    More importantly, the Iranian system does not want to have 
instability and conflict on the inside. They are very concerned 
about things like Arab Spring and the color revolutions that 
happened in Eastern Europe. They don't want to see that 
happening in Iran. The way you deal with that is through 
domestic development at home.
    That does not mean they will not support some amount of 
terrorism with some of these additional funds, but I think they 
will spend most of the money at home.
    Very quick on the best policy response for the region, I 
think it needs to be a multifaceted approach involving targeted 
sanctions on individual bad actors and financial flows, but 
also it needs to be support such as weapons sales, logistical 
support, cooperation with partners in dealing with individual 
terrorist groups, and the broader regional security 
architecture.
    But the solution cannot simply be just choke off all 
Iranian money and the problem is solved.
    Senator Coons. Thank you.
    Mr. Zarate. Senator Coons, I will take them seriatim.
    I think we run into a risk that the Joint Commission and 
the sanction subcommittee become the arbiters of how to 
interpret these sections, which by definition is kind of how it 
is set up. So I think we certainly can impose sanctions, but a 
lot of that then becomes subject to discourse and debate in 
that context.
    Senator Coons. Would you try to find ways to prelitigate 
that question?
    Mr. Zarate. I think so. This is an important point, I 
think, for the Congress, which is, I think, gaining clarity on 
what this all means, to ensure--you are a lawyer, sir--that 
there is a meeting of the minds here among all parties as to 
how this is all actually going to work. You cannot figure out 
all permutations, of course. But some of these fundamental 
questions should be answered before we move into the agreement, 
because I think it gets harder over time to either buck the 
agreement or to impose unilateral sanctions. I think we are in 
sort of the most effective and powerful position to actually 
determine how this goes and how it is shaped.
    In some ways, it is how customary international law is 
created. You create the doctrine, the interpretive notes, et 
cetera, that explain how this is going to be applied. So I 
think that is right.
    Otherwise, I think you create an incentive for Iran to do 
what Saddam Hussein did in the Oil for Food scandal. I helped 
chase down his assets on behalf of the Treasury Department when 
I was there.
    What he did in the context of that sanctions regime was to 
pick winners and losers, in part for geopolitical and 
diplomatic shielding. So you have the potential here of the 
Iranians picking Chinese, Russians, perhaps a selection of 
other European allies on the ground who are going to have 
vested commercial interests in ensuring that this is 
interpreted the right way. So I think that is a real danger 
here.
    In terms of strategy, just to repeat Richard's point, I 
think it has to be multifaceted. It has to involve 
interdictions. It has to involve strategic, targeted financial 
measures. It has to involve aggressive support to our proxies 
on the ground and our allies, which I think we failed to do 
from a counterterrorism perspective to date.
    On another point, if we go it alone, I think, again, it is 
easier to do now than later, because, over time, the sanctions 
regime sort of melts away. But I think the reality is, and I 
have written about this, there are potential long-term 
consequences. The Russians and the Chinese are clearly trying 
to challenge and create alternate platforms, payment platforms, 
currency arrangements, trade arrangements, to circumvent the 
dollar and the United States markets.
    On the margins, you talk to most experts, most Treasury 
officials, they will say this is marginally relevant. There 
will be other factors that really drive whether or not the 
United States is the principal economy and the dollar is the 
principal reserve currency around the world--rule of law, 
capital markets, the functionality of our Congress, for 
example. So all those things matter, perhaps, more.
    Finally on the flows in Iran, I think we should take the 
Iranians at their word. They are going to support their proxies 
and allies. They have in the past. There is no question that 
the sanctions restrictions that we put in place for oil 
purposes, which Richard was a part of and this administration 
did a great job on, has impacted their ability to support 
Hezbollah, the Palestinian rejectionist groups, and their 
proxies.
    They will, no doubt, and this is an expectation of folks 
like the secretary general of Hezbollah that they will receive 
more funding from Iran in the future as a result of the 
sanctions relief.
    Senator Coons. Thank you, both. Thank you for your service.
    The Chairman. Thank you.
    Before turning to Senator Gardner, even though there may 
have been a little groundwork underway in advance, just for 
reporting back to New Hampshire as to your efficacy, the intel 
briefing will take place at 5 o'clock Monday. Okay. Thank you.
    So, Senator Gardner.
    Senator Gardner. Thank you, Mr. Chairman.
    And thank you to our witnesses today. I appreciate your 
time, service, and testimony.
    Mr. Chairman, I wanted to clarify on the IAEA, they were 
offered both a setting such as this or a classified setting, is 
that correct?
    The Chairman. Yes. In any form. And, again, I think based 
on what we know about Parchin, all of us would like to dig into 
that more. I know that these agreements, generally speaking, 
are between the country and the IAEA. But generally speaking, 
we are in sort of new territory here altogether. And so again, 
we will write a letter though for all of us to participate in 
trying to get them to change their mind.
    Senator Cardin. Mr. Chairman, if I might, just to clarify. 
In setting up with the chairman and our staffs how we would 
proceed with the review period, our staffs, Senator Corker and 
myself, all felt that information about the IAEA would be 
critically important and we should hear it directly from the 
IAEA. So from the beginning, it has been our hope that we could 
get direct communications with the IAEA.
    We know there is confidentiality between the IAEA and the 
participating state. We know that. We understand that. We also 
understand that information is shared at times in a 
confidential way with other member states.
    The United States, because of its separation of branches, 
it becomes a little more complicated.
    So we made that request from the beginning. We do not know 
how much of that is under the control of our own government and 
how much is IAEA. And that has been one of the difficulties. 
There are two documents that we specifically requested that are 
confidential documents between Iran and the IAEA that we think 
are important for us to be able to see and review.
    So it is not just a direct contact with the IAEA for our 
review, which would be done, I would believe, in a confidential 
setting because of the information we would have to get.
    So we will continue to press for that, but it is an 
independent agency. It is not under the control of the U.S. 
Government.
    Senator Gardner. Thank you for that. Thank you to the 
ranking member for being a part of these and making sure that 
these hearings are successfully completed.
    I think it is important that we have that opportunity to 
hear. And I cannot imagine anybody, regardless of where you are 
in the government, would be opposed to us hearing the full 
details of the agreement. I think that is important.
    In the meantime, Mr. Chairman, perhaps if the IAEA is 
unavailable, maybe we hear from Olli Heinonen, who was a deputy 
at the IAEA. I know he has testified in the House, I believe, 
and I think our witnesses yesterday mentioned some of the 
comments he made about the agreement.
    The Chairman. We have experts in and out of our office 
nonstop. And we have had him in. But the problem is, he has not 
seen the agreement. So that is problematic.
    Senator Gardner. I understand. Thank you, Mr. Chairman. And 
thank you for that.
    Turning to Mr. Zarate, I have a question for you. Under the 
terms of the nuclear agreement, we talked a lot at the hearing 
with Secretary Lew about some of the individuals, some of the 
businesses that were dedesignated, delisted. And one of the 
companies that is set to be delisted is controlled by the 
Supreme Leader Khamenei. It was designated in 2013. It is known 
as the EIKO, which is a group of companies. It includes Rey 
Investment Company, Parsian Bank, Karafarin Bank, and Tadbir 
Group, which is their investment arm on the Tehran stock 
exchange.
    This EIKO was originally listed in 2013 under Executive 
Order 13599, which was not a nuclear-related sanction, but it 
was a sanction addressing deceptive financial practices and the 
risk that they pose to the integrity of the international 
financial system.
    In 2013, the U.S. Treasury designated them, along with 37 
subsidiaries, stating that they continued to generate and 
control massive off-the-books investments shielded from the 
view of the Iranian people and international regulators. That 
happened in 2013.
    We have also talked about the amount of money that will be 
freed up to Iran. It has been characterized being between $100 
billion to $150 billion. Secretary Lew spent time at the 
hearing last week talking about how that number may be around 
$55 billion or $56 billion, not $100 billion.
    But I guess I wanted to hear from you, Mr. Zarate, what in 
your view is the purpose of delisting these entities? And from 
Reuters' studies and others, we know that EIKO has $95 billion 
worth of assets, and they are coming off of this list. There 
may be some sanctions the United States will maintain to be in 
place against them directly. But $52 billion in a real estate 
portfolio, $3.4 billion in publicly traded companies and more. 
So $95 billion.
    Should that $95 billion that will be freed up, it looks 
like, be included in the $100 billion to $150 billion figure, 
or the $56 billion figure that will be an impact to Iran's 
economy up front?
    Mr. Zarate. Senator, you raise a great question. Because 
EIKO and other elements of the first tranche of delisting after 
implementation day do present this risk and this challenge, 
which is they may have had elements that support dimensions of 
the nuclear program. Some of them may have been captured by 
some of the nuclear executive orders. But others had other 
problems attendant to them that were making them subject to 
these sanctions and these other financial, what I call 
preventive measures, given the risks to the international 
financial system.
    I think this is a fundamental challenge for how we have 
constructed the unwinding, because in some ways, we have given 
up on much of the underlying conduct that we have worried about 
in terms of what these entities, owned and controlled by the 
regime and various elements, are able to do in the 
international financial system. And I think, unfortunately, 
what I see as the sort of blunt unwinding tranches here is 
really part and parcel of what is stated as the intent of the 
JCPOA, which is the normalization of trade and economic 
activity with Iran.
    Now I want this deal to work. I do not want to be sort of 
perceived as throwing stones at this, because this is 
incredibly hard. And the unwinding of the sanctions, which is 
the most significant sanctions regime out there, is incredibly 
difficult.
    But I think what we have done with precisely the example 
you described and others, Bank Sepah is another good example, 
is we have thrown them into the lot of unwinding without having 
the Iranians contend with the underlying conduct that is still 
a risk to the international financial system and our national 
security.
    Again, this is why I worry that, you know, viewed in 
maximalist terms, we have given Iran a get out of jail free 
card on some of these underlying issues. Again, I have been 
critical of even my own administration, our own actions, when I 
was at the Treasury and at the White House. What we did in 
2005, 2006, to let up too early on our financial leverage 
against North Korea, not forcing the North Koreans to deal with 
the underlying conduct, and stopping further financial and 
commercial isolation on the back of a nuclear deal, that was a 
mistake. And I said so, and I have written about it. I think it 
was a mistake at the time, and I still think so.
    So I do not think we should repeat those mistakes and 
ignore the underlying conduct that still presents a real risk 
to our national security.
    Senator Gardner. I think EIKO, one of the businesses the 
supreme leader has control through this group are assets in 
Europe that include a German factory with advanced dual-use 
machinery that Iran needs for indigenous production of 
centrifuges. And under the lifting of sanctions, they would be 
able to put money into that. Is that correct?
    Mr. Zarate. That is right. And the other challenge is that, 
given how we have defined not only the unwinding but ``nuclear-
related'' sanctions, I put that in quotes, we have included 
elements of proliferation and dual use and even missile trade 
that is still of concern and still is subject to other 
sanctions. So we have in some ways ensconced and embedded in 
here a very broad definition of what we are calling nuclear 
sanctions, which then affects the rest of the implementation of 
the deal.
    Senator Gardner. Thank you, Mr. Chairman. I need to go vote 
on the Energy Committee, so I thank you, Mr. Chairman.
    The Chairman. Thank you very much.
    Senator Udall.
    Senator Udall. Thank you, Mr. Chairman.
    And I thank both witnesses for your testimony today.
    Let us assume the deal is approved. We go forward under the 
deal. What do you think the United States needs to do to ensure 
the snapback option remains a legitimate threat for Iran for 
breaking the agreement? And how can we work with the P5+1 to 
ensure we have international buy-in for the use of these kinds 
of sanctions, if needed?
    Mr. Nephew. Senator, my view, again, remains that context 
is important. So I believe so long as we are insisting on very 
tough verification and interrogation of any incidents of even 
modest violations of the terms of the deal, and we respond to 
them directly, both in the joint commission and dispute 
process, including through even potential more modest sanction 
snapback for those more minor violations, that we can address 
the broader issue of snapback.
    The bottom line is the Iranians need to understand that we 
will respond at all times. And this starts by continuously 
monitoring the program, prompting and challenging them when we 
see things that are inconsistent with the terms of the deal or 
that cause us to question, and vigorously question, using the 
dispute process that we have put in terms of the deal.
    We have to do that with a high level of attention, and we 
need to do that with rigorous enforcement and monitoring.
    Senator Udall. Mr. Zarate.
    Mr. Zarate. Senator, I think Congress has a role to play 
here, because I think Congress can put in place measures that 
makes it very clear, not just to the negotiating parties but 
also the private sector, that there are going to be sanctions 
and sanctions provisions that are potentially brought to bear 
if there is evidence and suggestions of illicit Iranian 
activity.
    So creating a sanctions framework where Congress itself 
shapes the environment and shapes expectations around how the 
international community may view doing business with the IRGC 
or Quds Force or the intelligence services, that actually I 
think could be incredibly helpful.
    This grandfathering provision, getting clarity on that, I 
think is really important and will shape the marketplace.
    And then to Richard's point, enforcing the elements of the 
deal quickly and often and demonstrably I think will be 
critical.
    Senator Udall. One of the things that I think your 
testimony that I heard this morning highlights is that there 
definitely is a role for Congress to play. You have the 
approval or disapproval of the agreement, but if you move 
forward on the agreement, there is a role for Congress to play 
in order to strengthen it, to bring transparency, to plug holes 
that occur that we do not think are going to be there. Would 
you agree with that?
    Mr. Zarate. Absolutely. Whether or not you agree with the 
deal, I think Congress has a role to play in clarifying the 
deal, maintaining our power, and ensuring that it is executed 
properly to deal with the risks that are very real, deal or no 
deal.
    Senator Udall. Mr. Nephew.
    Mr. Nephew. Senator, I would agree as well.
    Senator Udall. There have been concerns about what happens 
at year 10, year 15, year 20, under the deal. What are your 
thoughts on these sunset provisions? And do you think the 
existence of a sunset is reason enough to reject the deal?
    Mr. Nephew. Senator, I do not. I do not believe there is 
any arms control arrangement that is either possible or has 
been achieved thus far that does not include sunset. Even the 
original NPT included a sunset. We had to get it extended 
permanently in the mid-1990s only after demonstrating it had 
been working for so long.
    So the idea that a country would voluntarily renounce its 
nuclear program in perpetuity I do not think was ever credible.
    Mr. Zarate. I think one element of the sunset provision 
that is problematic and, certainly, does not match with the 15-
year timetable and the presumption of the peaceful nature of 
the Iranian regime is the cessation of Chapter 7 obligations 
and scrutiny by the U.N. at year 10.
    Again, I am a bit more skeptical and I think we should be 
presumptive of ill intent on the part of the Iranians, or at 
least an intent to incrementally push the envelope in terms of 
what they are able to do in terms of an overt or covert nuclear 
weapons program. So I think that in and of itself is 
problematic.
    To Richard's point, sunset provisions are a part of the 
international legal landscape. But I think in this case, we are 
dealing with a unique circumstance. We are dealing with high 
risk. And we are dealing with a suspect party that was subject 
to a number of Security Council resolutions that assumed that 
they were a suspect party.
    Senator Udall. Thank you, both.
    Thank you, Mr. Chairman.
    The Chairman. Thank you very much.
    And just as clarification, how would we appropriately 
understand the grandfather issue? In other words, if we wanted 
clarification, as we talk with people, we have various 
opinions, and obviously we are in the selling mode at this 
moment, how would we best clarify that issue? What would be the 
responsible way for us to know what the grandfather or 
nongrandfather clause truly means, in advance of voting?
    Mr. Zarate. It is a great question. I have thought about it 
a little bit but perhaps not enough. So with that caveat, I 
will think out loud a little bit, if that is okay, Chairman 
Corker.
    One is Congress can lay out what you think it is and have 
people push back and reshape the definition. So a letter from 
the Senate or this committee proclaiming what it deems this to 
be actually has some impact and would force open reaction.
    Secondly, asking for in writing the interpretation from the 
various parties to the agreement, in particular our allies. How 
do they interpret this deal, and how are they going to enforce 
it?
    Third, I would suggest that the Treasury Department is 
going to have to have a role in clarifying how the sanctions 
unwinding is going to play out. So as part of that regulatory 
process, they are probably going to have to put out 
interpretive notes or other regulatory guidance. And so it is 
probably in that context that the administration is going to 
have to be incredibly clear, I hope, for the marketplace to 
then determine.
    So those are three ways that I can think of off the top of 
my head that might help.
    The Chairman. Thank you very much.
    Senator Isakson.
    Senator Isakson. Thank you, Mr. Chairman. I appreciate the 
issues you and the ranking member have raised on the IAEA.
    And, Senator Menendez, I agree with you entirely and 
associate with your remarks.
    I am not a nuclear scientist and certainly not an expert in 
this subject. I was, however, a real estate broker for 33 years 
and negotiated a lot of deals. And I have run for office 17 
times.
    When you run for office, you get to a point where if you 
are in the final two, there is a frontrunner and there is a 
challenger. I have been both at one time or another. But 
eventually, the press wants to challenge both of you to a 
debate toward the end of the campaign. And so you appoint your 
best guy to go negotiate your position on the debate. They 
appoint their best guy. They negotiate whether you are sitting 
or standing, whether you talk in English or French, whatever it 
might be, whether you can have a prop or anything else.
    It appears to me that the Iranians negotiated a lot of 
wiggle room in this agreement for them to do a lot of nefarious 
things if they wanted to. I think there is a paragraph in your 
testimony where it says, the problematic construct is Iran is a 
coequal, which really illustrates what I am talking about.
    As I understand it, and I want Mr. Zarate to correct me if 
I am wrong, if somebody challenges the Iranians to an 
inspection over a suspected violation of the agreement, they 
first of all can question, reject, and stall any challenge they 
want to. They can interrogate the people making the request. 
They can object to the reimposition of sanctions. And they can 
appeal anything they want to to the joint commission, which 
they sit on.
    Am I reading that correctly?
    Mr. Zarate. Yes, sir. That is my reading as well.
    Senator Isakson. So not only is there a potential 24-day 
period of time for due diligence to get to an inspection by the 
IAEA, which by contract cannot include an American inspector, 
but there is an additional way to do rope-a-dope for an 
extended period of time to keep that inspection from taking 
place. Am I correct?
    Mr. Zarate. Yes, Senator. And there have been other experts 
who have done analysis, and, certainly, Richard can comment on 
this as well, as to how many days that really means. And it 
means more, certainly, than 24 days, given the potential for 
stall and the potential for challenge.
    Of course, what has been negotiated in the letter of the 
JCPOA is the right of Iran to walk away. So they get the 
ultimate, what has been called the nuclear snapback by my 
colleague Mark Dubowitz, what I call it the heckler's veto. 
Whatever you call it, they get sort of the ultimate sanction 
here, which is, they get to start a nuclear program if they 
don't like it.
    Senator Isakson. Well, Senator Perdue, when he read part of 
the opening preamble to the agreement, where the Iranians say 
they will not develop a nuclear weapon, but from the day that 
JCPOA is signed, there is a glide path for them to eventually 
get to a position where they can. It may be as long as 15 
years, in the most strict interpretation, or 8.5 in the most 
liberal interpretation. But either way, you take that combined 
with the wiggle room they have negotiated with the joint 
commission where you can make the appeal or other things, you 
give them a glide path to being able to have a nuclear weapon.
    Which is why when the chairman asked the question yesterday 
about is there an alternative to agreeing to the deal or war, 
there should be, because we need to reclaim some of the 
equality we ought to have in standing in this agreement once it 
is signed. There will be bumps and bruises. The Iranians have 
negotiated a lot of excellent little rat holes for them to run 
into if something pops up, but we are pretty much exposed.
    I want to just call everybody's attention to one other 
thing Mr. Zarate put in his testimony, and that is paragraph 29 
of the preface of the entire agreement, where it says the EU 
and its member states and the United States of America 
consistent with their respective laws will refrain from any 
policies specifically intended to directly and adversely affect 
the normalization of trade and economic relations with Iran 
inconsistent with their commitments not to undermine the 
successful implementation of the JCPOA.
    So it looks like from the beginning there is a speed bump 
for all of us to be able to have any snapback, reimposition of 
sanctions, or any other economic tool we want to use, if we 
suspect the Iranians have violated the agreement. Is that 
correct?
    Mr. Zarate. That is right, Senator. The reason I highlight 
that paragraph is that I think it is essential, because it 
reinforces and illuminates what the intent of the deal is for 
Iran, which makes sense. They want reintegration into the 
international financial and global order.
    What I am arguing, though, and it is important, is that the 
reason these sanctions have been so darn effective post-9/11--a 
regime that has been subject to sanctions for three decades has 
come to the table. Why? Because they were unplugged from the 
global financial and commercial system.
    We messed with, we interfered, we interrupted their very 
trade and economy.
    My point is, if we want to preserve that power moving 
forward for terrorism, human rights, support to Assad, 
proliferation, and the rest, we may have just negotiated away 
the effective use of those kinds of measures. And that was the 
point of that portion of my testimony.
    Senator Isakson. That was my point, because we all know 
what got them to the table to negotiate with us. It was not 
that they liked us or respected us, but that we were squeezing 
them. They were calling ``uncle.''
    When they got to the table to negotiate from day 1, the 
construct of it brought them up to be a coequal with the United 
States when, in fact, it was our power and leverage that 
brought them there in the first place. That is what concerns me 
so much about the way in which the negotiations ended up.
    We have raised and elevated their stature and their 
position, and given them various windows along the way to be 
able to violate exactly what they promised in the preamble, 
which is to not develop a nuclear weapon.
    Thank you very much to both of you.
    Thank you very much, Mr. Chairman.
    The Chairman. Thank you, Senator.
    Senator Shaheen.
    Am I out of order? You all can politely decide.
    Senator Shaheen. Go ahead.
    Senator Kaine. Thank you, Senator Shaheen. Thank you, Mr. 
Chairman. And thanks to the witnesses.
    Mr. Zarate, since I last saw you, I have not finished 
reading ``Treasury's War,'' but I have enjoyed reading it. I 
would commend all to read the book he's written about the 
really significant advance on how Treasury has been an 
implement of our foreign policy with sanctions and applying 
them the right way. It is a wonderful book.
    Mr. Zarate. Thank you very much, Senator. I appreciate 
that.
    Senator Kaine. Three points. So I agree with the comment 
that Senator Menendez made following up on the chair and 
ranking about IAEA and the needing to dig more into their 
situation, whether it be agreements they may have with Iran as 
they do with other NPT members or just to get a comfort level 
with how they inspect. But I do not want to leave this room 
with an unstated, what I think would be an inaccurate 
impression that we do not trust the IAEA or they do not know 
what they are doing.
    If I can, just to remind everybody of a painful history, in 
March 2003, the IAEA issued an opinion that they said: To date, 
the IAEA has found no evidence or plausible indication of the 
revival of a nuclear weapons program in Iraq.
    That was in March 2003. The administration at that time 
immediately jumped out, trashed the IAEA, said they were wrong, 
and said that the United States needed to initiate a war that 
has proven highly costly in American lives, in treasure, in 
instability in the region, because the administration said, no, 
we have better intel. They do have a program of weapons of mass 
destruction and nuclear weapons. We need to worry about the 
mushroom cloud, and we need to begin this war because they will 
not disarm.
    The IAEA was right. The United States was wrong. And there 
was a significant generation-altering consequence of that.
    So I completely get the notion that we want to dig in to 
what the IAEA is going to do on this. I do not want to leave 
this room with the impression that the IAEA has not 
demonstrated their chops.
    The IAEA has not been perfect either. There were weaknesses 
in the North Korean negotiation, especially with respect to 
North Korean covert programs. But the IAEA and the 
international community went back to add the additional 
protocol that Iran is obligated under this deal to ratify in 
year 8 to fix challenges.
    So let us not leave the impression that the IAEA does not 
know what they are doing, because in one of the most critical 
decisions that we have made as a Nation in our foreign policy 
history, we trashed their conclusions. They were right. We were 
wrong. And a war that should never have been started, that is 
an editorial opinion, was the result.
    Senator Menendez. Would the Senator yield, just very 
briefly?
    Senator Kaine. Yes.
    Senator Menendez. I do not want you to think--I do not know 
if you are referring to my comments.
    Senator Kaine. Actually, no, not you, Senator.
    Senator Menendez. Okay, fine, because I agree, except that 
I want to know what they are going to do and do they have the 
wherewithal, financially and otherwise.
    Senator Kaine. I agree. Actually, your point is very good. 
The agreement says they will put between 130 and 150 inspectors 
into Iran to carry out inspections. Do they have the financial 
ability to do that? I think that is critical.
    But I was worried that there was an unstated point, and I 
wanted to clarify that.
    I think you both hinted at this but I want to ask your 
opinion on this statement. I was intrigued. I was going back, 
as part of understanding this deal, trying to understand the 
status quo ante before negotiations started in November 2013 or 
before the public phase of the JPOA began. I went back and I 
looked at the speech that Prime Minister Netanyahu gave to the 
U.N. in September 2012.
    He had a quote that I thought was interesting: Seven years 
of international sanctions have hurt Iran's economy, but let us 
be honest, they have not stopped Iran's nuclear program.
    I think the evidence suggests that the sanctions have been 
incredibly effective in hurting Iran's economy and getting them 
to the table to negotiate. Certainly, the congressional 
sanctions have been at the core of it, but also the 
international sanctions and the compliance of all allies in 
that.
    However, I think the Prime Minister was honest, and I think 
as you look at the data, it would suggest that the sanctions 
did not stop Iran's nuclear development. In some way, because 
of a resistance mentality or a defiance mentality, the 
sanctions may have accelerated centrifuge development to 
19,000, enriched uranium development to 11,000 to 12,000 
kilograms, the enrichment level to 20 percent, the progress on 
the Iraq plutonium reactor.
    But I was just curious, do you share that opinion? Did 
sanctions slow down Iran's nuclear program?
    Mr. Nephew. Senator, I would say that sanctions did have an 
impact, in terms of Iranian supply and procurement efforts. It 
caused difficulties.
    But I think your point is exactly right. If you look at the 
end of the 2011, Iran had about 9,000 installed centrifuges. At 
the end of 2013, they had 20,000 installed centrifuges. This is 
while our sanctions were as intense as they possibly could have 
been, given oil prices and so forth.
    My view is that sanctions were always a means to an end. 
The end was a diplomatic outcome that probably was not the end 
of the Iranian nuclear program but was putting it under 
significant restraints and very aggressive monitoring.
    Senator Kaine. Mr. Zarate.
    Mr. Zarate. Senator, again, thank you for your kind 
remarks.
    I think you are right. I do not think sanctions were a 
silver bullet here or were ever going to be a silver bullet. I 
have argued that we needed multiple points of leverage. I think 
it is important to keep in mind that sanctions have multiple 
purposes.
    To Richard's point, they can throw sand in the gears of 
what a country is trying to do, or a transnational 
organization. It can help deter actors willing to act with 
sanctioned parties. And it can ultimately hopefully change 
behavior and policy.
    I think the reality is the Iranians were brought to the 
table because of the sanctions, but they were also facing the 
reality of internal economic mismanagement, demographics that 
were not conducive to regime stability, and, I would argue, the 
ghost of the Green Movement. Even though they were able to 
crush it in its infancy, the very threat to the regime of 
internal instability, in combination with that external 
pressure, I think is really what drove President Rouhani and 
his team back to the table.
    So you are absolutely right. Sanctions alone were not going 
to do it. But sanctions were a necessary element to getting 
them to the table.
    Senator Kaine. The reason I ask about your thoughts about 
the Prime Minister's statement is this is a risk analysis, a 
very complicated one, where every option has both some 
predictable upsides and downsides, and then some unpredictable 
upsides and downsides.
    One of the alternatives we have to contemplate is if we 
walk away from a deal and we think that reimposing sanctions, 
now assuming we can get the international partners to 
completely go along, and I think that is a big assumption, but 
reimposing sanctions, getting everybody to go along, is going 
to lead to a better deal. It could lead to a better deal. It 
could also lead to the same kind of acceleration.
    I think in that same speech, the Prime Minister said they 
are just months away from crossing the nuclear threshold.
    Now the critique is, in 15 years, they could be months away 
from crossing the nuclear threshold. I think even some of the 
critics' critique of the deal acknowledged that the deal has 
moved the needle.
    But sanctions could get us a better deal. They could. 
Sanctions could also lead to an acceleration of an Iranian 
nuclear program that could put us in a worse position.
    Actually, we might assign different percentages to that, 
but we are dealing with, again, some upside risks and some 
downside risks, and some are known and some are unknown. This 
is a very complicated analysis, for that reason.
    Thank you.
    Thank you, Mr. Chairman.
    The Chairman. Thank you. And thanks for that line of 
questioning.
    Just to further clarify the IAEA situation, we can reach 
out and talk to former people nonstop to get a comparison 
between the inspection regime that is going to take place in 
Iran versus the ones that have taken place in other places. I 
know the Secretary of State mentioned this is by far the best 
we have ever had. I think most people dispute that. The one you 
are talking about in Iraq was actually a much better inspection 
regime. Much better.
    I know the other day in his testimony he tried to--well, he 
twisted around, I do not know if that was what he was trying to 
do, indicate that we had a lot of eyes on the ground when we 
invaded, but that is not what I was talking about. It is back 
in the 2003 timeframe.
    And the ability to go anywhere, anyplace, was much better 
with Iraq than exists with this. I think that is all the more 
reason that we need to get them in to understand.
    At least, let me say this, the elements we know thus far--
about Parchin, certainly--is much better, and the ``anywhere, 
anytime'' inspection that has been alluded to that could be 24 
days, it could be 74 days, is very different than what we had 
in Iraq.
    Senator Kaine. If I could, you are absolutely right. But we 
purchased those better inspections with a war. We got the 
significant inspections of Iraq as a result of gulf war 1.
    So I do not want to have to go to war to get a slightly 
better inspection regime. I want this regime to be as strong as 
it can be.
    The Chairman. Yes, I do not know. That is sort of a non 
sequitur to me. But I got it.
    Senator Rubio.
    Senator Rubio. Thank you. I actually want to continue on 
that point, because the choice before us was two things.
    On one hand was to continue with what we thought was the 
strategy, which are international sanctions that had an impact 
on Iran's economy. They continued to make progress in their 
enrichment capabilities and so forth. But it was the 
combination of international sanctions and the threat of 
credible military force, which no one wants to talk about, but 
that was on the table. The President has said that, if it came 
down to it, that the United States would do that if it were 
necessary. Versus what we have now, which is a deal that 
basically argues what this will do is, if they comply with it, 
it will slow them down. And in 10 years, if they want to 
breakout, it buys us 10 years of time, assuming everybody 
complies with everything.
    Here is my problem with that analysis. My problem with it 
is, in 8 to 10 years, which sounds like a long time to all of 
us here, it is nothing. Ten years goes very quickly. And that 
is if we are optimistic.
    In 10 years, Iran will be in a much stronger position. In 
fact, I think in 10 years, they will be immune from 
international pressure compared to where they are today.
    Here is why. First of all, they are going to use the 
sanctions relief and the billions of dollars that it frees up, 
and I know everybody wants to believe they are going to invest 
in hospitals and roads and social services in order to win 
their next election. I promise you they are going to win their 
next election. I do not think they are worried about that as 
much as they are about their need? For example, they are going 
to get to modernize their enrichment capability into a 21st 
century industrial system.
    It actually falls right in line with the mandate that the 
supreme leader, I believe, gave his negotiators, which is do 
not agree to anything that is irreversible. Go as far as you 
need to go to get the sanctions removed, but do not agree to 
anything that is irreversible.
    So they will have less centrifuges but they will be better 
ones. They will be modernized. And they will retain that 
infrastructure, which is the hardest part of any nuclear 
program, the infrastructure, the hardware that it takes to do 
it.
    But here is what else they will continue to do. They are 
going to continue to build their conventional capabilities. We 
do not think about that enough, but Iran in 10 years will have 
conventional capabilities, maybe less, that could potentially 
drive us out of the Persian Gulf and the Strait of Hormuz, 
because the price of being there will be too high. They can buy 
Chinese asymmetrical capabilities that allow them to kill 
ships, add to the fast boats things that they have been able to 
come up with that can threaten an aircraft carrier. They are 
going to continue build long-range rockets.
    Why are you building a lock-range rocket, an ICBM? Are they 
going to put a man on the moon? No. They are building it for 
purposes of targeting the continental United States. And they 
look at North Korea and say, yes, the North Koreans have a 
long-range rocket. We do not know whether it is going to hit, 
because they are not very good yet at guidance, but it will hit 
somewhere, like the West Coast of the United States. That alone 
has made North Korea immune.
    And they are going to continue to build up their surrogates 
in the region, which I would argue already, even now before 
sanctions relief, has given Iran tremendous leverage over U.S. 
policy.
    As an example, Iran has laid out some pretty clear 
redlines. They are going to hold back the Shia militia in Iraq 
from attacking American troops or going after Americans. They 
will agree to hold them back if we do not cross certain 
redlines that they have made very clear.
    What are their redlines? For starters, they do not want to 
see any United States combat troops in Iraq. And if we make any 
moves toward any sort of permanent presence in Iraq in the 
future, we are going to get attacked by Shia militias at their 
orders.
    They do not want to see us take any concrete steps to 
remove Assad from power. If they see us moving toward getting 
Assad out of power, we are going to get hit by their surrogate 
groups in the region, including Hezbollah and the Shia militia.
    If we take steps to try to help put in place an Iraqi 
Government that actually unifies that country and is not a 
puppet of Iran, not to mention one that may actually be hostile 
toward Iran's ambitions in the region, they are going to attack 
us.
    So they already have leverage over our policy. Now 
extrapolate that 8 to 10 years from now when their conventional 
forces are higher, when these groups are better armed, when 
Hezbollah in a couple years does not have just rockets, they 
have guided rockets, guided missiles, that do not just hit 
somewhere in Israel, hit exactly what they want to hit.
    So imagine a world in 10 years where Iran decides, or 8 
years or 12 years, where they just decide, you know what? We 
are building a nuclear weapon because we believe Israel has one 
or because we think someone else is going to threaten us.
    What can the world do then? Well, then reimposing sanctions 
really will not be an option at that point because all these 
companies that are deeply invested in that economy just will 
not let their nations, their governments do anything about it. 
We have already seen that in the case of the Europeans.
    But what will the price be of actually going after their 
systems? It will be worse than the price of going after North 
Korea now.
    Do we have a credible military option today to target the 
North Koreans' program? We do not. We do not because we know 
that the price of going after the North Korean program, through 
a credible military option, the price of that is Tokyo. The 
price of that is Seoul. The price of that is Hawaii. They will 
hit us back.
    Imagine Iran where the price of going after the Iranian 
program in 10 years, if they decide to break out, will be 
Washington, DC, or New York City, not to mention Tel Aviv and 
Jerusalem and any number of places in the region that are our 
allies.
    So my argument is that, in fact, what I think we have done 
here is walked right into the situation they wanted to lay out. 
They did not want a nuclear weapon next week anyway. But we 
have created a system where in 8 to 10 years, they will have 
the capability to quickly walk into the nuclear weapons club, 
not sneak in, walk in to the nuclear weapons club with a world-
class industrial enrichment capability, a much more powerful 
conventional force capable of actually asymmetrically driving 
our Navy from the region or further out, and, quite frankly, 
immune from any sort of credible military action because if we 
attack them, the price is going to be a nuclear devastating 
strike, potentially even on the continental United States.
    So my point is that when people vote on the deal in a few 
weeks, you are going to live with this for the rest of your 
life. In 10 years, 12 years, when Iran has a nuclear weapon and 
we cannot target them, people are going to remember this vote 
that is coming up and this deal as what laid the groundwork for 
it.
    I keep hearing this notion there is no other alternative or 
way forward. I disagree. I believe U.S. sanctions are the most 
important part of all the sanctions. I believe that these banks 
in Europe, German banks, whatever banks may be, if they were 
forced to choose between having access to the American economy 
and access to the Iranian economy, that is not going to be a 
hard choice for them.
    I know there is not a question embedded in any of this, 
other than, I guess, Mr. Zarate, in the 30 seconds I have left, 
I would ask you, do you have any doubt that when the sanctions 
are removed and the billions of dollars flow in that a 
significant percentage of that money will be used for the 
things I just outlined, to develop long-range rockets, to 
develop their conventional capabilities, and to better equip 
their surrogate groups in the region?
    Mr. Zarate. Senator, I do not know what the percentage will 
be, but this is a regime that is already investing in those 
capabilities, has already increased its budget allocation for 
the IRGC that could forge other elements of its security 
infrastructure. There is no doubt in my mind that they are 
going to use some of the relief and the actual flow of capital 
to support their proxies, as I said in my testimony, from the 
Golan to Yemen.
    There is no doubt in my mind. I do not know what the 
percentage is going to be. But it is going to be significant.
    The Chairman. Thank you.
    I do not have additional questions, but I think other 
members may, and we would be glad to entertain those for a 
moment.
    I do not want to let the war thing hang, though. I hope you 
are not trying to indicate that there are some of us who would 
like to see a war.
    Senator Kaine. No. Actually, let me be real clear what I 
meant about that, Mr. Chair, if you do not mind.
    You are absolutely right. The inspections in Iraq were the 
gold standard. This deal is not at that level. But the 
inspections in Iraq flowed from our winning gulf war 1. So 
there was a war we won. And then it set a pattern of an 
inspections regime in Iraq that we then used the intel from the 
inspections to bomb Iraq in the late 1990s.
    But there was a war that led to this super-comprehensive 
inspection regime.
    It is not a comment upon what anybody----
    The Chairman. I do not think anyone here is interested in 
that. I would say, just in response, that I think we all know 
from the meetings that we have had that Iran has never thought 
that the threat of force was real in recent times. And I hope 
we do not get to that. And I think that is what we are all 
trying to assess right now: is this an agreement that keeps us 
from that?
    But I might say, because they never thought that to be a 
threat, maybe that is the reason they purchased something that 
is, certainly, at a minimum, not near as good as what we had in 
the past. Maybe.
    But, Senator Shaheen.
    Senator Shaheen. Thank you, Mr. Chairman.
    When I passed to Senator Kaine it was not because I did not 
have questions. It was because he was first. And having started 
out at the end of the row here, I appreciate how challenging it 
is when somebody comes in with more seniority and bumps your 
questioning.
    Thank you both for being here.
    Senator Rubio presented a fairly stark, doomsday scenario, 
in his time. And I just want to go back and see if I can 
clarify a couple things with respect to what he said.
    First of all, does this agreement in any way affect our 
ability to take any military action in Iran should we choose to 
do so?
    Mr. Nephew.
    Mr. Nephew. Senator, no, it does not.
    Senator Shaheen. Mr. Zarate, do you agree with that?
    Mr. Zarate. I do, Senator.
    Senator Shaheen. Are you both in agreement with what I 
understand to be the intelligence assessments that today, 
before we enter into this agreement, that Iran is 2 to 3 months 
away from breakout to build a nuclear weapon, should they 
choose to do that?
    Mr. Nephew.
    Mr. Nephew. Senator, that is my understanding, 2 to 3 
months.
    Senator Shaheen. Mr. Zarate.
    Mr. Zarate. Senator, I have not seen the recent estimates, 
but that is my general understanding, based on what has been 
published.
    Senator Shaheen. It is also my understanding, again, based 
on estimates that I have seen, that should we enter into this 
agreement, at the end of the 10-year time period that Iran will 
be between 8 and 12 months away from building a nuclear weapon? 
Is that your understanding?
    Mr. Nephew. Yes, Senator, that is my understanding.
    Senator Shaheen. Mr. Zarate.
    Mr. Zarate. Yes, Senator. But at the end of the 
restrictions, Iran can quickly shrink that timetable back to 2 
months or even sooner.
    Senator Shaheen. And they will be able to shrink that 
timetable because they already have an enrichment program, and 
they have built or are in the process of building a plutonium 
program at the Arak site because of the work that they are 
doing right now, not because of what they are going to be able 
to do over the next 10-year time period. Is that your 
understanding?
    Mr. Zarate. That is. But it also the case they are likely 
going to be able to accelerate their activities given the 
modernization, in particular, around the centrifuge program and 
the enrichment.
    Senator Shaheen. That is actually not my understanding, 
based on the testimony from Secretary Moniz.
    But, Mr. Nephew.
    Mr. Nephew. Senator, my understanding is that, from years 
10 to 15, the Iranians are still going to be constrained with 
respect to their research and development activities, as well 
as the uranium stockpile. Furthermore, the Arak plutonium path 
is going to be even more closed down since they cannot do any 
of that.
    So my understanding is that, as of year 15, we are still 
going to be in that 6 to 8 month timeframe for the uranium 
breakout, but we are going to be years and years away from a 
plutonium-based bomb.
    Senator Shaheen. And you agree?
    Mr. Zarate. I was referring to uranium enrichment, not the 
plutonium capabilities.
    Senator Shaheen. So I want to go back and see if I can 
understand. There has been some suggestion that one of the 
challenges with relying on the IAEA is that the United States 
would not have inspectors on the ground as part of those 
activities. Are there other agreements that we have entered 
into where we have inspectors on the ground? And can you 
describe those, Mr. Nephew?
    Mr. Nephew. So I am aware of some, things like, for 
instance, bilateral arms control efforts with the Soviet Union. 
You had inspectors from the United States. And Soviet 
inspectors came here, and when it became Russia, obviously 
Russians. But again, there were restrictions and constraints 
placed upon those inspections because there were national 
security interests involved there.
    From the Iranian perspective, my understanding is that they 
have concerns with Americans tromping around their military 
sites. I think from their perspective there is reason to be 
concerned. But I do not think that should imply we will not 
have access to information from those inspections. The IAEA 
will be asked to provide reports and information, both to the 
members of P5+1, of which we are one, and the IAEA Board of 
Governors, of which we are one.
    Senator Shaheen. And with respect to our activities in 
Russia, since you gave that example, and with respect to Iran, 
we will also continue to have intelligence assessments about 
activities going on there; is that correct?
    Mr. Nephew. Absolutely. I think it will still be one of the 
most watched targets in the U.S. intelligence community.
    Senator Shaheen. Thank you.
    I want to go now to the sanctions question, because you all 
have testified, and I think I have heard this at every hearing 
that I have been in, that it is more likely that if we agree to 
the negotiated JCPOA, that Iran would most likely violate that 
in an incremental way rather than in a flagrant way. And, 
therefore, as you testified, Mr. Nephew, that the situational 
challenge will be how we respond to that and how we get the 
international community to go along with us in our response.
    So you both mentioned several other incremental options 
with respect to sanctions and other disincentives that we could 
engage in with Iran. And I wonder if I could get you to talk a 
little bit more about that.
    Mr. Nephew, do you want to start, and then Mr. Zarate.
    Mr. Nephew. Sure. I believe, at base principles, we still 
have the ability to impose sanctions with respect to particular 
bad conduct. Now, the terms of the deal require us to go 
through this dispute process to engage Iran on the terms of its 
violation.
    If it is a valve that is out of place, we may not wish to 
impose draconian sanctions for that or sanctions at all. 
Instead, there may be other restrictions that are imposed on 
Iran as a result of that violation.
    Senator Shaheen. Like what?
    Mr. Nephew. Additional monitoring, for instance. If a valve 
is found out of place, then it might be because the monitoring 
regime is not sufficient. So in my opinion, you can use the 
dispute process to tailor further the deal to make sure you do 
not have those problems in the future.
    But overall, if you have violation upon violation, it can 
become ticky-tack with lots of little ones that add up. 
Frankly, then you may believe that Iran is trying to 
systematically undermine the deal, which may push you in a 
direction of more aggressive sanctions response options.
    Senator Shaheen. Mr. Zarate.
    Mr. Zarate. Senator, I think there are a variety of things 
you could do. Certainly, unilaterally, you could impose a 
different type of sanctions. If the snapback had an element of 
tailored snapback as opposed to blunt snapback, potentially 
that is one way of dealing with relatively minor yet material 
infractions.
    I think the bigger question is going to be systematically 
how infractions are viewed. Will they be viewed as Iran really 
trying to cheat? Or is it simply Iran being Iran, pushing the 
envelope? I think that is going to be the biggest challenge, 
because I think those who do not want the deal to fail, and 
certainly may have commercial interests, et cetera, will make 
the assumption that these are forgivable offenses. Those that 
are more suspicious of Iran, obviously, will see these as just 
the tip of the iceberg reflecting what Iran may or may not be 
doing covertly, for example.
    So I think how all those delicts and infractions are viewed 
actually in toto becomes really important.
    Senator Shaheen. Can I continue?
    The Chairman. Sure.
    Senator Shaheen. My time is expired.
    The Chairman. You already have had such an impact on things 
with the intel briefing, we need to let you go ahead.
    Senator Shaheen. All right. Good. Thank you.
    So if you are going to divide the P5+1, so negotiators who 
are party to this agreement, would you put certain of them in 
one camp, people who think Iran is looking to violate the deal, 
and people who think we want to give them some slack on these 
things? And how would you divide that out? And then what 
options would we have as we are looking at those partners in 
negotiation to try to bring them around to our point of view?
    Mr. Nephew. Senator, I think I would say this: I think 
every party to the P5+1 wants to see the deal work. I think 
that they would treat any violation as being a potentially 
serious one.
    Now, on the one hand, if it is a valve issue, we will 
probably react more seriously to that than, for instance, 
Russia would. But I think a real, very substantial, significant 
violation of the deal would be as big a problem for the 
Russians and the Chinese as it would be for the P5+1.
    I think, ultimately, again, it will come down to the 
context of the violation and what we are suggesting in 
response. If we are able to be proportional and reasonable and 
serious about how we are handling this, I think the P5+1 will 
stay together.
    Senator Shaheen. Do you agree?
    Mr. Zarate. Senator, I have a slightly different view, in 
part because I think there is a question of how the nuclear 
program and Iran are viewed in the context of the negotiation.
    And Richard is right. Everyone wants the deal to work.
    But then there are other geopolitical factors that I think 
create gradations among the negotiating parties. One of the 
gradations is actually how willing the parties are to allow 
sanctions to be used effectively, is the way I would put it. I 
would put China and Russia in the camp where they certainly do 
not want to see the effective use of sanctions wantonly. And 
they certainly do not want to encourage the United States to 
use these powers effectively.
    And I think that is a real challenge in terms of the 
sanction framework.
    Senator Shaheen. Excuse me for interrupting, but on the 
other hand, they have been effectively working with the United 
States in terms of imposing those sanctions on Iran. Is that 
not the case?
    Mr. Zarate. Yes, because they had to. In many ways, they 
had to not only because of U.N. Chapter 7 obligations but also 
because of the market implications. CISADA and the rest of the 
regime imposed by the U.S. Government have really forced the 
choice. Are you going to do business in the United States or 
are you going to do business in Iran? I think that choice has 
been fairly stark for most market actors, to include Russian 
and Chinese actors.
    Senator Shaheen. Thank you both very much.
    Thank you, Mr. Chairman.
    The Chairman. Thank you.
    I do want to say, because of the Chinese relations, we did 
grant some significant flexibilities to them. So to say that 
they have held firm to this would be a little bit of an 
exaggeration because they were not going to hold firm so we 
granted them some flexibility. With Russia, maybe so.
    Senator Menendez.
    Senator Menendez. Just a quick question, and a comment.
    If it is true that sanctions did not stop Iran's nuclear 
program, neither does this negotiated agreement. It may delay 
it, but it does not stop it. So let us look at the standard we 
are trying to look at, in terms of judging.
    I have a concern that people think of snapback as an 
instantaneous reality. And yet in page 6 of your testimony 
talking about how we got to the point, you say this approach 
took time, patience, and coordination within the U.S. 
Government with allies. It would not be a financial shock-and-
awe campaign using a series of coordinated steps to isolate key 
elements of the Iranian economy, starting with its banks, then 
shipping, then insurance, and finally its oil sector.
    So my question is, how instantaneous, assuming we have all 
the laws in place, which is still a big question for me, how 
instantaneous is snapback in terms of both its actual--you have 
to give notice to the world, to companies, that you are now in 
violated space, in sanctioned space. We used to give people at 
least 6 months' notice of that.
    This idea that it is instantaneous, give me a sense of 
that.
    Mr. Zarate. It is a great question, Senator, because I 
think there are two different answers.
    One is the mechanics. You are absolutely right. The 
implementation of a snapback would have legal and mechanical 
implications, and you have to allow for contracts to be 
unwound, investments to be rejiggered and moved, et cetera. So 
the mechanics of that will take months, potentially.
    The second part, which is perhaps the most important is, as 
we get further along in the implementation of this deal, and 
the erosion of the sanctions architecture, you begin to lose 
the ability to affect the marketplace and its risk aversion to 
doing business with Iran. So that would take even longer to 
reinstitute, even though the snapback would certainly help.
    I think that would depend on enforcement. That would depend 
on expansion of sanctions lists. That would depend on a whole 
set of other measures, with the market understanding that Iran 
is being not only punished for its violations, but also being 
isolated from elements of the financial and commercial system.
    That in some ways would be in violation of the current 
reading of the JCPOA, which is in part why I have such grave 
concerns.
    But in any event, I think those are the two elements that 
do add delay to any snapback.
    Mr. Nephew. Senator, I generally agree, I think, with Juan 
that ``instantaneous'' is not going to be how this works. I 
think, Senator, you are absolutely right. There is going to be 
some wind-up period to the sanctions' immediate effect.
    But I think some of this time is going to be in the dispute 
resolution process. I do not anticipate that the dispute 
process itself is going to be a secret. I think there is going 
to be publicity about there being violations.
    Certainly, when a Security Council consideration and 
consultation begins, there is going to be attention paid. To my 
mind, that is part of the warning time and preparation time 
that companies and banks and businesses are going to have to 
build into their snapback calculations. They will see this 
coming, and that 30, 50, 60, 80 days of a dispute resolution 
period is a lot of time for them to start preparing for 
response to snapback. That does not mean on day 80 I think you 
are going to have zero economic activity with Iran. But it does 
mean I do not think that it will require 3 months plus 6 
months. I think if there is a 6-month windup period, some of 
that is in the dispute process.
    The second point I would just make in reaction to Juan's 
comment, I think it is true that over time the market is going 
to normalize its expectations. But I think it is going to be a 
much longer time than we have in mind, because our secondary 
sanctions are still in effect.
    So banks and companies are still going to have to be 
screening against the Treasury Department SDN list. They are 
still going to have to do their due diligence. They are still 
going to have to treat Iran as different, because otherwise 
they run the risk of being cut off from the United States.
    Senator Menendez. Thank you.
    My point, Mr. Chairman, is as we are calculating here, the 
sense of instantaneousness, there are going to be months 
involved under any circumstances. Months involved. Which means 
that this whole breakout period, months involved, to have an 
effect before you try to move the Iranians into changing their 
course if they are violating is a lot less.
    So when you take the totality of the consideration, even in 
the case of snapback, you are talking about a limited window in 
the future. And that has a real consequence as to judgment at 
the end of the day.
    Thank you.
    The Chairman. Certainly, between yourself and the two 
people at the table, there is a vast amount of experience on 
how long it takes for these things to kick in, no question.
    I want to thank our witnesses. It has been an outstanding 
hearing. We will leave the record open for questions, if it is 
okay, through close of business Monday, and hope that you would 
respond.
    But we thank you both for your service to our country. It 
has been important service. We thank you for being here today.
    And again, it has been an outstanding hearing. Thank you.
    We are adjourned.
    [Whereupon, at 12:23 p.m., the hearing was adjourned.]


                JCPOA: NON-PROLIFERATION, INSPECTIONS, 
                        AND NUCLEAR CONSTRAINTS

                              ----------                              


                        TUESDAY, AUGUST 4, 2015

                                       U.S. Senate,
                            Committee on Foreign Relations,
                                                    Washington, DC.
    The committee met, pursuant to notice, at 10:02 a.m., in 
room SD-419, Dirksen Senate Office Building, Hon. Bob Corker 
(chairman of the committee) presiding.
    Present: Senators Corker, Risch, Flake, Perdue, Isakson, 
Barrasso, Cardin, Menendez, Shaheen, Udall, Murphy, Kaine, and 
Markey.

             OPENING STATEMENT OF HON. BOB CORKER, 
                  U.S. SENATOR FROM TENNESSEE

    The Chairman. The Foreign Relations Committee will come to 
order.
    We thank each of our three outstanding witnesses for being 
here and look forward to not only your comments but certainly 
the questions that will come.
    This is the fifth in a series of hearings and briefings 
that we have had to evaluate the Joint Comprehensive Plan of 
Action between Iran and the P5+1. Over the past 2 weeks, we 
have received testimony from administration and private 
witnesses with regard to the strengths and weaknesses of the 
deal. We have also heard from sanctions experts about 
consequences of the fast pace and very generous sanctions 
relief provided to Iran under the agreement. And today, with 
you thankfully, we are going to have the opportunity to hear 
from experts on the capabilities of the inspections regime 
included in the Joint Comprehensive Plan of Action, the 
constraints the agreement will or will not, as the case may be, 
effectively place on future advancements toward nuclear weapons 
by the Iranians, and the overall implications of the deal for 
U.S. and global nonproliferation objectives. Yesterday, we had 
a classified briefing--the ranking member and I were just 
talking about it--relative to our capabilities to verify the 
agreement.
    This committee and Congress are about a month away from 
having to decide if this deal is better than no deal. 
Obviously, in order to cast this vote responsibly we have to 
answer the fundamental question, does this deal achieve our key 
objective of keeping Iran from gaining a nuclear weapon, 
rendering the United States and our allies and partners more 
secure from Iranian coercion and aggression? I am concerned 
about the leverage we have given up but, like others here, want 
to continue to understand whether we achieve that goal or not.
    In addition to addressing those aspects of this agreement, 
I hope our witnesses today will also provide their expert 
opinions on the following questions. What precedent does the 
Iran deal set for proliferation of enrichment technologies in 
regions of particular concern to the international community? 
What role will the eventual repeal of the conventional arms and 
ballistic missile embargos play in launching regional 
competition for advanced military systems? What examples from 
recent WMD history suggest that this deal does not include the 
strongest possible inspections and monitoring regime possible? 
Do you believe a better deal remains possible if the United 
States rejects the current deal? Obviously, a big question. And 
what are the risks? If you are recommending a course of action 
to Congress, what would you recommend and how would you support 
that recommendation?
    So we thank you all. We have tremendous respect for all of 
you. I know you have differing views on this topic, which is 
what is helpful to us.
    And with that, I will turn it over to our distinguished 
ranking member, Ben Cardin.

         OPENING STATEMENT OF HON. BENJAMIN L. CARDIN, 
                   U.S. SENATOR FROM MARYLAND

    Senator Cardin. Well, first, Chairman Corker, thank you 
very much for your leadership in the way that our committee has 
moved forward during this review period. We are only on day 16. 
We have 44 more days left before the clock runs out on our 60-
day review.
    And as you pointed out, this is our fifth hearing or 
briefing that we have had. This is our third public hearing. 
The first public hearing dealt with the JCPOA more broadly and 
how it works. The second dealt with the sanctions and how the 
sanctions regime operated. Today we are looking more at the 
constraints on Iran's nuclear programs and the inspection and 
verification regime. And we have three true experts, and we 
thank all three of you for joining us today. You are all very 
familiar with our committee, and we are very familiar with you. 
And this is going to be, I think, a great discussion. So Dr. 
Samore, Ambassador Joseph, and Mr. Albright, thank you for 
being available and being here today.
    Mr. Chairman, you laid it out correctly. I mean, our 
responsibility at the end of the day is to determine as 
individual Senators whether we think this agreement is in the 
best interests of our country. If we support it, we think it 
makes it less likely Iran would become a nuclear weapon power. 
If we oppose it, we think there is a better course. That is our 
objective. And it is a complex matter. Anyone who believes it 
is not a complex matter has not really studied it. It is not an 
easy yes or no answer.
    What I hope we will get into during today's hearing is the 
fact that there are certain time differences in this agreement, 
but we are, by this agreement, providing for a legal enrichment 
program for Iran. Can they use that legal enrichment program to 
move forward on a covert program for a nuclear weapon? What 
does the NPT requirements and the additional protocols do after 
the time periods have elapsed? Does that give us enough time to 
prevent Iran from breaking out to a nuclear weapon? Is the 
breakout time long enough? Does the IAEA have the capacity and 
the ability through this inspection regime and through the NPT 
and the additional protocols to detect if Iran in fact is 
trying to break out to a nuclear weapon in time for the 
international community to take action?
    It is also, I think, important for us to understand the 
priority activities in Iran, particularly its weaponization 
programs and its possible military dimensions. Is the agreement 
strong enough and is IAEA strong enough and do they have enough 
capacity in order to understand that?
    And then lastly, we need to remember that we are discussing 
a nonproliferation agreement with a hostile but sovereign 
country. We need to judge this agreement on its own terms, not 
against an imagined agreement. What can we really accomplish? 
We need to determine if this agreement accomplishes what it 
purports to do in the long run, or are there loopholes or gaps 
in areas that undermine its implementation or enforcement?
    As was the case during the Cold War, it is possible that 
meaningful diplomacy, combined with pressure, under the right 
conditions can yield positive results for U.S. national 
security. I think everyone would like to see a diplomatic 
solution to the Iranian nuclear weapon program. The question 
before us is whether the nuclear constraints contained in this 
agreement and this inspection and verification regime that it 
sets up meet that standard.
    And, Mr. Chairman, I am looking forward to the discussion 
with our distinguished panel.
    The Chairman. Thank you very much, Senator Cardin.
    Our first witness is David Albright, founder and president 
of the Institute for Science and International Security. Our 
second witness today is Ambassador Robert Joseph, Ph.D., senior 
scholar at the National Institute for Public Policy and former 
Under Secretary of State for Arms Control and International 
Security. Our final witness is Dr. Gary Samore, executive 
director for Research at the Belfer Center for Science and 
International Affairs at the Harvard University.
    We very much look forward to your testimony today and the 
questions that will follow. And if you will just start in the 
order I introduced you, I would greatly appreciate it. Thank 
you.

 STATEMENT OF DAVID ALBRIGHT, FOUNDER AND PRESIDENT, INSTITUTE 
     FOR SCIENCE AND INTERNATIONAL SECURITY, WASHINGTON, DC

    Mr. Albright. Thank you. Thank you, Chairman Corker, 
Ranking Member Cardin, and other esteemed members of the 
committee for the opportunity to testify today.
    Congress has a special responsibility and opportunity to 
evaluate the JCPOA. As Senators think about how to evaluate a 
nuclear deal, their scrutiny should not only lead to an up-or-
down vote of the agreement but also result in legislation that 
enshrines and elaborates on its provisions and its 
implementation over time, clarifies key interpretations of its 
provisions, establishes important conditions, and creates a 
framework for effective implementation.
    Most of my testimony that I am going to cover is really 
highlighting what we have found as significant concerns in the 
agreement and steps we have recommended in order to anticipate 
or remediate these weaknesses.
    I would also like to highlight that my organization and I 
are neutral on whether the JCPOA should be supported. We 
believe at this time of intensive, highly charged debate about 
the merits of the agreement, our analysis is sounder if we 
avoid taking a position on the agreement.
    There remain significant doubts that Iran will address the 
IAEA's concerns about the possible military dimension of Iran's 
nuclear program before implementation day. Failing to do that 
will impact negatively the success of the agreement. As such, 
action should be taken now to clarify that U.S. policy requires 
that the IAEA's concerns about possible military dimensions of 
Iran's nuclear program must be addressed before sanctions are 
lifted on implementation day. I believe that Congress should, 
thus, declare and make binding in legislation that the lifting 
of U.S. sanctions requires the determination that the IAEA's 
PMD concerns are adequately addressed.
    The JCPOA's fundamental goal is to ensure that Iran's 
nuclear program is peaceful even after its major nuclear 
limitations end. For 10 years, this agreement creates the 
conditions that any serious effort by Iran to build nuclear 
weapons will be time consuming and will be vulnerable to 
detection. However, whether the deal meets the goal of 
preventing Iran from building nuclear weapons in the long term 
is doubtful, and this uncertainty poses one of the more 
fundamental challenges to the agreement.
    After year 10, and particularly after year 15, as limits on 
its nuclear program end, Iran could reemerge as a major nuclear 
threat. The agreement does not prohibit Iran from building a 
large uranium enrichment capability and even a reprocessing or 
plutonium separation capability. The agreement essentially 
delays the day when Iran reestablishes its nuclear weapons 
capability and possibly builds nuclear weapons.
    To head off that day, the United States and its E3+3 
partners should not accept or approve Iran's nuclear plans 
after year 10. Ten to fifteen years from now, Iran will still 
have no reason to produce enriched uranium for civil purposes. 
The United States should state that an Iranian semicommercial 
enrichment plant will be neither economic nor necessary and 
will be inconsistent with the intent of the JCPOA.
    The verification provisions in the agreement have 
weaknesses and some must be remediated or compensated for if 
the agreement is to be verifiable. As a general finding, the 
verification provisions--with some remediation of their 
implementation--are likely to be adequate during the first 10 
to 15 years of the agreement, but they will be inadequate 
afterward if Iran implements its plan to expand its centrifuge 
program and possibly start a reprocessing program.
    I should also note that the agreement does not contain an 
anytime/anywhere access, particularly an anytime access, 
provision. The JCPOA does deliver on creating an access 
provision with consequences for noncompliance, and that is an 
important accomplishment. Where the JCPOA fails is on ensuring 
prompt access.
    A key criterion in the development of the agreement is the 
time Iran needs to produce enough weapon-grade uranium for a 
nuclear weapon, called ``breakout.'' The administration has 
used a 12-month breakout criteria in designing limits on Iran's 
centrifuge program. However, the agreed limits do not appear to 
guarantee a 12-month breakout timeline during the first 10 
years of the agreement. If Iran can relatively quickly redeploy 
its already manufactured IR-2m centrifuges, our preliminary 
calculations--and I want to emphasize ``preliminary,'' we got 
to this late in our assessments, and it is still ongoing--
result in only a 6-to-7-month breakout timeline, not a 12-month 
breakout timeline. And this redeployment issue of the IR-2ms in 
our preliminary assessment require clarification. In any case, 
the United States should ensure the additional negotiations, if 
necessary, that IR-2m centrifuges are dismantled in a manner to 
make them more difficult, if not impossible to deploy.
    The procurement channel created by the agreement requires 
special congressional attention I believe. The success of the 
procurement channel to deter and thwart Iranian violations will 
rest fundamentally on the supplier states and their companies. 
There is much work to do to ensure the procurement channel is 
implemented effectively.
    The agreement provides only 30 days to reject a proposed 
export to Iran, which for many states is not enough time to 
review adequately whether the particular exports are 
legitimate. Even in the United States, that could very well be 
a challenge and particularly when the United States is 
assessing whether goods could violate the intent of the 
agreement. And Congress is certainly going to need to support 
the deployment of necessary resources to improve the executive 
branch's capabilities to rapidly review exports to Iran and 
ensure that they do not contribute to activities inconsistent 
with the agreement. Pending the development of an adequate 
review system, the United States should state that it will 
maintain a presumption of denial if it determines that 30 days 
are not sufficient to adequately review proposals.
    In conclusion, the agreement should be recognized as having 
numerous strengths, and my organization has produced studies 
showing those and certainly the administration has provided 
many of those. However, the agreement cannot be evaluated 
without a critical look at its provisions and with some thought 
on ways to mitigate its weaknesses.
    Thank you.
    [The prepared statement of Mr. Albright follows:]

                  Prepared Statement of David Albright

    Congress has a special responsibility to evaluate the Joint 
Comprehensive Plan of Action (JCPOA), judge its adequacy to protect 
U.S. national security interests in the short and long term, and ensure 
its effective implementation. That effort should include a detailed 
look at the strengths and weaknesses of the agreement. As part of 
evaluating weaknesses in the deal, it should also seek ways to 
remediate its weaknesses
    Congress should create legislation to codify the agreement and 
interpretations of critical provisions, ensure its effective 
implementation, create reporting requirements, and mitigate weaknesses 
in the agreement. It should also ensure adequate funding for the 
International Atomic Energy Agency (IAEA), which will be the principal 
verification entity under the JCPOA and will require dramatically more 
staffing and resources to effectively carry out its responsibilities.
                              legislation
    As Senators think about how to evaluate a nuclear deal, their 
scrutiny should not only lead to an up-or-down vote of the agreement 
but also result in legislation that enshrines and elaborates on its 
provisions and its implementation over time, clarifies key 
interpretations of its provisions, and creates a framework for 
effective implementation. While the Iran Nuclear Agreement Review Act 
of 2015 satisfies some of the following provisions, Congress should 
ensure that any new legislation includes those provisions as well as 
additional measures and supporting reporting requirements, such as:

   A detailed description of the motivation, intent, and scope 
        of the agreement;
   Key technical and policy interpretations of major 
        provisions;
   Assessments about the adequacy of the agreement's 
        verification regime;
   Conditions to ensure adequate implementation of the 
        agreement;
   Clear statements of what constitutes violations, both 
        material and incremental;
   Consequences in case of Iranian noncompliance, including in 
        particular those that go beyond or complement the snapback of 
        sanctions; and
   Procedures for addressing Iranian unwillingness to comply 
        with remediation or cease the disputed activity.

    It is important to state that the need for this agreement has 
resulted from Iran's pursuit of nuclear weapons and its building of 
secret nuclear capabilities, which led to a crisis spanning more than a 
decade due to noncompliance with its safeguards obligations. Iran 
remains a suspect country. Therefore, it would be useful that 
legislation lay out a detailed chronology of Iran's violations of its 
nonproliferation commitments and describe its history of noncooperation 
with the IAEA. Moreover, the U.S. intelligence community should provide 
an unclassified assessment of Iran's nuclear weapons efforts up to 2004 
and any efforts related to nuclear weapons research and development 
that occurred afterwards.
    The legislation should lay out a common understanding of major 
provisions of the JCPOA. The information, clarifications, and 
interpretations gathered and recorded during congressional hearings can 
also contribute to the implementation legislation. The legislation 
should also state that the executive branch cannot alter the key 
interpretations of the agreement without consulting Congress.
    The legislation should contain major interpretations of specific 
provisions and declarations about key goals of the agreement. Obama 
administration officials have already stated one interpretation, namely 
that uranium enrichment (or by implication plutonium separation) is not 
a right of Iran under the Nuclear Non-Proliferation Treaty. The 
administration has also stated that it fully intends to prevent Iran 
from obtaining a nuclear weapon in the long term and that all options 
remain on the table to achieve this goal.
    Another needed interpretation is that any Iranian production of 
uranium enriched over 5 percent or separated plutonium, whenever that 
would occur, would be a significant threat to U.S. and international 
security and be viewed as inconsistent with the overall intent of the 
JCPOA. Moreover, an Iranian semicommercial enrichment program (or any 
reprocessing program) will be neither economic nor necessary and 
unlikely to be consistent with international nonproliferation norms, 
likely furthering nuclear proliferation and instability in the region.
    Congress should also endorse the steps that Iran must meet in order 
to receive sanctions relief on Implementation Day. The JCPOA has a list 
of conditions Iran must meet in order for key sanctions to be lifted on 
Implementation Day. The legislation should expressly link Iran fully 
meeting those conditions to U.S. sanctions relief. One condition is not 
sufficiently clear. Congress should clarify the relationship between 
resolving the IAEA's concerns about the possible military dimensions 
(PMD) of Iran's nuclear programs and Implementation Day. In particular, 
Congress should condition such relief on a determination that the 
IAEA's PMD concerns are addressed prior to Implementation Day.
    Congress should ensure that the IAEA is adequately funded to carry 
out its responsibilities under the JCPOA including enforcement of the 
Additional Protocol. It should also condition funding on U.S. nationals 
being able to usefully contribute to, and be employed by, the IAEA in 
carrying out its Iran safeguard and JCPOA responsibilities, while 
recognizing that U.S. nationals are barred from participating in 
inspections in Iran. But that regrettable concession should not prevent 
U.S. nationals from working on or even leading IAEA Iran verification 
efforts under the JCPOA.
    The legislation should include reporting requirements that require 
more detailed reports than contained in the Iran Nuclear Agreement 
Review Act. In order for Congress to have ongoing oversight during the 
implementation of the JCPOA, legislated Reporting Requirements should 
include periodic assessments such as:

   An annual unclassified compliance report, including review 
        and determination of the ongoing adequacy of the agreement's 
        verification and Iran's cooperation with the IAEA;
   Prompt reporting of all violations, noncompliance, and 
        noncooperation episodes;
   IAEA progress on reaching a broader conclusion under the 
        Additional Protocol in resolving PMD issues;
   Quarterly reports on the precise size of Iran's low enriched 
        uranium (LEU) stocks, both less than 5 percent and between 5 
        and 20 percent enriched, and natural uranium stocks;
   Precise updates on Iran's breakout timelines;
   Yearly report on the status of Iran' R&D developments, 
        particularly with regards to advanced centrifuges;
   Updates on the progress of modifications to the Arak 
        reactor;
   Regular reporting on Iran's procurements of proliferation-
        sensitive goods from abroad (especially if illicit);
   Prompt reporting of any Iranian exports of any 
        proliferation-sensitive goods;
   Reports on the spread of sensitive technologies, such as 
        enrichment- or reprocessing-related technologies, to other 
        countries of proliferation concern;
   Status and impact of the lifting of sanctions;
   Yearly nonproliferation assessment which addresses among 
        other issues whether this agreement has increased the risk of 
        the spread of sensitive nuclear technologies and ballistic 
        missiles, and if so what steps the administration is pursuing 
        to reduce the likelihood of further proliferation of sensitive 
        technologies.

    The legislation should also require:

   Regular consultations between Members of Congress or 
        congressional staff and appropriate executive branch officials;
   Regular hearings;
   The establishment of a specific congressional oversight body 
        in the Senate or House, or with Members in both;
   The creation of a senior executive branch implementation 
        office in the White House.

    In addition, the procurement channel created by the JCPOA requires 
special congressional attention. To implement the procurement channel, 
the United States needs to expand efforts to significantly strengthen 
export control systems internationally and commit anew to 
counterproliferation efforts against Iran's illicit procurements for 
its missile and military programs and any potential illicit nuclear 
programs. The success of the procurement channel to deter and thwart 
Iranian violations will rest fundamentally on the supplier states and 
their companies. This effort is necessarily international in scope and 
will require significant U.S. resources to ensure that all nations are 
implementing the requirements of the procurement channel and trade 
controls more broadly. As part of that effort, it is important to 
review and expand U.S. trade control outreach programs. The United 
States also needs to expand its domestic efforts aimed at the timely 
detection and disrupting of Iran's illicit procurement attempts. The 
JCPOA provides only 30 days to reject a proposed export to Iran, which 
for many states is not much time to review adequately whether 
particular exports are legitimate. Even the United States may be facing 
a severe challenge addressing proposals, particularly in determining if 
the export could contribute to activities inconsistent with the JCPOA 
within that 30 day window. Pending the development of an adequate 
review system, the United States should state that it will maintain a 
presumption of denial if it determines that 30 days are not sufficient 
to adequately review proposals. Congress should support the deployment 
of necessary resources to improve the executive branch's capabilities 
to rapidly review exports to Iran and ensure that they do not 
contribute to activities inconsistent with the JCPOA. It should also 
encourage greater cooperation with allies to improve their timely 
detection and thwarting of Iran's illicit trade.
    The snapback provision has been extensively discussed in the 
context of major violations of the JCPOA. However, in anticipation of 
less major violations, a range of options are needed in an escalatory 
ladder, where the rungs, not in any order, could be reporting a 
violation to the Joint Commission, reimposing some sanctions, delaying 
the provision of some or all civil nuclear energy cooperation, or 
blocking some or all exports to Iran under the procurement channel 
mechanism. The top rung would be the snapback of sanctions. Congress 
should require the executive branch to develop and report on a range of 
responses to incremental cheating by Iran.
                        concerns about the jcpoa
    The JCPOA has numerous strengths, which we at my organization and 
others have identified in numerous publications. In addition, the 
administration has been a fount of positive information about the deal 
to Congress and the public. However, the agreement cannot be evaluated 
without a critical look at its provisions.
    I would like to focus my testimony on what our analyses have 
highlighted as significant concerns in the agreement and the steps we 
have recommended in order to anticipate or remediate these weaknesses. 
I will focus on the nuclear provisions and not the sanctions 
provisions.
    Before doing so, I would like to highlight that my organization and 
I are neutral on whether the JCPOA should be supported. We believe that 
at this time of intensive, highly charged debate about the merits of 
the agreement, our analysis is sounder if we avoid taking a position on 
the agreement. We are also realizing as we dig deeper into the details 
of this agreement that its effectiveness, and thus whether or not it is 
sound, depends on the outcome of actions that are difficult to predict 
at this time. However, it is more likely that their outcome will be 
positive if additional steps are taken now. As Congress reviews this 
agreement, it should seek ways to ensure that the agreement is 
implemented effectively, which renders it more likely to succeed.
    Much of my testimony is based on our several-week assessment of the 
JCPOA. For greater detail about our findings, one can consult the 
following ISIS reports:

   The Plutonium Pathway, Arak Heavy Water Reactor and 
        Reprocessing;
   Possible Military Dimensions;
   The Joint Comprehensive Plan of Action ``Kicks the Can Down 
        the Road'': How To Prepare for the Day When the Can Finally 
        Lands;
   Heavy Water Reactor Restrictions in the JCPOA;
   Verification of the Joint Comprehensive Plan of Action;
   Removing Stocks of Near 20 Percent Enriched Uranium;
   When is the 300 Kilogram Cap on Low Enriched Uranium not a 
        Cap?;
   Reconciling the 300 kg Cap with Iran's Monthly Production of 
        Low Enriched Uranium; and
   Civil Nuclear Energy Benefits.

    In addition, we are finishing two additional reports:

   The Highly Enriched Uranium Pathway, and
   The JCPOA's Procurement Channel.

    I will summarize (or in one case restate) concerns from the 
abovementioned reports.
                   possible military dimensions (pmd)
    There remain significant doubts that Iran will address the IAEA's 
PMD concerns before Implementation Day, and such a failure will impact 
negatively the success of the agreement. As such, actions should be 
taken now to clarify that U.S. policy requires that the IAEA's concerns 
about possible military dimensions of Iran's nuclear programs must be 
addressed before sanctions are lifted on Implementation Day
    The JCPOA appears to require Iran to resolve these PMD concerns. 
The JCPOA explicitly requires Iran to complete a set of agreed upon 
steps with the IAEA prior to Adoption Day, which falls in October 2015, 
and well before Implementation Day. By mid-December, the IAEA will 
issue a final assessment on the resolution of all past and present, 
outstanding PMD issues. The public portion of the agreement is not 
specific regarding what constitutes Iran satisfactorily addressing the 
IAEA's PMD concerns. For example, the IAEA could report in December 
that Iran had a nuclear weapons program, parts of which may have 
continued, and Iran has so far cooperated adequately with the IAEA's 
investigation. This should be sufficient to allow an interpretation 
that the IAEA has initially addressed its PMD concerns. (A longer IAEA 
investigation would be required to reach a broader conclusion about the 
peacefulness of nuclear activities in Iran which could proceed until 
Transition Day or year 8). But what if the IAEA reports that its 
concerns remain unaddressed in whole or in part, or Iran denies access 
to sites sought by the IAEA? Or a more complicated possibility, what if 
the IAEA provides an ambiguous answer or even accepts Iranian answers 
that are incomplete or use civilian rationales for nuclear weapons 
related activities? To date, Iran has denied to the IAEA ever having a 
nuclear weapons program. As a consequence of this unclear situation, 
the PMD provisions may be left to an interpretation by the parties that 
is not yet clear to publics.
    The conditions in the agreement allow any member of the E3+3 to not 
lift sanctions on Implementation Day if Iran has not met its 
obligations. Whether Iran is addressing the IAEA's concerns should be 
apparent well before that day. If it does not, and Implementation Day 
happens nonetheless, this failure could undermine the IAEA's 
credibility and cast a long shadow on this agreement. The E3+3, and in 
particular, the United States, should not back down regarding the 
linkage of these two issues and abandon all leverage of sanctions 
relief. The administration should made clear in public statements that 
Implementation Day can occur only after the IAEA's concerns about PMD 
are adequately addressed.
    U.S. lawmakers are rightly skeptical that the U.S. administration 
will not require Iran to address the IAEA's PMD concerns prior to 
Implementation Day, or ever, in fact. In documents the administration 
submitted to Congress under legislative requirements, the 
administration wrote: ``An Iranian admission of its past nuclear 
weapons program is unlikely and is not necessary for purposes of 
verifying commitments going forward.'' \1\ While stating that Iran 
conducted nuclear weapons activities in the past, and thus confirming 
that Iran is deceiving the IAEA, the administration claims it knows 
enough about Iran's past nuclear weapons work, and has shared relevant 
information with the IAEA, to ``enable inspectors to establish 
confidence that previously reported Iranian [nuclear weaponization] 
activities are not ongoing.'' \2\ But the flaws in this argument 
include that U.S. knowledge may be incomplete, particularly on the key 
questions: what continued after Iran halted its structured nuclear 
weapons program in 2003, how far has Iran gotten in learning to build 
nuclear weapons, where did it carry out this work, and who conducted 
these activities? Moreover, the issue is broader than the IAEA 
certifying that activities previously ongoing are halted. It must also 
determine that no such activities are ongoing, and a lack of Iranian 
cooperation about its past work on nuclear weapons will make that 
determination all but impossible to make. Then, there is the issue of 
the IAEA's credibility, which means that a pass on Iran addressing the 
IAEA's concerns prior to Implementation Day will signal to Iran, and 
any other state for that matter, that intransigence on verification 
issues will ultimately succeed. In essence, the agreement would start 
off already weakened and provide Iran and other countries a dangerous 
precedent for future intransigence.
    Congress should thus declare and make binding in legislation that 
the lifting of U.S. sanctions requires a determination that the IAEA's 
PMD concerns are adequately addressed.
                        jcpoa's fundamental goal
    The Joint Comprehensive Plan of Action's fundamental goal is to 
ensure that Iran's nuclear program is peaceful even after its major 
nuclear limitations end. Put in alternative formulations, it seeks to 
ensure that Iran will not build nuclear weapons, or more directly, that 
Iran will be prevented from building them.
    For 10 years, this agreement creates the conditions that any 
serious effort by Iran to build nuclear weapons will be highly time 
consuming and will be vulnerable to detection. However, whether the 
deal meets the goal of preventing Iran from building nuclear weapons in 
the long term is doubtful. This uncertainty poses one of the more 
fundamental challenges to the agreement.
    The JCPOA's preface conditions Iran's nuclear program and its 
growth on ``scientific and economic considerations'' and assurances 
that the programs are for ``exclusively peaceful purposes, consistent 
with international nonproliferation norms.'' But these conditions are 
unlikely to be met 10-15 years from now, based on Iran's nuclear plans.
    One may argue that buying 10, perhaps 15, years should be a key 
factor in judging this agreement and that after 10 years the United 
States will have the same leverage as it has today to confront Iran 
over its nuclear weapons capabilities or any movement toward nuclear 
weapons. However, at that point, this U.S. leverage may not exist. That 
the United States may be in a worse position 10 to 15 years from now to 
influence Iran's nuclear plans should be a consideration of 
implementing the JCPOA.
    Ten years after the 1994 U.S./North Korean Agreed Framework was 
signed, North Korea had renounced this framework and was in the process 
of building nuclear weapons. At the time, the United States and its 
allies were poorly positioned to stop North Korea, or even judge 
accurately when it would actually cross the threshold of possessing 
nuclear weapons. Looking back to 10 years after the signing of the 
Agreed Framework, the United States had lost the valuable leverage it 
had had in 1994 when it negotiated the agreement.
    Given the volatility of the Middle East, firm predictions about 
substantial, effective U.S. leverage 10 years from now should be viewed 
more as wishful thinking than credible projections. While some voice 
confidently that Iran will change for the better over the next 10 to 15 
years, similar or same voices also said this 10 to 15 years ago. In the 
last 10 years, events in the Middle East have not unfolded as 
predicted, let alone as expected. Today, Iran can hardly be called more 
responsible or friendly to U.S. interests than it was 10 years ago.
    It should also be remembered that the 10-year limitation on Iran's 
centrifuge program, despite its value, is already a compromise of the 
initial E3 goal of 10 years ago to achieve a 10-year suspension in 
Iran's centrifuge program. And this compromise took 12 years to 
negotiate. So, 10-year nuclear limitations are not as lengthy as they 
seem, given how long the Iranian nuclear debacle has lasted, how little 
the onerous aspects of the Iranian regime have changed, how 
unpredictable the Middle East has proven to be, and how U.S. leverage 
may not be sufficient to stop Iran from building nuclear weapons 10 
years from now.
    Thus, any consideration of the JCPOA should carefully weigh its 
long-term prospects. As part of that evaluation, the United States 
supported by Congress needs to take steps today to increase the chance 
that it can respond successfully to stop Iran moving to build nuclear 
weapons after the major nuclear limitations end. This policy may help 
deter Iran from trying later.
    After year 10, and particularly after year 15, as limits on its 
nuclear program end, Iran could reemerge as a major nuclear threat. The 
agreement does not prohibit Iran from building a large uranium 
enrichment capability and even a reprocessing, or plutonium separation, 
capability; the agreement essentially delays the day when Iran 
reestablishes a nuclear weapons capability and possibly builds nuclear 
weapons. During the negotiations, according to discussions with 
negotiators, Iran laid out its plans for expanding its nuclear 
programs, in particular its gas centrifuge program. Iran's priority was 
its centrifuge program, and it stated its intention to deploy advanced 
centrifuges, such as the IR-2m, IR-4, IR-6, and/or IR-8 centrifuges, 
after year 10 of the agreement and in particular to greatly ramp up 
their deployment after year 13.
    The United States should view the agreement as by no means 
approving of Iran's plans for a large uranium enrichment program or its 
possible plans to create a reprocessing program. It should oppose these 
plans on the basis that they are uneconomic and unnecessary, pose a 
threat to regional and international security, and are inconsistent 
with the intent of the JCPOA.
    After year 13, the breakout timelines are expected to reduce 
steadily, as Iran deploys centrifuges at an expanded rate. After year 
15, this rate could increase significantly. This planned ramp-up after 
year 13 combined with the removal of limitations on enrichment level 
after year 15 means that Iran's breakout timelines could shrink to just 
days. Within a few short years, Iran could emerge with a nuclear 
arsenal of many nuclear weapons.
    Iran might abide by its commitments and value the benefits of 
international nuclear cooperation, in the process deciding to abandon 
its plans to expand its centrifuge program or give up any remaining 
aspirations to build a weapon after the major nuclear limitations end, 
but it could also choose to build up a large nuclear weapons capability 
and ultimately seek nuclear weapons after these limits sunset.
    Making a political predicate clear for not accepting or approving 
of any plutonium reprocessing or large growth in uranium enrichment 
will lay the basis for the United States to be able to deal with issues 
that could emerge after most of the deal's restrictions end. One part 
of that effort is the United States and its E3+3 partners not accepting 
or approving of Iran's nuclear plans after year 10. Ten to fifteen 
years from now, Iran will still have no reason to produce enriched 
uranium for civil purposes. The United States should state that an 
Iranian semicommercial enrichment program (or any reprocessing program) 
will be neither economic nor necessary and likely to be inconsistent 
with international nonproliferation norms.
    A set of intrusive verification measures, such as the Additional 
Protocol, will remain in place after year 15 of the deal, but they are 
not sufficient to stop Iran from obtaining nuclear weapons. Armed with 
a large centrifuge program, an Iranian attempt to break out to nuclear 
weapons would be detected, however probably not in time to take action 
to prevent it. Even with intrusive verification, the production of the 
first one or two significant quantities of weapon-grade uranium could 
well be missed by inspectors until after the fact, since breakout could 
happen so quickly at that point and Iran could take a few simple steps 
to delay the inspectors from becoming aware of the breakout. Moreover, 
small, secret enrichment plants using highly advanced centrifuges could 
escape detection for months. Finally, Iran may simply choose to walk 
away from its nonproliferation commitments and build nuclear weapons at 
a time when the United States and its allies are poorly positioned to 
stop it.
    More broadly, it is incumbent on those states, experts, and 
individuals concerned about Iran's future nuclear direction to find 
ways to dissuade it from implementing nuclear plans that will create a 
great deal of instability and possibly lead to war, given the reduced 
certainty about its nuclear weapons capabilities as its nuclear 
programs grow. Easing making the case, these plans, centered on uranium 
enrichment and possibly plutonium separation, are unnecessary and 
uneconomic.
    Congress should declare that any production of separated plutonium 
or uranium enriched over 5 percent, whenever it occurs, is inconsistent 
with the intent of the JCPOA. It should also make clear that the JCPOA 
does not endorse or approve of Iran creating a semicommercial 
enrichment program and that U.S. policy opposes such a program on the 
grounds of it being unnecessary, uneconomic, a proliferation risk, and 
a threat to U.S., regional, and international security.
                          verification issues
    Collectively, the verification requirements, if fully implemented, 
are designed to deter Iranian cheating and provide assurance that 
violations will be detected promptly, leaving time for a response. 
Several of the provisions are innovative. All aim to create an 
intrusive verification environment, backed up by the resources of the 
E3+3.
    The verification provisions have weaknesses, however, and some must 
be remediated or compensated for if the agreement is to be verifiable. 
Moreover, without stringent, long-term limits on Iran's sensitive 
nuclear programs, such as uranium enrichment activities, these 
verification conditions, some of which are also of limited duration, 
are unlikely to be sufficient. Thus, as a general finding, the 
verification provisions, with some remediation of their implementation 
or compensation for expected issues, are likely to be adequate during 
the first 10 to 15 years of the agreement, but they will be inadequate 
afterwards if Iran implements its plan to expand its centrifuge program 
and possibly start a reprocessing program.
Lack of Prompt Access to Suspect Sites
    Because of its controversy, I would like to focus on the access 
provision in the JCPOA. It is significant that the agreement does not 
contain a provision requiring anywhere, anytime inspections at suspect 
sites. Such prompt access has long been viewed as critical to ensure 
that undeclared activities are not hidden or moved prior to the 
inspectors' access. Instead, the agreement contains a procedure that 
will last for 15 years and is designed to ensure IAEA access to Iranian 
nuclear sites within 24 days of the formal request for access.
    Anywhere, anytime inspections, sometimes called ``snap'' 
inspections by administration officials, describe prompt inspections of 
sites suspected of undeclared nuclear or nuclear-related activities or 
facilities. The Additional Protocol seeks to ensure that its provisions 
of access approach anytime inspections. It has a condition of gaining 
access to suspicious sites in as little as 24 hours. This prompt access 
requirement in the Additional Protocol was the result of intensive 
negotiations among the IAEA's member states in the mid-1990s and 
represents a collective judgement of its fundamental importance in 
ensuring the absence of undeclared activities in a state. Prompt access 
is of particularly critical consideration in the case of Iran with its 
long history of conducting undeclared nuclear activities.
    IAEA inspectors had prompt access in Iraq in the 1990s and early 
2000s. South Africa declared that that its policy was to provide the 
IAEA anywhere, anytime access ``within reason,'' which was explained 
only as a request to not ask to go to a site in the middle of the 
night. In practice, the IAEA could get access to any South African 
facility soon after the request.
    The Additional Protocol recognizes the need for its access 
provisions to approach anytime inspections by its 24-hour rule. 
However, it fails to contain a means to impose immediate consequences 
on a state for allowing prompt access.
    The E3+3 negotiators of the JCPOA had to correct this shortcoming 
of IAEA safeguards agreements. Moreover, this shortcoming was not a 
theoretical exercise; Iran has frequently denied critical access to the 
IAEA. In fact, one could argue that the JCPOA was only possible if it 
contained a mandatory access provision, namely the certainty that an 
Iranian access refusal would lead to severe consequences.
    The JCPOA does deliver on creating an access provision with 
consequences for noncompliance. Where the JCPOA fails is on ensuring 
access promptly.
    One can ask why does the access provision of the JCPOA allows a 
delay of 24 days. As far as we could determine, it was a compromise 
between Iranian demands for 3 months and reasonable demands for at most 
a few days, where the latter is more consistent with the Additional 
Protocol's requirement of access to suspect sites within 24 hours. To 
any partner who said 24 days were too long, the U.S. answer was that 24 
days was what was possible to achieve in the agreement.
    The 24-day condition has stimulated a controversial public debate. 
Twenty four days could be enough time, presumably, for Iran to relocate 
undeclared activities that are in violation of the JCPOA while it 
undertakes sanitization activities that would not necessarily leave a 
trace in environmental sampling.
    This possibility poses special challenges because of Iran's long 
experience in hiding its nuclear activities. In that sense it has 
extensive practice at defeating IAEA and U.S. detection methods. Iran 
would be expected to plan ahead in case access is sought for any 
undeclared activity. This could include the use of specially designed 
equipment and facilities aimed at defeating the constraints in the 
JCPOA's verification rules. Iran could anticipate and plan to implement 
an effective way to defeat IAEA methods in case access was requested to 
a site conducting undeclared activity. When requested for access, Iran 
could rapidly try to hide its activities and avoid leaving any evidence 
for the IAEA.
    In past cases of subterfuge, Iran did not have to hide its 
activities within 24 days, as it would in the future. However, it 
gained valuable experience useful in sanitizing its activities more 
rapidly. Three cases are note-worthy and provided Iran with experience 
that would be valuable in the future, if it decided to build and then 
hide the evidence of undeclared facilities:

   Kalaye Electric, an undeclared centrifuge research and 
        development site. This site secretly produced relatively small 
        amounts of enriched uranium in violation of Iran's safeguards 
        agreement. It is here in 2003 where Iran is thought to have 
        first tried to defeat IAEA's environmental sampling methods. 
        After several months, however, Iran had not sanitized the site 
        adequately, and the IAEA detected enriched uranium as a result 
        of sampling a ventilation duct. Iran had mistakenly not 
        replaced this duct during its cleanup operations;
   The Lavizan-Shian facility, a site alleged to have housed in 
        the 1990s the Physics Research Center and its undeclared 
        military nuclear program. Likely out of fear of the IAEA asking 
        to visit this site and take samples, Iran decided in late 2003 
        to eliminate the entire site. It had many months to destroy the 
        buildings and level the site, including scraping the earth. 
        After the IAEA eventually asked to go to the site, it found no 
        evidence of nuclear materials, which was eventually rebuilt as 
        a sports center; and
   The Parchin military site, linked to high explosive work 
        related to nuclear weapons. One allegation is that the site was 
        used to test a nuclear weapons neutron initiator made with 
        uranium deuteride. Its sanitization status is unknown, but 
        efforts at sanitization have ostensibly been ongoing, as 
        visible in satellite imagery, for 3 years since the IAEA's 
        first request for access and are likely aimed at hiding traces 
        of uranium.

    These experiences, plus others, mean that Iran has extensive 
experience hiding its nuclear activities and importantly learning from 
its mistakes, in essence evolving its sanitization strategies. Kalaye 
Electric was a huge embarrassment for the Iranians, who were caught 
cheating on their safeguards agreement because of an oversight in 
sanitization. The next case chronologically, Lavisan-Shian, involved 
Iran destroying everything and carting away the rubble and earth. It 
subsequently refused an IAEA request to examine and sample the rubble. 
The Parchin case is more subtle, where the Iranians know that they 
cannot credibly destroy the key buildings where the tests are alleged 
to have occurred. Instead, Iran appears to have opted for a strategy of 
cleaning up and rebuilding the major buildings at the site.\3\
    Although Iran so far has not needed to hide its activities within 
24 days, it is experienced enough to be able to do so in the future for 
certain nuclear and nuclear-related activities. In the past, Iran could 
delay access with few consequences, and not surprisingly it took time 
to sanitize its facilities. Moreover, Iran needed this time since it 
did not anticipate getting caught in these three cases. It had to 
implement sanitization steps at facilities that were in no way prepared 
ahead of time for a rapid cleanup. With the JCPOA, it no longer has the 
option for a lengthy cleanup. But that does not mean Iran cannot adjust 
its strategies to plan for a rapid evacuation and sanitization of 
undeclared sites. The IAEA and the E3+3 should certainly anticipate 
Iran modifying its tactics of deception if it seeks to cheat on the 
agreement.
    What could Iran potentially hide or disguise in a 24-day time 
period? At ISIS, over the years, we have conducted several assessments 
on countries such as Iran, North Korea, and Iraq which have all cheated 
on their safeguards obligations. We have assessed the types and 
quantities of uranium releases from gas centrifuge plants as part of 
official safeguards studies and evaluated many cases where 
environmental sampling was used to uncover undeclared activities or 
failed to do so. Based on this work, we assess that Iran could likely 
move and disguise many small scale nuclear and nuclear-weapon-related 
activities. These include:

   High explosive testing related to nuclear weapons;
   Small centrifuge manufacturing plant;
   Small centrifuge plant that uses advanced centrifuges (in 
        this case, we assume a facility of tens of, or at most a few 
        hundred, centrifuges, organized in specially designed 
        facilities suitable for rapid removal and with a containment 
        system).

    Activities that would be difficult to hide successfully would 
include:

   Large-scale uranium conversion;
   Centrifuge plants holding thousands of gas centrifuges;
   A reactor or reprocessing plant;
   High explosive work with natural uranium as a surrogate.

    As can be seen, larger scale activities are more vulnerable to 
detection, as are those that use significant amounts of tell-tale 
nuclear materials, such as uranium or plutonium. But small-scale 
activities matter, and this is one of the key reasons why inspectors 
want prompt, or anytime, anywhere access.
    What can be done within the confines of the agreement? The IAEA 
should use the access provision to ensure that Iran will comply, and 
the agreement is sound. Soon after Implementation Day, it should 
request access to sites associated with the PMD issue.
    However, the IAEA cannot depend on prompt or snap access to detect 
a range of undeclared activities. It will have to weigh carefully 
whether to ask for access when it has suspicions but lacks conclusive 
evidence. It will have to consider the risk of Iran successfully 
sanitizing a site, something that would not be possible with a 24-hour 
access rule. The JCPOA's access provisions, while being an important 
enforcement mechanism, could inadvertently weaken the IAEA's ability to 
detect undeclared activities and materials.
    As a result, the E3+3 should view any Iranian delay in allowing 
access to the IAEA beyond 24 hours as requiring a calibrated response. 
At that point, and well before the 24 days have passed, the E3+3 should 
already slow nuclear cooperation and approvals of exports to Iran via 
the procurement channel. At the very least, Iran should get a message 
that prompt access is required under the Additional Protocol, despite 
the language in the JCPOA.
    To compensate for the uncertainties of potential sanitization, 
Western intelligence will likely be critical in exposing any Iranian 
cheating and defining where the inspectors should request access. The 
evidence will need to provide high confidence that even if the site is 
sanitized, complementary evidence and requests for access to other 
sites can establish that undeclared activities have occurred. However, 
Western nations are going to have to dedicate considerable resources to 
discovering reliably and promptly any secret nuclear activities in 
Iran. This task has gotten harder since Iran has tightened its security 
and intensified its counterintelligence efforts in recent years. 
Overcoming Iran's greater capabilities to hide its most sensitive 
activities is a central challenge facing this agreement.
    Moreover, Western intelligence will have to share information more 
routinely with the IAEA, and the IAEA will have to be more willing to 
act using this information and provide any results to the E3+3. It must 
be a two-way street, with both assigning a high priority to the 
detection of any suspect Iranian nuclear activities.
    In the first few years of the agreement, one would expect all the 
key countries will work diligently to achieve these goals. But this 
entire process may become harder for some of the E3+3 countries as 
vigilance wanes, trade expands, and potentially, relations with Iran 
improve. The IAEA may also encounter renewed internal resistance from 
member states which balk at intrusive inspections and information 
sharing in general.
     stocks of less than 3.67 percent leu: the issue of exceptions
    For 15 years, the JCPOA imposes a 300 kilogram (kg) cap on Iran's 
stock of less than 3.67 percent LEU hexafluoride in order to inhibit 
Iran's ability to break out. However, the JCPOA creates exceptions to 
this cap, which Iran may try to exploit by attempting to justify fuel 
fabrication for power or research reactors. To avoid the risk of 
significantly reducing the breakout timelines and instead preserving 
the value of the 300 kg LEU cap during the full 15 years of this 
limitation, the United States should officially state that an exception 
to the cap will not be granted except in extraordinary circumstances, 
and in no cases will an exception be made for Iran to domestically 
produce LEU slated for fuel in nuclear power reactors. In the case of 
research reactors, any exception will depend on the technical merits of 
the fuel and the size of the reactor. The fundamental position is that 
fresh LEU can be readily converted into uranium hexafluoride 
(UF6) and, therefore, the core goal of this 300 kg cap is 
not compatible with fuel fabrication in Iran. An exception is 
circumstances such as those involving the Arak reactor which 
importantly also has limited LEU requirements.
    The U.S. Government and at least some of its E3+3 allies appear 
fully prepared to block any Iranian attempt to exercise this option, 
except in the case of the Arak reactor. A public commitment to that 
affect should be sought collectively from the E3+3 governments.
    Congress should declare in legislation that U.S. policy is to block 
any exception involving making nuclear fuel in Iran, except for the 
Arak reactor.
                 stocks of 3.67 leu: enforcing the cap
    Under the JCPOA, Iran for 15 years must adhere to a cap of 300 kg 
of LEU hexafluoride. This cap must hold even though Iran is allowed to 
continue producing LEU. For the first 10 years, Iran can enrich with 
5,060 IR-1 centrifuges at the Natanz Fuel Enrichment Plant (FEP); 
afterwards, it can increase the number of centrifuges enriching. 
Enforcing this cap could prove challenging and an early test of the 
adequacy of the JCPOA.
    Based on previous performance data, using about 5,000 IR-1 
centrifuges, Iran is expected to produce about 100 kg of 3.67 percent 
LEU in uranium hexafluoride form (LEUF6) every month. The 
fact that every month Iran will be producing about one-third of its 
allowed stockpile means that it will regularly have to take actions to 
reduce its stock of LEU in order to comply with the cap.
    As discussed above, Iran could claim an exception to the cap under 
the agreement and seek approval to use the excess LEU to make reactor 
fuel. However, any such exception should be opposed except in a few 
cases, such as for Arak reactor fuel. In any case, an exception for the 
Arak reactor is unlikely to be suggested for years, since it is not 
expected to operate for at least 5, if not 10 years, and when it does, 
it will require very little LEU.
    Thus, for years, if Iran continues to produce LEU, it will need to 
take steps almost monthly that reduce its LEU stockpile. It has three 
steps it can take, two of which are spelled out in the JCPOA. It can 
remix the LEU with the depleted uranium tails to generate natural 
uranium or it can send the LEU overseas. The more reliable of the two 
methods will be down-blending to natural uranium. Remixing the LEU 
hexafluoride with depleted uranium hexafluoride is easy to do, and Iran 
has already done this type of remixing with its near 20 percent LEU 
under the Joint Plan of Action. It could also regularly sell the LEU 
abroad. However, finding buyers for such a small stream of LEU, 
relative to the much larger amounts typically sold in the international 
commercial market, may be challenging. The third step is to halt the 
production of LEU, at least temporarily. In fact, it could not produce 
LEU for many years, resuming LEU production if it needs it for the Arak 
reactor. A halt is in all fairness the only one of the three steps 
consistent with its practical needs.
    With Iran potentially bumping up against the cap monthly, what 
about violations? Because Iran can stop producing LEU, even if 
temporarily, and at any point and can down-blend LEU into natural 
uranium, Iran has the tools to immediately avoid any violation of the 
cap. As a result, any overage over the cap should be treated as Iran 
testing the limits of the agreement and a violation that requires a 
firm response.
    In anticipation of violations, the E3+3 should prepare a range of 
options in an escalatory ladder, where the rungs, not in any order, 
could be reporting a violation to the Joint Commission, reimposing some 
sanctions, delaying the provision of some or all civil nuclear energy 
cooperation, or blocking some or all exports to Iran under the 
procurement channel mechanism. The top rung would be the snapback of 
sanctions.
    Whether Iran abides by this cap and how violations of the cap are 
enforced will be an important indication of the performance of this 
agreement. But what should not be forgotten is that Iran does not need 
to produce LEU for several years. To avoid unneeded tension and 
misunderstandings over the cap, the United States and other members of 
the E3+3 should initiate discussions with Iran aimed at convincing it 
to sharply limit or halt LEU production on a voluntary basis. The 
agreement by no means prohibits this discussion, and Iran can always 
say no.
    Congress should state that incremental violations of the LEU cap 
are significant and warrant a firm response. It should explore how to 
reimpose U.S. sanctions in case of violations. In addition, it should 
declare that Iran has no need to produce LEU for years, if ever, and 
pending a need, such as the Arak reactor, should halt any further LEU 
production. It should also require the executive branch to engage Iran 
in discussions for halting LEU production soon after Implementation 
Day, unless a practical need is identified.
                     stocks of near 20 percent leu
    A special concern is Iran's remaining stock of near 20 percent LEU, 
because it can be used to significantly lower breakout timelines. The 
JCPOA seems to adequately address the issue of the remaining near 20 
percent LEU oxide stock by providing that: ``All uranium oxide enriched 
to between 5 percent and 20 percent will be fabricated into fuel plates 
for the Tehran Research Reactor or transferred, based on a commercial 
transaction, outside of Iran or diluted to an enrichment level of 3.67 
percent or less.''
    On balance, it is expected that most of Iran's near 20 percent LEU 
will leave the country prior to the lifting of sanctions on 
Implementation Day. Although it is legitimate to assume that Iran would 
want to recover the relatively large amount of LEU in scrap, it has 
little incentive or capability to do so by Implementation Day. 
Nonetheless, to ensure effective implementation of this provision, we 
recommend that all of the 125 kg (uranium mass) in scrap and waste be 
deemed unfit for use in TRR fuel and sent out of Iran prior to 
Implementation Day, since dilution would likely be overly difficult. 
The 45 kg in powder form is eligible to stay in Iran until 
Implementation Day since it can clearly be made into TRR fuel. Much of 
it, however, will probably end up in scrap, waste, or process forms, 
and this material should also be sent out of Iran prior to 
Implementation Day.
    Congress should require that the vast bulk of near 20 percent LEU 
leave Iran before sanctions are lifted.
                            breakout issues
    A key criteria in the development of the JCPOA is the time Iran 
needs to produce enough weapon-grade uranium for a nuclear weapon, 
called breakout. The administration has used a 12-month breakout 
criteria in designing limits on Iran's gas centrifuge program. However, 
the agreed limits do not appear to guarantee a 12-month breakout 
timeline during the first 10 years of the agreement, if Iran can 
relatively quickly redeploy its already manufactured IR-2m centrifuges. 
This redeployment issue, and our preliminary assessment, require 
clarification. In any case, the United States should ensure, via 
additional negotiations if necessary, that IR-2m centrifuges are 
dismantled in a manner to make them more difficult, if not impossible, 
to redeploy.
    After 10 years, based on discussions with knowledgeable U.S. and E3 
officials, the breakout timeline decreases to about 6 months at year 13 
of the agreement and can rapidly decrease after that year. After year 
15, the breakout timeline can reach a few days, as Iran institutes its 
stated plans to resume production of near 20 percent LEU and installs 
thousands of its most advanced centrifuges.
Similar Breakout Results as the Administration
    For many years we have calculated breakout timelines in 
collaboration with centrifuge experts at the University of Virginia. 
Our understanding from U.S. officials is that the U.S. methods and ours 
are similar in outcome. For example, our breakout results are similar 
to those of the U.S. administration when considering the centrifuge 
limits Iran has accepted during the first 10 years of the JCPOA. In the 
case of about 6,000 IR-1 centrifuges, a stock of 300 kilograms of 3.5 
percent LEU hexafluoride, and no available near 20 percent LEU 
hexafluoride, our breakout estimate would have a mean of about 12-14 
months, where the minimum breakout time would be 11-12 months.\4\ We 
have used the mean as the best indicator of breakout time and interpret 
the minimum time as a worst case. Thus, our estimate of breakout would 
confirm the United States assessment that these limitations satisfy a 
12-month breakout criterion.
Iran's Stock of Near 20 Percent LEU
    We have frequently expressed our concerns that Iran's stock of near 
20 percent LEU could unacceptably lower breakout timelines.\5\ Breakout 
estimates depend critically on Iran's usable stock of near 20 percent 
LEU. Thus, as discussed above, it is significant that the JCPOA 
requires Iran to get rid of the bulk of its remaining stock of near 20 
percent LEU prior to Implementation Day. If Iran does not do so, 
Implementation Day should be postponed until it does.
Effect of 3.5 Percent LEU \6\
    Another consideration is that Iran may accumulate additional 3.5 
percent LEU over the limit of 300 kilograms LEU hexafluoride 
(equivalent). The accumulation of a few hundred kilograms of 3.5 
percent LEU over the limit would lower the breakout times by a few to 
several months. If it can accumulate more than about 1,200 kilograms, 
it could lower the breakout time to below 6 months. As a result, Iran 
exceeding the cap is a serious potential violation and one that should 
be deterred.
Effect of Redeployed IR-2m Centrifuges
    A major gain in the JCPOA is that Iran must dismantle its excess 
centrifuges and place them in monitored storage. However, 
reinstallation of these same centrifuges is possible and such an act 
would lower breakout timelines.
    According to the JCPOA, Iran will remove all excess centrifuges, in 
particular IR-2m centrifuges, its most advanced currently deployed 
centrifuges. However, Iran is not removing all the associated equipment 
at the Natanz Fuel Enrichment Plant. At this plant, Iran will remove 
``UF6 pipework including subheaders, valves and pressure 
transducers atg cascade level, and frequency inverters, and UF6 
withdrawal equipment from one of the withdrawal stations, which is 
currently not in service, including its vacuum pumps and chemical 
traps.'' However, the agreement does not appear to require the full 
dismantlement of all feed and withdrawal equipment used in the cascades 
at the Fuel Enrichment Plant.\7\ Leaving this equipment in the Natanz 
plant provides Iran a head start on restarting enrichment in 
reinstalled cascades.
    If Iran were to break out, it would be expected to reinstall 
centrifuges to lower breakout timelines. Secretary of Energy Ernest 
Moniz stated in Senate testimony before this committee that it would 
take Iran 2-3 years to reinstall all its dismantled equipment. This 
corresponds to an average rate of about 2 to over 3 cascades per month. 
Another estimate, which is used by another member of the E3+3, is that 
Iran could install no more than two cascades per month.
    These estimates depend critically on assumptions about issues that 
are very difficult to know precisely. How much equipment will remain in 
the centrifuge plants, and how quickly could Iran reinstall the 
centrifuges and associated equipment? Can Iran start enriching in these 
newly installed cascades rapidly, or are there additional delays before 
enrichment could resume in them, which lengthen breakout? Can Iran 
successfully redeploy its roughly 1,200 IR-2m centrifuges within about 
3 months of starting a breakout, despite not having operated any of 
these cascades previously in the Natanz Fuel Enrichment Plant? Can 
actions still be taken to make reinstallation more difficult?
    In our calculations, the key variable is the number and 
installation rate of the IR-2m centrifuges after breakout starts. For 
the purposes of this discussion, a reinstallation rate of two cascades 
per month is used, where Iran first reinstalls 
IR-2m centrifuge cascades and afterwards reinstalls IR-1 centrifuge 
cascades. We assume that in a breakout Iran would deploy its most 
advanced machines first. Although it has not operated any of the six 
installed IR-2m cascades at the Fuel Enrichment Plant, Iran has for 
several years been operating a single cascade at the Natanz Pilot Fuel 
Enrichment Plant. Given this prior experience, we judge Iran could 
redeploy IR-2m centrifuges first, despite the risks. The reward would 
be a considerably faster breakout.
    Another assumption is that the enrichment output of the IR-2m 
centrifuge while operating in cascade will be about four separative 
work units (swu) per year, where the range is 3-5 swu/year. With these 
assumptions, the breakout timeline drops to approximately 6 to 7 
months. If only IR-1 centrifuges were reinstalled at a rate of two 
cascades per month, the breakout timeline would decrease to 
approximately 9-10 months.
    In our evaluations, a decrease in breakout time to 9-10 months, 
given all the uncertainties, would not be that significant. However, a 
decrease to 6-7 months is significant and appears to contradict claims 
that Iran would need 12 months to breakout under limitations stated in 
the JCPOA. This discrepancy needs further study and clarification.
    An additional uncertainty is how many IR-2m centrifuges Iran has 
produced. Some experts have speculated that Iran has made up to 3,000 
IR-2m centrifuges by now. Installation of additional IR-2m centrifuges 
would further reduce breakout timelines. The answer may be clearer once 
Iran declares its existing inventory of rotor tubes and bellows under 
the JCPOA. However, if Iran declares it has enough rotor tubes and 
bellows for only 1,200 IR-2m centrifuges, questions about these numbers 
may persist.
    The JCPOA's verification arrangements on Iran's centrifuge numbers 
do not appear sufficient to determine if Iran has hidden away a large 
number of centrifuges. The JCPOA does not contain a provision that 
ensures that the IAEA can verify the number of centrifuges Iran has 
manufactured. Under the JCPOA, the IAEA is allowed to verify Iran's 
declared inventory of existing rotor tubes and bellows by item counting 
and numbering. These conditions are not sufficient to determine whether 
the declaration of the number of rotor tubes and bellows is complete 
(and therefore whether it may secretly possess hidden centrifuges). 
Iran does not appear obligated to provide to the IAEA additional needed 
information, such as the amount and type of raw materials and equipment 
procured historically for its centrifuge program that would allow a 
verification that Iran has fully declared its inventory of rotors and 
bellows and is not hiding a significant number of them, or by 
implication, centrifuges.
    In determining a broader inventory of centrifuge rotor tubes and 
bellows produced in Iran, a value lies in records and evidence from 
procurement information related to goods Iran obtained from abroad over 
the years that needed to make those centrifuge parts. In several cases, 
it procured goods used in those parts only from abroad, such as in the 
case of high quality materials, such as maraging steel and carbon 
fiber. If Iran had to declare all its imports of key goods for its 
centrifuge program, or at least the ones relevant to the manufacture of 
rotor tubes and bellows, the IAEA can check with the supplier and 
member state to verify the amounts sent to Iran and can also ask about 
other possible procurements. In addition, it can compare Iran's 
declaration of goods to existing member state information about such 
procurements. Once the IAEA can determine an inventory of key imported 
goods, it can recreate the Iran's supply chain for centrifuge 
manufacturing and estimate whether Iran's declaration of centrifuge 
rotors and bellows (along with other components) is complete. Without 
obtaining Iran's declaration of key procurements, checking its 
declaration of centrifuge rotors and bellows will depend on existing 
member state information, which is almost always incomplete or not of 
sufficient quality for the IAEA to verify or challenge Iran's 
declaration of centrifuge rotor tubes and bellows.
    Nonetheless, the IAEA should use its authorities under the 
Additional Protocol to press Iran for procurement information relevant 
to rotors and bellows. In particular, it can argue that it needs this 
information to ensure that Iran does not have covert centrifuge plants 
enriching uranium. The United States, backed by Congress, should insist 
that the IAEA do so.
Breakout Estimates in Years 10-13 and afterwards
    There is little public information about the numbers and types of 
centrifuges the agreement allows Iran to install from years 10 through 
13. According to several negotiators, Iran's centrifuge capability, 
which will comprise a mix of advanced centrifuges, will build up after 
year 10 and reach a breakout timeline of about 6 months by year 13. We 
are unaware of the uncertainties in this estimate. For example, would 
it be shorter, if reinstallation factors were more fully considered?
    After year 13, the centrifuge limitations will unwind relatively 
rapidly. With the ending of restrictions on near 20 percent LEU in year 
15 and Iran's stated intention to resume producing this LEU, Iran can 
lower breakout timelines significantly. Within a few years and under a 
variety of scenarios, Iran could deploy sufficient advanced centrifuges 
and accumulate enough near 20 percent LEU to lower breakout estimates 
to a few days. At this point, breakout of enough weapon-grade uranium 
for one or two nuclear weapons could occur without the IAEA being aware 
it happened until after the fact. Preventing Iran from reaching this 
level of capability remains a priority.
                          procurement channel
    The JCPOA lays out an entity and a set of procedures for states to 
make direct- and dual-use nuclear related sales to Iran via a 
procurement channel. It creates a set of new procedures and an 
oversight body called the Procurement Working Group under the Joint 
Commission. The Working Group will oversee direct- and dual-use nuclear 
related purchases by Iran. The IAEA will have authority to check the 
end use of direct nuclear-use goods and can use its access provision to 
check the end use of dual-use goods. Otherwise, the state responsible 
for dual-use good sales will have authority to check the end use of an 
important subset of dual-use goods.
    A preliminary assessment of the procurement channel provisions 
overall shows that a large burden will remain on countries to regulate 
their national nuclear-related trade with Iran. Likewise, the burden 
will be on suppliers, law enforcement, and intelligence agencies to 
detect and prevent illicit attempts to procure or sell goods, and to 
report in some manner to the Working Group on any illicit attempts they 
see from Iran that would indicate or signify possible noncompliance or 
covert nuclear activities. The E3+3 will need to take into account that 
it will need to ensure states seeking to export nuclear wares to Iran 
understand the new procedures. The E3+3 should understand that its 
failure to lay out how non-JCPOA states should report on, or moreover, 
how the Joint Commission should address Iranian lapses relating to 
nuclear-related imports and exports, may create problems as the deal is 
implemented. The lack of penalties for minor or incremental violations 
by Iran regarding illicit procurements (or other noncompliance) is a 
major weakness in the deal.
    Effective planning and remediation steps are necessary now to 
prepare for problems and strengthen these provisions. Outreach by 
governments will be needed to explain these provisions to domestic 
companies and ensure they do not circumvent the proscribed, official 
channel. In addition, any suppliers seeking to make sales to Iranian 
entities outside the channel will need to be detected and stopped.
    Moreover, the success of the procurement channel will depend on 
export control systems working throughout the world. The United States 
will need to expand its outreach to help countries improve their export 
controls more generally and to implement the procedures of the 
procurement channel more specifically.
    Several countries, including China, Turkey, and possibly Russia, 
can be expected not to implement the new procedures adequately. The 
former two countries have not adequately implemented the United Nations 
Security Council sanctions on Iran; they cannot be expected to 
implement the new procedures effectively when new business 
opportunities in Iran begin to multiply. Nonetheless, the United States 
and its allies will need to press these countries to improve 
implementation of their domestic export controls and abide by the new 
procedures of the procurement channel.
    However, even fully responsible states can expect challenges, some 
of which will be difficult to overcome without new resources and 
commitments. One concern is that the JCPOA provides for only a 30-day 
window to decide on proposals to transfer sensitive goods to Iran. 
According to the JCPOA, ``Each participant in the Procurement Working 
Group will have to communicate to the Coordinator, within 20 working 
days, whether it approves or rejects the proposal. The timeline for 
consideration may be extended for an additional period of 10 working 
days at the request of a participant of the Procurement Working 
Group.'' Although the JCPOA process requires only one state on the 
Working Group to stop the export, no state is likely to want to 
disapprove exports without a justification. But 30 days is unlikely to 
be sufficient time for states, including the United States, to conduct 
due diligence on the full range of expected dual-use exports to Iran, 
including those a state determines ``could contribute to activities 
inconsistent with the JCPOA.'' All supplier states will need to devote 
sufficient resources and develop adequate systems to review export 
proposals quickly and adequately. Pending the development of such 
systems, the United States should state that it will maintain a 
presumption of denial if it determines that 30 days is not sufficient 
to adequately review proposals. Congress should authorize more 
resources to improve the executive branch's capabilities to rapidly 
review exports to Iran and ensure that they do not contribute to 
activities inconsistent with the JCPOA.

----------------
Notes

    \1\ Jay Solomon, ``Lawmakers Say Iran Unlikely to Address 
Suspicions of Secret Weapons Program,'' Wall Street Journal, July 26, 
2015. See also: Unclassified Verification Assessment, submitted by 
Obama administration to Congress under the Iran Nuclear Agreement 
Review Act of 2015 (INARA). Delivered to Congress on July 19, 2015.
    \2\ Ibid.
    \3\ Iran's activities at Parchin raise the question of why it has 
been sanitizing actively during negotiations if it is supposedly 
prepared to address the PMD issue. The ongoing sanitization activities 
also raise serious doubts about the soundness of the reported proposal 
for Iran to take its own environmental samples at Parchin, instead of 
the IAEA doing so, as is the standard procedure.
    \4\ More recent ISIS calculations that assume a more efficient 
average arrangement of the cascades shorten our previous estimates 
somewhat. This reflects a view that Iran may keep under a deal its 
cascades that are the more efficient ones.
    \5\ For additional detail and sources see David Albright and Serena 
Kelleher-Vergantini, ``The U.S. Fact Sheet's Missing Part: Iran's Near 
20 Percent LEU (Updated June 5, 2015 with new IAEA data),'' ISIS 
Report, June 5, 2015.
    \6\ For additional detail and sources see: Albright and Kelleher-
Vergantini, ``Iran's Stock of Less than Five Percent Low Enriched 
Uranium, June 2015 Update,'' ISIS Report, June 2, 2015.
    \7\ In the case of the Fordow centrifuge plant, the dismantlement 
of the excess centrifuge cascades, which total about half of those at 
the plant, appears more complete. In the second hall of the Fordow 
Enrichment Plant, Iran must ``remove all excess centrifuges and uranium 
enrichment related infrastructure from the other wing of the FFEP 
[Fordow Fuel Enrichment Plant]. This will include removal of all 
centrifuges and UF6 pipework, including sub headers, valves 
and pressure gauges and transducers, and frequency inverters and 
converters, and UF6 feed and withdrawal stations'' (emphasis 
added).

    The Chairman. Dr. Joseph.

    STATEMENT OF AMBASSADOR ROBERT G. JOSEPH, PH.D., SENIOR 
 SCHOLAR, NATIONAL INSTITUTE FOR PUBLIC POLICY, WASHINGTON, DC

    Ambassador Joseph. Good morning, Chairman Corker, Ranking 
Member Cardin, other distinguished members of the committee, 
thank you for the opportunity to testify today. It is a 
privilege for me to provide my views and my recommendations.
    In my prepared statement, I identify what I call five fatal 
flaws of the nuclear agreement with Iran: ineffective 
verification that will not detect or deter cheating at suspect 
sites such as at military facilities that Iran's Supreme Leader 
has declared to be off limits to inspectors; recognizing and 
legitimizing Iran's path to nuclear weapons both through 
uranium enrichment and in 15 years through reprocessing of 
plutonium; busting the sanctions regime and thereby abandoning 
our most important leverage to ensure Iran's compliance with 
the terms of the agreement; failing to prevent breakout in a 
meaningful way, both after the constraints are lifted and in 
the interim when Iran may decide to race to a bomb; and failing 
to limit Iran's ballistic missile force, including its ICBM 
program that makes sense only in the context of a nuclear front 
end.
    I also identify four strategic consequences: first, the 
likelihood of more nuclear and missile proliferation in the 
gulf and the broader Middle East; second, undermining the 
international nonproliferation regime by setting very damaging 
precedents on verification and undercutting the authorities of 
the IAEA; third, enabling with hundreds of billions of dollars 
over time a more aggressive and repressive Iranian regime; and 
fourth, increasing not decreasing the prospects for conflict 
and war.
    Given the profound national security implications that stem 
from these consequences, I believe that this is a historic 
moment, and at this moment, I do not think one can overstate 
the importance of the congressional review and action on this 
agreement. And here I would make four recommendations.
    First, Congress should vote on the agreement and reject it 
if you decide that it is a bad agreement. I think the metrics 
to judge good from bad are straightforward. Is the agreement 
verifiable? Does the agreement deny Iran a nuclear weapons 
capability? Does the agreement, following the expiration of 
constraints placed on Iran, prevent Iran from building a 
nuclear weapon in a short period of time? And is there 
meaningful phased relief of sanctions and are there guaranteed 
snapback provisions? Because the answer in my assessment to 
each of these questions is no, it is important for Congress to 
reject the agreement and insist on a return to the negotiating 
table to seek an outcome that meets long-standing U.S. goals.
    Second, Congress should, to the extent that it can with 
congressionally imposed sanctions, tie incremental relief to 
the fulfillment of Iran's commitments.
    Third, if the agreement moves forward, Congress should make 
clear that any cheating will result in its immediate 
termination. Unfortunately, it appears that the Obama 
administration may seek to explain away noncompliant behavior 
as it has reportedly done with Iran's failure to meet its 
obligations under the Joint Plan of Action. For this reason, 
Congress should establish a team B of outside, nonpartisan 
experts with access to the highest levels of intelligence to 
assess Iran's compliance with all provisions of the agreement.
    And fourth, Congress should move forward with funding to 
expand missile defense in the region and against the emerging 
Iranian ICBM class missile threat.
    To conclude, I know that you have heard the arguments that, 
despite its flaws, Congress should go along with the agreement 
because it is the best that we can do or because it is better 
than no agreement or because if we walk away from the deal, we 
are choosing war. Based on my personal experience over many 
years, none of these assertions holds up. We can do better as 
we demonstrated with Libya where we demanded and received 
anywhere/anytime access to all sites and where we removed the 
program by sending over a large ship, which we loaded up with 
hundreds of metric tons of nuclear equipment and with their 
longer range missiles, and then we sailed it back home. While 
Libya is not Iran, there are a number of lessons that apply to 
Iran that I would be pleased to talk about, if you like.
    Let me just say that with Iran, we violated every rule of 
good negotiating practice. We gave up our leverage at the 
outset by relieving sanctions to keep Iran at the table. We 
consistently signaled that we were desperate for an agreement. 
We allowed ourselves to be squeezed for concession after 
concession as Iran manipulated arbitrary deadline after 
arbitrary deadline. And most important, instead of holding the 
line on key issues whose outcome would determine whether it is 
a good or bad agreement, we made concession after concession.
    As for the assertion that this deal is better than no deal, 
well, that is a question for Congress to answer. I would just 
refer you to the statements repeatedly made by the President 
and Secretary of State that no deal is better than a bad deal.
    As for the notion that it is a choice between this 
agreement and war, this is simply a false choice. It is 
hyperbole brought to you by the same individuals that 
predicted--in fact, they committed to achieving in the 
agreement constraints on Iran's ballistic missiles, anywhere/
anytime access to sites, to people, and to documentation and 
getting to the bottom of the military activities, including the 
design of a nuclear warhead that Iran is suspected of 
conducting. This track record of predictions could not be 
worse.
    There is no certainty that we can get a good agreement. 
There are no risk-free alternatives, but the costs and risks of 
accepting this bad agreement far outweigh the alternative of 
going back to the negotiating table. Iran will criticize us, as 
it does every day in its vitriol against the great Satan. 
Russia and China will criticize us as they continue their 
respective aggressions in Ukraine and the South China Sea. Even 
some of our allies will criticize us if we insist on reopening 
negotiations. But others will cheer us like Israel and our Arab 
partners that know Iran a lot better than we do. And with 
American leadership, combined with close consultations and 
sound positions on the issues, I am confident that we can turn 
this around just as we have at other critical junctures in the 
past when our national security demanded it.
    Thank you very much for your consideration.
    [The prepared statement of Ambassador Joseph follows:]

             Prepared Statement of Ambassador Robert Joseph

    Chairman Corker, Senator Cardin, other distinguished members 
present today, thank you for the invitation to testify before the 
committee on the nuclear agreement with Iran. It is a privilege for me 
to provide my views and recommendations.
                            five fatal flaws
(1) Ineffective Verification
    President Obama has stated that the Joint Comprehensive Plan of 
Action (JCPOA) is not based on trust but on rigorous monitoring and 
verification. Iran has repeatedly proven itself a master of denial and 
deception in cheating on every nuclear agreement it has signed to date. 
The expectation, based on over 20 years of experience, is that Iran 
will cheat again if it can get away with it.
    Unfortunately, the terms of the agreement do not provide for an 
effective means to detect or deter cheating, unless Iran decides to 
violate its commitments openly at declared facilities under IAEA 
monitoring. Here, the added access and information that Iran must 
provide under the Additional Protocol and other relevant provisions of 
the JCPOA would be beneficial. The problem is that Teheran is less 
likely to cheat in front of the international inspectors than at 
undeclared sites such as military bases where it has cheated in the 
past and where Iran's Supreme Leader has ruled out any inspections.
    In fact, the suspect site provisions contained in the JCPOA--the 
managed access and the dispute resolution procedures--are significantly 
weaker than the measures contained in the standard Additional Protocol. 
Twenty-four-hour notice is replaced by a 24-day notice. And if Iran 
continues to object, the procedures could result in additional delays 
of days or weeks before Iran is actually confronted with the choice of 
permitting access or having the case referred to the Security Council--
something Iran has never seemed all that concerned about in the first 
instance. In short, instead of anywhere, anytime, unfettered access to 
places, people, and documentation--all essential for effective 
verification--implementation of the JCPOA is dependent on Iran's 
cooperation.
(2) Providing a Pathway to Nuclear Weapons
    Despite assertions to the contrary, the JCPOA does not cut off 
Iran's path to produce fissile material for nuclear weapons. It does 
not deny Iran a nuclear weapons capability--the long-standing U.S. goal 
in the negotiations. While it is preferable that Iran spin fewer, 
rather than more, centrifuges at Natanz and that its stockpile of low 
enriched uranium be limited for the period that these restriction 
apply, the basic premise of the agreement remains fundamentally flawed. 
Despite multiple U.N. Security Council resolutions demanding the 
complete suspension of all enrichment and reprocessing activities, the 
JCPOA leaves in place a large-scale enrichment infrastructure. Even 
during the period that the constraints are imposed on Iran, this 
infrastructure could be used to achieve breakout or, more likely, 
``sneakout.'' When the constraints do expire, Iran's enrichment program 
can expand qualitatively and quantitatively so that the breakout time 
will be ``virtually zero.'' Teheran can also decide to reprocess 
plutonium in the future. Thus, the JCPOA recognizes and accepts Iran as 
a nuclear weapons threshold state. It gives what was--and almost 
certainly still is--an illicit nuclear weapons program an international 
seal of approval.
    As for weaponization, actually fabricating a warhead, the November 
2011 IAEA report identified 12 activities with potential military 
application--some, including a missile warhead design, that are only 
associated with producing a weapon. In the intervening years, Iran has 
consistently stonewalled the IAEA, denying it access to facilities, 
documentation, and people to investigate these past and perhaps still 
ongoing programs. While the JCPOA requires Iran to implement yet 
another IAEA roadmap for resolution of these issues, there is little 
reason to think the result will be any different than on multiple 
previous occasions when Teheran made similar commitments that were then 
ignored.
(3) Busting the Sanctions Regime
    A third flaw is the early relief of sanctions and the JCPOA ``snap-
back'' provisions--a clear triumph of hope over experience. It took 
over 10 years for sanctions to have a substantial effect on Iran's 
economy. Once sanctions are further loosened and most ended, it will be 
extraordinarily difficult to restore them. We will have given up our 
leverage and will be dependent on Russia, China, and others, including 
friends, with commercial interests in continuing to do business with 
Iran. There are procedures that that suggest sanctions will be 
reconstituted if violations occur, although perhaps as long as 85 days 
after the fact. But there are many detours that could delay imposition 
and, once the restrictions are lifted in 10-15 years, the option of 
restoring effective sanctions is for all practical purposes removed 
altogether.
(4) Failure to Prevent Breakout
    Also deeply flawed is the notion of extending the breakout time 
from 2 or 3 months to 12. Following the end of restrictions on Iran's 
enrichment program, we will be in a worse situation with an even more 
capable Iran, operating thousands of advanced centrifuges. If a 2-3 
month breakout time is unacceptable today, why is it acceptable in 10-
15 years?
    Moreover, unless Iran begins breakout at a declared facility under 
IAEA monitoring, how will we know when the clock begins? Despite 
assertions that we will know when Iran decides to go nuclear, our track 
record suggests the opposite, especially in a covert ``sneakout'' 
scenario. In the past, we were caught off guard at the timing of the 
first Soviet nuclear test, the first Chinese nuclear test, and the 
Indian and Pakistan nuclear tests. More recently, and more directly 
related, we debated for years whether North Korea was operating a 
uranium enrichment facility--a debate that ended only when Pyongyang 
announced that it had begun production of highly enriched uranium for 
weapons and invited an American nuclear scientist to visit the site.
    Finally, even if we did know when breakout began, what response can 
we realistically expect to occur? The likelihood, based on previous 
experience, is that months will go by until there is an internal U.S. 
consensus that a violation has taken place. More months will go by as 
the international community deliberates about how to respond. Consider 
two recent examples of how long these matters take: it took nearly 4 
years for the IAEA Board of Governors to refer the Iran nuclear issue 
to the U.N. Security Council and it took years for the U.S. Government 
to conclude that Russia had violated the INF Treaty, despite clear-cut 
evidence in both cases.
(5) Failure to Limit Ballistic Missiles
    One line of argument used to justify the shift in the U.S. position 
from including ballistic missiles to excluding them in the negotiations 
was that, if Iran's nuclear weapons capability is precluded by the 
terms of the agreement, the threat of a nuclear-tipped ballistic 
missile also goes away. However, in light of Iran's continuing efforts 
to develop longer range ballistic missiles, including an ICBM 
capability, one might turn the argument around: if the agreement 
effectively blocks Iran's path to nuclear weapons, why would Tehran 
continue to work on a costly weapons system that could never be 
effectively armed?
    Indeed, in February of this year, in the middle of the high stakes 
negotiations, the Iranians successfully orbited their fourth satellite. 
The technology that enables a space launch vehicle to launch a 
satellite is directly transferable to a long-range ballistic missile. 
Iran's willingness to move forward with the launch, given the timing, 
demonstrates its commitment to advancing its ICBM program, and its 
continued willingness to violate U.N. resolutions--in this case, U.N. 
Security Council Resolution 1929, which prohibits Iran from undertaking 
``any activity related to ballistic missiles capable of delivering 
nuclear weapons, including launches using ballistic missile 
technology.''
    In fact, there are a number of interrelated assumptions on which 
this argument--or, more accurately, this assertion--is based. It 
assumes that permitting Iran a large-scale enrichment capability is 
compatible with the goal of denying Iran the ability to produce 
weapons-grade fissile material; it assumes that the 12-month breakout 
time is meaningful; it assumes that the agreement will be effectively 
verifiable; and it assumes that the United States and the international 
community will respond to evidence of cheating before Iran can mate a 
nuclear weapon to a ballistic missile. None of these assumptions holds 
up under scrutiny. As a result, the threat to the U.S. homeland and to 
our NATO allies of an Iran armed with nuclear-tipped ballistic missiles 
will increase, not decrease, under the anticipated agreement. The 
threat will also increase to the Gulf Arabs leading to more 
proliferation in the broader Middle East and a greater risk of war.
                      four strategic consequences
(1) Increased Prospect for Nuclear and Ballistic Missile Proliferation
    For me personally, because I approach these issues from a 
nonproliferation perspective, one of the most significant negative 
consequences of the JCPOA is the increased likelihood of nuclear 
proliferation. As a result of Iran's greater capabilities and 
influence--reinforced by a growing skepticism among our allies about 
the U.S. resolve to defend their interests--other Gulf States may 
decide to acquire a nuclear threshold capability similar to Iran's. 
Saudi Arabia has already made clear that it will want what Iran is 
permitted. My sense is that these states, which may also include Turkey 
and Egypt and perhaps others, will want to ensure that they are not a 
step behind Iran--and the proliferation dynamic will be unleashed.
    Moreover, because the United States and other P5+1 members have 
agreed to exclude ballistic missiles in the negotiations, the message 
to other rogue states will be that we are not serious about imposing 
costs for missile proliferation. This could be a further incentive for 
states seeking weapons of mass destruction to acquire ballistic 
missiles as a means of delivery. For Iran, it could encourage even 
closer cooperation with North Korea on the transfer of missile 
technology and perhaps in nuclear weapons field.
(2) Weakening of the International Nonproliferation Regime
    Despite having been negotiated in the name of nonproliferation, the 
JCPOA undermines the international nonproliferation regime. The 
provisions relating to the timelines for suspect site inspections 
(permitting an initial delay of 24 days in place of a 24 hour notice) 
and the failure to firmly back the IAEA investigation of Iran's 
possible military activities undercut the authority of the Agency. Both 
may well be used by future proliferators as precedents to hide their 
activities and avoid penalties. American leadership of the 
international regime will also be weakened because of the abandonment 
of decades of U.S. policy discouraging the spread of enrichment and 
reprocessing activities. How can the United States credibly argue that 
Iran can have a large-scale enrichment capability but Saudi Arabia and 
other states, including allies such as South Korea, should not?
(3) A More Aggressive and Repressive Iran
    With tens of billions of dollars in immediate sanctions relief, and 
massive more amounts to follow, Iran's military and Revolutionary 
Guards will have access to more resources for more missiles, for more 
weapons across the spectrum, for continued support to the Assad regime 
in Syria, and for more terrorist activities. The end of the arms and 
ballistic missile embargoes in 5 and 8 years respectively, will only 
add to Iran's capabilities to intimidate its neighbors, enflame the 
Sunni-Shiite divisions, and support instability throughout the region.
    The notion that Iran's leaders will become more moderate as a 
result of the nuclear agreement has no basis in fact. Following the 
conclusion of the negotiations, Iran's Supreme Leader again denounced 
the United States to cheers of Death to America. In his speech, he made 
clear that Iran would continue to support its allies in Syria, Iraq, 
Yemen, and Lebanon, and reaffirmed his support to terrorists groups 
dedicated to the destruction of Israel.
    Iran's economy will benefit from the end of sanctions, with the 
likely result that the regime will be strengthened. This will enable it 
to continue, if not intensify, its brutal repression of all domestic 
opposition in the struggle for a free and democratic Iran. And with a 
nuclear weapons capability in waiting, Iran's leaders will be even more 
secure in persecuting their domestic opponents without fear of external 
intervention.
(4) Increased Prospect for Conflict
    The nuclear agreement will likely lead to a greater chance of 
conflict and war. With increased military capabilities, and a nuclear 
weapons option that it can exercise when necessary, Iran may become 
even more aggressive in the region in promoting its theocratic and 
national goals--undermining long-term American allies in a region of 
vital U.S. interests. With the U.S. pullout of Afghanistan and drawdown 
in Iraq, Iran is the prime candidate to become the preeminent power in 
the gulf and beyond. And given the lifting of the embargoes on 
conventional arms and ballistic missiles, Iran's military capabilities 
will grow all the more, creating even greater incentive for Iran's Arab 
neighbors to increase their arms. Media reports indicate that the Obama 
administration has already signaled that it will increase arms 
transfers to the region.
    A bad agreement--one that does not end Iran's nuclear weapons 
capability--may also compel Israel to do what it has sought to avoid 
for years--respond with force to eliminate an existential threat to its 
existence. Everyone wants a diplomatic resolution of the Iran nuclear 
threat, especially Israeli leaders. But an agreement that paves the way 
to a nuclear weapon--as Israel's Prime Minister characterized the 
JCPOA--may force Israel's hand.
                          four recommendations
    (1) Congress should vote on the agreement, and reject it if it is a 
bad agreement. As President Obama has stated, a bad agreement is worse 
than no agreement. The metrics to judge good from bad are straight 
forward:

   Is the agreement verifiable?
   Does the agreement deny Iran a nuclear weapons capability--
        the long-standing declared goal of the United States and the 
        international community?
   Does the agreement, following the expiration of the 
        constraints placed on Iran, prevent Teheran from building a 
        nuclear weapon in a short period of time?
   Does the agreement prevent or extend the breakout time in a 
        meaningful way?
   Is there a meaningful phased relief of sanctions and are 
        there guaranteed snap-back provisions?

    Because the answer in my assessment to each of these questions is 
``No,'' it is important for the Congress to reject the agreement. In 
its place, Congress should insist on a return to the negotiating table 
to seek an outcome that meets long-standing U.S. goals. This would send 
an important message that the Congress will not be boxed in by Security 
Council resolutions that circumvent the constitutional process and 
congressional oversight. It will also send an important message to 
Iran's leaders that their self-declared victory in the negotiations 
will not stand in the future.
    (2) Congress should, to the extent that it can with congressionally 
imposed sanctions, tie incremental relief to the fulfillment of Iran's 
commitments. The burden should rest on Iran to prove its compliance, 
not on the U.N. to prove its failure to comply.
    (3) Congress should make clear that any cheating--any failure by 
Iran to meet all of its obligations--will result in the immediate 
termination of the agreement. We know Iran will cheat. Unfortunately, 
it appears that the Obama administration may seek to explain away 
noncompliant behavior as it has reportedly done with Iran's failure to 
meet its obligations under the initial Joint Plan of Action. Here, the 
Congress should establish a ``Team B'' of outside nonpartisan experts 
with access to the highest levels of intelligence to assess Iran's 
compliance with all provisions of the agreement. Team B efforts have 
been welcomed in the past, for example in evaluating the Soviet nuclear 
threat and Soviet arms control compliance, and have been found to be of 
value by the intelligence community in providing different perspectives 
and approaches.
    (4) Congress should move forward with funding to expand missile 
defenses in the region and against the emerging Iranian nuclear armed 
ICBM-class missile threat. The latter might include reinstituting Phase 
Four of the European Phased Adaptive Approach that was cancelled as a 
concession to Moscow. At a minimum, it should include moving ahead with 
a third interceptor site on the U.S. East Coast. The threat is real and 
the first priority is protecting the American people from attack.
    Thank you for your consideration.

    The Chairman. Thank you, sir.
    Dr. Samore.

STATEMENT OF DR. GARY SAMORE, EXECUTIVE DIRECTOR FOR RESEARCH, 
HARVARD UNIVERSITY, BELFER CENTER FOR SCIENCE AND INTERNATIONAL 
                     AFFAIRS, CAMBRIDGE, MA

    Dr. Samore. Thank you, Chairman Corker and Ranking Member 
Cardin. I appreciate this opportunity to brief the committee on 
a new report which the Belfer Center has just produced this 
morning, and we have placed it at your table. I would like to 
request that it be put into the record.
    The Chairman. Without objection.

[Editor's note.--The Belfer Center report mentioned above was 
too voluminous to include in the printed hearing. It will be 
retained in the permanent record of the committee.]

    Dr. Samore. Thank you, sir.
    Now, this report was produced by the Belfer team of nuclear 
experts. The intent is to try to provide a comprehensive 
description of the agreement and to evaluate its strengths and 
weaknesses, including issues on which the Belfer team 
disagrees, most importantly, whether or not Congress should 
approve or reject this agreement.
    With respect to the agreement itself, we have three main 
conclusions.
    First, if the agreement is implemented, it will effectively 
prevent Iran from producing fissile material for nuclear 
weapons at its declared nuclear facilities for at least 10 to 
15 years. That assessment is based on both the physical limits 
on Iran's nuclear capacity at Arak and Fordow and Isfahan, as 
well as the inspection and monitoring regime at declared 
facilities, which will quickly detect any significant cheating 
or breakout.
    The reason for the 10-to-15-year range in our estimate is 
because the Belfer team disagreed on how to characterize the 
expansion of Iran's enrichment capacity in years 11 to 15 in 
the agreement. As you know, Iran is then allowed to begin 
replacing the IR-1 centrifuges with more advanced centrifuges, 
and the plan for that expansion and replacement is not public. 
So that leaves room for disagreement among the experts. Some of 
our experts thought that at year 15 breakout time would be 
about what it is today, a couple of months. Other experts 
thought that if the Iranians can make these more advanced 
centrifuges work properly, breakout time at year 15 could be 
down to a couple of weeks. And that is just an unknown and 
disagreement in our report.
    But all of our experts agreed that in any event Iran is 
very unlikely to take the risk of trying to break out at its 
declared facilities because that would be detected very quickly 
and there would be time for the United States and other 
countries to take action to prevent breakout from happening.
    So in other words, this agreement blocks Iran from 
producing fissile material for nuclear weapons for 10 to 15 
years at its declared facilities. That means that if Iran is 
going to produce nuclear weapons in the next 15 years, they 
will have to do it at secret facilities to produce fissile 
material, and this leads to the second major conclusion of the 
report.
    The verification and the compliance measures in this 
agreement, along with continuing United States and allied 
intelligence efforts, are likely to detect any Iranian effort 
to build secret facilities to produce fissile material. And of 
course, the agreement has provisions to reimpose U.N. sanctions 
in the event of a major violation.
    At the same time, the report concludes that intelligence 
and inspections under the JCPOA are less likely to deter or to 
detect incremental cheating or secret activities not involving 
nuclear material, such as certain areas of nuclear weapons 
research or centrifuge research. So you can never say with 
complete confidence that the secret pathway is cut off, but the 
agreement makes it more difficult for Iran to conceal efforts 
to build secret facilities to produce nuclear material and 
makes an international response in the form of sanctions more 
certain.
    The one area of verification that the Belfer contributors 
most disputed was the significance of the IAEA's investigation 
into Iran's previous military activities, so-called PMD. Some 
of the Belfer experts felt that full resolution of PMD was 
essential to establish a baseline for future monitoring of 
Iran's nuclear program, while others felt that the United 
States and U.S. allies already have sufficient information from 
intelligence so that we do not need to have full settlement of 
the PMD issue.
    The third point, and I think the one that is most difficult 
to assess and predict, is what happens after 15 years when the 
physical constraints on Iran's nuclear program and most of the 
special monitoring provisions expire. Supporters of the 
agreement think it will create conditions--it could create 
conditions to reduce Iran's incentives to develop nuclear 
weapons over time, while opponents think that it could 
legitimize Iran's nuclear weapons option. At that point, 15 
years from now Iran would be able, within a matter of years, to 
build a large enrichment facility, large enough to provide low-
enriched uranium fuel for its nuclear power program, and such a 
large-scale enrichment program could create more credible 
options for both nuclear breakout and for concealing secret 
facilities. Iran could even claim it needs to produce highly 
enriched uranium for civil purposes. As Secretary Moniz has 
testified before this committee, the United States could object 
if Iran takes steps that we consider to be inconsistent with a 
civil program, but whether we could rally international support 
at that point is very unclear. It is obviously hard to make 
predictions about things that could be happening 15 years from 
now.
    So that takes me to the final issue, the overall judgment 
about this agreement compared to alternatives. Obviously, the 
agreement is better than no deal because it constrains Iran's 
nuclear program and imposes additional monitoring. But just as 
obviously, the deal could be better. It could have tighter 
physical constraints. It could have stronger inspections. It 
could have longer duration. And on this issue, the Belfer team 
was deeply divided between those who thought we should accept 
the current deal with its known strengths and weaknesses or 
whether we should take the risk of rejecting this deal and 
attempt to try to negotiate a better deal. And frankly, we do 
not have an answer to that question, which is the fundamental 
question Congress faces, but we have at least tried to lay out 
the arguments to frame the debate.
    Thank you very much. I look forward to responding to your 
questions.
    [The prepared statement of Dr. Samore follows:]

                 Prepared Statement of Dr. Gary Samore

    Thank you, Mr. Chairman and Ranking Member.
    I appreciate this opportunity to brief the committee on a new 
report just published by the Belfer Center for Science and 
International Affairs on the Iran nuclear deal. With contributions from 
the Belfer Center's nuclear experts, the report is intended to provide 
a comprehensive description and balanced evaluation of Joint 
Comprehensive Plan of Action, including issues on which the Belfer team 
disagree--most importantly, whether or not Congress should approve the 
agreement.
    With respect to the agreement itself, we have three main 
conclusions.
    First, if the agreement is implemented, it will effectively prevent 
Iran from producing fissile material for nuclear weapons at its 
declared nuclear facilities for at least 10-15 years. This assessment 
is based on both the physical limits on fissile material production at 
declared facilities (such as Arak, Natanz, and Fordow) and the IAEA 
inspection and monitoring measures at declared facilities, which would 
quickly detect any significant cheating, diversion of nuclear material, 
or breakout.
    Reason for 10-15 year range is because Belfer experts disagreed on 
how to characterize Iran's enrichment capacity during years 11-15 of 
the agreement, when Iran is allowed to gradually replace its IR-1 
centrifuges at Natanz with limited numbers of IR-2m, IR-4, IR 6, and 
IR-8 centrifuges. Some contributors believe that breakout time at year 
15 will be about the same as it is today--a few months--while others 
think it could be shorted to a few weeks, but as you know, the details 
of the enrichment plan are not public. Nonetheless, the Belfer team 
agrees that Iran is unlikely to risk breakout at Natanz through at 
least year 15 because detection would be very swift and certain.
    In other words, the agreement blocks Iran's pathway to produce 
nuclear weapons for at least 10-15 years unless Iran can build secret 
facilities to produce fissile material--so-called sneakout option.
    This leads to our second major conclusion. The verification and 
compliance measures in the agreement--along with continuing U.S. and 
allied intelligence efforts--are likely to detect any Iranian attempt 
to build secret facilities to process nuclear materials and to reimpose 
U.N. sanctions if Iran is caught in a major violation. At the same 
time, the report concludes that intelligence and inspections under the 
JCPOA are less likely to deter or detect incremental cheating or secret 
activities not involving nuclear material, such as certain areas of 
nuclear weapons research. You can never say with complete confidence 
that the secret pathway is cut off, but the agreement makes it more 
difficult for Iran to conceal and makes international response more 
certain.
    The one area of verification that the Belfer contributors most 
disputed was the significance of the IAEA's investigation of Iran's 
past nuclear weapons program, so called Possible Military Dimensions or 
PMD. Some contributors felt that full resolution of PMD was essential 
to establish a baseline to monitor future activities, while others felt 
that the U.S. and allies already have sufficient information from 
intelligence.
    Third point--and I think the most difficult to assess--is what 
happens after 15 years, when the physical constraints on Iran's nuclear 
program and most of the special monitoring provisions expire? 
Supporters of the agreement, it could create conditions to reduce 
Iran's incentives to develop nuclear weapons, while opponents think it 
could legitimize Iran's nuclear weapons option. At that point, Iran 
would be able within a matter of years to build an enrichment facility 
large enough to provide low enriched uranium for its nuclear power 
program. Such a large scale enrichment program would create more 
credible options for both nuclear breakout and sneakout. Iran could 
even claim it needed to produce highly enriched uranium for civil 
purposes. As Secretary Moniz testified before this committee, the U.S. 
could object, but whether we could rally international support is 
unclear.
    So--that takes me to the final issues--overall judgment about the 
agreement compared to the available alternatives. Obviously, the 
agreement is better than no deal, in terms of constraining Iran's 
nuclear development and increasing monitoring. But just as obviously, 
the deal could be better--tighter physical restrictions, tougher 
inspections, and longer duration. On this, the Belfer team was deeply 
split between those who thought we should accept the current deal (with 
its known risks) or take the risk of rejecting this deal in hopes of 
negotiating a better deal. Frankly, we don't have a final answer, but 
we've tried to lay out the best arguments on both sides.
    Thank you, Mr. Chairman and Ranking Member. I'd be happy to answer 
your questions.

    The Chairman. Well, we thank you all. You are all very well 
respected and, obviously, if you listen to the testimony, that 
is what is going to make this decision a tough one for many. 
There are a lot of different views.
    I am not going to use most of my questioning time, but I am 
going to ask one question, make one point I guess to David 
Albright. You mentioned that we should not agree to the 
arrangements beyond 10 years, but you understand we have 
already agreed to that. Right?
    Mr. Albright. I am sorry.
    The Chairman. I do not know if you have seen all the 
documents that we have seen, but you understand we have already 
agreed to Iran's industrialization of their program beyond 10 
years. That is part of the agreement now.
    Mr. Albright. The way we have read it is that that is not 
an agreement in the sense that it does not object and prohibit 
it, but it is not approving it. And so the United States could 
turn around and say that it does not approve of it. And to be 
honest, I have heard from administration officials similar 
language.
    So I think it can be worked with, and basically argued that 
the U.S. position would be that if Iran builds a large 
enrichment program--I would say a semicommercial one--that has 
no need, is uneconomic, that that would be inconsistent with 
the agreement.
    The Chairman. I do not think there is anybody on this panel 
who would agree with you--up here. I mean, I think that most of 
us have read the documents down in the SCIF. I do not think 
there is anybody that does not believe that the United States 
has agreed to the industrialization of their nuclear program. 
Now, what they are going to do with it is something that people 
may disagree on, but I do not think there is any disagreement--
just for what it is worth--among all of the folks sitting up 
here that, in essence, we have agreed to the industrialization 
of their program.
    One of the areas that yesterday came up in our classified 
meeting--and I thought it was a very good meeting--is the 
procurement channel issue. I think most of us have thought, if 
you listen to Wendy Sherman and others, that we have got a 
really tight grip on the procurement channel. But I think what 
we realized yesterday is that that is not true, that the way 
the procurement channel works--we know that there are plenty of 
illicit exporters, we know that there are A.Q. Khan-type folks 
in China. We have had hearings to that effect that are shipping 
these goods to Iran and other places. The deal requires 
exporters to report that they are exporting illicit goods to 
Iran. There is no reporting on the other end. And I just find 
that to be a phenomenal gap in this. And to me, it creates 
tremendous opportunities for illicit issues to be dealt with. 
And if you look at the confidence levels of our intelligence 
community and their feelings about their ability to actually 
intercept that, I would just say that it gives me tremendous 
pause.
    I do not know if you want to add to that or take away.
    Mr. Albright. And we were involved in designing the model 
of the procurement channel last summer and working with the 
administration and other countries on what it should be. And I 
think it does fall short of what is needed. I mean, again, you 
never can get the ideal case, but there are some real issues 
that have to be compensated for if this deal goes forward and 
you mentioned some. The end use verification is inadequate. The 
IAEA does not have--it certainly does not have a mandate. I 
mean, it is going to have to seize one to try to exert itself 
to look for--in a sense to check the end use and to look for 
suspicious imports because you are worried both about covert 
activity, that it could be efforts to procure for a covert 
nuclear program, but it could also be an effort to stockpile so 
that these goods could be used in surging if they decide to 
renounce the deal.
    And so I think there is quite a bit of work, and I think 
some thought has to be put in to how do you compensate for 
that. And part of that is going to rely on the United States 
being able to assess much more.
    The Chairman. So we are good. I am going to move on and 
will interject as we go. Thank you very much and I look forward 
to working with all of you.
    Senator Cardin. Once again, thank you all for your 
testimony.
    So much of this depends upon the IAEA, and the Director 
General will be here tomorrow. It will be in a closed setting. 
So the public will not have an opportunity to hear it. But I 
would just ask you what questions should we be asking of the 
Director General? We are very concerned that they have the 
capacity and the expertise that they need. We are very 
concerned that they have the access, including intelligence 
information, in order to make these judgments. We are very 
concerned about the prior military dimension and whether they 
will be able to give us an accurate assessment of what happened 
previously. So if you were in our position, what questions 
should we be asking the Director General?
    Dr. Samore. Yes, sir. I mean, I think there are two 
important issues. The first is whether the IAEA has sufficient 
resources, expertise, equipment, and support in order to do its 
main job, which is to monitor the declared facilities. That is 
their bread and butter. The IAEA is never going to be capable 
of detecting secret facilities the same way that intelligence 
agencies are. So they are going to have to depend very heavily 
on support from the United States and other countries in order 
to carry out that part of the mission. But in terms of the 
declared facilities, that is where their real expertise is, and 
we want to be sure they have the competence to do that.
    The second issue, it seems to me, is really PMD. I mean, 
Amano has made a decision to reach an agreement with the 
Iranians on a list of steps which he expects them to take in 
order to resolve concerns about PMD and to allow the agency to 
issue a final report that will close out that issue. And I 
think it is worth asking him what he expects from the Iranians 
in terms of their cooperation. My guess is that we will not see 
full cooperation from Iran. They may allow technical exchanges 
and access to facilities and so forth, but I think it is very 
unlikely we will see Iran genuinely cooperate to acknowledge 
the weapons activities that were taking place----
    Senator Cardin. That is an issue I want to get back to.
    But, Mr. Albright, let me just get your assessment.
    Mr. Albright. Yes. A couple. One is--and you would not be 
the first to do that--to ask that the IAEA simply rule in 
December in their report that Iran had a nuclear weapons 
program and parts may have continued, that they make a positive 
judgment that is in line with most countries' assessments of 
what happened, and then to make a judgment whether Iran has 
cooperated by providing access.
    Senator Cardin. Do you think that we will be able to get 
adequate information to connect the dots? In the past, there 
has been concern as to how much we do know about their 
weaponization program and their military nuclear program. Do 
you think that the IAEA will have enough access to be able to 
make those assessments? And this leads somewhat to the road map 
and the annexes that we have not seen yet. They are not public. 
But what is your confidence level?
    Mr. Albright. Well, one is that their November 2011 report 
more or less said that the evidence that they have is that 
there was a bomb program in the past and parts may have 
continued. What they argue is that it is not their information. 
It is member state information. And I think the Director 
General should be pressed of why they cannot use member state 
information, why they need their own because frankly who 
expects them, even if they get access to Parchin or some of the 
other sites they have asked to get to, that suddenly they are 
going to find out new information about past efforts on Iranian 
nuclear weapons.
    Senator Cardin. So, Ambassador Joseph, let me ask you. How 
important is the PMD? How important is it for us to know what 
happened in the past for us to be able to judge what is going 
on in the future? And what is your confidence level that the 
IAEA will get to the truth?
    Ambassador Joseph. Sir, I think that is one of the most 
important questions before all of us in terms of assessing this 
agreement. I think it is absolutely vital that we understand 
how far along Iran was in terms of the PMD, the development of 
a nuclear weapons capability. And as the IAEA report of 
November 2011 points out, these activities could continue or at 
least some of these could continue to the present. So I think 
it is vital. If we do not understand how far along they are, 
there is really no way of assessing this baseline for breakout.
    Senator Cardin. And your confidence level of the IAEA 
getting to the truth?
    Ambassador Joseph. Well, my confidence level is very low. I 
mean, why--and this would be a question for Mr. Amano. Why is 
today any different than the past 4 years? Iran has been 
stonewalling on each of these activities for 4 years. Why does 
the IAEA think that they are going to have clarification and 
resolution by December of this year? There is just no reason 
for that optimism.
    Senator Cardin. Let me take you 10 to 15 years down the 
road, Dr. Samore. As far as we know, they have complied with 
the agreement. How confident are you that being a 
nonproliferation signer of an NPT and having committed to the 
advanced protocols--how confident are you that the IAEA will be 
able to determine in adequate time if Iran decides at that 
point to break out to a nuclear weapon?
    Dr. Samore. Well, if Iran has a very large-scale enrichment 
facility, then that would, at least in theory, give them the 
ability to break out very quickly perhaps before the IAEA could 
even alert the international community. Even more likely is 
that I think Iran would try to build secret enrichment 
facilities nested underneath or inside of a much larger program 
because they would have thousands of technicians and facilities 
for producing centrifuges and so forth, and they might try to 
divert some of that equipment and personnel to build secret 
facilities. I have always thought that was the much greater 
threat because breaking out from declared facilities is very 
risky.
    Senator Cardin. Of course, they are required to notify of 
other facilities, but they could violate that.
    Dr. Samore. Exactly.
    Senator Cardin. So are you saying basically that your 
confidence level at the declared sites is pretty high but 
outside of the declared sites, that IAEA absent direct 
information, intelligence information--that it would be very 
difficult for them to be able to track what is going on in 
Iran?
    Dr. Samore. I am saying after 15 years, our confidence 
level will have to decline. I mean, if Iran decides to build 
large-scale enrichment facilities, then we are going to have 
less confidence. That does not mean that we will not know. We 
might still be able to detect an effort by Iran to build secret 
facilities. In some respects, that is independent of the IAEA 
inspections. I mean, we and others have a national intelligence 
capability which is not fundamentally dependent on inspections. 
We uncovered both Natanz and Fordow without there being any 
special inspection mechanism in place. So I think that would 
continue.
    Senator Cardin. Mr. Albright.
    Mr. Albright. Just to clarify, if the program is large--
they are making 20 percent enriched uranium--they can do simple 
things to make it so the IAEA does not actually know what is 
going on for it could just be a matter of days or a few weeks. 
Yes, again, people will be suspicious, but they can just 
prevent access. They can turn off the cameras. They can do all 
kinds of things and in that time perhaps make enough weapon-
grade uranium for a couple nuclear weapons. And so that is why 
you worry about a large program.
    Senator Cardin. Ambassador Joseph, if I understand it, one 
of your major concerns is the time limits, that once those time 
limits evaporate, that there is not very much protection here 
for discovery?
    Ambassador Joseph. Yes, sir. That is correct. I agree with 
Dr. Samore. I think the most likely route for sneak-out is with 
secret facilities. And the agreement that is before you is 
particularly weak in terms of the provisions with regard to 
inspections at suspect sites.
    But I also would not rule out a breakout scenario at 
declared facilities. I think we will have high confidence that 
they are breaking out. So we will be able to detect that. But 
remember, North Korea broke out. North Korea kicked out the 
inspectors and began reprocessing plutonium. And what did we 
do? So the question then will become, well, how do we respond 
to a breakout if they chose that route, which is open to them? 
It is a political decision that they can make.
    Senator Cardin. Thank you.
    The Chairman. Before I turn to Senator Flake, on the PMD 
issue, I had a very good conversation with Secretary Kerry 
before we finalized those. And to me, the PMD piece was an 
indication to me of how vigilant we were actually going to be. 
And as I read the PMD agreement--and I do not think there is 
any dispute on this, and we can certainly talk to Mr. Amano 
tomorrow and will. But it does not matter whether Iran becomes 
clean or not, whether they give a D-minus report or an A-plus 
report. The only thing that is required for sanctions relief is 
that there be a conversation and that the IAEA issue a report. 
But it does not matter relative to whether they come clean or 
not. And to me it just signaled the P5+1's lack of desire to 
really make sure that this agreement was stringent. And that 
was what was so depressing to me when I saw the qualitative 
pieces of that, plus the anytime/anywhere inspections, plus the 
lifting of the conventional arms embargo, plus the lifting of 
the ballistic arms embargo, plus unbelievably lifting 
immediately the ballistic missile testing ban.
    But with that, Senator Flake.
    Senator Flake. Thank you, Mr. Chairman.
    Thank you for the testimony.
    Mr. Albright, you talked in your testimony about the need 
to pass legislation to clarify a lot of these aspects of the 
agreement. If this were a treaty, those would be called RUDs 
and we would be able to clarify exactly what is meant, our 
reservations, our understandings, declarations. We do not have 
that ability formally here, but what form should that 
legislation take and what would be the timing be in your view?
    Mr. Albright. Well, I think certainly our motivation is 
from arms control and ratification of arms control treaties. I 
mean, that is the model we are using. But we do not see 
anything that would ban Congress doing that in the case of an 
Executive agreement, particularly one of this importance.
    Now, the timing. I do not see a time limit on this. I do 
not see the 60-day clock affecting this. Again, I am not 
experienced enough to know whether it should be done in 
parallel to our resolution on a vote or a bill on a vote, 
should it be done sequentially. But I think certainly there is 
a need to do it long before implementation day because I also 
think it could have very positive pressure on the Iranians, 
some to deal with just what Senator Corker said. I mean, in my 
discussions with the administration, they claimed to me that 
Iran has to address the PMD issues, but I understand the 
skepticism and I share it. But Congress could in legislation 
require that to be addressed before U.S. sanctions come off. So 
I think the Congress has leverage and I think that it can make 
a much stronger deal if, let us say, Congress does vote to 
approve it.
    Senator Flake. There is one area where there seems to be 
conflict.
    Mr. Albright. Oh, I am sorry. Votes not to disprove it.
    Senator Flake. Thank you.
    There does seem to be disagreement or at least something 
that requires clarification that many of us have tried to 
address with the administration, and that has to do with the 
imposition of sanctions for nonnuclear activities. If Iran were 
to engage in conduct unbecoming, which would not be a break 
from the past, and we were to impose, say, sanctions on their 
central bank in response to this activity, not the nuclear 
activity, but this activity, the administration seems to say 
that all of those tools remain in our toolbox. But the 
agreement says otherwise, as I read it and as many of us read 
it.
    Mr. Samore, you are nodding your head. Can you speak to 
that? And is that something that could be clarified in some 
type of accompanying legislation or legislation passed after 
this is implemented?
    Dr. Samore. I think this is an area of disagreement in the 
agreement. We assert that we have the right to impose sanctions 
on Iranian individuals and entities for reasons other than 
nuclear proliferation activity, counterterrorism, human rights, 
and so forth, and that we will go ahead and do that as 
necessary. The Iranians assert that if we reimpose all the 
sanctions that we just lifted for nuclear reasons under the 
guise of some other pretext, they will consider that to be a 
violation of the agreement. And so I think in implementation, 
that will be one of the tensions. We will undoubtedly find 
reason to impose sanctions for other reasons, perhaps even on 
the same individuals or entities that we have actually 
dedesignated, and the Iranians will complain. They will say 
this is inconsistent with our understanding of the agreement. 
At some point, that may lead the agreement to collapse. But 
that is one of those disagreements that are structurally 
embedded in the agreement.
    Senator Flake. Does that behoove us to that disagreement or 
misunderstanding or whatever we want to call it now? Does it 
fall to us to try to clarify that?
    Dr. Samore. Well, Congress can certainly support what the 
administration asserts, which is that we are free to impose 
sanctions for other reasons.
    Senator Flake. And we should codify that in statute at 
least? Would that be useful in your view?
    Dr. Samore. I mean, you are the legislator. I do not know 
whether you do that in statute or sense of Congress, but it 
seems to me that is clearly what the administration claims. So 
Congress would simply be supporting what the administration's 
interpretation is. And I am sure the Majlis, when it is their 
turn to vote on the agreement, they will assert that any 
reimposition of sanctions is a violation of the agreement.
    Senator Flake. Turning to the period of time 10 years out 
and beyond, a lot of the restrictions are lifted. They can 
enrich uranium only to a certain percentage. They are subject 
to the NPT. What examples do we have elsewhere in the world 
where countries have become a nuclear threshold state and have 
remained there? And does this give us confidence or should it 
worry us about where we are going from here? Ambassador Joseph, 
do you want to address that first?
    Ambassador Joseph. Well, certainly North Korea went to the 
brink of being capable of acquiring nuclear weapons through its 
plutonium reactor in Yongbyon and the reprocessing of the spent 
fuel to provide for the fissile material for weapons. It also, 
of course, embarked on the enriched uranium route, again 
covertly. When North Korea decided that it wanted to 
demonstrate a nuclear weapon with a nuclear test, it did so. It 
did so at the time of its choosing. The same is true with 
regard to India and Pakistan.
    And I would point out that with regard to North Korea, with 
regard to India, with regard to Pakistan, we did not have good 
intelligence that gave us an indication that they were going to 
go from having this capability to actually demonstrating this 
capability and weaponization.
    So I think there are a number of cases in which you find 
countries going to that level and then crossing the line.
    There are other countries that, of course, could become 
nuclear weapons states in a very short period of time because 
they possess in some cases lots of plutonium, weapons-grade 
plutonium, and the capability for fashioning a nuclear device.
    Senator Flake. Dr. Samore.
    Dr. Samore. So, you know, I agree with Bob. There are 
plenty of countries that have--not plenty--but there are some 
countries that have advanced civil nuclear programs that 
involve production and possession of fissile material. I mean, 
Japan is the best example.
    But it is really a question of the country's motivation. I 
mean, we have some confidence that the Japanese are not likely 
to pursue nuclear weapons because they have a relatively 
transparent democratic system. They are treaty allies with us, 
so we believe that we are able to address their security 
concerns. None of that applies with Iran. So the concern is 
that if Iran had the same kind of threshold capacity that Japan 
has, there would be fewer political constraints on them 
actually producing nuclear weapons.
    Senator Flake. Thank you.
    The Chairman. Senator Menendez.
    Senator Menendez. Thank you, Mr. Chairman.
    Thank you all for your testimony.
    Dr. Samore, let me ask you. If in fact the administration 
and the P5+1 had not been able to strike an agreement with 
Iran, would we be at war with Iran right now?
    Dr. Samore. I do not think so. I think the Iranians have 
been very, very careful in pursuing their nuclear program in a 
way that they are hoping will avoid military action. If you 
look at the last decade of their program when they first broke 
the agreement with the Europeans in 2005, they have proceeded 
in a very cautious way. And, of course, both President Bush and 
President Obama have decided not to use military force as long 
as the Iranian program was proceeding gradually.
    Senator Menendez. So if, in fact, the Congress felt that 
this deal did not rise to the sufficient level for the national 
interests and security of the United States and rejected it, it 
would not necessarily mean we would be at war with Iran.
    Dr. Samore. I agree. It does not necessarily mean we would 
be at war with Iran. I think they would resume their nuclear 
program, but they would continue to be cautious about avoiding 
things that could trigger a military strike.
    Senator Menendez. Ambassador Joseph, you already said that. 
Is that basically your view?
    Ambassador Joseph. Yes, Senator, it is. I do not believe 
Iran wants a conventional war with the United States. The 
problem with this agreement is that it will shift the balance 
of power toward Iran. It will make Iran more capable and, in my 
view, more aggressive externally and more repressive 
domestically.
    Senator Menendez. So we have had three witnesses, two who 
support the agreement, before the committee, one who opposes 
it, and all of them have said it is not a choice between this 
and war, because I want to get that over with. I find that 
insulting to be perfectly honest with you.
    Mr. Albright, you are a physicist. Right?
    Mr. Albright. Yes.
    Senator Menendez. You have been a former weapons inspector 
as well. Is that correct?
    Mr. Albright. Yes.
    Senator Menendez. So in May of this year, you wrote a 
commentary with another colleague saying making Iran come clean 
about its nukes. And in it you said, ``a prerequisite for any 
final agreement is for Iran to address nuclear weapons 
questions raised by inspectors of the International Atomic 
Energy Agency. If Iran is able to successfully evade questions 
about a weapons program now, when biting sanctions on oil 
exports and financial transactions are in place, why would it 
address them later when sanctions are lifted?''
    You went on to say, ``it is critical to know, whether the 
Islamic Republic had a nuclear weapons program in the past, how 
far the work on warheads advanced and whether it continues. 
Without clear answers to these questions, outsiders will be 
unable to determine how fast the Iranian regime could construct 
either a crude nuclear test device or a deliverable weapon if 
it chose to renege on its agreement.''
    You also went on to say, ``the discussions have focused 
exclusively . . .''--this is before the agreement--`` . . . on 
uranium enrichment and plutonium production capabilities. This 
is a mistake. Yes, Iran's ability to produce fissile material 
is of crucial importance, but the world would not be concerned 
if Tehran had never conducted activities aimed at building a 
nuclear weapon.''
    And a final point that I want to point out in your 
commentary because then I want to ask you a question or two 
about it. You say, ``if Iran can get away with these things, it 
will have defeated a central tenet of IAEA inspections: the 
need to determine both the accuracy and completeness of a 
state's nuclear declaration. Other countries contemplating the 
clandestine development of nuclear weapons will certainly watch 
Tehran closely.''
    Has anything changed in your views from the commentaries 
you wrote back in May?
    Mr. Albright. Nom, no, I think I may state it differently. 
I mean, I think one of the issues of risk is the IAEA 
credibility. I mean, it is the verification entity, and in a 
sense if Iran gets away with it on PMD, then the IAEA's 
credibility is damaged.
    Senator Menendez. So this is not simply about getting 
culpability from Iran.
    Mr. Albright. No, not at all.
    Senator Menendez. Because the world largely believes it is 
culpable. Otherwise, we would not have slapped U.N. sanctions 
and a whole host of other things. The issue is to determine, as 
best as we can, from both access to the site, its inspectors, 
documents, and other things to determine how far along in the 
weaponization they got.
    Mr. Albright. That is right.
    Senator Menendez. Now, let me ask you something. I was a 
little stunned--and of course, you cautioned that it is not a 
final assessment, but when you said preliminary assessments--
and I am going to paraphrase. Correct me if I am wrong. That 
the breakout time--that the agreement does not seem to 
accomplish a 1-year breakout--that it may be between 6 and 7 
months. At what point in time will you be able to, with 
certainty, since you cautioned that it is a preliminary 
estimate, be able to make that determination?
    Mr. Albright. Well, we are working on it.
    Senator Menendez. Do you think it will be before September 
17?
    Mr. Albright. Definitely. And we would like to get an 
administration response. I mean, we asked them last week for a 
response on this concern. I mean, we did not give them the 
number, but it is in the testimony. We have a difference with 
the administration sometimes on the breakout estimates in the 
sense that they often have taken a position that if Iran has 
not done it, then it will not do it. I do not want to go into 
the technical details of this in the breakout estimates.
    One of the questions I have is whether the administration 
is assuming that since Iran has not enriched in the IR-2ms at 
the fuel enrichment plant in the sense of there is 1,000 
deployed and they have not enriched, is it that Iran will not 
choose to deploy those IR-2ms if they did break out, where in 
our assessment we are looking at it, well, they are their best 
machines in terms of output and they have been testing one 
cascade of them for several years at the pilot plant, that they 
would then deploy those first. And what we found in the 
calculation last week essentially was that has a much bigger 
impact than I think we anticipated 3 weeks ago.
    Senator Menendez. And that would be concerning to me 
because if I already am a little concerned that what we bought 
here was a very expensive alarm system where we have added 9 
months to the 3 months that we have and some other elements, 
but have not largely gotten significant parts of their 
infrastructure to be dismantled--I am not suggesting all of it 
would be dismantled, though I would like to see that. But if it 
is 6 or 7 months and you have to presume every possible 
option--right--because you are, in part, dealing on hope here, 
though ``hope'' I think is a bad national security strategy. 
Six or seven months--that is not going to be helpful if they 
decide to break out because by the time we reimpose sanctions 
or snap back--and that would be my final question--it would be 
meaningful. The next President of the United States, depending 
upon when that happens, will really only have one choice: to 
accept Iran as a nuclear weapons state or to strike--to have a 
military strike because sanctions will be in effect.
    So let me ask the last question. Ambassador Joseph, I have 
been trying to get the administration--Senator Flake has been 
very focused on non-nuclear-related sanctions. I am concerned 
that if you are going to snap back to something, to the extent 
that that is still a significant deterrent, you have to snap 
back to, for example, the congressionally mandated sanctions 
that I think have largely been viewed as a key driver to 
bringing Iran to the table. They expire next year. If, in fact, 
you do not reauthorize them, then I am not quite sure what you 
are snapping back to. As a deterrent, is it not important to 
have those sanctions reauthorized and sooner rather than later?
    Ambassador Joseph. Sir, I think it is very important. Iran 
needs to know that there are consequences if it violates the 
agreement. And I am very concerned that we will be in a 
situation where, if we reimpose sanctions, it will mean the end 
of this agreement. I just think that we have, for all practical 
purposes, busted the sanctions regime and given up our 
leverage. To the degree that we can reestablish that, I would 
be 100 percent in favor, but it is going to be very tough. But 
that is the situation we are in today.
    Senator Menendez. My time has expired. I see that Dr. 
Samore wants to say something.
    The Chairman. Go ahead.
    Dr. Samore. Could I? You know, just very quickly, Senator, 
I do not think reimposition of sanctions is an effective 
response to breakout. I think the only effective response to 
breakout is military force. I mean, if the Iranians have 
decided to run the risk of openly dashing for a nuclear weapon, 
I do not think sanctions are going to deter them or stop them.
    Senator Menendez. So it seems to me that if Iran makes a 
political decision to move forward because it believes it is 
the preservation of the regime, the revolution, or its place in 
the region, then ultimately, if that is a view that is one that 
would prevail, then we are just kicking the ball down the road. 
But we will have a stronger resurgent Iran with more money and 
greater defense capabilities than it has today.
    Thank you, Mr. Chairman.
    The Chairman. Senator Isakson.
    Senator Isakson. Thank you, Mr. Chairman.
    I do not know who to direct this to so I will direct it to 
all three of you and you can volunteer who takes it first.
    We all know that Iran is a pretty big player in state 
sponsorship of cyber espionage. We also know the IAEA is trying 
to comfort us that its capabilities are remote in terms of 
monitoring the Iranians. If they are remote, they are cyber-
based. If they are cyber-based and Iran is a major player in 
cyber espionage, do you think the IAEA is capable of defending 
itself from being penetrated by the Iranians during the course 
of this agreement?
    Mr. Albright. I can say one thing. I am not sure the IAEA 
is safe from being penetrated by any nation. So I think you 
have to factor that in. And so if you look at the particular 
issue you are raising on what could be remote monitoring--and 
again, at declared sites where you would have video 
surveillance of certain locations--you will have to work with 
trusted member states on proper encryption. You also have to go 
there and check. The IAEA will have to decide how often does it 
have to go to assure itself that the system cannot be tampered 
with.
    Senator Isakson. No other volunteers?
    Dr. Samore. Senator, it is a great question. I wish I could 
answer it. I think that is a good thing to point out to Amano 
because I think as David said----
    Senator Isakson. I can do that tomorrow. This was a warm-
up.
    Dr. Samore. No, no. I think it is a great question. I mean, 
the IAEA has their own computer experts and department, but I 
am sure that they could benefit from assistance in terms of 
developing encryption.
    Senator Isakson. Well, given the study that you have done--
and we appreciate you providing us with the Belfer group 
study--do you think a detected cyber espionage breach by the 
Iranians would be a material breach in the agreement?
    Dr. Samore. Yes. I think anything that interferes with the 
monitoring of the IAEA, whether it is physically denying access 
or denying electronic access, would be a violation of the 
agreement. Absolutely.
    Senator Isakson. Dr. Joseph, go ahead. Yes.
    Ambassador Joseph. I was just going to add another thought, 
and that is, we all know that Iran is a master of denial and 
deception. I believe that they are very capable in the cyber 
area. It may be that the IAEA will not know when they are 
penetrated. They will not even know that because of the 
capability that Iran has in that area.
    Senator Isakson. Which is why the comfort they try to give 
us that they have the remote capability lessens in its 
importance when you worry about the inspection regimen in the 
agreement otherwise.
    Dr. Albright.
    Mr. Albright. I think on the remote, you can check that 
because in the end it is save resources. They could send 
someone who just lives there. But it is not a very wise use of 
resources, just like the daily inspections now are particularly 
a wise use of resources, although they may look good 
politically. So I think on that particular issue, you can deal 
with it. The broader issue brought up by Ambassador Joseph is 
more profound. I mean, we are going to have to, from a U.S. 
point of view, understand that the IAEA is penetrated and what 
does that mean. And again, I do not know how you ask Director 
General Amano about that, but I think we have to anticipate 
that Iran has penetrated the IAEA.
    Senator Isakson. I think it is an appropriate question to 
ask Mr. Amano.
    Mr. Albright. Yes.
    Senator Isakson. Dr. Joseph, I appreciate your answer--all 
of your answers really--to Senator Menendez on the false choice 
of this agreement or war. I thought all your responses were 
good. And I do think it is a false choice.
    In your response, Ambassador Joseph, you made the following 
statement. You said none of the assertions really against this 
agreement hold up about this being an agreement or war, and our 
best lesson is the lesson we learned in Libya. Would you 
expound on what lesson was learned in Libya?
    Ambassador Joseph. Senator, I had the privilege of leading 
the negotiations with Libya on Libya's nuclear program in 2003. 
In those negotiations, which were conducted in secret, we 
insisted on anywhere/anytime access, and they provided that. 
When we said we wanted to go to a facility, they took us there. 
In fact, they took us to undeclared facilities that we did not 
even know about because the Libyans had made the strategic 
decision to give up the program. And in terms of the 
resolution, as I mentioned, we brought the nuclear program of 
Libya back to the United States, along with its longer range 
missiles.
    Now, I think we did that because we approached this with a 
strategy, a strategy that used economic sanctions, a strategy 
that used intelligence very skillfully--in fact, I think this 
is first and foremost an intelligence success story--and a 
strategy that had at its core a credible, in the minds of the 
Libyans, a credible option for the use of force. We did not 
differentiate between diplomacy and the use of force or 
diplomacy and economic sanctions. The key is to have a 
comprehensive approach that brings all of these tools together 
to achieve the outcome. And that is the furthest thing that we 
have done in our negotiations with Iran. We have turned this on 
its head.
    Senator Isakson. I recognize that Iran is not Libya and 
vice versa, but your implication in your answer was that if we 
rejected this deal in a resolution of disapproval, at least you 
implied to me you think the Iranians would come back to the 
table?
    Ambassador Joseph. It is not a certainty, but I think the 
damage that was being done to the Iranian economy brought them 
to the table in the first place, and if we start to reimpose 
sanctions, U.S. sanctions, secondary sanctions particularly in 
the financial area--this is a brittle regime. This is a regime 
that is at war with its own people. The reason they came back 
to the table was they did not want to have their economy fuel 
even more domestic instability. This is a regime that 
understands its own vulnerabilities, and I think for that 
reason, it will come back to the table. They will bitch. They 
will moan, as will others, if we say no to this agreement. But 
I think ultimately they will need to come back. They are the 
ones that need an agreement. We should insist on an agreement 
that achieves our national security interests, not those of 
Iran.
    Senator Isakson. Thanks to all of you. Did you want to say 
something, Dr. Albright?
    Thank you, Mr. Chairman.
    The Chairman. Thank you.
    Senator Udall.
    Senator Udall. Thank you, Mr. Chairman.
    I really appreciate the testimony of the witnesses here 
today.
    Dr. Samore, I believe Ambassador Burns was part of your 
group. You talked about the group that put together our Iran 
nuclear deal definitive guide. We have been looking forward to 
that. So that is good to have. He did very well last week, and 
I want to just remind everybody about a couple of things he 
said and then ask you some questions on that.
    One of his points was other than attempting to disapprove 
this along party lines, he said let us work with the President 
to strengthen America's position in the Middle East, move 
forward with a nuclear deal, push back against Iranian power in 
the region. A Congress that sought greater unity with President 
Obama would help to strengthen our country for the struggles 
that are inevitably ahead with Iran in the years to come.
    Let us assume--they had a lot of debate here about whether 
we are going to move forward with this agreement or not. I 
personally believe we are going to have this agreement. We are 
going to move forward. So let us assume that. What ideas do you 
have to strengthen the President's hand as he attempts to 
enforce this agreement? As we move forward, what are the things 
that we should be looking at in terms of filling the holes and 
trying to do everything we can to make this a stronger 
agreement as we move down the line? Because as anybody knows, 
an agreement is a living object and a living presence and it 
moves along and you work through it. It is not something that 
is just a matter of concrete. And you have some very powerful 
parties that are a party to it.
    Please, go ahead, Dr. Samore.
    Dr. Samore. Thank you, sir.
    If you accept the argument that this deal at least buys 15 
years in terms of delaying Iran's nuclear capacity, I think the 
key question for us is how do we take advantage of those 15 
years both to contain Iranian aggression and influence in the 
region and to try to promote political change because at the 
end of the day, the only way to really resolve the nuclear 
issue is to have a government in Iran that has decided they do 
not want nuclear weapons. I do not think we have that now. That 
is why I am skeptical about the likelihood of this agreement 
surviving 15 years. But if it does, if we do have some time, 
the important thing is our policy in the region, our policy 
toward Iran, how we coordinate with our allies and our partners 
in the region after this agreement has been implemented.
    And I think that really falls primarily on the next 
administration. I mean, I think for President Obama, 
implementation of the agreement will suck up a lot of energy 
and time. We know that the Iranians have to take a long list of 
nuclear steps before sanctions are relieved. I think there are 
bound to be compliance issues early on, especially on 
procurement and other areas. So I think really it is the next 
administration. Assuming that this agreement is implemented and 
does not collapse in its infancy, the next administration is 
going to have to focus on a broader strategy toward Iraq, 
Syria, Yemen, and so forth and how that relates to our broader 
efforts to contain Iran and to promote political change.
    Senator Udall. One of the things you talked about was this 
regime and the opposition to it. But the society as a whole is 
a very Western looking society. Is it not? You are talking 
about the regime, but are there not some very hopeful things 
there in terms of where they are headed that we could take 
advantage of?
    Dr. Samore. You know, it is a very divided society, and I 
think there certainly are elements, younger, Western educated 
elements that would probably support the kinds of political 
change and evolution we would like to see. There is also a very 
strong faction of hardliners. And I think it is very difficult 
for us to predict how Iran will evolve as a political system 
over 10 to 15 years and frankly how this agreement will affect 
that. And one of the issues that we debated in this report 
between opponents and supporters is what that impact would be. 
And I frankly have come to the conclusion that we are just not 
smart enough to predict a decade out what the consequences----
    Senator Udall. And that is very important.
    Let me just weigh in, as Senator Isakson and others have, 
on this war or no war issue. I think that is really a side 
issue that can be argued out. I think the critical issue here 
is with the parties that were involved. I mean, we had the 
P5+1. We had the Security Council. We had very, very smart 
countries with good nuclear scientists looking at this and 
pushing to get the best deal possible. So what makes us think 
when we walk away from the deal and the other countries--none 
of them are going to disapprove it. They want the deal to go 
forward. What makes us think going alone, we can get a better 
deal than this?
    Dr. Samore. So my best guess is that if we reject the 
agreement, it will lead to an erosion of the sanctions regime, 
but not a collapse because I do not think at the end of the day 
the Europeans would be prepared to go ahead with this agreement 
without us. But I think their enthusiasm for sanctions and for 
intensifying sanctions is not going to be very apparent, and I 
do worry about the Russians and the Chinese breaking ranks. So 
I think in the near term, there would be a weakening of the 
sanctions regime, and I think the Iranians would take advantage 
of us walking away from the deal to resume their nuclear 
activities in a cautious way, as I said to Senator Menendez. I 
do not think they will race for a bomb. So at least in near 
term I think we will have a situation where the sanctions are 
weaker and the Iranians are advancing their nuclear program.
    Now, maybe that ultimately leads back to a negotiation. It 
could very well. But I am not sure that we will be in a 
stronger position at that point to force the Iranians to make 
fundamental concessions that they were not prepared to make in 
this negotiation. And I think that is the risk of walking away 
is that, yes, we may have another negotiation but it may not 
turn out with a better deal or fundamentally better deal.
    Senator Udall. Please, go ahead, Dr. Albright.
    Mr. Albright. One thing I think you have to remember. The 
United States led these negotiations. I mean, I have spent all 
summer in Europe and I have spent a lot of time discussing this 
with different negotiating teams. I think they had to accept 
things, in many cases, duration. I do not think there is 
universal support for a 24-day access provision. I mean, if you 
think about the IAEA sanctified 24-hour access, it was a huge 
negotiation early in the mid-1990s to say, look, you want to 
know about undeclared activities. Twenty-four-hour access is 
the gold standard. So you can imagine some countries did not 
like the 24 days. So I think you also have to keep that in 
mind. I tend to agree with Gary, but I think on that question, 
the United States is the leader of this, and if it went back 
and said, look, we have to do something differently, I think 
several of these partners are going to go along, and they may 
even get behind some of these strengthening efforts.
    Senator Udall. Thank you, Mr. Chairman. I went over my 
time. I apologize.
    The Chairman. Very good.
    Senator Perdue.
    Senator Perdue. Thank you, Mr. Chairman.
    And thank you to the witnesses for your objectivity today. 
This is obviously terribly important.
    Dr. Samore, the objective here on the Iranian side was to 
have a civil nuclear program. Why was it important in their 
minds to enrich, in your mind?
    Dr. Samore. Well, first of all, I do not think that is the 
objective of the Iranian nuclear program. I think the objective 
of the program is to create nuclear weapons or at least an 
option to produce nuclear weapons.
    Senator Perdue. So that was a false start to begin with.
    Dr. Samore. Correct.
    Senator Perdue. So then our position in the negotiation was 
to preclude them from becoming a nuclear weapon state forever. 
Because this sunsets, I think we have two problems with this 
deal. Number one, we allow them to enrich, and we gave that 
away right up front.
    Mr. Ambassador, I have a question and let me lead into it 
here. You mentioned in your comment something that sparked a 
nerve here and I want to get to it. But it looks to me like--I 
have read this document. This document obviously does not 
preclude Iran from becoming a nuclear weapons state at some 
point in time. Even Secretary Kerry last week said, you know, 
look, they can break out after 10 or 13 years, but we will know 
it. My question is, so what? You mentioned North Korea had the 
same position. They broke out. What did we do? The 
administration says, yes, but we are no worse off in 10 years 
than we are today. So why not give it a shot? Well, I disagree 
with that logic. In 10 years, Iran will be much stronger than 
today.
    The question I have for you involves two fundamental 
problems with the deal, the fact that we are allowing them to 
enrich creates all this uproar about inspections, and the 
second is we sunsetted it in a very short period of time.
    So my question, Mr. Ambassador, having been through this--
and we have two great examples in recent history, North Korea 
and Libya--are we better off today to take our chances even if 
we have to go it alone with our sanctions, of which by the way 
I am not afraid. I am a business guy and I know how sanctions 
work. They go at companies, not countries. I am quite confident 
that that will not break down entirely even if we had to go it 
alone. But are we better off today saying ``no'' to this deal, 
holding out for no enrichment, holding out for longer sunsets 
that will, in fact, preclude them from becoming a nuclear 
weapons state, or is it better to take a chance and run the 10-
year clock and take our best chances?
    Ambassador Joseph. Thank you, Senator. I think everyone has 
agreed, or at least they have used the talking point that no 
agreement is better than a bad agreement. This is a bad 
agreement.
    I think you are exactly right. Iran in 10 years will be 
stronger. Iran has a nuclear option today. It will have it for 
the next 10 years, the next 15 years, and beyond that. If Iran 
decides to go for a nuclear weapon, it can have a nuclear 
weapon in a short period of time. Maybe we can push this off a 
few months. Yes, it is better that Iran has a smaller stockpile 
of enriched uranium to 3.67 percent, better than a larger 
stockpile, better to have 5,000 centrifuges running than 20,000 
centrifuges. Those are all good things. But we cannot forget 
the nuclear option is there for Iran if it decides to go down 
that path.
    And as for containment, that is a great concept. It is a 
great concept. Well, we are going to start after this agreement 
to contain Iran. Okay. Well, let me say that to me there is a 
real disconnect there. We are going to give Iran access not 
just to the $150 billion signing bonus, but the hundreds of 
billions of dollars over the course of that 10 or 15 years. 
What are they going to do with this? Well, part of it will, I 
am sure, improve their economy. But the Supreme Leader has made 
very clear that he is going to continue to support Assad in 
Syria. He is going to continue to support terrorism through 
Hezbollah and other sources. They are going to continue to 
support insurgencies within the region and fuel the Shia-Sunni 
conflict. Iran is a bad actor. We are giving them the 
capability and, by the way, they retain a nuclear option under 
this agreement. So, yes, we can talk about containment, but we 
are feeding the beast here.
    Senator Perdue. Thank you.
    Yesterday we saw the Iranian Ambassador to the IAEA make a 
comment. We have seen various saber rattling by the Foreign 
Minister, by the advisor to the Supreme Leader. On July 21, 
Defense Minister Brigadier General Hossein--I listen to guys 
with stars on their shoulders, said ``We will by no means allow 
any foreign authority access to our military and security 
secret.'' I do not know how to even be more direct than that.
    Mr. Albright you have been involved in this before. How do 
you react to these comments that obviously Iran is now saber 
rattling around what they will not do?
    They also said that they will not allow us to have access 
to these side agreements with the IAEA. I have a real problem 
with that, particularly with some things that we have learned 
in the classified setting in the last 24 hours. Could you 
respond to that issue?
    Mr. Albright. Yes. I do not think you can have an agreement 
if Iran sticks to a position of no access to military sites. 
You cannot distinguish between a military and civilian site 
when you are talking about nuclear matters. And the IAEA never 
has. So I think that is a given.
    Now, on the secrecy issue, Iran objects regularly. I mean, 
they have complained about my organization because we publish 
what are essentially unclassified, to be publicly released 
safeguards reports by the IAEA. We publish them early for 
various reasons. So Iran takes a very strict position on 
secrecy. The IAEA does not have to particularly because of the 
U.N. Security Council resolutions on this, the international 
interests. They can actually do quite a bit legitimately to 
reveal things. I think they can reveal this deal that they have 
with Iran or at least aspects of it. I do not think they are 
bound in any way by safeguards confidentiality to say, no, no 
one can see what is in here because Iran is a special case and 
there is a lot of other political and institutional forces at 
play.
    And the background is Iran objects to everything. Every 3 
months, it files what is essentially an obnoxious report 
complaining about the IAEA giving up information about its 
nuclear program. And I want to emphasize ``obnoxious report.'' 
And I do not say that easily. And they have certainly 
complained about us in that and many others. So I think they 
have to be pushed back on this very hard and IAEA should be 
revealing much more rather than less.
    Senator Perdue. We had that advice last week by some 
experts that said, look, if you go forward with this deal, you 
have got to enforce it in a very hard manner. So you are 
echoing that right now.
    Dr. Samore, do you have one last comment?
    Dr. Samore. Yes. On the question of access to military 
sites, if you look at the agreement, there is no exclusion for 
military sites, although the agreement recognizes there needs 
to be managed access to protect certain kinds of secrets. And 
as you said, some senior Iranian generals are saying we will 
never allow access to military sites. Who is right? We will 
find out the first time the IAEA requests access to a military 
site. If the Iranians reject it, the agreement will collapse.
    Senator Perdue. Thank you, Mr. Chairman.
    The Chairman. If we could, before we go to Senator Murphy, 
is it normal that especially--and this is not a normal 
situation. I got it. Iran is not a normal country. But should 
we have access to the IAEA agreement with Iran? I mean, that is 
a question we are going to be taking up tomorrow. I think you 
said, yes, Mr. Albright?
    Mr. Albright. At least parts of it. I mean, to get a real 
honest rendition of what is in it that is relevant to the 
agreement.
    The Chairman. And do the other two of you have any thoughts 
on that before we have that meeting tomorrow?
    Ambassador Joseph. Yes, Senator, I think we certainly 
should have access, otherwise how do we understand how to 
assess what we know about the PMD issues and what we will know 
about the inspection at Parchin where the IAEA has suspected 
illicit activities associated with the militarization aspect of 
the Iranian nuclear program.
    The Chairman. Dr. Samore.
    Dr. Samore. I think Congress should have access to the 
substance of that agreement, not the agreements themselves, and 
I am hoping that Amano will--because he is the one who really 
has to brief you. I mean, he is the one who controls and 
possesses that information. So I am hoping that in your 
briefing with him he will provide some additional details.
    The Chairman. Thank you all.
    Senator Murphy.
    Senator Murphy. Thank you, Mr. Chairman.
    I think underlying this whole deal are two premises that I 
think I heard both Ambassador Joseph and Dr. Samore articulate. 
One is that if Iran decides to rush toward a nuclear weapon, 
there is no agreement that can stop them. Ultimately they have 
a nuclear program that is advanced enough, thus, that if they 
were to make that decision, they can get to a nuclear weapon in 
a relatively short amount of time. And thus, as Dr. Samore 
says, really the only effective deterrent in the grand scheme 
of things is a military option.
    And so that is what I read this agreement as being about, 
is about trying to lengthen the amount of time that we would 
have to detect that breakout, increase the likelihood that we 
would figure it out, and preserve an international coalition 
such that we could effectively wipe out their nuclear 
capability, should they make the decision to get a weapon.
    So I think you concede at the outset that there is never 
going to be an agreement that is going be able to stop Iran 
from ultimately making the decision and starting along that 
path. You are only trying to make your military option more 
likely and a more lethal as part of this.
    And so you sort of have to make a decision at the outset 
whether or not you want an agreement or you do not, whether you 
are just confident to know that we continue to have a military 
deterrent, that it is likely, as you have all said, to have an 
effect on the Iranians or whether we want an agreement that 
hopefully makes that military option more likely.
    And so I want to sort of get back to this question of 
getting a better agreement, and I think, Ambassador Joseph, you 
were maybe jumping to answer this question. So I would love to 
have your thoughts on this because I think that is what a lot 
of us are having trouble squaring. If you reject this deal, 
your standard of proof for how you think events are going to 
play out is actually pretty high, is you have got to make a 
case not only that a set of events can play out that gets Iran 
back to the table, but you also have to play out a scenario in 
which the leverage is changed to an extent that they will agree 
to a deal that is tougher than the one they agreed to.
    And that is where I have a hard time figuring out how that 
scenario plays out. I can get them back to the table, but I 
cannot figure out how they come back to the table in a weaker 
position than they are today because almost everyone that has 
testified before this committee says that while the sanctions 
may not blow up, they are going to fray. While they will not 
race to a bomb, they are going to continue to build more 
centrifuges. While the United States' legitimacy around the 
world will not be catastrophically damaged, it will be eroded. 
And so under those circumstances, it is hard for me to 
understand how we ultimately get to a better deal. I think we 
can get back to the table eventually, but I have a hard time 
figuring out how we get to a better deal.
    And I think you wanted to answer this question, Ambassador 
Joseph. And then I would love to hear a little bit more from 
Dr. Samore about your skepticism and why you have skepticism 
about that.
    Ambassador Joseph. Senator, I think you have framed the 
question very well, and it is an important question.
    I certainly agree with the premise that the leverage has 
changed. But I do not think it is irreparable. I think that 
over time we could reestablish effective sanctions. I believe 
that there is an agreement that can stop Iran that can deny 
Iran a nuclear weapons capability. That was the U.S. position 
for 10 years. That was the U.S. position that was reflected in 
multiple U.N. Security Council resolutions that demanded the 
complete suspension of all enrichment and reprocessing 
activities. I think we could get that agreement. It is going to 
be more difficult now than it was a year ago.
    Senator Murphy. So you do not accept my initial premise 
that this is really about trying to preserve an effective 
military option. You actually think there is an agreement that 
can wipe out their ability to get to a nuclear weapon.
    Ambassador Joseph. I think that there is a prospect for 
getting that agreement. There are no guarantees in this 
business. But I can say that my assessment is that this is a 
bad agreement. This is an agreement that does not stop them 
from having a nuclear weapons capability that they can exercise 
at any time of their choosing and have a nuclear weapon in a 
short period of time. And that has the various strategic 
consequences that I talked about in my prepared statement. I 
think fundamental negative strategic consequences.
    And there is this general concern about, well, if we walk 
away from this, what will others do. Well, I have been in the 
nonproliferation business a long time, and I was very much 
involved in exiting from the Agreed Framework once North Korea 
was caught cheating with a covert enrichment program. And we 
had allies who said, well, you know, let us not get out of this 
agreement. Let us not do that because the freeze at Yongbyon on 
their plutonium reactor is worth continuing this. Well, when we 
got out of the agreement, after consultations with allies and 
improving their understanding of the dynamics involved, the sky 
did not fall.
    The same is true with the ABM Treaty and our withdrawal 
from the ABM Treaty in 2001. We had a number of allies who were 
very comfortable with the United States being very vulnerable 
to missile attack against our homeland. They were very 
comfortable with that. But with the end of the cold war, with 
the emergence of the North Korean missile and nuclear threat 
and the Iranian threat now starting to emerge, it was essential 
that we have the capability to defend this Nation, which I 
think everyone now agrees is a very positive capability that we 
have against small-scale attacks.
    Senator Murphy. Dr. Samore.
    Dr. Samore. So I think this is where I disagree with my 
friend. I think the likelihood of this government in Iran 
agreeing to a diplomatic agreement that fundamentally removes 
their capacity to produce nuclear weapons, dismantles their 
capabilities, has very extended or indefinite duration, much 
more stronger challenge inspection regime, I just think that is 
extremely unlikely that we would be able to have the kind of 
economic leverage that would force them to accept such a 
disadvantageous agreement.
    The only scenario in which I could imagine us imposing on 
them that kind of agreement would be backed by a military 
ultimatum, and I do not think the United States is prepared to 
issue that kind of ultimatum to Iran because the risk would be 
that they would reject it and we would then have to use 
military force.
    Senator Murphy. And just to confirm, you do not believe 
that there is a circumstance, at least in the short term, that 
gets us back to the table with a set of conditions that prompts 
a better agreement.
    Dr. Samore. Not in the short term. I mean, in the longer 
term I cannot tell. That really drifts into the next 
administration. But certainly in the rest of this 
administration, it is hard to imagine us getting back to the 
table.
    Senator Murphy. Thank you, Mr. Chairman.
    The Chairman. Senator Risch.
    Senator Risch. Thank you, Mr. Chairman.
    I want to focus for a few minutes on these secret 
agreements.
    You know, I am being asked, as everybody is here, to ratify 
and embrace this agreement that incorporates two agreements 
between Iran and the IAEA that we cannot see. Now, you know, I 
have been around a long time, and in the history of 
jurisprudence in the United States, I have never heard of any 
party so foolish as to enter into an agreement with another 
party and accept and agree to two agreements with a third party 
that they have not seen and that the parties refuse to give 
them access to. Has anybody here ever heard of such a 
situation?
    [No response.]
    Senator Risch. Well, let me ask the three of you this. On 
something important in your life, building a home, buying a 
car, or something quite important in your life, would any of 
you sign a contract that accepts and incorporates and agrees to 
an agreement between the adverse party and a third party that 
they refuse to let you see? Would any of you three do that?
    [No response.]
    Senator Risch. Well, we are talking about probably the most 
important security matter facing the United States, our allies, 
especially Israel, and the world, and this is what we are being 
asked to do. I mean, I do not know of a fool that would agree 
to an agreement that they cannot read.
    We have had the intelligence community in and I have cross 
examined them at length about this, and they have said, no, 
they have not seen it, but they know what is in it. I said, how 
do you know what is in it? Do you know anyone who has seen 
that, who has read it? Because in an agreement, every word, 
every comma, every period, every paragraph means something. And 
they said, well, no, but we have been told. I am just 
astonished--astonished--that people are willing to buy onto 
this particularly with the party that we are dealing here--the 
party that is involved in this. I cannot believe people are 
willing to look the other way on this.
    Guys, give me your thoughts on this? Mr. Samore, you are 
anxious to get involved.
    Dr. Samore. Well, I am not sure I am anxious, Senator.
    Senator Risch. If you want to make a deal you have not read 
but tell me about it.
    Dr. Samore. You know, I would say two things. First of all, 
you will have to satisfy yourself based on the briefings you 
get whether we have a reasonable understanding of the 
substance.
    Senator Risch. How can you do that with a contract that 
every word is important? How can you become comfortable with 
somebody else telling you this is what is in it and this is 
what it means? How can you get there?
    Dr. Samore. Well, of course, the U.S. Government may have 
exactly that kind of specific information. I do not know, but 
that is what you will have to decide.
    Senator Risch. I can tell you they do not unless you know 
someone who has that information.
    Dr. Samore. I do not.
    The second thing I would say, the more important issue I 
think is I think you have to weigh the importance of the IAEA-
Iran document on PMD against the other elements of the 
agreement.
    Senator Risch. Is that all it is about is PMD?
    Dr. Samore. Yes.
    Senator Risch. How do you know that?
    Dr. Samore. The ones we are talking about.
    Senator Risch. How do you know that?
    Dr. Samore. I am confident of that, but you can ask Amano. 
It is a road map----
    Senator Risch. I want to get to your level of confidence. 
Tell me how you are confident of that.
    Dr. Samore. I am confident of that because if you look at 
the public document, the roadmap document that Amano signed 
with Salehi, it makes reference to two confidential documents 
that spell out the steps Iran is supposed to take to resolve 
PMD.
    Senator Risch. But we do not know what is in there. I mean, 
yes, that is in it. Is there something else in there? You do 
not know if there are other things in there.
    Dr. Samore. I think you will have a chance to ask Amano 
tomorrow.
    But anyway, the more important point I want to get across 
is you have to weigh how important resolution of PMD is against 
the other elements of the agreement, and if you think PMD is so 
important that we should not accept an agreement unless that is 
fully resolved, then you should reject the agreement.
    Senator Risch. Mr. Samore, set aside the PMD thing. Okay. 
We can argue about the PMD question, but first we got to know 
that that is all it refers to. And I am not satisfied to have 
an Iranian tell me that that is all that it refers to. I got to 
see it. I got to handle it, and I got to read it. Then I will 
know what it refers to. So the PMD issue, yes, we can talk 
about that and probably come down on different sides of it, but 
what I am scared to death of is we get down the road, somebody 
opens a closet, and out falls the language of the secret 
agreement, and say, ha, you really screwed up. You trusted us.
    Dr. Samore. Right.
    Senator Risch. Mr. Joseph.
    Ambassador Joseph. Senator, I share your concern, your 
frustration, and I would point out that the members of the 
Majlis, the Iranian Parliament, will have access to this set of 
secret agreements. I do not know how you sort of weigh the 
issues, how you could determine to go forward if you do not 
know what is in the set of agreements.
    Senator Risch. A good point about the Iranian Parliament 
being in a better position than we are.
    Mr. Albright.
    Mr. Albright. Yes. I think, again, the IAEA sharing 
documents gets a little tough. One of the hopes I would have is 
that it will leak. Then we will all get to see it.
    Senator Risch. The problem is you do not know that a leak--
you are getting legitimate language.
    Mr. Albright. Yes, maybe, and I agree. I would say one 
thing, though, this needs to be circumscribed in some way, I 
would argue, with legislation--of language in legislation, but 
most of these conditions in the deal have to do with things 
that have to be played out over the next several months. My 
understanding is they are not conditions that come into play a 
year from now. And so, again, I understand your concern that 
there may be something hidden in there, and I certainly share 
that concern. But I think the bottom line, though, is that if 
we are talking about access to Parchin and who is going to take 
the samples, that has to play out pretty quickly even under the 
limited conditions.
    Senator Risch. Thank you. I appreciate that.
    One last question. You know, everybody here--and I heard it 
said by some of the Senators. Oh, we can enter into this 
agreement. No big deal. Look, the military option is still on 
the table. We are in no worse condition. Is there any one of 
you who would disagree with me when I say that every hour of 
every day, every minute the Iranians are in a better military 
position to defend what they have got than what they are at 
this moment? Anybody disagree with that?
    Mr. Albright. No.
    Could I add one thing? I think it is really a sign of a bad 
agreement if the only thing you can argue is we can use a 
military option in 10-15 years from now. I mean, let us be 
honest. What military option was exercised against North Korea 
in 2003 when it decided to go for nuclear weapons? I remember 
war games at the time. I can remember war games with the 
government officials prior to their nuclear test in 2006. I 
mean, we were going to do all kinds of things to North Korea 
would be the consensus, but nothing happened.
    Senator Risch. Great point.
    My time is up. Thank you, Mr. Chairman.
    The Chairman. Go ahead. Out of generosity of spirit, I 
think Ambassador Joseph and Dr. Samore may want to say 
something about that.
    Ambassador Joseph. Sir, just two footnotes, one on North 
Korea. I was working in the White House at the time working 
proliferation and nonproliferation issues, and there was no 
consideration that I am aware of at all about using force when 
North Korea decided to move toward a nuclear weapons 
capability. There was no consideration of that.
    Second, in terms of what may or may not be in these secret 
agreements, my sense is that if these agreements did provide 
for a real way forward on PMD and on Parchin, you would see 
them.
    Senator Risch. They would be on the table.
    Ambassador Joseph. You would see them.
    Why, after 4 years of stonewalling on these issues by Iran, 
we, for whatever reason, could think that these are going to be 
resolved by a couple of side agreements and they are going to 
be resolved by mid-December, my view is that is just sheer 
fantasy.
    The Chairman. Dr. Samore.
    Dr. Samore. Just to say very quickly, I think the United 
States military option against North Korea was always very 
limited because of the balance of military power on the 
peninsula and in particular the vulnerability of Seoul to a 
counterattack.
    In the case of Iran, not that I am proposing a military 
strike, but we have a lot more military advantages and 
tremendous superiority. So I do not accept your argument that 
in the next 10 or 15 years, the Iranians will be relatively 
better able to protect themselves than we are to attack them. I 
think that is to be seen. I mean, that is in our hands to some 
extent.
    Senator Risch. Briefly a followup. You mean to tell me they 
deployed the SA-200 and the S-300 from Russia that is not going 
to be a game-changer for their ability to protect their 
facilities?
    Dr. Samore. Well, I mean, you should talk to military 
professionals.
    Senator Risch. We already have. Thank you.
    Dr. Samore. I think we believe we have ways of countering 
those capabilities.
    The Chairman. Senator Markey.
    Senator Markey. Thank you, Mr. Chairman, very much.
    It is clear that we have a very checkered history in this 
whole area of the IAEA and the use to which it has been placed.
    So, again, back in 1981, the Israelis bombed the Osirak 
reactor outside of Baghdad. It destroyed it. It was a 
clandestine nuclear weapons program, and Ronald Reagan had Jean 
Kilpatrick vote to condemn the Israelis in the United Nations. 
But again, the Israelis were teaching us a big lesson that the 
IAEA is essentially, at that point in time, nothing more than a 
paper tiger. It was not effective. It was not getting the 
access that it wanted. And the Reagan administration was 
ignoring that, and within a couple years, they were actually 
aligning with Iraq and Saddam against the Iranians in the Iran-
Iraq war. So that is a checkered history right there.
    And then we move up to Libya, and we kind of promised 
Qaddafi if you cooperate with the IAEA, if you cooperate with 
us, no problem. You get peace. But there was rejoicing all over 
America when we saw these pictures of Qaddafi being killed 
because he did not have a nuclear weapon. Thank you, Mr. 
Joseph, for that negotiation, but your actions did not then 
lead to the United States kind of dealing with the essence of 
that deal. We were in, once we knew he did not have a nuclear 
weapon.
    The same thing was true in Iraq. In Iraq, the IAEA was in. 
The IAEA was saying to George Bush they do not have a nuclear 
weapon. There is no threat in the form of a mushroom cloud 
coming our way. We cannot find it, Mr. Bush. We cannot find it, 
Mr. Rumsfeld. We cannot find it, Mr. Cheney. Please do not 
start this war. Give us more time to go through every site, but 
we cannot find it. And nuclear programs are huge programs. It 
is not like a biological or chemical program. These are huge 
programs. And George Bush just started this war.
    A lot of our problems right now, even this deal, relates to 
what happened back there in 2003. We disrespected the IAEA or 
the Bush administration disrespected the IAEA. It undermine its 
credibility.
    So both in 1981 with Reagan and 2003 with Bush, both times 
they were basically not dealing with the essence of the role 
which the IAEA has to play. They are the referee. They are the 
group that has to come in and make a determination as to 
whether or not there is in fact an active nuclear weapons 
program in place, and we have to determine whether or not they 
are gaining the access that is necessary to do so. That is the 
essence of this whole debate, whether or not we are going to 
repeat history or we are going to create new history that turns 
the IAEA into the watchdog, not the lapdog.
    It turns out in 2003, it was a watchdog. It was accurate. 
Our inspectors were able to gain access and the Bush 
administration just ignored it and decided to start a 
conventional war because they knew he did not have a nuclear 
weapon. We would not have invaded if he had a nuclear weapons 
program. That is the irony, of course, in Libya. That is the 
irony in Iraq.
    And we do not invade North Korea because they do have 
nuclear weapons. All of that is not lost on Iran. That is what 
complicates this. Iran is saying they do not want a nuclear 
weapons program.
    Now, we know that they had a nuclear weapons program 
historically. We know that they are now negotiating with us to 
put the program under safeguards. We think for the known sites, 
this system is sufficient in order to be able to detect in a 
timely fashion any activities that could lead to a nuclear 
weapon. We know all that. The question will turn then on their 
intentions with regard to a secret program and their intentions 
in the long term. And I would say honestly, if you are the 
Iranians, you really do not want to run the risk of the United 
States and the P5+1 all agreeing that a conventional military 
attack on their nuclear facilities is, in fact, justified at 
any point in time. You would not want a match with--you have an 
Iran against the combined forces of the P5+1 if they really 
wanted to go in. That is a big question. That is a Dirty Harry, 
``do I feel lucky'' question if they move in that direction.
    So I guess what I would say to you, Dr. Samore, is how do 
you feel about the 2020s and the 2030s? Because everyone is 
going to have an opinion on it. I would like to just hear your 
opinion. Do you think it is likely that they are going to 
comply or not with this agreement?
    Dr. Samore. You know, that is really a great question. I 
mean, I think that there is a reasonable chance that they will 
cheat or renege on this agreement in the course of the next 15 
years. And in some ways, I think that is a good scenario for us 
because I think if they cheat, there is a very good chance we 
will catch them if it involves a major violation, and that 
would put us in a very strong position to reimpose sanctions 
or, if necessary, use military force. And if they renege, I 
have confidence--of course, there will be a lot of finger 
pointing who is at fault. I have confidence in the capability 
of the United States to rally our allies and others in order to 
resume a pressure campaign against Iran. So for me kind of the 
easy scenario is that the Iranians have agreed to long-term 
constraints on paper, but that after a year or 2, that will 
fade and this agreement will collapse and we are back where we 
were. That does not bother me.
    Senator Markey. Can you imagine a scenario where a 
President of the United States would not feel compelled to take 
the necessary action in order to ensure that Iran did not have 
a nuclear weapon in the 2020s?
    Dr. Samore. I mean, I think it is such an American interest 
to prevent Iran from getting nuclear weapons. And of course, 
that has been our policy since the Reagan administration, and 
that is why I first started working on the Iran nuclear issue. 
I think that is a very enduring part of U.S. foreign policy and 
any President will have that as an objective.
    Mr. Albright. Can I disagree?
    Senator Markey. I just need a second.
    So I guess what I would say, Mr. Chairman, going back to 
Jimmy Carter selling uranium to the Indians, knowing the 
Pakistanis were going to ramp up their nuclear weapons program 
in 1980, through the Osirak raid, through the vertical arms 
race of the United States and U.S.S.R. where we were never 
going to use nuclear weapons against each other, but this 
horizontal proliferation continued, ignore unfortunately by 
both of our countries and the rest of the world, all the way up 
to today. We kind of now have the moment where we have to 
decide if this IAEA in its present form with the mandate it is 
receiving under the leadership of Amano is capable of doing its 
job. That is the test.
    And I thank all of the witnesses for being here today.
    And thank you, Mr. Chairman, for holding this hearing.
    The Chairman. Do you object if they respond to what you 
just said?
    Senator Markey. If I have to stay and hear it, then I am 
going to miss the next meeting. And I apologize.
    The Chairman. I will listen and tell you what they said.
    Senator Markey. If you do not mind. Thank you.
    The Chairman. Okay. Go ahead, gentlemen, if you will 
briefly.
    Mr. Albright. Let me just give a historical example. In 
2003, the United States knew Iran had a structured nuclear 
weapons program and did not strike militarily. It was even 
being exposed by the IAEA.
    Senator Markey. And that was the Bush administration. They 
did not.
    Mr. Albright. Yes. Well, and who else would?
    Senator Markey. In other words--no. The point I am making 
here is that we knew that Saddam Hussein did not have a nuclear 
weapons program and we invaded them. And what was that signal 
sent to Iran by the Bush administration? Get a nuke, be more 
like North Korea or other countries, and we will not invade 
you.
    Mr. Albright. I am not disagreeing with your point. I am 
just making a different point, that do not count on a military 
strike.
    Senator Markey. You are saying if George Bush would not 
strike, then it is unlikely that a future President would 
strike. Is that what you are saying?
    Mr. Albright. That is right. I do not think you can count 
on it at all.
    Senator Markey. But, again, this situation was all created 
back then because if we had to----
    The Chairman. If we could, though, let us let----
    Mr. Albright. I agree with that.
    Senator Markey. If we had determined that Iraq did not have 
a nuclear weapon, and then we moved the whole coalition to 
surround Iran in 2003 and said give up your nuke and we are not 
going to invade, we would not even be here today. But Bush 
decided to violate this kind of trust with the IAEA and now 
Iran took the wrong message from it.
    The Chairman. Yes, sir. If you all could be brief, that 
would be----
    Ambassador Joseph. I will try.
    Let me say, irony notwithstanding, I think it is much 
better that Mr. Qaddafi met his fate, a well-deserved fate I 
would add, without nuclear weapons than with nuclear weapons. I 
think it is really a hard argument to make that this was not a 
win for nonproliferation, that we picked up their program and 
we brought it back here, an illicit nuclear weapons program.
    And oh, by the way, the IAEA did not have a clue about the 
program in Libya. Not a clue.
    One of the reasons that the--and I certainly agree with the 
Senator. One of the reasons that Iran wants a nuclear weapon is 
because it wants to guard against outside intervention so it 
continues to repress, brutally repress its own population. That 
is one of the reasons. There are other reasons, to intimidate 
neighbors, to expand its influence in the region. There are a 
whole lot of reasons. I would not list George Bush as one of 
them.
    The Chairman. Dr. Samore.
    Senator Markey. I just totally disagree.
    The Chairman. If we could--I will just say I do agree with 
the Senator and that is why I opposed what we did in Libya. I 
do think we taught folks a lesson, and that is if you give up 
nuclear arms, we are more likely to take you on militarily than 
if you do not. And I think there was a learning moment there. 
And I do agree with Senator Markey's comment in that regard, I 
do think Iran has learned from that. And I think that that is 
the reason they are pursuing a nuclear weapon today.
    Senator Shaheen.
    Senator Shaheen. Thank you, Mr. Chairman.
    Mr. Albright, in your testimony, you talk about Congress 
ensuring that any new legislation includes provisions that 
would help to address, should we go forward with this 
agreement, that would address--or look at strengthening the 
agreement I guess is a better way to put it. I wonder if you 
could speak to what kind of legislation you think Congress 
should consider.
    Mr. Albright. Big picture legislation.
    Senator Shaheen. Right. I meant assuming the agreement goes 
forward, in order to strengthen the U.S. position with respect 
to the agreement and with respect to potential actions in the 
Middle East, what are measures that you think Congress should 
consider. For example, I was just in a hearing in the Armed 
Services Committee and former Ambassador Edelman suggested that 
we should consider passing an AUMF on Iraq that would be----
    Mr. Albright. I am sorry. What is that?
    Senator Shaheen. That Congress should pass an AUMF----
    Mr. Albright. Okay.
    Senator Shaheen [continuing]. That would be a follow-on 
should Iran decide not to comply with the agreement. I think 
that is probably challenging given that we have not been able 
to get agreement on AUMF on ISIS. But what are other kinds of 
measures that you are suggesting we should be looking at?
    Mr. Albright. It would be a stand-alone piece of 
legislation, and it is motivated by ratification of arms 
control treaties. I mean, you want to lock in interpretations. 
You want to put the executive branch on notice that 
interpretations cannot be changed without consultation with 
Congress. A simple provision would be that the PMD issue has to 
be addressed before U.S. sanctions come off. You could put in 
language for providing support through moneys and other means 
for the IAEA verification effort. You could put in language, 
which I understand it is not popular, that the deal does not in 
any way sanctify or approve--I mean, you could choose the 
language--a semicommercial Iranian centrifuge program. You 
could put in language that instructs the United States to 
discuss with Iran, again outside the deal, that it should not 
produce any more low-enriched uranium pending a need. And it 
has no need. It has a 300 kilogram cap and absolutely no need 
to produce enriched uranium for many years. So you could put in 
instructions to that effect. And in my written testimony, I 
tried to put in more examples.
    Senator Shaheen. I think in most of the testimony that I 
have heard with respect to the agreement over the last couple 
of weeks, people have suggested that if Iran violates the 
agreement, they would do it in an incremental way, which would 
make it more difficult. So they would not do it in a way that 
would allow us to just recognize and snap back the sanctions. 
It would be incremental. And so it seems to me that if we are 
going to go forward with this agreement, it is very important 
that we have a variety of options for addressing any potential 
incremental violations of an agreement.
    And you are nodding, Dr. Samore. What kinds of options 
should we be thinking about with respect to violations?
    Dr. Samore. So I think it is important, as I said earlier, 
to recognize that there are bound to be implementation issues. 
There are bound to be areas where we think the Iranians have 
violated the agreement. There could even be ambiguous 
situations where the agreement is not clear. So I think it is 
important that we talk to the other P5+1 to figure out how we 
are going to address a situation that is short of a major 
violation. I agree with you that at least in the beginning, it 
is not likely the Iranians would be so foolish as to make a 
major violation. And that will be part of the implementation 
chore.
    There is enough flexibility within the four corners of the 
agreement to take a number of steps in terms of partial 
reimposition of sanctions, designating individuals and 
entities. So there is sufficient room in the agreement. What is 
needed is an actual discussion among our allies as to how we 
would take advantage of that flexibility.
    Mr. Albright. Can I add a few? There are opportunities, for 
example, in the procurement channel. You could take a position 
that if, let us say, Iran does not allow access within 24 
hours--who cares about the 24 days--you would simply stop 
approving any exports to Iran. You would object to everything 
in theory, or you could object to some things. You could also 
stop or slow down the nuclear cooperation. There is a huge 
incentive package in this agreement on nuclear cooperation that 
covers incredible numbers of areas, and you could slow that 
down. So I think you could create--we call it a ladder of 
reactions where the top rung may be snapback of sanctions. And 
I guess even higher would be the military option. But there is 
a lot of rungs that you could fill out or build into this 
ladder.
    Senator Shaheen. Ambassador Joseph, did you want to add 
anything?
    Ambassador Joseph. Yes, Senator. I think that you are 
right. I think the likelihood is that there will be an 
incremental breakout, a series of step-by-step violations. 
There will be a lot of pressure to explain away each of those. 
I mean, the Iranians are masters at this, and there will be a 
lot of pressure to explain away the violations.
    So I think it is really quite important that there be a 
team B, as I have suggested in my prepared statement, of 
outside experts, nonpartisan with access to all of the 
intelligence to assess Iranian compliance with the agreement. 
And that is something Congress can do.
    And I would just add that even though I fully agree that 
the likelihood is incrementalism, we cannot rule out a decision 
by the Supreme Leader to throw out the inspectors and to go for 
a nuclear weapon. We saw that with North Korea.
    Senator Shaheen. Sure. I understand that. I am assuming 
that if that were the case, it would be very easy to figure out 
what our response would be. I do not think that presents a 
difficult scenario for us.
    Thank you all very much.
    The Chairman. Thank you.
    I know Senator Cardin had an additional comment.
    Senator Cardin. I was just going to respond to some of the 
comments that have been made, including our witnesses.
    The Congressional Review Act that we passed envisioned that 
Congress will be involved beyond just the review period. There 
are requirements for the administration to provide us 
information, and there are various actions that we can take. 
And I think some of the comments that have been made today 
build upon the intent that the drafters of this oversight 
legislation intended that there be an active role for Congress. 
Moving forward, that is not to prejudge whether we take other 
action or not, and there are different views as to whether 
Congress should approve or disapprove the agreement. But a 
congressional role was always envisioned.
    In regards to the documents, I just really want to 
underscore this point. Senator Corker and I believe that we 
should review these documents. We said that from day one. Once 
these documents were received, within moments it was clear that 
there were two documents missing that we wanted Congress to 
review. So we sent a letter to the administration almost 
immediately for those two documents. And I still believe--I 
know Senator Corker agrees with me--that Congress should have 
eyes on those documents.
    But let me just put this in perspective because we will 
have the Director General here tomorrow. It deals with a part 
of the process that will be completed within a relatively short 
period of time, that is, the PMD review. And it is spelled out 
in a pretty specific time frame within the JCPOA.
    And Senator Corker is absolutely right. There is no direct 
relationship between the compliance with the IAEA's report and 
sanction relief. There is no direct tie to that. But I think it 
is envisioned that that will be completed before the sanction 
relief will have matured so that we will be able to know that 
before it is done.
    What concerns me--and that is the reason I raised this 
initially--is the quality of the report we are going to get 
from the IAEA on December 15, and if we do not have the 
adequate cooperation and access, as represented in these annex 
documents, that is something we should know before we vote in 
the Congress of the United States. That is the reason why I 
think it is particularly important that we get more 
information. And I am hoping that the Director General will 
shed some light on this tomorrow.
    The Chairman. Well, based on what----
    Mr. Albright. Can I add one thing?
    The Chairman. Let me just say, then you can, and thank you 
all for being here.
    But based on what we heard testimony about yesterday 
relative to some of the things that are occurring inside Iran 
as we speak and as we sit here relative to previous activities, 
it does not seem to me like we are going to get a particularly 
satisfying report.
    But go ahead. I will leave it at that. You all go ahead.
    Mr. Albright. Yes, just one thing I should have mentioned. 
I mean, your legislation was critical in our thinking about--
because without your legislation, then there is no base to 
build upon. So I apologize. I certainly should have emphasized 
that in what I said orally.
    Senator Cardin. Do not worry. We will bring it up. 
[Laughter.]
    Mr. Albright. Yes. No, no. It was great legislation.
    Ambassador Joseph. Mr. Chairman, I just wanted to make one 
point for clarification. I think this is arguable. Perhaps it 
was a mistake for the Obama administration in 2011 to intervene 
in Libya. I am not an expert on that, but I think there may be 
a strong case.
    I do not think that there is any case to suggest that we 
made the wrong decision in 2003 to take out Libya's nuclear 
weapons program. I mean, that is what this is all about. We 
wanted to get rid of their nuclear program just like we want to 
get rid of Iran's nuclear weapons capability. This agreement 
does not do that.
    The Chairman. I think what happened in 2003 in Libya was an 
outstanding high mark, if you will, in ending proliferation. I 
think what we did in 2011 did teach people that if you do away 
with your nuclear program and you do things that the United 
States and our allies do not like, you are more likely to be 
invaded and taken out than if you have a nuclear program, which 
is why I think Iran is pursuing the nuclear program that they 
are.
    Do you want to say something, Gary?
    Dr. Samore. Well, I just want to say quickly I share your 
view that the resolution of PMD is not going to be satisfactory 
because I do not think Iran is prepared to truly, genuinely 
cooperate with the IAEA. That would require admitting the truth 
that they had a nuclear weapons program before 2003, and I do 
not think they could do that or they are not willing to do it.
    The Chairman. Well, listen, we have a great country because 
we have great citizens who are very bright and learned and help 
us make good decisions. Certainly you all are three of the best 
examples of that. We thank you for being here.
    If it is okay with you, the record will remain open until 
the close of business Friday. If additional questions come in, 
if you could answer them fairly promptly, we would appreciate 
it.
    Thank you all for your service to our country, and we look 
forward to seeing you again soon. Thank you.
    We are adjourned.
    [Whereupon, at 12:08 p.m., the hearing was adjourned.]



                     IMPLICATIONS OF THE JCPOA FOR 
                     U.S. POLICY IN THE MIDDLE EAST

                              ----------                              


                       WEDNESDAY, AUGUST 5, 2015

                                       U.S. Senate,
                            Committee on Foreign Relations,
                                                    Washington, DC.
    The committee met, pursuant to notice, at 2:18 p.m., in 
room SD-419, Dirksen Senate Office Building, Hon. Bob Corker 
(chairman of the committee) presiding.
    Present: Senators Corker, Risch, Johnson, Flake, Gardner, 
Perdue, Cardin, Menendez, Shaheen, Udall, and Markey.

             OPENING STATEMENT OF HON. BOB CORKER, 
                  U.S. SENATOR FROM TENNESSEE

    The Chairman. The Committee on Foreign Relations will come 
to order.
    We want to thank you both very much for being here. We have 
been a little rushed. This is actually our third Iran hearing 
today, for those of us who are on Banking and here.
    But this is the final in a series. We began on June 3, 
talking about the regional implications. We are going to end 
our hearing process, prior to the debate that will take place 
in September, with the regional aspect.
    I am not going to deliver my normal opening comments. I am 
just going to sort of pause with this.
    I was walking down the hallway with one of our most 
thoughtful members, and I think he laid out an analogy that I 
agree with wholeheartedly. I guess as we have gone through all 
the details, the thing that keeps bothering me, one of the 
biggest issues that bothers me, is what we are in essence going 
to be doing with Iran is we know the momentum shifts in 9 
months, the leverage shifts. All the sanctions relief will take 
place between now and next March and April.
    Until then, they have the leverage of the nuclear snapback. 
It is not unlike what we have seen in North Korea, where they 
have a weapon, and basically, we are concerned about what they 
may do with South Korea--what they may do with our allies. So, 
we continue to allow North Korea to act out. We know that the 
way Iran acts out is they do so through terrorism in the 
region.
    They are going to be greatly empowered, and they are going 
to be on equal balance to us; whereas right now we have the 
leverage over them, and in 9 months, that leverage is going to 
be alleviated.
    I have to tell you: all of us today were in a briefing with 
the IAEA, a very nice gentleman, the Director General, Mr. 
Amano, a very, very nice gentleman. I just do not know how 
anybody could have sat through that meeting, if you had any 
questions at all about the integrity of our inspections, I do 
not know how anybody could have left there today feeling more 
assured--far less assured from my standpoint.
    Again, the fact that we cannot even get access to 
documents, Ben and I worked for 4 days to try to make sure we 
clarified every single agreement that had to be put forth to 
us, the fact that they ran it through Wendy Sherman and others, 
you all know the IAEA protocol, for us not to even know.
    So we have this issue of concern about what they are really 
doing in Iran during this period of time. The leverage shifts 
to them, so we have uncertainty about where they are, is my 
point. And then all of a sudden the leverage is with them. I 
think that, in the region, what we have done, if this goes 
through, is we have created a situation where the United States 
is going to be very reticent, very reticent, to place any 
additional sanctions in place for fear that they will walk away 
from the deal, which empowers them in the region.
    So no doubt there has to be a regional strategy. I have not 
seen it yet. We are obviously seeing the effects of the 
administration giving support to various Arab allies and 
saying, if you withhold any disagreement, we will supply you 
with X. We do not know what X is yet. I understand some people 
have been briefed on that.
    Maybe, Ken, you know or maybe, Michael, you know.
    But I think this will be a very interesting hearing. I 
appreciate having experts like you come in and help us in this 
way.
    And I, certainly, want to thank our outstanding ranking 
member, who we have literally almost lived together over the 
past 2 months in working through these. It has been a very 
bipartisan, strong effort to make sure that all of us know as 
much as we can before we come to a very serious debate that I 
hope in no way takes on any kind of--look, this says a lot 
about the Senator. This is not a partisan issue in any way: Do 
you feel that this agreement will keep Iran from getting a 
nuclear weapon or not?
    Every one of these countries knew that we were going to be 
taking this vote before the agreement was reached. So, again, 
we are just carrying out our obligations. To try to turn this 
into a partisan issue, which I will just go ahead and say in 
this hearing that I feel like the administration is trying to 
do to diminish legitimate concerns that people have, to me, is 
inappropriate.
    This is going to be a tough vote for everyone here. I will 
say right now, I will never criticize anybody for their vote, 
because I think everybody, hopefully, will vote their 
conscience based on what they feel is in the national interest 
of our country.
    With that, Ranking Member Cardin.

         OPENING STATEMENT OF HON. BENJAMIN L. CARDIN, 
                   U.S. SENATOR FROM MARYLAND

    Senator Cardin. Chairman Corker, we are going to test the 
strength of our relationship, because we are going to be apart 
for almost 5 weeks. We will see how we survive. [Laughter.]
    The Chairman. Do not exaggerate. Four weeks.
    Senator Cardin. Oh, no. I think it is 4 weeks and 6 days, 
if we get out today. If you go back to last Monday with the 
last vote--anyway, we are on day 17 of the 60-day review. I 
think this is the fifth public hearing we have had.
    I just really, first, want to thank and congratulate the 
leader of our committee, Senator Corker, for how he has used 
this period of time to not only inform the Senate Foreign 
Relations Committee, but to inform the entire Senate on the 
Iran nuclear agreement.
    I think we envisioned it would be this way, but it was your 
leadership that really focused us and used our time in a most 
effective way.
    And it is difficult. These are not easy decisions. And you 
have given us, I think, the material we need in order to 
analyze this and come to the right decision for our country.
    So thank you very much for your extraordinary leadership.
    I also want to thank the members of this committee. Our 
hearings have gone rather long, because just about every member 
of the committee has been here to question, which I think is 
reflective of the seriousness that the members have taken on 
this assignment. So, I thank each member of the committee, both 
the Democratic and Republican side, and our staffs, for all the 
hard work they have put in during this review period.
    Mr. Singh, thank you for being here.
    Dr. Pollack, thank you for being here.
    In this hearing, we want to focus on the U.S. policy in the 
Middle East. What are the ramifications of this agreement in 
regards to our regional issues? The Middle East is critically 
important to U.S. national security. What are the impacts of 
this agreement going forward on our national security in the 
Middle East?
    I share Senator Corker's ultimate view, and that is that we 
have to decide whether this agreement puts us on a better path 
or worse path to prevent Iran from becoming a nuclear weapons 
state. That would be a game-changer for the region. We know 
that. We have been trying to analyze that.
    But part of this is what happens if this deal goes forward, 
and there is compliance with the agreement, what impact does 
that have on the regional security in the Middle East?
    I do not expect Iran's behavior in the region to change. At 
the end of the day, this is still an anti-American, anti-
Semitic revolutionary regime that has cultivated a network of 
proxies to challenge stable governments in the region and 
protect dictators like Assad in Syria.
    If the agreement goes forward, Iran will have additional 
financial capabilities. We know that. We also know that they 
will have the ability, after time, to move forward in a more 
aggressive way on their ballistic missile program and on 
conventional arms once the embargo is lifted after 5 years.
    So what is the impact on regional security, on Gulf State 
countries, and the state of Israel?
    What is the impact of a legal enrichment program in Iran 
with regard to what other countries in the region may want to 
do in order to match Iran's capacity in the region?
    What will happen with the balance of power in the Middle 
East?
    These are all questions that I hope will be part of this 
discussion. U.S. leadership in the Middle East is critically 
important. We know that. What steps should the United States 
take, including the Congress, for an effective regional 
security strategy?
    I hope this particular hearing will help us fill in some of 
these blanks.
    With that, Mr. Chairman, I look forward to hearing from our 
witnesses.
    The Chairman. Thank you, sir.
    Our first witness is Michael Singh, managing director of 
Lane-Swing, senior fellow at the Washington Institute. I know 
we have had multiple conversations, as I am sure you have with 
most on the committee. We thank you very much for sharing your 
expertise.
    Dr. Ken Pollack, a senior fellow at the Center for Middle 
Eastern Policy at the Brookings Institute, also someone we have 
heard from a great deal and respect a great deal.
    We are privileged to have you here. If you will, you done 
this many, many times, take about 5 minutes to generally 
outline what you would like to say. Your written documents, 
without objection, will be entered into the record, and then we 
will have some questions.
    Again, thank you for being here. Start in whatever order 
you would like to start. Thank you.

   STATEMENT OF MICHAEL SINGH, MANAGING DIRECTOR, LANE-SWING 
    SENIOR FELLOW, THE WASHINGTON INSTITUTE, WASHINGTON, DC

    Mr. Singh. Thanks a lot, Chairman Corker, Ranking Member 
Cardin, and members of the committee. I have been working on 
this issue for about 10 years. It is an honor to be before you 
today to talk about it. It is an honor to be with Ken, who is 
an analyst for whom I have the highest respect.
    The nuclear agreement that we are looking at with Iran has 
strong points and weak points. My judgment, however, is that it 
leaves Iran with a significant nuclear weapons capability. And, 
indeed, it allows Iran to improve that capability over the life 
of the deal while obtaining broad, upfront sanctions relief, 
like you mentioned, Mr. Chairman.
    I believe that this has been Iran's twofold objective, 
throughout these talks, throughout now the 12-plus years we 
have been talking to them, to escape rather than have to 
confront the strategic choice between retaining the nuclear 
weapons option on the one hand, and diplomatic and 
rehabilitation on the other hand.
    This is relevant to the topic at hand, the regional 
question, because Iran's nuclear ambitions are not separate 
from but, in my view, are part and parcel of its larger 
regional strategy, which emphasizes projecting Iranian power 
while creating an inhospitable environment in the region for 
the United States and our allies.
    Iran does not do this through conventional military power, 
and I do not think that they will. They do it and they will do 
it, I think, through asymmetric capabilities such as proxies, 
arms trafficking, sea denial tactics, cyber activities, and 
missiles. There is nothing in the accord that requires Iran to 
cease these activities or incentivizes Iran to change its 
strategy. Indeed, I would say that the deal seems more likely, 
as you mentioned, Senator Cardin, to facilitate that strategy.
    Iran is going to have additional resources, should it wish 
to help some of its proxies who have been financially squeezed 
recently--Hezbollah, Palestinian Islamic Jihad, the Houthis in 
Yemen. There are plenty of reports out in the open sources 
suggesting they have been financially squeezed.
    It can ensure that its militias in Iraq, those Iranian-
backed militias, can outmatch the official security services, 
much as they do in Lebanon with all the consequences that has 
had, as well as to buy political influence in Iraq, 
Afghanistan, and elsewhere.
    With the removal of the ban on Iran exporting arms and the 
lifting of sanctions on the import of arms to Iran in no more 
than 5 years, Iran is going to face fewer impediments to arming 
those proxies. While we do have some other authorities, as the 
President has mentioned, to target that kind of activity in 
some circumstances, I would say that those have been a little 
used and that they are weakened rather than strengthened by 
this accord.
    For example, we are losing the U.N. panel of experts, which 
was set up professionally to monitor Iran's arms activity.
    These kinds of actions by Iran would, I think, spur a 
reaction by our allies in the region, who consider Iran their 
chief rival. They may act, I think, more aggressively, more 
autonomously, to counter Iranian proxies. I think we are 
already seeing this dynamic play out in places like Yemen, 
Syria, Iraq, and elsewhere. They may even choose to pursue 
nuclear capabilities of their own, as you mentioned, Mr. 
Chairman.
    I also think that increased Iranian interventionism would 
feed the already rampant sectarian polarization in the region. 
I think Iran's involvement in conflicts in Syria and Iraq is 
one element that fuels support for groups like ISIS and, 
frankly, that ISIS uses as a recruiting tool in those places.
    Looking beyond the Middle East, because I think this has 
wider implications, Iran is likely to bolster its ties with 
Russia and especially with China. Both of them share with Iran 
a basic interest in challenging the U.S.-led international 
order. And I think that their cooperation is not just going to 
take diplomatic and economic aspects. I think it will take 
military aspects as well.
    Moscow and Beijing are already Iran's largest supplier of 
arms. And Russia, I think, is likely to soon provide Iran with 
nonsanctioned systems like the S-300 or better and may, I 
think, quickly come to the Security Council asking for 
exemptions for more arms exports. It is going to be a matter of 
political will to stand up against those and block them.
    Russia and China will also be able to assist Iran's 
ballistic missile program, when sanctions are lifted in 8 
years. It is particularly important, I think, for Iran's 
efforts to develop ICBMs, which I think would benefit 
enormously from foreign assistance from such countries.
    A particular challenge, Mr. Chairman, for U.S. interests in 
the region is Iran's pursuit of a rudimentary anti-access/area-
denial strategy in the Persian Gulf. That region is well-suited 
to A2/AD strategy because of its narrow confines, its highly 
concentrated population centers, and its target-rich 
environment--for example, vulnerable energy infrastructure.
    And it is an area where Iran could benefit from Chinese 
assistance. We already see China pursuing its own much more 
advanced A2/AD strategy in the Western Pacific. There was one 
analyst from CSBA, the think tank, who said that Iran could 
enhance its A2/AD strategy immensely through selected high-end 
purchases, such as enhanced missiles, and by expanding its low-
end investment in sea mines, fast attack craft, well-armed 
proxies. And this would be a significant challenge for the 
United States.
    Now some of these effects, as has been stated, some of 
these regional effects, we would see as a consequence of any 
nuclear deal that is not preceded by an Iranian strategic 
shift. I think that is why it is so important to ensure that 
the benefits of the nuclear deal outweigh these costs.
    But as it is, I think we are going to have to invest very 
significant resources to offset the downsides of the accord. 
These will include things like increased resources for the 
intel community and for the IAEA to monitor what Iran is doing; 
increased assistance for our regional allies in a real effort 
to repair relations with those regional allies; a review of our 
military posture in the region to make sure that we are well-
positioned to counter an Iranian A2/AD strategy, which to me 
has to be done in the context of an overall increase in defense 
resources, if it is going to be seen as credible by our 
adversaries; as well as more proactive policies to counter 
Iranian activities in Syria, Iraq, and elsewhere.
    I worry that instead we may be self-deterred, as you 
mentioned, Mr. Chairman, from really holding Iran to this 
treaty like we have I think been with the INF treaty with 
Russia, with the Syrian chemical weapons arrangements. I think 
we need to be very careful to avoid, instead, incrementally 
shifting our own policies in a misguided effort to bolster 
Rouhani and protect him against hardline backlash that he may 
have inside Iran or just to demonstrate the transformative 
effects of this deal. I think we need to disincentivize 
destabilizing policies by Iran, incentivize more constructive 
behavior.
    But the strategic shift needs to be Iran's, not ours, which 
is one of the things I fear.
    To me, the bottom line is that we have negotiated a weak 
deal and painted ourselves into a diplomatic corner. The 
alternative I do not think is war. I think that is wrong. I 
think the alternative is, though, a mess with our allies, some 
important allies.
    But in the longer run what I would argue is the real 
question is not going to be whether, but when, we need an 
alternative policy, because even in the best-case scenario, 
this deal is narrow and its limitations start phasing out 
anywhere from 5 to 15 years, which means this problem will be 
bequeathed to a future President. And I think one question to 
look at is, are we bequeathing it with a better or worse 
framework and tools to deal with it?
    The agreement may buy time, if it works as intended, but it 
buys time for Iran, too. I have no doubt that Iran will use 
that to its advantage. Thanks.
    [The prepared statement of Mr. Singh follows:]

                  Prepared Statement of Michael Singh

    Chairman Corker, Ranking Member Cardin, and members of the 
committee, thank you for this opportunity to appear before you today to 
discuss the nuclear agreement with Iran and its implications for the 
United States and the Middle East.
                    america's objectives and iran's
    When we analyze foreign policy, the first question should be what 
interest or objective is served by a particular policy. A good policy 
should clearly advance U.S. interests and should complement rather than 
clash with our larger strategy, unless the policy in question heralds 
an entirely new strategy that can be clearly articulated and 
implemented. A prudent, conservative foreign policy should clearly 
deliver benefits that outweigh its costs or, by incurring certain 
costs, forestall an even greater projected cost.
    The objective in this case is not--and has never been--simply to 
conclude a nuclear agreement with Iran. A deal is a means toward an 
end, not an end in itself. The intended end in this case is to prevent 
Iran from possessing a nuclear weapon, in order to safeguard our 
interests in the Middle East and beyond, which would be clearly 
threatened by such a development. While this objective has long enjoyed 
consensus bipartisan support, the question that has divided 
policymakers--acutely in recent years--is how to accomplish it when 
faced with an Iranian leadership apparently willing to entertain great 
cost and risk to expand Iran's nuclear weapons capability.
    At the outset of the recently concluded diplomacy--the P5+1 process 
devised in 2005--the U.S. strategy was to persuade Iranian leaders to 
embark on a broad ``strategic shift,'' recognizing that the costs of 
their regional strategy outweighed the benefits. The logic of this 
approach was that Iran's nuclear weapons ambitions were not separate 
from but an integral part of a larger security strategy, and only a 
strategic shift would sustainably end those ambitions.
    Absent such a strategic shift, the sensible stance was to insist on 
the suspension of Iran's nuclear efforts and dismantlement of its 
nuclear infrastructure. Even if Iran retained the desire for nuclear 
weapons, it would be denied the means to develop them, and a ban on 
nuclear fuel cycle and related activities would be less challenging to 
police than limitations on the same activities would be. Such an 
approach would also offer an appealing symmetry--the dismantling of 
Iran's nuclear fuel cycle infrastructure and related activities in 
exchange for the dismantling of sanctions.
    Absent such dismantling, the most sensible approach would have been 
to deny Iran at least those elements of its nuclear program most 
essential to retaining the option to build a nuclear weapon in the 
future--to deny it a nuclear weapons capability, practically speaking. 
Yet retaining that option appears to have been a key Iranian objective 
in these negotiations.
    Iran's negotiating positions over the past decade-plus of nuclear 
talks suggest a twofold objective: securing the removal of sanctions 
while retaining a nuclear weapons capability. While Iran has throughout 
the negotiations proven willing to brook temporary limitations on 
certain nuclear activities, it has steadfastly refused to consider 
steps--for example, forgoing advanced enrichment R&D, providing access 
to suspected weaponization sites and scientists, or accepting 
limitations on missile activities or permanent constraints of any 
kind--that would foreclose the future development of a nuclear weapon.
    Indeed, Iran's behavior makes little sense absent a desire for 
nuclear weapons. It can obtain reactor fuel from abroad, as do most 
countries that utilize nuclear energy. Furthermore, an indigenous fuel 
cycle is marginal to Iran's energy security, given its rich endowment 
of fossil fuels. Rather, it is Iran's secret pursuit of that fuel cycle 
and other nuclear weapons-applicable technology that has proven a 
greater threat to its energy security in the form of sanctions on its 
hydrocarbon, financial, and other sectors.
                      assessing the nuclear accord
    It is instructive to assess the extent to which the agreement 
advances the U.S. and Iranian objectives described above. Nuclear 
weapons development requires three lines of action--fuel fabrication, 
weaponization, and development of a delivery vehicle. It also 
presumably requires secrecy, since being caught at the task would 
entail risk of a military response.
    When it comes to fuel fabrication, the nuclear agreement leaves 
Iran in possession of a full nuclear supply chain from uranium mining 
to enrichment, and also leaves in place the heavy water reactor at 
Arak. These are subject to various temporary restrictions--Iran agrees 
to cap the number and type of centrifuges installed, the level to which 
it enriches, and the amount of low-enriched uranium it stockpiles, and 
converts its heavy water reactor at Arak to avoid producing weapons-
grade plutonium. It also agrees not to build new enrichment, heavy 
water, and reprocessing facilities.
    Two points stand out as most concerning, however: Iran is permitted 
to continue research and development on advanced centrifuges and to 
begin deploying such centrifuges after just 8\1/2\ years. Because such 
centrifuges are designed to enrich uranium much more efficiently than 
Iran's existing ``IR-1'' centrifuges, they are far better suited to a 
covert weapons-development effort--far fewer of them, operating for 
less time, would be required to produce weapons-grade fuel. Second, the 
restrictions described above phase out 10 to 15 years from now, meaning 
that at that time Iran would face few technical impediments to reducing 
its breakout time substantially.
    When it comes to weaponization, the agreement commits Iran not to 
``engage in activities, including at the R&D level, which could 
contribute to the development of a nuclear explosive device.'' \1\ But 
the question is how Iran's adherence to this commitment can be 
verified, especially since such activities tend to be secretive by 
their very nature. Indeed, International Atomic Energy Agency (IAEA) 
reporting suggests that Iran has already engaged in various 
``activities related to the development of a nuclear explosive 
device,'' \2\ part of what the IAEA terms the ``possible military 
dimensions'' (PMD) of Iran's nuclear program.
    Many analysts have urged that Iran be required as part of any 
agreement to disclose the extent of its past (and possibly ongoing) 
weaponization and other clandestine nuclear efforts so that inspectors 
understand what progress Iran made, and provide the IAEA with the 
necessary access to ensure that such efforts are not resumed. The 
agreement does not appear to meet these criteria. It does not specify 
that inspectors must be given access to weapons-related sites and 
personnel, or that full disclosure of past weaponization and other 
clandestine nuclear work is required for the agreement's implementation 
to proceed. Without such provisions, I do not believe we can have 
confidence that Iran's work on nuclear weapons will not be resumed 
(perhaps by elements of Iran's security apparatus, and perhaps even 
without the knowledge of the civilian officials with whom inspectors 
interact) or even that it has ceased.
    In the area of delivery vehicles, the agreement contains no 
limitations whatsoever as far as I can tell. Iran is not required to 
limit its ballistic missile development and testing, nor does the list 
of ``activities which could contribute to the design and development of 
a nuclear explosive device'' from which Iran agrees to refrain in Annex 
I of the agreement include any mention of missile reentry vehicles, 
despite their inclusion in the IAEA's accounting of PMD. Indeed, the 
binding ban on Iran ``undertak[ing] any activity related to ballistic 
missiles capable of delivering nuclear weapons, including launches 
using ballistic missile technology'' \3\ contained in U.N. Security 
Council Resolution 1929, is replaced with nonbinding, hortatory 
language \4\ in U.N. Security Council Resolution 2231.
    The effect of this shift is that as of ``Implementation Day'' of 
the nuclear accord, Iran will not be barred from conducting ballistic 
missile launches or pursuing nuclear-capable ballistic missiles, which 
are an essential part of any modern nuclear weapons program. This 
concern has even been voiced in the past by Russian officials. In 2008, 
following a failed Iranian missile test, then-Deputy Foreign Minister 
Aleksandr Losyukov said the test added ``to general suspicions of Iran 
regarding its potential desire to build nuclear weapons.'' \5\ When 
sanctions on Iran's ballistic missile program are lifted in 8 years, it 
will also be able to receive foreign assistance, which has been 
described in the past by U.S. officials as essential to its ability to 
produce intercontinental ballistic missiles (ICBMs). While some U.S. 
secondary sanctions on missile cooperation with Iran will remain in 
place, these are insufficiently robust to deter Iran's likely partners.
    Taken together, these weaknesses suggest that the agreement will 
permit Iran to retain the option to build a nuclear weapon in the 
future. Indeed, the agreement could be seen as a means by which Iran 
buys time to perfect, in some cases with international assistance, the 
technologies--advanced centrifuges, weaponization, and long-range 
ballistic missiles--required to build a nuclear weapon in the future. 
In my view, this is not by accident--Iran's ``redlines'' seem to have 
been designed to shape this outcome, implying again that Iran's purpose 
in the talks has been to obtain sanctions relief while retaining or 
even improving its nuclear weapons capability.
    The strength of the agreement must instead rest, then, on our 
ability to detect and deter any such weapons-development effort, 
whether covert or overt. Unfortunately, the inspection mechanism in the 
accord does not appear up to this task. While robust monitoring will be 
in place at declared sites, the U.S. intelligence community assessed in 
2007 that Iran ``probably would use covert facilities--rather than its 
declared nuclear sites--for the production of highly enriched uranium 
for a weapon.'' \6\ The agreement does not, however, permit inspectors 
anything approaching unfettered access to suspect sites.
    Rather, after an indefinite back-and-forth with Iran regarding 
suspicious activity, the IAEA could formally request access to a site, 
which would initiate a deliberative process lasting as many as 24 days. 
If, however, Iran continued to deny inspectors access at the end of 
this period, the matter might not be resolved for another 30 to 65 
days--bringing the delay to 54 to 89 days--or even longer if any of 
these periods were extended by consensus of a ``Joint Commission'' 
consisting of Iran, the EU, and the P5+1. This is far too long a delay 
to permit inspectors to do their jobs effectively.
    Combined with Iran potentially not being required to disclose and 
provide access to PMD-related sites, personnel, and documentation, and 
a missile program that is not subject to inspection at all to my 
knowledge, the result is an inspection regime that falls short of what 
is necessary to detect covert nuclear activity. This inadequacy is 
compounded by the fact that Iran's breakout time even at declared sites 
could potentially diminish to near zero once the restrictions on its 
enrichment- and reprocessing-related activities phase out in 10 to 15 
years, rendering it practically improbable to halt a breakout attempt 
even with monitoring in place.
    The inspection regime is further undermined by the agreement's 
enforcement mechanism. The only remedy for noncompliance--whether the 
refusal of access to inspectors by Iran or any other violation--is the 
termination of the accord and the reimposition of previous U.N. 
resolutions, in which case Iran has asserted that it would consider its 
obligations under the agreement null and void. The implication is that 
small violations of Iran's obligations are likely to go unpunished, and 
access requests are likely to face a high bar, for fear of unraveling 
the accord entirely--the IAEA may hesitate to make a formal access 
request for fear of being party to the agreement's collapse, and the 
other parties to the accord may hesitate to support the IAEA if they 
do. Violations of Iran's other obligations may be explained away as 
inadvertent, the work of rogue elements within Iran, or otherwise not 
worth risking the entire accord over.
    As is often the case with such agreements, the leverage will be 
with the less risk-averse party. The U.S. has not, for example, imposed 
any cost on Russia for its reported violation of the INF Treaty, nor on 
Syria for apparently violating its commitment to destroy its chemical 
weapons. Indeed, in both cases U.S. officials have appeared loath even 
to acknowledge the violations. Iran has already indicated its intention 
to test the inspection regime by asserting that access to military 
sites will be refused as a rule. The absence of ``snap'' inspections 
will remove a psychological barrier to cheating and further encourage 
such risk-taking. Even in the event sanctions snap back, their initial 
effect is likely to be only psychological or symbolic--their economic 
impact will take far more time to be felt, much less to affect Iran's 
decisions.
    Military force remains an option in extremis to enforce the 
agreement. However, the military option may prove more difficult to 
exercise in the future given the international legitimacy the accord 
grants to Iran's nuclear activities, the international involvement in 
those activities that it permits, any steps by Iran to further harden 
its nuclear sites against attack, and the likely return of 
international investment and commerce to Iran.
    In sum, the nuclear agreement is best thought of as a form of 
containment: Iran will retain its nuclear weapons capability, and the 
U.S. and our allies will attempt to prevent it from being used. But it 
is a containment policy in which we agree in advance to gradually lower 
our defenses by phasing out the limitations on Iran's nuclear 
activities by a date certain, and limit our own toolkit by lifting 
sanctions nearly comprehensively up front. In past proposals, the U.S. 
had made the easing of restrictions dependent on Iran's own behavior. 
Under this accord, all Iran need do is bide its time and the 
restrictions will be lifted regardless of its policies. The incentive 
for Iran is therefore simply to wait: to avoid significant overt 
nonperformance under the accord, but not to alter in any fundamental 
way its nuclear ambitions or regional strategy.
             broader implications of the nuclear agreement
    The challenge to U.S. interests posed by Iran goes well beyond its 
nuclear and missile program. Chairman of the Joint Chiefs of Staff 
General Martin Dempsey recently told the Senate Armed Services 
Committee that the threats posed by Iran also included its support for 
proxies, arms trafficking, sea-based mines, and cyber activities. These 
and other Iranian activities threaten our interest in nonproliferation, 
counterterrorism, freedom of navigation, and cybersecurity, and 
directly challenge a U.S. regional strategy focused on ensuring 
regional stability and bolstering the security of our allies.
    President Obama has asserted that the agreement does not presume 
any improvement in Iranian behavior on these fronts, though he has 
expressed hope that Iran's behavior will, in fact, change as a result 
of the deal. However, in the short term at least, Iran's behavior in 
the region is more likely to worsen than improve.
    Anti-Americanism is central to the ideology of the Iranian regime, 
and Iranian leaders--having just reached a diplomatic compromise with 
the U.S.--may feel the need to reaffirm its anti-American bona fides. 
The agreement is also widely perceived as a victory for Iranian 
pragmatists led by President Hassan Rouhani and was, according to 
Secretary of State John Kerry,\7\ opposed by the Islamic Revolutionary 
Guard Corps (IRGC) and other hardliners. Iran's Supreme Leader, widely 
regarded as seeking to balance the regime's contentious factions, may 
feel the need in the agreement's wake to give freer rein to those 
hardliners to prevent one faction from becoming too powerful.
    Finally, Iranian regional behavior is not driven solely by U.S. 
policy or this nuclear accord, but by events in the region themselves. 
Iran's security strategy, in part compensating for a lack of 
conventional military power, has focused on building asymmetric power 
through proxies and surrogates who are able to project Iranian power 
and keep potential foes such as Israel and Sunni Arab states occupied 
far from Iran's borders.
    There is nothing in the agreement that requires Iran to change this 
strategy, or that would forestall a spike in malign Iranian behavior. 
Quite the opposite--the agreement will provide Iran with an influx of 
financial resources, some portion of which seem likely to go to foreign 
priorities such as Lebanon, Syria, Iraq, or Yemen. An infusion of 
Iranian funds could have salutary effects on the Assad regime, which 
has reportedly depended on Iranian assistance, for example receiving a 
fresh $1 billion line of credit from Tehran just last month; on 
Hezbollah, which has reportedly seen assistance from Iran decline as 
the latter was squeezed by sanctions; on Palestinian Islamic Jihad 
(PIJ), which has reportedly been suffering from financial duress; and 
on Hamas, which seeks to rebuild military capacity degraded in its last 
round of fighting with Israel. It could also be used to step up 
recruiting for Iranian-backed militias in Syria and Iraq, to ensure 
that Iraqi Shiite militias backed by Iran are better resourced than 
official Iraqi security services, and to buy increased political 
influence in Iraq, Afghanistan, and elsewhere.\8\
    The agreement will also lift the ban on ballistic missile tests and 
the designations of certain entities involved in Iran's regional 
troublemaking, such as (in 8 years) the IRGC-Quds Force. It will also 
remove, in no more than 5 years, sanctions barring the transfer of arms 
to Iran--paving the way for the possible modernization of Iran's 
relatively antiquated conventional forces--and will lift by my reading 
the ban on Iran exporting arms itself.\9\ While in some circumstances 
other authorities exist to prohibit arms transfers to Iranian proxies, 
these measures have been poorly enforced and seem likely to be weakened 
further, not strengthened, by this agreement. As a result, and seeing 
as regional conflicts in which Iran is embroiled show little sign of 
abating, there is more reason to believe that Iran's regional 
activities will increase rather than diminish, including the 
proliferation of sophisticated arms.
    While some regard Iran as a potential partner against the likes of 
ISIS, in fact any uptick in Iranian regional troublemaking stands to 
benefit ISIS and its ilk, which feed off the sectarian polarization 
Iran's activities foster. In addition, because many U.S. allies in the 
region see Iran and its proxies as a major threat to their security, 
they are likely to respond to any increase in Iranian adventurism. To 
an extent, we are already witnessing these dynamics playing out around 
the region. To make matters worse, U.S. allies may also seek in the 
wake of the accord to match Iran's nuclear capabilities to ensure they 
could respond rapidly to any Iranian nuclear breakout; while there is 
no guarantee they will do so, the incentive is clear. Our reassurances 
to them will be met with skepticism in light of our relative inaction 
thus far to counter Iranian regional aggression, and in light of our 
failure to follow through on similar assurances given to Ukraine in 
1994 as part of our pursuit of a different arms control treaty.
    This incentive will remain even if, as some hope, the Iranian 
regime becomes friendlier or more constructive in the coming years. 
Even a different regime in Tehran may not wish to concede a nuclear 
capability that has been granted international legitimacy. And given 
the long history of rivalry between Iran and its major neighbors, the 
presence of a large, advanced nuclear program in Iran will likely 
prompt a balancing reaction in the region regardless of Tehran's 
attitude toward the United States.
    The agreement also seems likely to foster closer diplomatic, 
economic, and military ties between Iran and a host of states outside 
the region, including India, Pakistan, Russia, and especially China. 
Sino-Iranian trade has been growing despite sanctions, and even China's 
energy imports from Iran have reached record highs in 2014-2015 despite 
NDAA sanctions calling for states to reduce their oil trade with Iran. 
In addition, China-Iran military ties have increased, with Chinese 
fighter jets landing in Iran to refuel and Chinese warships paying a 
call to the Iranian port of Bandar Abbas in recent years. Chinese and 
Iranian defense officials have called for expansion of these ties, and 
the lifting or phasing out of sanctions will smooth the way for this to 
occur.
    All of this is on its face would appear to constitute a significant 
strategic reversal by the United States--accommodating Iranian nuclear 
expansion after years of opposing it, lifting sanctions on Iran after 
years of expanding them, and facilitating Iran's financial and 
diplomatic reintegration into the international community after years 
of seeking to isolate it. These actions stand in opposition to long-
standing U.S. strategy in the Middle East, which aimed to foster 
regional stability and prosperity by bolstering the security of allies, 
effectively countering those who challenged our mutual interests, and 
preventing inroads by hegemons from inside or outside the region. This 
conflict between our actions and our stated strategy inevitably leads 
allies to conclude either that our commitment to that strategy and to 
the region itself is diminished, or that we are embarking on a broader 
strategic realignment.
                             looking ahead
    One of the chief defenses offered for the nuclear agreement is 
that, whatever its shortcomings, it is preferable to the alternatives. 
It is one thing to say, however, that a negotiated agreement of some 
sort was preferable to alternatives such as military conflict or 
acquiescence, and another entirely to claim that this is the best 
accord that could have been negotiated. I have little doubt that 
different tactics could have produced a stronger agreement. Indeed, it 
is the very denigration of our alternatives and failure to credibly 
project consequences--whether sanctions or military force--for Iran of 
failing to accept strict limitations on its nuclear activities that in 
my view most contributed to the weakness of this accord. The notion 
that Iran would have marched inexorably toward a nuclear weapon were it 
not for this deal ignores the considerable deterrent effect that 
further sanctions and the credible threat of military force would 
likely have had on Iranian decisionmaking.
    Such assertions on both sides, however, are now largely a matter 
for historical debate. The more immediately relevant question is 
whether to implement the accord. If the deal cannot muster sufficient 
domestic support, it should like any rejected agreement be 
renegotiated. There is no particular reason it cannot be, though the 
other parties are likely to resist. Ordinarily they would nevertheless 
require U.S. participation for the termination of international 
sanctions, but the recent passage of a U.N. Security Council resolution 
endorsing the accord and setting a schedule for lifting sanctions gives 
rise to the possibility--the text of the deal is not clear on this 
point--that the deal's implementation could proceed even without the 
United States fulfilling our obligations.
    It is also possible that Iran would refuse to implement its 
obligations were the deal rejected by the United States, and that it 
would find sympathy from partners such as Russia and China. Because, 
however, our allies would remain committed to preventing Iran from 
developing a nuclear weapon, Iranian noncompliance would not be met 
with resignation but would likely lead to a resumption of previous 
efforts to resolve the crisis through diplomacy and pressure. None of 
these scenarios is by any means an easy one; our policy to date will 
not be without consequences.
    If the nuclear accord is implemented, U.S. policymakers will need 
to contend with the new reality it creates. We must avoid the 
temptation to overlook harmful Iranian policies or offer unilateral 
concessions in a misguided effort to bolster one regime faction against 
another, but instead establish clear disincentives for destabilizing 
behavior and incentives for constructive behavior by Tehran. It will be 
important to ensure that the U.S. intelligence community and IAEA have 
sufficient resources to monitor Iranian nuclear efforts, to strengthen 
the U.S. position in the Middle East by reinvigorating our regional 
alliances, to restore the credibility of U.S. military deterrence in 
the context of an overall strengthening of U.S. defense resources, to 
more firmly counter Iranian regional actions while pressing Iran to 
play a more constructive regional role, and to respond quickly to 
violations of Iran's nuclear obligations as well as activities not 
covered by the agreement such as provocative missile tests. Frankly 
these are objectives we should have been pursuing now for years--not 
merely considering as a consequence of a nuclear accord--but have 
neglected.
    Most difficult of all, the next President is almost certain to find 
the nuclear constraints imposed on Iran by this accord to be 
unsatisfactory, if for no other reason than those limitations will 
begin to expire by the end of the next President's tenure if he or she 
is reelected. In this sense, the question is not whether, but when, we 
will need to devise an alternative policy toward Iran's nuclear and 
regional activities. The next President will need to rebuild 
international support for a strengthened Iran policy with fewer tools 
at his or her disposal, and may well be doing so in a less favorable 
international context given recent shifts in the international security 
environment and the likely strengthened diplomatic, economic, and 
strategic ties Iran may enjoy with other states in the future.
    As I noted at the outset, sensible foreign policy must clearly 
advance American interests at a cost that is outweighed by the policy's 
projected benefits. It is not clear that the nuclear agreement with 
Iran meets these criteria. It does not clearly achieve the objective it 
sets out to--the prevention of a nuclear-armed Iran--nor does it 
complement our broader strategy in the Middle East or our global 
nonproliferation strategy. Instead, it entails significant costs that 
are justified primarily by conjuring the specter of an even more costly 
war no analyst believed was imminent.

----------------
Notes

    \1\ Joint Comprehensive Plan of Action, part C, para 16.
    \2\ IAEA GOV/2011/65.
    \3\ U.N. Security Council Resolution 1929, op9.
    \4\ U.N. Security Council Resolution 2231, Annex B, para 3.
    \5\ ``Iran: Russia Says New Rocket Raises Nuclear `Suspicions,' '' 
Associated Press, February 7, 2008.
    \6\ 2007 Iran Nuclear NIE.
    \7\ Secretary of State John Kerry at the Council on Foreign 
Relations, July 24, 2015.
    \8\ For more examples, see ``The Regional Impact of Additional 
Iranian Money,'' PolicyWatch 2456, The Washington Institute for Near 
East Policy, July 28, 2015.
    \9\ U.N. Security Council Resolution 1747, op5.

    The Chairman. Thank you very much.
    Dr. Pollack.

STATEMENT OF KEN POLLACK, SENIOR FELLOW, CENTER FOR MIDDLE EAST 
         POLICY, BROOKINGS INSTITUTION, WASHINGTON, DC

    Dr. Pollack. Thank you very much, Mr. Chairman, Ranking 
Member Cardin, distinguished Senators. It is a pleasure to once 
again be speaking before you, and a pleasure to be sharing the 
dais with my friend, Mike Singh.
    I want to start just briefly because I have not been on 
record anywhere else by saying that I find myself an 
unenthusiastic but nevertheless firm supporter of the 
agreement, unenthusiastic because I believe that this is a 
weaker deal than what we might have gotten. I was not present 
in the negotiating chambers, so I do not know exactly how 
things could have gone. But given where we were 2 years ago, I 
do believe it was possible to have gotten a stronger deal.
    That said, I am also a firm supporter of it because I 
believe that, first, it is not a bad deal. It has some 
important strengths. And I do believe that it will ultimately 
leave us in a position where our national interests are better 
served by accepting it than by rejecting it. For me, that is 
the ultimate criteria upon which to judge this deal itself.
    That said, I completely agree with the thrust of Mike 
Singh's remarks, that ultimately where this deal is really 
going to be made or broken is in the region. We should all 
remember that our concern about the Iranian nuclear program was 
not that the Iranians would acquire nuclear weapons and 
suddenly lob one at Tel Aviv or Riyadh or Mecca or someplace 
else that we cared about. It was always about how it would 
enable Iranian subversion and aggression in the region.
    That is where this is all going to play out. I think that 
it behooves us, then, to focus, as you are doing in these 
hearings, on this question of what should U.S. policy toward 
the region be after a deal.
    To make a point that I have made several times, that I 
think also reflects what Mike just said, I look at this deal, 
and these are my words, not his, I look at this deal as a 
pretty good deal for 10 or 12 years. After that, it is a bet. 
It is a bet that either Iran will change fundamentally or that 
circumstances will constrain Iran in such a way that it does 
not resume its efforts to acquire a nuclear weapon, once the 
strictest terms of the deal have been set aside and moved past 
by the subsequent terms of the deal.
    For that reason, what happens in the region becomes even 
more important. We have 10 to 12 years to set the stage 
properly, to shape the environment, to make sure that Iran is 
not able to take advantage of that period, but also hopefully 
to put Iran in a position where, in 10 or 12 years, its cost-
benefit analysis, if not its regime, has changed fundamentally, 
and its approach to the region, to our allies, to our 
interests, is fundamentally changed.
    That is going to be a major challenge. Right now, as you 
are all aware, we have a very big problem on our hands in the 
region. Our allies are deeply frightened by what they see going 
on. They are concerned that the agreement will enable the 
Iranians to become more aggressive in ways that the region does 
not need, given how unstable it already is.
    They are also, I would suggest, even more concerned about 
where U.S. policy toward the region may go afterward. I think 
they are all, as I hear it from them in private, terrified that 
the United States will see the nuclear agreement with Iran as a 
get-out-of-the-Middle-East-free card, as a chance to say we 
have solved the biggest security threat facing the Middle East, 
now we are done, we can leave and disengage even further.
    That, I would suggest to you, is the greatest fear of our 
allies in the region, and it is where a future U.S. policy, a 
post-JCPOA policy has to be focused. We have to find ways to 
reassure our allies.
    In addition, I think we are also going to have to find ways 
to deter the Iranians. We have heard now from the supreme 
leader, from a number of hardliners. There seems to be no 
indication that the Iranians are planning to dramatically 
change their policy toward the region. In fact, everything that 
we have been hearing, I would suggest, indicates that the 
Iranians intend to perhaps become even somewhat more 
aggressive, if only to demonstrate what I am calling their 
revolutionary mojo, that they have not lost the thrust of 
Khomeini's philosophy, that they are still committed to an 
anti-American, antistatus quo policy, regardless of any nuclear 
agreements with the United States.
    They may also seek to test us. They too may wonder if the 
United States is looking to disengage even further from the 
Middle East, in the wake of a nuclear agreement. And if they do 
not find the United States staunchly standing its ground, 
backing up its allies, and ready to push back on them, they may 
decide to push harder, both out of opportunity and, again, to 
demonstrate whatever revolutionary credentials they still feel 
necessary.
    For me, all of this comes down to a question mark about 
where the United States is planning to go in its regional 
policy after the JCPOA has come into effect. To me, that is 
ultimately a far greater consequence than the technical details 
of the deal. Whether it is 25 days or 20 days or 30 days before 
a violation can be enacted upon, to me, is not terribly useful, 
not terribly meaningful.
    To me, what is important is how the United States is going 
to behave in the region, because if we behave in one way, I 
think that we will terrify our allies and we will embolden the 
Iranians. What we have seen from our allies over the last 4 or 
5 years is that when they are frightened, they get aggressive, 
and they do not get aggressive in a good way. They do not have 
the political, military, or economic capacity to act 
aggressively in their region.
    I would simply hold up Saudi Arabia's unprecedented 
intervention in Yemen as Exhibit A of that. This was a war that 
they should have never gotten involved in. And they did it, as 
they will say in private, because the United States was not 
doing more for them. That is where we have to put our focus.
    And I would simply like to close by saying that when I look 
around the region, I fear that it is going to require the 
United States actually stepping up and pushing back on the 
Iranians, both to reassure our allies and to deter the 
Iranians. When I look around the region and look at the 
potential venues, fortunately, we have no shortage of places 
where we could take it to the Iranians.
    That is a joke. I am being horribly sarcastic with that.
    But unfortunately, only one really stands out. Yemen is a 
place where we should be trying to get the Saudis to do less, 
not more from us. Iraq is very fragile and will probably 
require both Iranian and American cooperation to make that turn 
out well. For better or worse, mostly worse, we have 
surrendered much of our former influence in Iraq to the 
Iranians. Therefore, it too is not the right battlefields.
    Syria strikes me as the place. In my mind, signing the 
JCPOA ought to come with a new commitment on the part of the 
United States to finally make good on the pledges that we have 
made to actually commit meaningful support to the Syrian 
opposition to demonstrate again to our allies that we are 
willing to stand up to the Iranians, to the Iranians that we 
are not going to back down if they try to run the table on us.
    [The prepared statement of Dr. Pollack follows:]

                Prepared Statement of Kenneth M. Pollack

    Mr. Chairman and distinguished Senators, I am honored to be able to 
appear before you to discuss the Joint Comprehensive Plan of Action 
(JCPOA) with Iran and, in particular, its regional implications. I 
believe this to be, arguably, the most important aspect of the 
agreement. For that reason, I consider it imperative that the United 
States be ready to shape the regional environment to ensure that the 
JCPOA contributes to American security, rather than undermining it. To 
me, that will be determined primarily by America's behavior in the 
region after the JCPOA, and not by the specific terms of the deal 
itself. This agreement is likely to be made or broken on the 
battlefields of Iraq, Syria, and Yemen, not in the centrifuge halls of 
Natanz and Fordow.
                                the deal
    Let me start by being candid about my thinking on the deal itself. 
Unenthusiastically but firmly, I believe that the United States should 
accept the Iranian nuclear agreement and implement it fully. I am 
unenthusiastic about the Joint Comprehensive Plan of Action because it 
is an imperfect agreement at best. I was not in the room while it was 
being negotiated, so I cannot be certain, but I do not believe that it 
was inevitable that we ended up with this agreement, given where we 
started from with Iran 2 years ago. I continue to believe that the 
United States could have negotiated a better deal with Iran had the 
Obama administration handled those negotiations differently. I am 
particularly concerned that the most stringent constraints on Iran's 
nuclear program effectively end after 10-15 years. While it is not 
unreasonable to believe that Iran will be a very different country in 
10-15 years, or may find reasons not to resume development of a nuclear 
weapon at that time, it is equally plausible that we will face the same 
old Iran then that we do now, and that Iran may seek a nuclear weapon.
    Nevertheless, I firmly believe that it would be a mistake for the 
Congress to override a Presidential veto and prevent the United States 
from adhering to the agreement. First, it is not a disastrously bad 
deal. For 15 years, Iran's nuclear program will be very limited. It 
will be difficult to cheat and the administration won important 
victories in ensuring that ultimately the inspectors are to be given 
access to any facility they want to see, and the United States retains 
the ultimate threat of having the U.N. sanctions reimposed with only 
the cooperation of our European allies. One of the most important 
lessons that we should have learned from our painful experiences with 
Iraq is that this is what makes for a successful arms control 
agreement. It is NOT necessary to be certain that you can detect every 
instance of cheating--that is impossible, and the United States did not 
do that even in Iraq where the inspectors had far, far greater access 
and authority. It is merely necessary that the target country believe 
that there is a reasonable probability that any cheating activity will 
be detected, and an equally reasonable probability that such cheating 
will result in consequences that it finds unacceptably painful. That 
was what ultimately convinced even Saddam Hussein to give up his hidden 
WMD programs (although he did so in his own inimitably bizarre manner). 
The JCPOA creates just that disincentive for Iran, and therefore I 
think we can have a reasonably high degree of confidence that Iran will 
abide by it. Indeed, I think it unlikely that they will meaningfully 
cheat for the foreseeable future--although it is impossible to know if 
that means 3 years, 5 years, 15 years, or longer.
    I know that opponents of the deal bristle whenever they hear it, 
but I believe that, imperfect as it is, accepting the deal is 
considerably better for the United States than any of the realistic 
alternatives. I have written extensively about these alternatives in 
the past, even warning 2 years ago that I feared we would soon be 
forced to confront the very dilemmas we now face.\1\ I believe that 
stopping Iran from acquiring nuclear weapons militarily would likely 
require a major war, and quite possibly a full-scale U.S. invasion and 
occupation of Iran. I do not think that necessary or desirable. I 
believe that Israeli Prime Minister Benjamin Netanyahu's belief that 
the United States could reject this deal and somehow force Iran to 
negotiate a new one that is better for the United States is misplaced. 
I think it far more likely that were the United States to turn down the 
JCPOA, we would find ourselves in a far worse position. In those 
circumstances, I think it most likely that Iran would gain widespread 
international sympathy, the sanctions would erode and then collapse--as 
I watched the same happen to the even-tighter Iraq sanctions when I was 
the NSC Director for Persian Gulf Affairs during the late 1990s--and 
Iran would emerge stronger and less constrained that it is today. I do 
fear that in such a scenario, Iran would narrow its breakout window 
significantly, or even field a nuclear arsenal.
    This may not be the deal we want or even the deal might have had, 
but it is the deal we have. And I am convinced that it is the only deal 
we will ever have and we are more likely to regret turning it down than 
we are to regret having accepted it.
                       and now for the hard part
    Ultimately, I see the JCPOA as a pretty good deal for 15 years, but 
after that it's a bet. A bet that after 15 years, Iran will be kinder, 
gentler, smarter, better disposed toward us and our allies, or more 
sober about the cost-benefit values of acquiring nuclear weapons.
    Consequently, what looms largest in my assessment of the nuclear 
agreement is how the United States deals with Iran during those 15 
years. Can we shape circumstances in such a way that we are more likely 
to have a better Iran emerge from those 15 years? Perhaps more 
important still, we should never lose sight of the fact that an Iranian 
nuclear weapon was never the real threat to American interests. It was 
exceptionally unlikely that Iran would ever use a nuclear weapon, let 
alone give one to terrorists.\2\ Instead, the reason that we and our 
allies have focused so heavily on Iran's nuclear program is because an 
Iranian nuclear arsenal threatened to enable further Iranian subversion 
and/or aggression in the Middle East--a part of the world that does not 
need any more instability than it already has.
    That is why I am more concerned about how the United States 
conducts its foreign policy toward the Middle East under the auspices 
of the JCPOA than I am about the technical pros and cons of the 
agreement itself.
    We will probably have 15 years before we really have to worry about 
the prospect of an Iranian nuclear arsenal again. But Iran probably 
won't pull in its horns, give up its regional ambitions, and suddenly 
embrace America and its allies during that period of time. If the 
various remarks of Iran's Supreme Leader are any guide, Iranian policy 
is unlikely to become any more accommodating, and could become far more 
confrontational as Tehran seeks to demonstrate that it has not lost its 
revolutionary mojo and tests whether the United States plans to use the 
JCPOA to justify further disengagement from the region.
    Indeed, that is what I fear most. That a war-weary and ``Middle 
East-weary'' U.S. administration will point to the JCPOA and say, 
``See, we removed the greatest threat to U.S. interests and allies in 
the Middle East, so now we can afford to step back from the region even 
more than we already have.'' I fear that the JCPOA will justify another 
``pivot to Asia,'' which as best as I can tell was nothing more than an 
excuse for pivoting away from the Middle East, with demonstrably 
catastrophic consequences in Iraq and elsewhere.
    Even here, the real questions are not those about regional 
proliferation, which has dominated discussion of this matter to date, 
but about the civil and proxy wars currently roiling the Middle East, 
and the likely role of the United States in the region after a nuclear 
accord with Iran. It is those issues that are likely to determine 
whether a nuclear deal with Iran leads to greater stability or greater 
instability in the Middle East, and thus whether it ultimately benefits 
or undermines American national security.
                                  iran
    It is important to begin any assessment of regional dynamics in the 
wake of an Iranian nuclear agreement by asking how Iran itself is 
likely to behave. As always, we need to be very humble about our 
ability to predict Iran's future behavior. Iran has an opaque and 
convoluted political system, riven by factions and presided over by a 
Supreme Leader who has often made decisions by not making decisions or 
by splitting the Solomonic baby. Indeed, it seems most likely that once 
the JCPOA has been agreed to by all sides, there will be a debate in 
Tehran over Iranian foreign policy (as there always is), with moderates 
and reformists arguing for Iran to use the deal as the start of a 
larger process of reopening to the world and even rapprochement with 
the United States. Inevitably, various Iranian hardliners and 
conservatives will argue that a deal makes such moves unnecessary and 
that instead Iran can and must redouble its efforts to export 
Khomeini's revolution and drive the United States and its allies out of 
the Middle East altogether.
    Ayatollah Khamenei's various statements in recent weeks continue to 
lead me to conclude that he views the JCPOA in purely transactional 
terms. It is a straightforward deal for him: sanctions relief for 
constraints on his nuclear program. Nothing more and nothing less. It 
seems unlikely he will countenance a wider rapprochement with the 
United States, although we can all hope that Foreign Minister Javad 
Zarif and President Hassan Rouhani will be able to convince him 
otherwise.
    Iran has always seemed to fashion discrete policies toward 
different states of the region. In each case, it has a certain set of 
interests in a country and engages in a policy debate over how to act 
toward that country--in which Iran's complicated domestic politics 
interact with various strategic perspectives to produce a policy toward 
that country. Right now, Iran probably has a Syria policy based on its 
interests and its politics as they relate to Syria. It appears to have 
an Iraq policy based on its interests and its politics as they relate 
to Iraq. And the same for Bahrain, Saudi Arabia, Yemen, etc. Neither 
those interests nor those politics appear likely to change much, if at 
all, as a result of the nuclear deal, at least in the short term. 
Instead, Iranian actions toward all of those places seem precisely 
calibrated to what Iran is trying to achieve there, and that is 
unlikely to be affected by the nuclear deal one way or the other.
    It is also worth noting that, across the region, the Iranians seem 
pretty comfortable with their current policies. They may well believe 
that things are mostly going their way. Their Shia allies are dominant 
in Iraq, Lebanon, and Yemen (despite recent tactical reverses in 
Yemen). In Syria, the Assad regime is embattled and has suffered some 
setbacks, but it remains in power and Iran continues to commit its own 
resources and the troops of its Iraqi and Hezbollah allies to shore up 
the Alawi position there. Most reports indicate that the Iranians exert 
far greater control over Assad's rump Syrian state than they ever have 
in the past. Thus, Iran may feel its position has improved in Damascus, 
even if Damascus's control over Syria has taken a beating. Tehran may 
also feel it could be doing better in Bahrain, but of the countries in 
play in the region, that's the only one Iran cares about where Tehran 
may not believe it is ``winning.''
    In short, all other things being equal, it seems unlikely that 
Iranian policy toward the region will change merely as a result of a 
nuclear agreement with the P5+1. There is no particular reason to 
believe that Iran is ready to throw in the towel in any of these 
places. But neither is there any reason to believe that Iran is looking 
to increase its aggressive involvement in any of these states but has 
been somehow constrained from doing so by the nuclear negotiations.
    But all other things may not prove equal. It may be that Khamenei 
will feel that a nuclear deal is a major concession to Rouhani and the 
Iranian Left and therefore may feel the need to demonstrate to the 
hardliners of the Iranian Right that a nuclear deal does not mean that 
Tehran has abandoned Khamenei's ideology by giving up its enmity with 
the United States. If that is the case, Iran may ratchet up some of its 
antistatus quo activities in certain selected venues.

          Israel is the obvious case in point: Iran may try to convince 
        Hezbollah, Hamas, Palestine Islamic Jihad (PIJ), and others to 
        mount attacks on Israel. That's almost a ``freebie'' for Iran. 
        Israel is unlikely to retaliate directly against Iran, everyone 
        will know that Tehran is behind the attacks, and since the 
        Netanyahu government has managed to isolate Israel in ways that 
        the Palestinians never could, Tehran will be playing to a 
        popular cause. The problem here is that Iran may not be able to 
        pull the trigger on such a campaign. Hezbollah and Hamas are 
        both extremely wary of picking a fight with Israel, as 
        demonstrated by the fact that neither has done so in the face 
        of multiple Israeli provocations. The events of the Arab Spring 
        and the Syrian civil war has estranged Hamas from Iran and tied 
        Hezbollah down in intense combat such that neither may be 
        willing to heed a hypothetical Iranian call for new attacks on 
        Israel. The Gulf Cooperation Council (GCC) states have begun a 
        campaign to wean Hamas from Iran entirely and bring it into the 
        Sunni Arab fold. For their part, PIJ and other Palestinian 
        proxy groups probably face the same anti-Iranian pressures as 
        Hamas, are weaker than in the past, and may have a hard time 
        penetrating Israel's ever more sophisticated defenses.
          Bahrain is another possibility. Because Bahrain is a 
        majority-Shia state whose people have been disenfranchised and 
        oppressed by the regime--and their Saudi allies--it is another 
        arena where Iran may be able to burnish its revolutionary 
        credentials in a relatively popular international cause. But 
        here, too, there are limits. Some Bahraini Shia clearly accept 
        aid from Iran, but the majority appear to prefer not to. They 
        recognize that the more that they can be dismissed as Iranian 
        agents, the harder it is for them to get international pressure 
        on the regime to reform. In addition, Bahrain is a very 
        sensitive issue for the Saudis, and the Iranians have to worry 
        that if they press on Bahrain, the Saudis might push back 
        somewhere else where they are more vulnerable.
          A last possibility is Yemen. Iran has few direct stakes in 
        Yemen, and its nominal allies, the Houthis, remain dominant 
        militarily despite their inability to retake Aden. So Iran has 
        a relatively powerful ally and little to lose there. But, once 
        again, Iran's ties to the Houthis have been exaggerated, and it 
        is another very sensitive spot for the Saudis.

    Consequently, it may prove difficult for Iran to make much mischief 
in any of these arenas--more difficult than it may be worth for them.
    As this analysis suggests, I believe that Iran's most likely course 
after a nuclear agreement will be to continue to pursue the same 
regional strategy it has pursued over the past 3 years. That strategy 
is inimical to the interests of the United States and its allies in 
many ways. However, there is a much greater danger: the danger that 
Iran will interpret American behavior after a nuclear agreement as a 
sign of further disengagement from the Middle East. If that is the 
case, it is highly likely that Iranian goals will become more expansive 
and its policies more aggressive as it believes that the United States 
will not be as willing (or able) to block its moves. Thus, the most 
important variable in Iranian regional behavior after a deal may well 
prove to be the U.S. reaction, rather than anything derived from 
Iranian strategy or politics itself.
                                 israel
    Let me now turn to the question of likely Israeli responses to a 
nuclear deal. I think it important to address the elephant in the 
living room first: It is highly unlikely that Israel will mount a 
military attack against Iran if the JCPOA is enacted by all sides. As I 
have laid out in greater detail elsewhere, Israel currently does not 
have a good military option against Iran for both military-technical 
and political reasons.\3\ That's why Israel has uncharacteristically 
abstained from a strike, despite repeated threats to do so since the 
late 1990s.
    The political circumstances are even worse now and will remain so 
after the JCPOA goes into effect. Consider the context: Iran has just 
signed a deal with the United States and the other great powers 
agreeing to limits on its nuclear program, accepting more intrusive 
inspections than in the past and reaffirming that it will not try to 
build a nuclear weapon. If the Israelis were to attack in these 
circumstances, an already anti-Israeli international climate would 
almost certainly turn wholeheartedly against them.
    The question of how the international community would react to an 
Israeli strike on Iran is of more than academic interest to the 
Israelis. If Israel attacks Iran, there is a very real risk that Iran 
would respond by withdrawing from the JCPOA and probably the NPT, 
evicting the inspectors and announcing that it will acquire nuclear 
weapons since its own conventional forces and the word of the 
international community were clearly inadequate to deter an unprovoked 
Israeli attack. The Iranians would doubtless also demand that the 
remaining sanctions on them be lifted (and probably call for the 
imposition of sanctions on Israel). If such actions were not 
forthcoming, Tehran would probably set about busting the sanctions with 
the active connivance of many other countries, probably including 
members of the P5+1.
    The problem for the Israelis is that in those circumstances, with 
the entire world furious at them for committing aggression and 
destroying a deal that most see as having been the best way to keep 
Iran from acquiring nuclear weapons, there is likely to be very little 
will to preserve the sanctions on Iran. It's hard to imagine a scenario 
in which Iran has a better chance to break out of the sanctions cage 
than this one.
    Thus, an Israeli military strike in these circumstances would be 
unlikely to help prevent Iran from acquiring nuclear weapons. It is 
more likely to ensure an Iranian nuclear weapon and jeopardize the 
international containment of Iran.
    While this set of problems makes an Israeli military response 
unlikely, that doesn't mean that Jerusalem will just roll over and 
accept the JCPOA or the new world it will make. First, I suspect that 
the Israelis will ramp up their covert campaign against Iran and its 
nuclear program. More Iranian scientists may get mysteriously 
assassinated in Tehran. More sensitive Iranian facilities might blow 
up. More computer viruses might plague Iranian networks. More money 
might find its way to Iranian democracy activists and ethnic 
minorities. Of course, even then, the Israelis may show some restraint: 
The Iranians are believed to have greatly improved their own cyberwar 
capabilities, and even a right-wing Israeli Government might not want 
to provoke a harsh Iranian response that would affect Israel's civilian 
economy.
    Second, I think it pretty much a foregone conclusion that the 
Israelis will also seek greatly expanded U.S. aid in response to a 
nuclear deal with Iran. I assume that Secretary of Defense Ashton 
Carter got hints of the Israeli shopping list when he was in Jerusalem 
last month. I expect that Israel will seek to improve its capability to 
strike Iranian targets, to defeat retaliatory missile and rocket 
attacks by Iran or its allies, and to ensure that Israel has a secure 
second-strike capability. More F-35s, greater funding for Israel's 
Arrow antiballistic missile and Iron Dome antirocket systems, and more 
capable bunker-busting munitions all seem like certain Israeli 
requests. But Jerusalem may well ask for other weapons and capabilities 
previously denied it, both because it may feel a strategic need for 
such enhanced capabilities and because it may believe that the United 
States will be more willing to provide them to secure Jerusalem's 
(grudging) acquiescence to the deal. It may also seek greater American 
forbearance for the acquisition of additional cruise-missile subs, 
which appear to be the core of Israel's secure second-strike 
capability.
    Finally, a nuclear deal with Iran could push Israel to become more 
aggressive in its own neighborhood. The Israelis will doubtless argue 
that the deal has made them feel less safe, and therefore less willing 
to take risks on other security matters--particularly developments with 
the Palestinians, but potentially in Syria and Lebanon as well. (The 
Israelis are very comfortable with the Egyptian and Jordanian 
governments and are unlikely to take actions that would undermine them 
or diminish their cooperation with Israel.) For instance, in the wake 
of a nuclear deal, Israel may look to smash Hezbollah and/or Hamas in 
Gaza again to convince them not to mount new attacks against Israel 
once their old Iranian allies (a strained relationship in the case of 
Hamas) begin coming out from under the sanctions and possibly flexing 
their muscles across the region.
    It is worth noting that some Israeli officials may favor such 
actions out of a genuine belief that this is what is necessary to 
guarantee their security after what they depict as a ruinous Iran deal. 
Others may do so cynically, using their well-known unhappiness with the 
JCPOA to justify doing a bunch of things that they believe that the 
U.S. and international communities would be loath to condone otherwise.
                              saudi arabia
    Especially in light of these assessments of likely Iranian and 
Israeli behavior after the nuclear deal, Saudi Arabia is the real wild 
card we must consider. The Saudis aren't exactly fans of a nuclear deal 
with Iran. And Saudi Arabia is the most likely candidate to acquire 
nuclear weapons if Iran were to do so.\4\ In private, Saudi officials 
have repeatedly warned American officials (including this author) that 
if Iran crosses the nuclear threshold, Saudi Arabia will follow suit--
and nothing will stop them--because they will not live in a world where 
Iran has a nuclear weapon and they do not. Prince Turki al-Faisal, the 
former Saudi intelligence chief, has gone so far as to repeat that 
warning in public.\5\ For instance, in 2011, Turki commented that ``It 
is in our interest that Iran does not develop a nuclear weapon, for its 
doing so would compel Saudi Arabia, whose foreign relations are now so 
fully measured and well assessed, to pursue policies that could lead to 
untold and possibly dramatic consequences.'' \6\
    Yet the Saudis are often far more subtle and creative than others 
give them credit for. Even if Iran were to acquire an actual weapon or 
a near-term breakout capability, the Saudis might not simply take the 
obvious path forward and buy a nuclear weapon itself. There are many 
actions the Saudis could take to create ambiguity and make Iran (and 
others) wonder whether the Saudis had acquired a nuclear capability 
without declaring that the Kingdom had joined the nuclear club. Riyadh 
could build a nuclear plant of its own and begin to enrich uranium, 
perhaps even hiring large numbers of Pakistanis and other foreigners to 
do so very quickly, in almost exactly the same manner that the Iranians 
have proceeded. A favorite Israeli scenario is that one day, satellite 
imagery of Saudi Arabia suddenly reveals the presence of a half-dozen 
nuclear-capable Pakistani F-16s at a Saudi air base. Pakistan has long 
contributed military support, equipment, and even whole formations to 
Saudi defense, so this would not be anything extraordinary. Everyone 
would wonder whether the F-16s had brought nuclear weapons with them 
and the Saudis could studiously avoid answering the question. The 
Iranians, and the whole world, would not know. There would be no proof 
that the Kingdom had acquired a nuclear weapon and therefore no 
particular basis to impose sanctions on Riyadh. Yet overnight, the 
Iranians would have to calculate that the Kingdom had acquired a 
nuclear weapon.
    But all of that lies in the realm of hypotheticals inappropriate to 
the current context. If Iran ratifies the JCPOA, it will be publicly 
pledging not to acquire a nuclear weapon--and it will have the entire 
international community (except Israel) giving them the benefit of the 
doubt. In that context, we should not expect the Saudis to acquire a 
nuclear weapon of their own in response.
    The Saudis have had good reasons for not acquiring one all of these 
years (and the Pakistanis good reasons for not giving it to them). More 
than that, the optics would be all wrong for the Saudis. Iran has just 
signed a deal with the U.S., U.K., France, Germany, Russia, and China 
agreeing never to build a nuclear weapon and accepting limits on its 
enrichment program to reassure the world that it won't/can't get a 
nuclear weapon. In that context, if Saudi Arabia goes out and buys a 
bomb from someone, suddenly Riyadh (and whoever sold it to them) will 
become the international pariahs. All of the sympathy will swing to 
Iran, which will be seen as having behaved well, whereas there will be 
worldwide demands to sanction the Saudis (and their suppliers) for 
doing exactly what Iran has agreed not to do. None of this makes sense 
for the Saudis and probably explains at least part of why Pakistan is 
already distancing itself from Riyadh on military matters despite their 
historic (nuclear) ties.
    That said, the Saudis may react in other ways. First, we should 
expect that the Saudis will announce that they are going to build up a 
nuclear program of their own to the precise levels Iran has been 
allowed by the JCPOA. Doing so would be an important warning both to 
the Iranians (that the Saudis will match their nuclear capabilities at 
every step) and to the West (that they will have further proliferation 
in the Middle East if they do not force Iran to live up to its new 
commitments).
    Second, the Saudis may choose to ramp up their support to various 
Sunni groups fighting Iran's allies and proxies around the region. The 
Saudis seem to agree with the Iranians that Tehran is ``winning'' in 
Lebanon, Iraq, and Yemen. Syria is a more uncertain affair, but Iran's 
allies are hardly defeated there and Iran is amping up its support for 
them. The Saudis also seem to believe that Iran is making important 
inroads in Oman and with various Shia communities elsewhere in the 
gulf. So while the Iranians may want to hold to a steady course, the 
Saudis may choose to double down.
    Unfortunately, there is a greater danger still. The Saudis and 
their Sunni Arab allies may fear that the United States intends to use 
a nuclear deal with Iran as a ``Get Out of the Middle East Free'' card. 
The Gulf States are convinced that this is the Obama administration's 
intent. Across the board in private, gulf officials damn the 
administration for its weak response to Iran, brought to a head at the 
May 2015 summit at Camp David, where they claim that the United States 
offered nothing new as reassurance that Washington would push back on 
Iran. The danger here is that, far from accommodating Tehran as some 
have feared, the Gulf States are far more likely to get in Tehran's 
face to try to deter or even roll back the Iranians and their allies. 
The GCC air campaign in Yemen is a perfect example of this. It 
represents a stunning departure from past GCC practice: They had never 
intervened directly with their own armed forces against another state, 
except behind a massive American force, as in the Persian Gulf War of 
1990-91.
    The ultimate problem is that the Gulf States are not strong enough 
to take on Iran alone, and if they act provocatively toward Iran, even 
if intended to deter Iranian aggression, they could easily provoke just 
such aggression and/or overstretch their own limited capabilities with 
potentially dire consequences for their own political stability. If the 
United States is not there to reassure the Gulf States and deter Iran, 
things could get very ugly.
                           the american role
    Inevitably with any question related to the geopolitics of the 
Middle East, the question eventually turns to the United States. The 
preceding analysis all points to the centrality of the American 
response to the nuclear agreement with Iran as the critical factor that 
will determine whether the deal ultimately proves beneficial or 
detrimental to regional stability, and thus to American interests 
themselves. As always, the United States is master of its own fate to a 
much greater extent than any other country on earth, even in the 
turbulent and unpredictable Middle East.
    Two points stand out to me from the preceding analysis and the 
modern history of the region. The first is that while Iranian strategy 
is anti-American, antistatus quo, anti-Semitic, aggressive, and 
expansionist, Iran is not reckless and is typically quite wary of 
American power. When the United States exerts itself, the Iranians 
typically retreat. The exception that proves the rule was in Iraq in 
2007, when initially the Iranians did not back down from their support 
to various anti-American Iraqi militias, only to have those militias 
crushed and driven from Iraq during Operation Charge of the Knights and 
subsequent Iraqi-American campaigns along the lower Tigris. As we see 
in Iraq today, the Iranians apparently recognize that they misjudged 
both America's will and its capacity to act then, and are once again 
content to battle Washington for political influence in Baghdad but 
unwilling to challenge U.S. power militarily, even by proxy.
    The second point that stands out is the other side of the coin from 
the first. In the absence of American engagement, leadership, and 
military involvement in the region, the GCC states (led, as always, by 
the Saudis) get frightened, and their tendency when frightened is to 
lash out and overextend themselves. Again, the unprecedented GCC air 
campaign in Yemen is a striking example of this. As the Gulf Arab 
States see it, the United States has never been so disengaged from the 
region--at least not in 35 years--and so they feel that they have to 
take equally exceptional action to make up for it. I continue to see 
the GCC intervention in Yemen as a wholly unnecessary and unhelpful 
move, a rash decision meant to check what the GCC sees as a looming 
Iranian ``conquest'' of Yemen. In private, GCC officials make no bones 
about saying that they felt compelled to intervene in Yemen because the 
United States was embracing Iran rather than deterring or defeating it. 
While all of that is a set of overstatements and exaggerations, it 
drives home the point that in the absence of a strong American role in 
pushing back on Iran, the GCC's default mode is to attack on their 
own--and that only makes the situation worse, not better.
    What the Obama administration offered the Gulf States at Camp David 
failed to allay their fears or reassure them that the United States was 
ready to help them address their security concerns. That too is 
understandable: Washington did not offer a new defense pact or even an 
explicit nuclear umbrella--just more of the same. Some new weapons. 
Some new training. Nothing categorically different that was really 
likely to convince the Gulf States that the United States was truly 
committed to gulf security or to reassure them that a nuclear deal with 
Iran would not mean American abandonment of the region, let alone a 
shift toward Iran.
    In truth, I suspect that there is only one way that the United 
States is going to reassure the Gulf States that it does share their 
interests and is not going to leave the field open to the Iranians. Not 
coincidentally, it may be the only way to demonstrate to the Iranians 
that the United States is neither abandoning the region nor too fearful 
of jeopardizing the nuclear agreement to block Iran's continued 
aggressive activities around the Middle East. Indeed, it is probably 
what will prove necessary to force Iran to abandon its aggressively 
opportunistic regional policy. And that is for the United States to 
pick a place and take the Iranians on there.
    Here there are three possibilities, but ultimately only one 
conclusion. Yemen is the wrong place for the United States to confront 
Iran. Yemen is simply not consequential enough to justify making any 
American investment there; in fact, Washington should be doing 
everything it can to help the Saudis and the GCC end their own 
intervention in Yemen, not reinforcing it. Iraq is also the wrong 
choice. The Iranians are too strong in Iraq now, Iraq is too important 
to Iran, and the Iraqis have a chance of solving their problems and 
regaining stability--but theirs is a fragile polity that probably could 
not survive a U.S.-Iranian war on their territory. Both we and the 
Iranians need the Iraqis to sort out their problems, and Iraq will 
probably need both of our help to do so. Thus, Iraq is also the wrong 
place at the wrong time.
    That leaves Syria. If the United States is going to push back on 
Iran in the aftermath of the nuclear deal to demonstrate to both Tehran 
and our regional allies that we are not abandoning the field and 
allowing (or enabling) the Iranians to make greater gains, Syria is 
unquestionably the place to do it. Iran's allies in Syria have been 
considerably weakened in recent months. Our Arab allies are eager to 
have us take the lead there, and President Obama has committed the 
United States to just such a course, even if his actions have fallen 
woefully short of his rhetoric. This is not the place to describe how 
the United States might mount such an effort, nor to assess the 
likelihood that it would succeed if the U.S. were willing to commit the 
necessary resources (which would likely include a heavier air campaign 
than at present, but not ground combat troops).\7\ I will simply point 
out that in the aftermath of the Iranian nuclear deal, finally 
executing the administration's proclaimed strategy for Syria may be the 
best and only way to regain control over the dangerous confrontation 
escalating between Iran and America's Arab allies.
    Roughly 45 years ago, Great Britain announced that it was 
withdrawing from east of Suez, dumping the Middle East in America's 
lap. As I reflect on our handling of this unwanted responsibility, I am 
struck by our regular efforts to take some deliberate, decisive action 
and call it ``done.'' Starting with 1988's Operation Praying Mantis, 
and continuing on to Operation Desert Storm, the Middle East peace 
process during the 1990s, the 2003 invasion of Iraq, and the 2011 
withdrawal from Iraq, the United States has kept searching for a 
political-military achievement that would make it possible to leave the 
Middle East behind. We never found it. Even when the achievements 
succeeded, they could not fix all of the problems of this troubled and 
troubling part of the world. And our determination to walk away only 
made the next problem even worse.
    Although the Joint Comprehensive Plan of Action is hardly a perfect 
deal, it is an accomplishment of sorts. It has the potential to make 
the Middle East a modestly safer place in the future--certainly for 10-
15 years, and possibly for longer. But that will only happen if the 
United States resists its natural inclination to try to use the JCPOA 
as yet another excuse to walk away. Perhaps paradoxically to an 
American mind, the only way that the JCPOA is likely to make the Middle 
East a better place rather than a worse one is if the United States 
uses it to remain involved in the region. To reassure our allies and 
rein in their fearful aggressiveness. To deter the Iranians and 
demonstrate to them that we will not allow a nuclear agreement to 
become a cover for their own aggression. If we do that, then I believe 
that the Joint Comprehensive Plan of Action could be an important 
aspect of a wider, more engaged American policy toward the Middle East. 
But without a wider, more engaged American policy toward the region, 
neither the JCPOA nor even an unattainable ``perfect'' agreement with 
Iran will amount to more than fodder for the Nobel Prize committee.

----------------
Notes

    \1\ I treated all of these options at great length in my book 
``Unthinkable: Iran, the Bomb and American Strategy'' (Simon and 
Schuster, 2013).
    \2\ For longer explications of these views, see Pollack, 
``Unthinkable,'' esp. pp. 66-70.
    \3\ See in particular, Pollack, ``Unthinkable,'' esp. pp. 183-223.
    \4\ For a concurring Israeli assessment, see Amos Yadlin and Avner 
Golov, ``A Nuclear Iran: The Spur to a Regional Arms Race?'' Strategic 
Assessment, Vol. 15, No. 3 (October 2012), pp. 7-12.
    \5\ Associated Press, ``Prince Hints Saudi Arabia May Join Nuclear 
Arms Race,'' New York Times, December 6, 2011.
    \6\ Jay Solomon, ``Saudi Suggests `Squeezing' Iran over Nuclear 
Ambitions,'' Wall Street Journal, June 22, 2011.
    \7\ For the fullest explanation of the administration's Syria 
strategy, see the testimony of the Chairman of the Joint Chiefs of 
Staff, General Martin Dempsey, before the Senate Armed Services 
Committee on September 16, 2014. For an outside assessment along 
similar lines, see Kenneth M. Pollack, ``An Army to Defeat Assad: How 
to Turn Syria's Opposition Into a Real Fighting Force,'' Foreign 
Affairs, Vol. 93, No. 5 (September/October 2014), pp. 110-124.

    The Chairman. I am going to defer to the ranking member on 
questions, like I have on several of these, and maybe interject 
a few things.
    But I do want to say, if I could, there will be, no 
question, a conventional arms race taking place in the Middle 
East as a result, and we are going to be assisting in that. Is 
that correct?
    Dr. Pollack. Absolutely.
    The Chairman. And secondly, I described one of my 
colleagues walking over here, giving the best analogy--and he 
can own up to it, if he wishes--but there is going to be a new 
tension created that will cause us potential trepidation as it 
relates to some of Iran's activities and whether we really wish 
to counter because of, again, within 9 months the leverage 
changing to a degree. Is that a fair assessment?
    Dr. Pollack. Yes, I would put it this way, Senator. I think 
that there will be new challenges from the Iranians. But my 
assessment, both of our allies and of the Iranians is, that how 
we, the United States, respond to those challenges is really 
what is critical. What we have seen in the past is that when 
the United States steps up, acts with determination, it 
reassures our allies, and the Iranians typically back down. 
They do not want to fight with the United States of America.
    The problem is typically when we act in the opposite 
fashion, which again frightens our allies, causes them to 
overreact in very dangerous ways, and can embolden the 
Iranians.
    The Chairman. I am going to reserve my remaining 6 minutes.
    Ranking Member Cardin.
    Senator Cardin. I thank both of you for your testimony.
    There is no question that we entered into these diplomatic 
negotiations because of the significance of Iran in the Middle 
East. And we did not want Iran to become a nuclear weapon power 
for several reasons, but it is just too consequential in that 
region and the world for a country that has already 
demonstrated its interference in the region to have the nuclear 
card.
    So one thing you said, Dr. Pollack, that concerns me, maybe 
you will clarify this a little bit, because the question I am 
really going to ask you is what action should this 
administration and Congress, hopefully working together, do to 
make it clear to Iran that this is one part of our 
relationship, it is not the exclusive part, and we are going to 
watch very carefully what they do in regards to their human 
rights record, what they do in regards to their missile 
program, what they do in regards to interference in other 
countries in the region. You have already mentioned Lebanon, 
Hezbollah, Houthis in Yemen, support for the Assad regime. All 
of that is a concern to us.
    But what got me a little bit concerned is when you said 
that the United States should respond with more aggressiveness. 
It seems like we meet their additional support by a military 
response by the United States.
    Is that not just accelerating a military confrontation--
when I thought that this agreement is trying to find a 
diplomatic solution for the region?
    Dr. Pollack. Thank you, Ranking Member.
    I think that is a very fair question. It gives me a chance 
to spell out my thinking a little bit more.
    I am not suggesting that the United States deploy ground 
troops to Syria. I do not think that is necessary.
    Senator Cardin. I was hoping that would be your response.
    Dr. Pollack. That said, I do think that there are any 
number of reasons, now including the potential regional 
response to the JCPOA, that argue in favor of greater American 
assistance in building a viable Syrian opposition, providing it 
with the support that it needs, both to defeat Daesh, ISIS, 
ISIL, whatever we are calling it this week, as well as the 
Assad regime, stabilize the country, end the civil war there.
    It is something that I think this chamber, in particular, 
has recognized for a long time. Obviously, there has been a 
great deal of debate over exactly how to do that, but the 
position that the administration articulated in September of 
last year actually laid this out I thought very nicely.
    I would go back to Chairman Dempsey's remarks to the SASC, 
where he laid out the strategy. I thought it looked beautiful. 
The problem is that we have never actually resourced or 
fulfilled the strategy as it was laid out. I think, again, for 
a whole variety of different reasons, that was a mistake.
    What I am trying to put on the table is that I think that 
in the wake of the JCPOA, doing something like that actually 
making good on the pledges made by this administration with 
regard to Syria is actually going to become even more 
important.
    Senator Cardin. Could this lead to a greater military 
involvement by the United States in the region?
    Dr. Pollack. It is certainly possible. If the Iranians 
believe that the United States is backing down, sure, we may 
have to. But what I am really looking for is how we avoid that.
    Again, my experience, my read of history--and, Mike, you 
will pardon me; you said you been working on this. I have been 
working on this for 28 years, 27 years. My experience of the 
Iranians is that where we get into the most trouble is whenever 
we convey weakness to them. They are always probing. They are 
always looking. They are very opportunistic.
    When they see the United States is pulling back from 
somewhere, does not know what it is doing, then the Iranians 
will push forward, typically when we have pushed on them. When 
we have said to them this far and no further, we will push back 
on you, we see the Iranians pull back in a very significant 
way.
    Senator Cardin. But the problem is Iran is pushing forward 
currently under sanctions in a lot of different regions and in 
a lot of different areas. It is not just one. It is not just 
Syria. With more resources, they could push more aggressively 
in multiple areas. And for the United States to counter that, 
if I understand what you are saying--what some of us have 
talked about is how do we use the same tools we use for nuclear 
and use them more aggressively in response to their terrorist 
activities, human rights activities? That is, look at a more 
sophisticated sanction regime on Iran, if they, in fact, use 
these resources to increase their human rights violations and 
terrorist activities.
    But it seems to me you are taking a different tack, saying 
we should match them with our military involvement. I 
understand you are not talking about troops on the ground, but 
it is somewhat different than what some of us had hoped.
    Mr. Singh.
    Mr. Singh. I think that it is right, unfortunately. I agree 
with Ken here. But I see it as sort of the downside of our 
approach, in that I think you are absolutely right, Senator. My 
reading of the actual text of the JCPOA suggests that we could 
reimpose oil export sanctions, financial sanctions for 
terrorism grounds or human rights grounds, for example. I am 
skeptical, though, that our allies will agree with us on that.
    It is worth going back in the history of this negotiation. 
We had sought a strategic shift by Iran. It is wrong to say 
that we were always just focused on the nuclear question, for 
reasons that both Ken and I have talked about. What is true, 
though, is that we had an awfully hard time getting support 
from allies for things like terrorism-related sanctions, 
getting the EU to designate Hezbollah as a terrorist 
organization, or Hamas, for example, even though they are 
Iranian proxies.
    We focused the U.N. process on proliferation because it is 
a lot easier to get the allied support, including of Russia and 
China, on that issue, but it is not to say that was our only 
concern. The idea was that you use that issue as a way to drive 
a tough bargain and get the strategic shift you are looking 
for.
    But now, having sort of sacrificed those instruments, I 
think it is going to be really tough to get support to re-
impose them in the way we did before. Remember, we had the U.N. 
foundation for all those ad hoc or sort of multilateral 
sanctions we did on top of it. So what we are going to be left 
with is that your toolkit has shrunk, and your toolkit now 
consists of more kinetic action or less effective sanctions, 
like we were using in the past before these newer form of 
sanctions that we have been using recently.
    Senator Cardin. Is there anything that Congress should do 
now, in contemplation of this agreement going forward?
    Mr. Singh. On this particular topic, I would say that what 
would be awfully useful--and I do not know if this is for 
Congress or not--but basically a statement by not just the 
United States but our allies about how we read this agreement, 
that it actually does allow us to reimpose these sanctions for 
other grounds, and we are not making any promises to give Iran 
impunity on these other issues.
    But I think that is going to be awfully tough to get, even 
from our closest European allies.
    Senator Cardin. Thank you, Mr. Chairman.
    The Chairman. Senator Perdue.
    Senator Perdue. Thank you, Mr. Chairman.
    Dr. Pollack, you mentioned that, on balance, you think this 
is a good deal. Let me just ask you this. Against the original 
criteria, the goal was to preclude Iran from ever becoming a 
nuclear weapons state.
    Against that standard, how would you evaluate this?
    Dr. Pollack. Sir, I can only say that the jury is out. We 
do not know whether or not Iran will become a nuclear weapons 
state. I think it is going to be difficult and unlikely that 
they will choose to do so in the next 10 years. As I said, 
after that, we do not know. It is a bet after 10 years.
    Senator Perdue. So the question is, are we in a stronger 
position 10 years from now or a weaker position? I think the 10 
years is variable. We all know that. Are we in a stronger 
position or weaker position, relative to the sanctions regime, 
relative to their economic strength, other developments in the 
region, and so forth?
    And I agree with Mr. Singh. There are three options today. 
One is the deal. Two is war. Three is something we hardly ever 
talk about here, and that is imagining a doubling down of the 
sanctions that got them to the table in the first place.
    Would you address both of those issues for me, please, 
quickly?
    Dr. Pollack. Sure.
    I was maybe one of the first people who proposed this whole 
conception of using the sanctions to bring the Iranians to the 
table in a book I wrote back in 2004. I will say that I think 
that we did reasonably well with it. I think we might have done 
better.
    I am deeply skeptical, though, that we are going to be able 
to hold the sanctions in place, if the deal was turned down. 
Again, I say this with no love. I would love to be able to say 
to you, absolutely, the international community is with us, 
vote down the deal, we will get a better one. That is simply 
not my analysis of the circumstances.
    Senator Perdue. Mr. Singh, I have had two trips, I have 
been blessed with two trips to the Middle East, two private 
meetings with Prime Minister Netanyahu. A couple of us have 
actually met with five heads of state. We had a Foreign 
Minister from Saudi Arabia here just a couple weeks ago.
    I echo what you both have said already, that is that the 
overwhelming conclusion that we walked away from those meetings 
with was that there is tremendous trepidation about what it is 
our intention is and what our strategy going forward is, among 
our allies. I am very concerned that if we go ahead with this 
deal as a proxy for our relationship with them without telling 
them specifically what our strategy is, that we create a false 
sense of security there, and it encourages them to do things 
that otherwise they would not do.
    Let me just mention one. Saudi Arabia and Yemen. That to me 
is a direct result of Saudi Arabia visiting Moscow just weeks 
ago, talking about arms purchases.
    So I am very concerned about a realignment, if you will, of 
strategic alliances in the region that are directly driven by a 
deal that causes more questions than questions it answers.
    Mr. Singh.
    Mr. Singh. I think that fear is justified, Senator. I think 
even before this deal, as many of you Senators know, there were 
a lot of concerns from our allies in the region that we were 
looking to disengage from the region, things like the 
withdrawal from Iraq in 2011, the talk about a pivot to Asia, 
talk about energy independence, even if those things were 
justified.
    The failure to put them in a strategic context, the failure 
to assert continued American leadership in the region, the 
failure to follow up on things like the Syria redline, I think 
had a damaging effect on our credibility there.
    Now if you look at what we are doing here, it looks from 
the outside like a major strategic reversal. So we are going 
from isolating Iran to now facilitating Iran's reentry into the 
international financial system. We are going from sanctioning 
Iran to relieving sanctions, from opposing their nuclear 
program to actually assisting in many respects their nuclear 
program.
    Because we have not situated that in any articulation of 
how this fits into a larger strategy, I think the tendency of 
our allies is to assume that there is some unspoken strategic 
realignment, as you mentioned. That is going to be very tough 
to dispel, especially because, look, if we were relatively 
inactive against Iran before this deal, now that we have a 
vested interest in keeping this deal, what is the likelihood or 
credibility that we are suddenly going to get really tough? I 
think folks just do not buy it.
    Senator Perdue. So one of the things that I see as a side 
derivative, and we do not talk about because we are really 
trying to figure out if this deal can stop them from becoming 
nuclear, is the question of what happens with Russia's 
influence in the region and China's influence in the region. It 
looks to me like Iran is the conduit through which they improve 
their relationships in the Middle East, relative to where we 
are today.
    Mr. Singh. I think that is right. I have done a lot of work 
on the question of the Chinese policy in the Middle East and 
the Chinese-Iran relationship, in particular. I think China 
sees Iran as its sort of natural strategic partner in the 
region. There is a strong economic relationship there that 
rests on their oil trade, their energy trade. It is the only 
place in the Middle East where you can reach the Middle Eastern 
energy supplies by pipeline, so you do not need to worry about 
the U.S. Navy in the Persian Gulf. And it is the only country 
there on the gulf littoral----
    Senator Perdue. I am sorry to interrupt you, but that is a 
new point of understanding.
    So what you are saying is there is a possibility in the 
very near future that Iran will have the capability of 
precluding our Navy from the Persian Gulf?
    Mr. Singh. Look, it is certainly true, and I do not want to 
sort of get beyond my expertise on the energy issue, but 
certainly you see China building pipelines and other sort of 
land-based energy infrastructure to try to bypass those 
maritime chokepoints, and of course you see Iranian ports being 
developed outside of the Strait of Hormuz.
    Senator Perdue. I have one other question, and I will throw 
this to both of you.
    Why is the ballistic missile development no later than 8 
years from now so important to them, if all they want is a 
civil nuclear program? There are 18 other countries in the 
world that have civil programs that do not enrich, that are not 
allowed to enrich. In fact, there are only five that are 
allowed to enrich that have civil programs that do not have 
nuclear programs, countries like Japan, Germany, Holland, 
Brazil, Argentina. We have allowed Iran to bypass those 18.
    So I want to go to the ballistic missile. Right now, they 
have a series of missiles that they own. They are all mostly 
short-range, but they are developing this 1,400-mile Sajjil-2 
missile, and they have the Shahab family of missiles.
    My question is, this ballistic technology, why is it so 
important to them? That could put into this agreement late, we 
understand, so why is that important to them?
    Mr. Singh. Look, when you look at a nuclear weapons 
program, a delivery vehicle, a ballistic missile, is the third 
leg of that program.
    Senator Perdue. So it really has nothing to do with the 
civil nuclear program?
    Mr. Singh. They will say that it does. They will say that 
is not a civil nuclear program, but they will say the ballistic 
missiles have nonnuclear, not nonmilitary, of course, but 
nonnuclear use.
    If you are developing the medium-change missiles, that is 
for regular warheads. If you are developing an ICBM, no, that 
is a space-launch program to put satellites into space.
    The difficulty for us, I think, is that, as Secretary 
Carter I think said quite recently, an ICBM is one of the most 
dangerous things that Iran can possibly develop. I do not think 
any country that does not have nuclear weapons has developed an 
ICBM.
    What the agreement does is while it keeps Iran's ballistic 
missile program totally opaque--there are no inspections of the 
ballistic missile program--it lifts the ban on Iran conducting 
launches, for example. They can conduct a launch on 
implementation day, and it is not banned by this agreement. And 
it removes sanctions on foreign assistance in 8 years.
    If you want to build an ICBM, which is tough, foreign 
assistance I think would be critical.
    Senator Perdue. Thank you, Mr. Chairman.
    The Chairman. If I could actually clarify: they were banned 
from missile launches until this agreement. This agreement, for 
some reason, immediately lifts that ban on missile testing. Is 
that correct?
    Mr. Singh. That is correct. So I believe it was Resolution 
1929 banned Iran from conducting missile work and lunches. If 
you look at the new Resolution 2231, that binding language now 
becomes just hortatory language.
    The Chairman. That is right. I will just use a minute of my 
time.
    Why would we have agreed to lifting that when you mention 
that ICBM issue is for delivering a nuclear weapon. They 
already have an incredibly sophisticated ballistic missile 
program. Why do you think we chose to lift something, go 
backwards on that particular issue, on the front end of this 
deal? What would have been the motivation on our part to do 
that?
    Mr. Singh. Well, I can only tell you what U.S. officials 
have said, which you probably have heard yourself, and that is 
the idea that this is just a nuclear agreement, not a missile 
agreement.
    I think that is a false dichotomy. If you look at all the 
U.N. Security Council resolutions on this issue prior to 
Resolution 2231, they talk about the missile program and the 
nuclear program in the same breath, in the same sentence. They 
are not seen as separate. They are seen as part and parcel.
    Second, there is this idea that because Iran is doing its 
part, we have to do our part, which is to lift all these 
sanctions.
    I think that is not right because, in fact, Iran has not 
fulfilled its obligations under those previous resolutions. We 
have changed those obligations. So there is no reason that we 
have to hold ourselves to a letter of a resolution that we are 
not holding Iran to.
    You can understand why Iran would want it. Again, if Iran 
want a nuclear weapons option, having a delivery vehicle is 
necessary. So that is why one of my concerns is that, in fact, 
Iran will actually be able to enhance its nuclear weapons 
option over the next 8 to 10 years.
    The Chairman. Senator Menendez.
    Senator Menendez. Thank you, Mr. Chairman.
    Thank you both for your testimony.
    First of all, I think this question has been asked by you, 
Mr. Singh, with reference to, is it this agreement or war? I 
think your answer to that was no. Is that correct?
    Mr. Singh. Correct.
    Senator Menendez. Dr. Pollack, is it this agreement or war?
    Dr. Pollack. I think there are multiple possibilities.
    Senator Menendez. Okay.
    So that binary choice is not real. Extrapolated down the 
road, a lot of things could happen, but that binary choice is 
not real. I do not know, I think the administration does itself 
a disservice when they keep putting that out there, including 
the President's speech today. I do not quite get it.
    Let me ask you this. One of the things the President said 
in his speech today is that there is a bipartisan consensus in 
Washington about the dangers of a nuclear armed Iran, that it 
could cause a regional arms race. So if that is true, and I do 
believe it is true, the only thing that prevents that nuclear 
arms race is a pretty ironclad belief by our partners in the 
region that somehow Iran will not get there by virtue of this 
agreement.
    But this agreement actually, despite the constant refrain 
that it for all times stops Iran from achieving a nuclear 
weapon, that is if there is absolute conformance and adherence 
to the agreement.
    Is that not fair statement?
    Mr. Singh. I think that is right. I mean, it is assuming 
that they are not able to undertake covert nuclear activities 
under the agreement and also assuming that they do not then 
expand their activities after the phasing out of limitations.
    Senator Menendez. Right.
    So the reality, based on the 20-year history that Iran has 
had as it has marched forward by deception, deceit, and delay, 
where they are on the verge of being a nuclear-threshold state, 
a lot of history would have to change here in terms of the 
entire forward movement being without consequence, in terms of 
challenges that they would present as violations of the 
agreement.
    So if I am sitting in the gulf, and I am thinking about 
this 20-year history, and I am thinking about their 
infrastructure being largely still intact, although in some 
respects may be delayed but it is intact, and I am thinking 
about after the sanctions are gone in a year, 2 years, when 
they are flush with money and the world is dealing with them 
and doing business with them, that any time beyond that, that I 
decide to break out, that, yes, we will have a warning, but we 
will be in no better position today. And one could argue that, 
in fact, they will actually be resurging economically, have 
greater defense mechanisms like the S-300. You mentioned a few.
    So if I am looking at that and I am in the region, am I 
saying to myself: I really have to seriously consider under the 
theory of mutual self-destruction as a preventative measure 
that I have to think about whether or not I am going to pursue 
a nuclear weapon?
    Mr. Singh. I think you are right, Senator. I think in part 
because the way this agreement works, that these limitations 
get phased out at a date certain, I think if you are a rival of 
Iran's, you have to circle that date on the calendar. That is 
the date by which you have to develop your own capability. Or 
it certainly provides an incentive to develop the capability by 
that date. Because unlike our past proposals, which would only 
review the limitations, review the agreement based on Iranian 
performance, again, this is a date certain.
    I think that one thing that has gotten lost in a lot of the 
debate here is that this is probably true even if Iran is being 
friendlier with the United States. The simple presence of a 
very large nuclear program in Iran, because Iran historically 
is seen as a rival by these countries, will I think prompt them 
or at least incentivize them to develop their own nuclear 
capabilities.
    I do not think they are going to look first and foremost as 
to whether the United States and Iran have a friendly or 
unfriendly relationship, because that requires betting on the 
future in a way that they may not want to.
    Senator Menendez. Dr. Pollack.
    Dr. Pollack. Senator, if I could jump in here, that is one 
thing where I do disagree somewhat with Michael.
    I think you are correct that you identified the incentives 
that the gulf is feeling. I think that there certainly will be 
a hedging strategy on their part. They will start looking into 
what it might take them to acquire a nuclear capability, 
certainly on the part of the Saudis in extremis.
    But where I disagree with Michael is in the role of the 
United States. I see the United States as the critical 
intervening variable here. The Saudis and other Gulf States 
have faced other dire threats in the past, including nuclear 
threats. Iran has had a nuclear weapons program, an active one, 
since the 1980s, so too has Iraq. The Saudis never did acquire 
a nuclear weapon, because they felt they could rely on the 
United States. That has always been their default position.
    When they believe that they can rely on the United States, 
they are very comfortable. In fact, that is their preference.
    So for me, to bring it back to where we started out, the 
critical question moving forward in dealing with what I think 
you have rightly identified as the concerns that they already 
have expressed, the question is, what do we do?
    Senator Menendez. And in that regard, if I am sitting in 
the gulf and I look at Ukraine and look at the United States as 
a party to the Bucharest agreement, where we said give up your 
nuclear weapons. In this case, they would not be giving up 
their nuclear weapons, but they would be giving up their 
thoughts about having a nuclear weapon in return for the 
guarantees of your territorial integrity, and in this case 
security. That did not work out too well for the Ukrainians.
    So I would have to be saying to myself, how is this 
guarantee going to be manifested at the end of the day, which 
gives me sufficient assurance that I am not going to move 
forward? Is that a fair statement?
    Dr. Pollack. I absolutely agree with that. I think that you 
are totally right, that they may be thinking about Ukraine. But 
I suspect that they are looking at events closer to home, which 
drive home the same point to them, as Michael mentioned, our 
disengagement from Iraq, our continuing failure to live up to 
our rhetoric on Syria, our general disengagement from the 
region, the pivot to Asia, the list goes on.
    Senator Menendez. I am concerned that it would seem to me 
that at the same time that we were hopeful in taking 2 years to 
see if there could be an agreement that we would have had a 
parallel track that would have thought about, if there is 
agreement and all along Iran has sought significant sanctions 
relief, that we have a parallel track of a policy as to what 
happens when they get $100 billion, $150 billion, whatever the 
amount of money.
    Certainly, a country that is already in the midst of the 
greatest state sponsor of terrorism, and in the region with the 
Houthis in Yemen, with Hezbollah in Lebanon, with propping up 
Assad, with mischief in Iraq and having a totally different 
purpose in Iraq than we do, ultimately, if they were doing all 
of that with the difficulties they are having, take only a 
small percent of that, forget about most of it that, yes, will 
be spent domestically, take only a small percent, you can 
create a lot more havoc.
    So we did not do that, because we are now scrambling and 
thinking about, well, what is the aftermath of this, assuming 
the agreement is upheld.
    Succinctly, if you were to say to Congress, to the 
administration, here are the two or three major things we need 
to be doing right now in expectation that the agreement will 
survive and that, in fact, we need to be thinking about what we 
need to do in the region, what you say they would be?
    Mr. Singh. Well, I think here I would agree with Ken. We 
have to look at countering Iranian activities in the region 
much more firmly. I think Syria is the most important theater 
for doing that. But I think also in Iraq and other places, I 
think we need to look hard at our own military posture in the 
region. I include in that sort of allied military postures to 
make sure that we are going to be staying one step ahead of 
whatever Iran might do when it comes to this agreement.
    Part of that has to be, I guess my third point, we need to 
repair our relations with allies. This is all stuff we should 
have been doing, as you suggested, Senator, a long time ago, if 
we knew that this sort of agreement was coming. We certainly 
should not have waited until now.
    Dr. Pollack. Senator, if I could just quickly answer the 
question. I might put Mike's point slightly differently.
    Number one, do not draw down our forces from the region. No 
peace dividend from this.
    Number two, we do need to expand our support to Iraq. I 
will not go into details, but we do need to expand our support 
to Iraq.
    And third, we need to actually resource the plan we put in 
place a year ago or announced a year ago to build a meaningful 
Syrian opposition, one that will challenge not to just Daesh 
but also the Assad regime.
    Senator Menendez. Thank you, Mr. Chairman.
    The Chairman. If I could, I am going to use one more of my 
minutes before we go to Senator Flake.
    I think what I am hearing you say is that I know the 
President--and I agree with Senator Menendez, I wish he would 
not continue saying it is this agreement or war. We have had 
their military folks in, and the folks who sat at the table 
said war has never been discussed.
    So we know that there is not going to be a war, and that is 
a fact. Iran knows there is not going to be a war.
    But what I hear you saying is, by virtue of this agreement, 
we are actually going to need to be more robustly involved in 
preparation for kinetic activity in the region to keep things 
in balance.
    Is that what you are saying, Ken?
    Dr. Pollack. I might just put it slightly differently, 
Senator, because I would have said that we needed to do the 
same thing even if we did not get the agreement. But I do think 
that there are aspects of the agreement that do tweak things 
slightly.
    But nevertheless, I think the concerns of our allies and 
the suspicion of our adversary, the Iranians, that we are 
looking to disengage, those have been there for the past 6 
years. The agreement is simply part of the warp and woof of our 
policy along those lines.
    The Chairman. Thank you.
    Senator Flake.
    Senator Flake. Thank you, Mr. Chairman.
    Thank you for the testimony.
    Mr. Pollack, in your testimony, you mentioned a few times 
that you believe that Iran and others have testified in a 
similar vein, that the Iranians particularly the Ayatollah, 
will seek to burnish his revolutionary credentials here, to 
assure that those who he wants to assure that they have not 
lost their mojo, I think is how you put it. And that would 
cause them to take action in the region, nonnuclear action that 
we would object to, obviously.
    My concern has been that in the agreement it seems to 
prohibit us from responding in ways we have traditionally 
responded to Iran's behavior--through sanctions, for example. 
We have received assurances from the administration that we 
still have all the tools in our toolbox to respond in this way, 
but I cannot help but think that we might be less likely to 
respond, given that our response, as Iran has already 
indicated, would be taken as a move of bad faith and that it 
would free them up from their obligations to abide by this 
agreement.
    If we are so concerned now that in testimony and in answer 
to Senator Menendez's question as to whether or not Congress 
could actually pass legislation to renew the Iran Sanctions Act 
so we would have something to snap back to, not dealing with 
the President's waiver authority or anything else, said maybe 
not, we might not be able to do that.
    I fear that if we are reluctant, if this administration is 
reluctant, to even countenance legislation reaffirming 
Congress' right to reimpose sanctions or to actually continue 
sanctions, then we might be reticent to confront Iran in 
nonnuclear activity, and that this agreement might move 
leverage toward Iran here.
    Can you respond to that, both of you?
    Dr. Pollack. Sure, Senator. This is also in partial 
response to Senator Cardin's point before.
    I think it is fair for Congress to look at whether you are 
still able to employ sanctions as a tool against Iran. But I do 
think it will be more difficult moving forward. I think that 
both the letter and, more importantly, the spirit of the JCPOA 
and how it is being received internationally are going to make 
it far more difficult to find international support for new 
sanctions on Iran.
    It is one of the reasons why I think that the United States 
is going to have to look at the whole range of other tools in 
our toolkit, including pushing back on the Iranians at the 
unconventional level.
    Senator Flake. Mr. Singh.
    Mr. Singh. I agree with that. I think your analysis was 
right, Senator, that even though I think the text of the 
agreement does not rule out the fact that we can do that, I 
think we could interpret it to suggest that we could to 
reimpose the sanctions, I do think that there will be 
reluctance.
    Again, I would go back to some other treaties, like the INF 
treaty, where I think you have heard recently from the 
administration that they believe that Russia has been violating 
the treaty, but we have not seen consequences. The Syria 
chemical weapons arrangements, where there was a recent article 
in the Wall Street Journal that said we do not believe that 
Assad has given up his chemical weapons. Well, the penalty for 
that was supposed to be U.S. military action, but we have not 
done that.
    So the leverage does tend to be with the least risk-adverse 
party, and we tend to get very invested in simply keeping the 
agreements going, in a sense.
    Again, I go back to my answer to Senator Cardin. I think it 
is also going to be hard to build the allied support on those 
issues as opposed to the nonproliferation issue.
    Senator Flake. What concerns me is that if we are 
reluctant, if the administration is reluctant, to clarify with 
legislation--now, unfortunately, this is not a treaty. If it 
were, we could pass RUDS, saying our reservations, our 
declarations, our understandings. But that is not possible 
here.
    But if the administration is unwilling to say go ahead, 
reauthorize it so we will have something to snap back to, if we 
are unwilling to have that type of confrontation over the 
meaning of the agreement, then it worries me that should Iran 
run afoul of other obligations, keeping their nuclear 
obligations but continuing to create mischief in the region, it 
worries me that we would be less inclined to actually move to 
block that. That has serious implications for the region and 
regional security.
    I thank the chairman.
    Senator Menendez. Will the gentleman yield? Will the 
Senator yield for a moment?
    Senator Flake. You bet.
    Senator Menendez. To your point, today in the Senate 
Banking Committee, we had Assistant Secretary Sherman and Mr. 
Szubin there. And I once again asked about not whether the 
timing is right, but do we have the right under this agreement, 
and I read that section that I believe makes it a problem of 
the agreement. The answer is this is not the time to discuss 
that.
    Well, the Iranians had no problem in sending a letter to 
the Security Council saying that reintroduction or reimposition 
is a violation of the agreement and, therefore, it will allow 
us to walk away.
    So I am just concerned, going to the Senator's point, that 
if they are willing to assert what their view is, I am not so 
sure why we are reticent to assert what our view is, unless our 
view, which would be a problem here I think in the Congress, is 
that we cannot reauthorize.
    Senator Flake. Thank you.
    The Chairman. Before turning to Senator Shaheen, I will use 
another 30 seconds to say, on the INF agreement, it was not 
just the desire that you mentioned to keep the agreement in 
place. I think that is kind of where we end up. We do not want 
to challenge because we want to keep the agreement in place. It 
was also the concern they did not even tell us--I mean, I know 
Senator Risch was quite upset during the START Treaty. I 
supported it. He did not. But he was quite upset during the new 
START Treaty debate because the administration knew that Russia 
had violated the INF treaty, but they were unwilling to tell us 
or our allies because they were afraid that it would somehow 
compromise our intelligence. So you have the issue you are 
talking about now, but also the issue of us not wanting to 
share with the IAEA or our allies what we know to be a 
violation, because we do not want to give up our sources.
    So I just want to add that. That is a problem, okay?
    Senator Shaheen.
    Senator Shaheen. Thank you. Thank you both for testifying.
    Mr. Pollack, you in your testimony and here in speaking, 
you said that you believe this agreement, as you put it, that 
it could be perceived as a get-out-of-jail-free card in the 
Middle East. I just wondered if that is your assessment of 
where this administration and the Congress are with respect to 
the Middle East?
    Dr. Pollack. Thank you, Senator. I will be very honest and 
say I do not know. The administration insists that that is not 
what they are intending. I worry that this is a case of 
``methinks the lady doth protest too much.''
    The administration kept insisting all through its first 6 
years that it was not disengaging from the Middle East, but it 
was. The pivot to Asia was typically described as being about 
how we overinvested in the Middle East and had underinvested in 
Asia and needed to shift those priorities.
    I think that all of that was very much mistaken, both in 
terms of the rhetoric and the actions. I would like to believe 
that the administration has recognized that and is not planning 
on doing any more toward disengagement in the region.
    But that is where I think Congress can play an enormous 
role. I think if Congress makes very clear that its support for 
the agreement is conditional on a robust American commitment to 
the region, I think that is one where the administration would 
be perfectly willing to give, just as they may have been 
perfectly willing to give to the Iranians on some of the issues 
that Senator Menendez raised earlier.
    Senator Shaheen. On Monday, the members of the Gulf 
Cooperative Council announced that their viewpoint is that the 
JCPOA, when implemented, would contribute to the region's long-
term security. Did this come as a surprise to you? What are the 
interests that you think they weighed in coming to this 
conclusion?
    Dr. Pollack. My 27 years dealing with the gulf, as well, I 
suspect that they said this because they knew that this is what 
the United States wanted to hear. In private, what I hear from 
them is very different. I hear a tremendous amount of 
trepidation on their part. They believe that the administration 
has disengaged from the region. And, again, they fear that the 
agreement will be a further move.
    As Michael described earlier, some of them, I think the 
much less sophisticated ones, fear that this is going to be the 
United States throwing them off for the Iranians. I think that 
the more sophisticated ones simply see an administration that 
was never terribly enamored of the Middle East, always looking 
to remove itself from the Middle East, and fear that this 
agreement will enable that even further.
    So again, I think it is about dealing with their fears. But 
again, I think they are open to being persuaded otherwise.
    Senator Shaheen. I am not sure I understood what you were 
saying about an arms race in the Middle East. Were you 
suggesting that the agreement, if it were approved, would lead 
to an arms race in the Middle East? Or that we should not 
support providing additional arms to countries in the Middle 
East?
    Dr. Pollack. Sure. Yes, it is a complex question.
    I think the agreement will spur the arms race. There is 
already an arms race in the Middle East. I think it will 
further spur it.
    I think the Iranians are going to have access to a lot more 
cash, which they are going to use to refurbish a badly 
dilapidated military. I think that will be seen as very 
threatening by the GCC states, who will try to counter it with 
a buildup of their own.
    Arms races sometimes have been very destabilizing in 
history. On other occasions, they have not been. I think, 
again, it is really how you manage it. All other things being 
equal, I would prefer that there not be an arms race in the 
Middle East, although obviously it is quite useful for the 
American arms industry. But it may not be the worst thing.
    Senator Shaheen. I am just trying to square that premise 
with the idea that one of the places where we can take some 
strong stands against the Iranians is in Syria. And given that 
our program there is supposed to be to identify opposition 
groups that we can vet who will fight Assad, and obviously as 
part of that we are going to help arm, train, and equip them, I 
would ask what you think that does to this concern.
    And also one of the things that I said on the Armed 
Services Committee, as Mr. Singh can tell you since he was 
there earlier this morning, a number of members of the Armed 
Services Committee have suggested that if we are going to do 
that with Syrian opposition groups, that it is very important 
that we also provide some protection for them--i.e., air 
cover--for any operations that they should be doing. One 
concern that has been raised is the potential of that to 
escalate into war with Assad, direct war with Assad.
    I wonder if you could just comment.
    Mr. Singh, I would ask you to do that as well.
    Dr. Pollack. Senator, I think the policy that we are trying 
to pursue in Syria is nonsensical. The idea that we are going 
to try to create a Syrian opposition where the members have no 
ties of any kind to any Islamic organization and are willing to 
solely fight Daesh and not the Assad regime, to me it is almost 
surprising that we did find 50 guys who were willing to do 
that.
    Senator Shaheen. Okay, so help me understand what other 
kinds of measures you think we ought to be taking in Syria. 
Should we be establishing a no-fly zone? Should we be providing 
that air cover for people who are going to be trained and 
equipped under that program? What other kinds of measures are 
you suggesting we take there?
    Dr. Pollack. Senator, I am glad to speak with you off-line 
in much greater detail on this. It is a subject on which I have 
written extensively.
    But let me simply say, first, it will require a much 
greater effort to train a much larger Syrian opposition, create 
a conventional Syrian opposition force, one tasked to suppress 
all the fighting in Syria. That means dealing with ISIS and 
Nusra and the regime and Ahrar al-Sham and everybody else, not 
just picking out our particular bad guy of the moment. It will 
mean very significant air support.
    A no-fly zone would only be the half of it, but I would not 
start with a no-fly zone. Until we actually have an opposition 
army capable of taking the field, all we need to be doing is 
defending them.
    But it also requires a very significant political piece, 
where I do not see us having made even the slightest effort to 
start. It is a lesson that we should have learned from Iraq, 
Afghanistan, Bosnia, Cambodia, Timor, all of these other civil 
wars that we have seen external powers, including ourselves, 
get involved in over the last 15 years. We have learned an 
enormous amount.
    You cannot win these militarily. You have to win them 
militarily. You have to create a military stalemate. But that 
is only the starting point for a new power-sharing arrangement 
and building of new institutions that can actually govern and 
rule the country.
    Senator Shaheen. Mr. Chairman, can I get Mr. Singh to 
comment on that?
    The Chairman. Sure.
    Senator Shaheen. The Syria piece?
    Mr. Singh. Look, I agree with Ken. There is nothing Ken 
said that I would not second.
    I will just say that I think it is important as you look at 
the administration's strategy that we not be sort of led into a 
strategy by increments or by simply reacting to what is 
happening. That makes me very uncomfortable. I think it is 
important that you have a sense of what we are trying to 
accomplish. We plan out a strategy to do it, and then we 
resource that adequately to get it done. I am concerned that 
instead what we are seeing is this kind of drip-by-drip type 
approach.
    Senator Shaheen. Thank you.
    Thank you, Mr. Chairman.
    The Chairman. I am going to take another 30 seconds here 
and say, by the way, there were 54, who signed up. Seven were 
captured in the last week, so there are 47 left in this train-
and-equip program.
    I think the lack of any seriousness with Syria is also 
leading--I think Senator Shaheen is on the right track--I think 
that is leading to much concern.
    There was a great story today. I think it was in the 
Washington Post about the National Security Council. Instead of 
having any kind of central effort where you try to get 
everything going at one time, that is exactly what they do. 
They pick one thing at a time. I hate for this to sound 
pejorative, but after 6.5 years, after us passing an AUMF 
relative to Syria, after us passing an assistance package and 
none of it being acted on really appropriately, I do not think 
there is anybody who would believe that there is going to be a 
coordinated ``somebody put in charge'' effort in the Middle 
East to deal with these between now and November 2016. I mean, 
that is not going to happen. There may be elements.
    But it seems to me, and I get back to one of our Senators 
earlier, Senator Flake, I think that is another fallacy here 
that that has not been developed, that that has not been 
thought about. So you end up in a situation where you have 
tremendous concerns. You have this escalation. And you have 
people who are concerned about our commitment who, therefore, 
end up doing things that are not in the best interest of the 
region.
    Senator Johnson.
    Senator Johnson. Thank you, Mr. Chairman.
    I think the administration strategy is very clear. Rather 
than peace through strength, it is really peace through 
withdrawal, and we have seen that.
    Just very succinctly, I want to give you an opportunity to 
expound a little bit more on a couple of points. But do either 
of you believe that there is any reason whatsoever for Iran to 
have a peaceful nuclear program or enrich for a peaceful 
program?
    Mr. Singh, from your testimony, I believe not.
    Mr. Singh. I would say that most of these activities in 
which Iran is engaged do not have a clear, sensible, civilian 
purpose.
    Senator Johnson. There is only one reason.
    Dr. Pollack, do you agree with that?
    Dr. Pollack. Yes, I do.
    Senator Johnson. So they want a nuclear weapon. That is 
clear.
    Do you either of you believe with this deal that they have 
really abandoned that ambition?
    Mr. Singh. No, quite the opposite. I think this will enable 
them to cement that nuclear weapons option.
    Senator Johnson. Dr. Pollack.
    Dr. Pollack. I do not know. That is my position on this. I 
think the Iranians have made an agreement. I think that it is 
likely for the next 3, 5, perhaps 10 years, they will not try 
to acquire a nuclear weapon. I think that it is advantageous to 
them to agree to this. What I do not know about is what happens 
after 10 years.
    Senator Johnson. I am fairly certain.
    You did mention that it is going to cause a conventional 
arms race. I agree with that, new tensions, new challenges. You 
said that we can avoid that if the United States steps up, acts 
with determination, is not backing down, and does not convey 
weakness.
    Again, in your own words, Dr. Pollack, you said that the 
list goes on that contradicts us showing any strength, correct?
    Dr. Pollack. We would need to do better than we have done 
so far, Senator.
    Senator Johnson. Here are my assumptions and predictions. 
Iran is going to be on a path to get a nuclear weapon.
    Mr. Singh, I think you laid out very carefully or 
convincingly in your testimony that they are going to use this 
agreement to do exactly that. They are just kind of delaying 
it. This gives them the time to build up the capability so when 
all of these things go away, they are right there.
    So that being the case, the fact that we really have been 
engaged in a strategy of peace through withdrawal, what is 
going to happen over the next 18 months? Predict that out. How 
is Iran going to behave? How are they going to increase their 
influence? What is the next President going to have to deal 
with? And how are they going to be able to deal with this 
situation in 18 months?
    I will start with you, Mr. Singh.
    Mr. Singh. Look, I think that Iran's regional strategy will 
remain essentially the same, except that they will have more 
resources to pursue it and fewer impediments ahead of them, 
except to the extent that now we engage in new policies to 
create more impediments as a result of this deal.
    Senator Johnson. But again, a conventional arms race, Gulf 
States are building up arms. We obviously cannot train and 
engage in the strategy. You said it is great strategy, just 
impossible to implement in Syria. There is an arms race, no 
pushback on Syria whatsoever, withdrawal from Iraq, and Iran 
increasing influence in Iraq. What is this going to look like 
in 18 months?
    Mr. Singh. I think it looks worse, frankly.
    Just a clarification on the arms race, I do not disagree 
with the idea that there is going to be an arms race. But I 
think we need to bear in mind it is going to be asymmetric. I 
do not think the Iranians are going to be building aircraft 
carriers. I think they are going to continue to invest in these 
asymmetric capabilities relatively cheap. It is an anti-access/
area-denial strategy.
    But they will, again, have more resources to do it. So it 
is not just a money against money sort of challenge here, as it 
has been characterized out there a little bit so far.
    Senator Johnson. But again, that asymmetric strategy has 
been extremely effective in destabilizing the region, right, 
and really accomplishing Iran's strategic objectives?
    Mr. Singh. No, not effective in stabilizing the region.
    Senator Johnson. No, destabilizing.
    Mr. Singh. Iran has not had success, for example, in 
winning the war in Syria. I do not think they have had much 
success against ISIS. But, again, I think if their strategy is 
simply to project their power and influence, their influence in 
Syria over the Assad regime is now, I would say, almost total. 
Their influence in Lebanon is very significant. Their influence 
in Iraq has grown, and they have made environment less 
hospitable to United States forces, to United States action, 
and to our allies.
    Senator Johnson. I would say their strategy is 
destabilizing the region.
    Mr. Singh. Yes, absolutely. So I think to their objectives, 
I think it has been some success, not a total success, mind 
you. I would not go that far. I think they have had their 
setbacks.
    Senator Johnson. Dr. Pollack, I would like both of you to 
comment on what the next President is going to have to do.
    Dr. Pollack. I think the next President is going to have a 
very challenging situation in the Middle East to face. I do not 
know what the Obama administration is going to do. I hope they 
will do better in the future than I would say they have done in 
the past.
    I can point to things that they have done in the past, even 
in the Middle East, where they have surprised me and did more 
than I expected them to do, and it was important. Iraq being a 
perfect example.
    I was very fearful throughout all of last summer that they 
were simply going to pack up and say we gave Iraq a chance and 
walk away. They did not. They stepped up. And the air campaign 
was extremely important. So, too, was the provision of advisers 
and military support. I would like to see them do more, but I 
am trying to give them credit. So it is conceivable to me.
    If they do not, if their first 6 years are more in keeping 
with how they handle the last 18 months, then yes, I suspect 
you will see the Iranians push. We will not respond. It will 
frighten our regional allies who may do some additional 
precipitous things, as they did in Yemen.
    That is going to create an even longer list of challenges 
for the next President.
    Senator Johnson. And then that next President should do 
what?
    Dr. Pollack. It is a hell of a question, Senator. I am 
working on that hard. I fear, I will put it this way, that if 
we do not step up, if we are not willing to push back on the 
Iranians and reassure our allies that by the time next 
President takes office and realistically is able to assemble 
his or her staff and get his or her policies set that we may 
really have only two options in the Middle East, which will be 
what I am calling either we step up and make a much greater 
investment to try to restore the situation or we step back and 
we really do try to define what are our absolute redlines and 
nothing else. And we let the rest of the region sort itself out 
in what will be an unbelievably bloody and uncertain process 
that could go in a variety of directions that would be very 
harmful to our interests.
    Senator Johnson. Mr. Singh.
    Mr. Singh. Look, I think that as you look at this deal and 
everything surrounding the deal, obviously there are a lot of 
problems in the Middle East, which the next President is going 
to inherit. I do not think it is reasonable to expect any 
administration to solve all the problems on its watch. I think 
the question is, are you bequeathing to your successor a 
productive framework? Are you bequeathing the tools? Are you 
bequeathing strong alliances and a strong diplomatic process?
    I worry that in fact that is not going to be the case here, 
that in fact you will have diminished tools, weakened alliances 
and really, as we have been talking about so far, no real 
framework to address these issues. So I think the next 
President is going to have to come in, look at all these 
problems in the Middle East, and do a sort of top-to-bottom 
review. And start with a strategy, not start by sort of one-
offing each problem but a strategy for the region, which is 
going to center on rebuilding alliances, first and foremost, 
and then with those allies, coming up with some joint 
approaches to these problems.
    Senator Johnson. My interpretation of the testimony is that 
this is making the situation in the Middle East worse.
    Thank you, Mr. Chairman.
    The Chairman. Thank you.
    I think aside from the human tragedy and some of the 
humanitarian problems we have seen, what that bodes for is 
tremendous job security for the two of you as we move into the 
future.
    Dr. Pollack. Thank goodness for that.
    The Chairman. Senator Markey.
    Senator Markey. I know Mr. Pollack has two children he is 
going to have to put through college, so I know he is extremely 
grateful for the totality of our need for expert advice.
    Mr. Pollack, your MIT Ph.D. thesis was the ``Influence of 
Arab Culture on Arab Military Effectiveness,'' so that takes us 
to Saudi Arabia, their culture, their military effectiveness. 
They have much more money than anybody else has.
    So what is wrong? Why can they not mount their own capacity 
here? Why can they not put together this much larger Sunni 
military but turned into diplomatic capacity to create the 
conditions for a negotiation, a diplomatic resolution on these 
issues? Why are they so dependent on us? What is it in their 
Arab culture that so affects their Arab military effectiveness?
    Dr. Pollack. Senator, perhaps the next time I see you, I 
will drop off a copy of my dissertation, which was 1,500 pages.
    I will put the answer this way. First, I think it is clear 
that all of the Gulf States have indulged a culture of 
exceptionalism and reliance on others to do their dirty work 
for them.
    There was an old joke that I remember from the 1990s that 
the Kuwaitis used to make. The joke was that the government has 
declared war on Iraq and South Korea got the contract. In other 
words, we do not have to do this for ourselves. We can pay for 
someone else to.
    As a result, they have not really developed their own 
capacity, their own tools of statecraft, their military. Even 
their economic instruments are extremely rudimentary. The one 
thing that they are often able to do is throw money at a 
problem. But throwing money at a problem rarely solves the 
problem.
    Especially in the Middle East what they have learned is 
that you really cannot buy anyone. You might be able to rent 
them for a brief period of time, but even then, you can only 
rent them until a higher, better offer comes along.
    So it has made them very weak compared to just looking at 
what the CIA World Factbook might suggest based on their per 
capita income.
    Senator Markey. During the American Civil War, both the 
slaveowners in the South and the manufacturers in the North, 
they could actually buy their way out of serving in the Civil 
War. So on both sides, the same slogan came up, ``It is a rich 
man's war, but a poor man's fight.''
    So there is a lot of that going on in the Middle East, 
where you think you can spend the money to get yourself out of 
it, or buy the big fancy jets and other equipment, but 
ultimately it does not translate into anything truly effective 
on the ground without U.S. or allied help to accomplish the 
goal.
    Given the context of this deal, do you think the Saudi 
Arabians are going to be more inclined to get a nuclear weapon 
as a result of this deal or not? Do you think they will be 
satisfied that there is an umbrella that we are going to place 
over that region and that this agreement will sufficiently 
constrain Iran's ability without detection to actually obtain a 
nuclear weapon? What is the Saudi attitude, from your 
perspective?
    Dr. Pollack. I think this is an absolutely critical 
question, Senator. I do not think that there is a quick or easy 
answer to it. I think it is actually a very complex situation.
    First, I do think, just the simplest answer, that the deal 
will incline the Saudis slightly toward nuclear proliferation, 
but only slightly. I think the truth of the matter is that the 
Saudis are concerned about the deal. They are concerned about 
the strategic shift and the potential to be left in a situation 
where the United States has abandoned them, and Iran is once 
again free to pursue its nuclear aspirations.
    But that is some way off. And the default position of all 
of our gulf allies is typically to do nothing and let us do it 
for them.
    We should also remember the long history of nuclear 
proliferation. Far more countries have started down the path 
toward acquiring a nuclear weapon than actually brought it to a 
finish. President Kennedy's famous remark that there would be 
25 countries with nuclear weapons by the year 2000 was famously 
proven wrong. It is because there are very important 
disincentives. And countries with even more compelling 
strategic rationales than Saudi Arabia decided not to acquire 
nuclear weapons at various points in time.
    It is all a way of saying that I think these next 10 years 
are going to be critical. I suspect that the Saudis will look 
into the possibility of proliferating, if only as a hedge. But 
I think whether or not they truly decide to do so, and it will 
be difficult for them to do so, will ultimately depend on 
whether they believe that we or conceivably someone else will 
provide the deterrence that they need.
    Senator Markey. Do you think they believe that, that we 
will provide the deterrence?
    Dr. Pollack. I think that, at the moment, they do. But I 
think they are questioning it.
    Senator Markey. Again, our greatest concern is that it 
would be kind of a fulfillment of President Kennedy's warning 
that there would be 20 to 25 countries with nuclear weapons. We 
have avoided it.
    So that is really what this agreement is intended on trying 
to accomplish, which is to stop it from hitting the Middle East 
and having that whole domino effect.
    And so you think, at least for the time being, this will 
work. If Iran had a nuclear weapon, had already detonated one 
and was refusing to give it up, Saudi Arabia would try to 
purchase or create its own nuclear weapons capacity. Do you 
agree with that?
    Dr. Pollack. Absolutely. What is more, I agree with the 
statements. I do not think that war is the most likely 
alternative. I do fear exactly what you are laying out, that 
the most likely alternative is a situation where we have the 
erosion if not the collapse of sanctions, Iran is unfettered. 
Whether or not Iran tries to acquire a nuclear weapon, we will 
not know. But it may be like Iraq where we think they are doing 
so. And the belief, the fear, that they are doing so may cause 
others to act.
    Senator Markey. And who are ``others''?
    Dr. Pollack. First and foremost, the Saudis. I think a 
very, very distant second, the Turks, the UAE, the Egyptians. 
But I think it is really about Saudi Arabia.
    Then we can also think farther afield, because there is a 
question mark. If the Iranians acquire nuclear weapons and they 
are not punished for doing so, if the Saudis acquire and are 
not punished for doing so, who on Earth is going to punish 
South Korea or Taiwan or Brazil, for that matter?
    Senator Markey. Exactly. So this is an important world 
moment. It is important moment for the IAEA, to make sure that 
it works.
    Dr. Pollack. Absolutely.
    Senator Markey. And if I may, in conclusion, just say how 
much confidence that you have that this IAEA is not the IAEA of 
the Osirak bombing in 1981? Do you think this is an agency that 
now has the steel in its spine and the funding necessary in 
order to do its job and blow the whistle if something goes 
wrong?
    Dr. Pollack. Senator, I think they are certainly better 
than they were, but I am not an expert on the IAEA. All I can 
say is that I hope that they do have that steel in their spine.
    Senator Markey. Okay, thank you.
    Thank you, Mr. Chairman.
    The Chairman. Thank you.
    I know Ranking Member Cardin wanted to make a couple 
comments.
    Senator Cardin. First of all, I thought that this was very 
helpful. I thank both of you. It sort of helps put it in 
perspective the realities of the Middle East and what our 
options are going to be. We all know that U.S. policy is always 
a challenge not only what we want to lead, but also when trying 
to get a coalition to work with us. We do not always get 
consistent messages from our so-called friends, so it is never 
an easy task.
    I really just want to make one observation and that is, if 
you go back a decade ago, I do not think many people believed 
that sanctions would get Iran to the table to negotiate a 
nuclear agreement. We know that we had resistance from the 
executive branch, from both Republican and Democratic 
administrations. But Congress went forward because we had very 
strong views about it.
    So I do not deny that this administration or the next 
administration, whether it is a Democratic or Republican 
administration, will want to do things their way and will not 
particularly want Congress' advice on how to be tough on 
terrorism and human rights violations by Iran.
    But my guess is, Congress is going to be tough. And we are 
not going to worry too much about the niceties of this 
agreement, because we know what they told us.
    So I guess I would just point out the fact, and I think we 
need to put it into the equation, that there are many of us in 
Congress on both sides of the aisle, those who will ultimately 
support and those who will ultimately vote against this 
agreement, that are going to come together to say that we are 
going to be watching very closely and we are going to be 
prepared to do what we need to, to make it clear that we are 
going to use every tool in our toolbox and increase our toolbox 
so that we can act on these issues.
    I say that because I thought the points both of you made 
about U.S. involvement and the credibility of sanctions or the 
strength of sanctions being affected by this agreement are 
absolutely true. I agree with your assessments.
    But I do think after the dust settles one way or another on 
this agreement, we need to see how we can strengthen our 
toolbox so America can have the type of leadership we need in 
this administration and the next administration to affect 
Iran's equations in the region as to what they do.
    The Chairman. Thank you.
    This will be the last of our hearings. We do have a 
briefing taking place at 5 o'clock. It is an all-Senate 
briefing.
    I want to thank the committee for the cooperation in 
putting all these briefings together. All of us come at this 
with different backgrounds and points of view. But I could not 
have a better partner in Senator Cardin.
    And I appreciate very much the way you have worked with us, 
and your staff has, to put together such a rigorous system of 
briefings and hearings.
    My understanding is that we have now agreed, as the Senate, 
to move to debate on this as soon as we get back, without a 
motion to proceed, which is unusual. My sense is that you are 
going to see a very respectful, sober debate about the facts 
and about concerns that people have.
    But we will be entering that with the benefit of the 
testimony that you have given today, the private conversations 
that you have been involved in. And for that, we are deeply 
grateful.
    For the knowledge of the members, we will leave the record 
open until the close of business Friday. If you would answer 
fairly promptly any inquiries that people make, we would 
appreciate it.
    The Chairman. Without further ado, this meeting is 
adjourned. Thank you.
    [Whereupon, at 3:48 p.m., the hearing was adjourned.]
                              ----------                              


              Additional Material Submitted for the Record


  Statement of Abraham D. Sofaer, George P. Shultz Senior Fellow, The 
         Hoover Institution, Stanford University, Stanford, CA

    Chairman Corker and distinguished members of this committee, thank 
you for inviting me to submit my views concerning the Joint 
Comprehensive Plan of Action (JCPOA) reached between the P5+1 and Iran 
and submitted to Congress on Sunday, July 19, 2015, pursuant to the 
Iran Nuclear Agreement Review Act of 2015. Both Houses are studying the 
Agreement in depth, recognizing that it will have major consequences to 
U.S. and international security regardless of how Congress acts. Rather 
than adding to the voluminous record on how the JCPOA is supposed to 
work, and calling attention to Iran's opportunities to evade its 
provisions, I will summarize my conclusions and then provide a 
description of the premises on which these conclusions are based, 
derived specifically from my experience representing the United States 
in negotiations with Iran for 5 years, and my study of U.S./Iranian 
relations from 1979 to 2013, described in my book, ``Taking On Iran.''
    Mr. Chairman, I am not among those opposed to negotiating with 
Iran. I negotiated constructively with Iran for 5 years, and I have 
repeatedly criticized both Republican and Democratic administrations 
for failing to engage Iran. The evil things that Iran has done since 
the start of the Islamic Revolution, beginning with taking U.S. 
diplomats hostage, are no more a basis for refusing to negotiate with 
Iran than the evil conduct of the Soviet Union was a basis for refusing 
to negotiate with that government. I commend the Obama administration 
for negotiating directly with Iran.
    U.S. negotiations with the Soviets were based, however, on strength 
and well-established principles of effective diplomacy. This 
administration, by contrast, like those of all prior administrations, 
has failed to respond to Iranian policies with strength, and to 
negotiate with Iran in accordance with the principles successfully used 
in negotiating with the Soviets. This history is covered in detail in 
my book, but the one point that bears emphasis here is that the threat 
of war was not part of the U.S. strategy that succeeded with the 
Soviets, and is not the path I would propose in dealing with Iran.
    I agree with President Obama that the possibility of war must be 
retained, but that an attack on Iran's nuclear facilities would be 
complex, harmful to U.S. interests in many ways, and likely ultimately 
to fail in preventing Iran from developing a nuclear weapon. The 
President is unfair when he accuses those who oppose the JCPOA as 
favoring war over diplomacy.
    I believe that Congress should disapprove the JCPOA and vote to 
override any veto, because the Plan is inadequate in limiting Iran's 
nuclear program and makes no effort to curb its other illegal conduct. 
While the President speaks of Congress' potential vote of disapproval 
as ``blocking'' or ``killing'' the JCPOA, he has already secured the 
JCPOA's implementation through U.N. Security Council Resolution 2231, a 
maneuver undoubtedly intended to lift the U.N. nuclear sanctions 
through a process that a Resolution of Disapproval could not possibly 
affect. Congressional disapproval cannot prevent the JCPOA from going 
into effect to the extent it is implemented by Resolution 2231. But it 
would convey Congress' view that the Plan is inadequate, and limit the 
damage the Plan is certain to cause.

   Weaknesses of the JCPOA. The JCPOA contains some significant 
        limitations on Iran's nuclear program worth supporting, 
        including the reductions in enrichment capacity and 
        modification of the heavy water reactor at Arak. The weaknesses 
        in the Plan, however, its limited duration, and the long 
        history of Iranian evasion, undermine the President's claim 
        that the Plan blocks every path Iran has to obtaining a nuclear 
        weapon. Particularly misleading is the assertion that the Plan 
        ``permanently'' prohibits Iran from developing a nuclear 
        weapon. The JCPOA is not the source of any such prohibition; 
        Iran has agreed it will never develop a nuclear weapon because 
        it does not want one, not because of the JCPOA, or even the 
        NPT.
   The JCPOA will also have a detrimental impact on nuclear 
        weapons activities in the Middle East. It legitimizes Iran's 
        nuclear program and could set into motion a nuclear arms race 
        in the most volatile area of the world.
   The administration's defense of these weaknesses is that the 
        only option to the JCPOA is war. This is the sort of scare 
        tactic President Reagan faced when he pushed back against 
        illegal Soviet interventions and inhumane treatment of its 
        nationals. And it is no less false. Iran respects strength and 
        scorns weakness. War is more likely to result if the JCPOA is 
        approved. It is inherently unstable because of what it allows 
        Iran to continue doing.
   Effect of Resolution 2231. The administration also argues 
        Congress should approve the JCPOA, because the sanctions will 
        become ineffective anyway. What the administration means by 
        this is that the U.N. sanctions will end pursuant to Security 
        Council Resolution 2231 (20 July 2015) regardless of what 
        Congress does. This argument, Mr. Chairman, seems correct. 
        Congress has, in fact, been prevented from voting on lifting 
        the U.N. nuclear sanctions, since they will ``terminate'' upon 
        receipt of the report from the IAEA certifying Iranian 
        compliance with its JCPOA commitments listed in paragraphs 
        15.1-15.11 of the Plan's Annex V. This resolution is now 
        established international law, and the other parties to the 
        JCPOA are moving ahead with plans to resume business with Iran 
        irrespective of Congress' potential action.
   Congress should carefully consider the separation-of-powers 
        implications of the President's promising to allow Congress to 
        review an international ``Plan'' and then voting in the 
        Security Council to negate Congress' power to review and stop 
        the Plan's implementation. The important issue now, however, is 
        the effect of Security Council Resolution 2231.
   By making implementation of the Plan dependent wholly on the 
        condition stated in Resolution 2231, namely the IAEA's 
        acceptance of Iran's compliance, the administration has also 
        enabled Congress to disapprove the JCPOA without altering its 
        termination of the nuclear resolutions if Iran complies. If 
        Iran wants the nuclear-related Security Council resolutions 
        lifted, and its frozen funds returned, it must comply with its 
        undertakings in the Plan to the IAEA's satisfaction, regardless 
        of whether Congress approves or disapproves the JCPOA. 
        Furthermore, in order to prevent the nuclear-related 
        resolutions from coming back into effect, Iran must continue to 
        comply with its obligations under the JCPOA, or else it could 
        trigger the process provided for in Security Council Resolution 
        2231, paragraphs 11 and 12. Again, this process is independent 
        of whether Congress approves or disapproves the JCPOA.
   I acknowledge, Mr. Chairman, that this is an extraordinary 
        proposition. But it flows from the extraordinary form of 
        understanding that the JCPOA represents, and the unprecedented 
        action by the Security Council, deliberately orchestrated, that 
        appears to immunize Resolution 2231 and to that extent the 
        JCPOA from any impact based on a Resolution of Disapproval. 
        Congress no doubt has the power to prevent the Executive from 
        cooperating with an international legal requirement. But even a 
        legislative instruction to that effect would not undo the vote 
        to ``terminate'' the Security Council's nuclear resolutions on 
        the conditions it provides.
   Benefits of Disapproval. What effect, then, would Congress' 
        vote to approve or disapprove the JCPOA have on U.S. 
        obligations or otherwise? Approval would signify Congress' 
        support for the Plan. Disapproval, on the other hand, would 
        convey the position that Congress believes the Plan does too 
        little to control Iran's nuclear and nonnuclear activities, and 
        that U.S. policy should support additional measures for both 
        purposes.
   In my view, therefore, Mr. Chairman, any Member of Congress 
        who supports doing more to curb Iran than done by the JCPOA can 
        vote to convey that message without ``blocking'' or ``killing'' 
        what the administration has achieved. For example, the U.S. has 
        under its control some $2 billion in Iranian assets. Approving 
        the JCPOA could lead the administration to release some or all 
        those funds, whereas disapproval will allow only funds frozen 
        pursuant to the terminated UNSC resolutions to be released. 
        Also, the U.S. has in place unilateral sanctions based on 
        Iranian support for terrorism that threaten banks with 
        restrictions if they do business with Iran, such as the 
        Comprehensive Iran Sanctions, Accountability, and Divestment 
        Act of 2010. Those sanctions will not be subject to Executive 
        discretionary nonenforcement if Congress votes to disapprove.
   The administration has assured Congress and the public that 
        it will continue to press Iran to stop its illegal activities 
        in nonnuclear areas. The President has also said, however, in 
        his speech at American University, that unilateral U.S. 
        sanctions will not work. The Ayatollah has triumphantly 
        declared that the JCPOA places no limitation on Iran's 
        continuing to help President Assad stay in office and to expand 
        Shiite power. He would undoubtedly object, and Iran has 
        reserved the right to stop complying with the JCPOA, if the 
        U.S. imposes new sanctions to freeze Iranian funds based on 
        these nonnuclear activities. By voting for disapproval, 
        Congress would put the U.S. on record as committed to ending 
        Iran's nonnuclear related policies that undermine peace and 
        security abroad, and oppress its people at home.
   Disapproval will also have the important effect of signaling 
        Congress' support for confronting Iran, and for making it pay 
        as dearly as possible for its international adventures. It 
        would signal Congress' support for going beyond the imposition 
        of sanctions in pressuring Iran, without war, as the U.S. did 
        in confronting the Soviet Union. Iran is overstretched and 
        vulnerable economically and politically. Disapproval would 
        reflect a determination by Congress to apply enhanced strength 
        in order to force a more effective and comprehensive diplomacy, 
        a policy more likely to lead to a genuine and lasting peace.

    This summarizes my view, Mr. Chairman, of why Congress should vote 
to disapprove the JCPOA. My conclusion that disapproval cannot prevent 
Security Council resolution 2231 from taking effect may displease some 
who would like to prevent that consequence, but it seems unavoidable 
given the President's power to renounce international agreements, 
including the nuclear-related resolutions potentially terminated by 
resolution 2231. This circumstance does permit Congress, however, to 
vote disapproval on a basis that preserves the elements of the JCPOA 
that Iran will be required to perform, while making clear that Congress 
insists that more be done to confront Iran's conduct in general. What 
follows are the experiences and historical data which have led me to 
reach this set of recommendations.
         i. negotiating with iran: lessons since the revolution
    I had the privilege, Mr. Chairman, as Legal Adviser to Secretaries 
of State George P. Shultz and James Baker, to lead negotiations for the 
U.S. with Iranian representatives in The Hague from 1985 to 1990. After 
a slow start, I was able with the help of a superb staff, including Bob 
Clarke, a Farsi-speaking professional from the Iran Desk, to settle 
many thousands of claims between Americans, U.S. companies, and the 
U.S. Government, who we represented, and Iran and its agencies. As the 
pace of settlement picked up in The Hague, the Iranians sent a Member 
of its Council of Guardians to lead their team. We made good progress, 
and under instructions from our governments we settled some interesting 
law-related issues with political significance. Perhaps most important, 
we settled the claims of Iranian families for their lost ones in the 
tragic shoot-down of Iran Air 655.
    This experience convinced me that negotiating with Iran, though 
difficult and frustrating, is worthwhile. Iran routinely initiated each 
round of talks with preposterous demands, but its sophisticated 
negotiators reacted reasonably after equally tough responses. It also 
became obvious, though, that the U.S. and Iran remained unwilling to 
deal openly with each other. Every major settlement at the Tribunal was 
met with the suspicion that it had something to do with getting Iran to 
release U.S. hostages. Many huge claims remain unresolved some 35 years 
after the Tribunal was created.
    Our approach in dealing with the Soviet Union during the Reagan and 
H.W. Bush administrations differed from our approach in dealing with 
Iran. With the Soviets, we firmly pushed back against their every 
initiative, in Europe, Central America, Africa, and Afghanistan. At the 
same time we engaged them on every issue that divided our societies, in 
every possible forum, and with a robust and effective diplomacy. With 
Iran, we responded weakly to their aggressive actions, even to their 
responsibility for killing our Marines in Lebanon, and our Airmen in 
Saudi Arabia. As a substitute for real strength, we refused to 
negotiate with Iran in any forum other than at The Hague. Under both 
Presidents Reagan and H.W. Bush, strength plus diplomacy produced 
positive results with regard to the Soviet Union, while weakness and 
the absence of diplomatic engagement failed to contribute to reducing 
U.S./Iranian alienation.
    The absence of conventional methods for dealing with Iran led, 
under Reagan, to Iran/Contra, a humiliating and unsuccessful effort to 
shortcut the process of restoring relations. Subsequent administrations 
have tried appealing directly to Iran for a change in its positions, 
with equally ineffectual results. President Clinton deliberately 
disregarded Iran's responsibility for the Khobar Towers bombing in an 
effort to establish a new relationship with President Khatami. 
President Obama has, like some others before him, laced his speeches 
with deferential remarks, showing respect for Iran, accepting partial 
responsibility for the situation, and calling for better relations.
    The JCPOA should be seen as the latest of a series of efforts to 
engage Iran that attempt to bypass the tried and true requirements of 
strength and effective diplomacy, for which no substitute exists when 
it comes to convincing a radical regime to change its ways. As Henry 
Kissinger has explained, convincing such regimes is not a matter of 
using reason to resolve disagreements through compromise, but rather 
the creation of an `` `objective' situation [that] is ratified by the 
settlement.''
    The other lesson learned from my experience in the Reagan and Bush 
administrations, and that has been confirmed by more recent events, is 
that strength is no less effective in dealing with Iran than it was in 
dealing with the Soviets. In the one confrontation we had with Iran 
during that period, the 1988 Operation Praying Mantis after IRGC 
missile attacks on U.S. flagged vessels and its mining of gulf waters, 
the U.S. Navy sank several IRGC boats, and destroyed or damaged naval 
warships and military planes. The IRGC ran for cover, and has never 
again fired missiles at U.S. flagged vessels or laid mines in the gulf.
    Iran handled the U.S. Navy attack in a manner that reflected its 
respect for strength. When I sought to cancel a meeting scheduled with 
my Iranian counterpart in The Hague, the day after we sank an Iranian 
mine-laying ship as part of that operation, he responded that we should 
meet as scheduled rather than ``burn the only bridge between our 
countries.'' This lesson has come through loud and clear on several 
subsequent occasions: after President George H.W. Bush pushed Iraq out 
of Kuwait, President Rafsanjani arranged the release of the hostages 
held in Lebanon; after President George W. Bush drove al-Qaeda and the 
Taliban from Afghanistan, Iran cooperated in establishing a new 
government there; and after he drove Saddam Hussein from power in Iraq, 
Iran offered to negotiate with the U.S. on all issues. After each of 
these displays of U.S. strength, Iran was more, not less, open to 
dealing with the U.S., though regrettably we did not accept any of 
these opportunities to engage.
    It has been a grave error, in my view, that the U.S. has failed to 
settle or complete all the claims now pending in The Hague for some 35 
years, and has failed to take advantage of the opportunities that have 
occasionally presented themselves to attempt to deal with all of our 
serious differences with Iran. The problem with this administration's 
effort is not that it engaged in negotiations; rather it is that it 
gave up the increasingly apparent benefits of pressuring Iran and 
settled for an agreement that deals exclusively with nuclear related 
issues, allowing Iran to continue supporting terrorism and engaging in 
other conduct that undermines international peace and security.
                 ii. an alternative agenda short of war
    President Obama has belittled the contention that any option exists 
short of war that could serve U.S. interests more effectively than the 
JCPOA. He is wrong. A program of increased pressure on Iran, combined 
with broader-purposed, more effective diplomacy, can be devised that 
could force Iran to accept established norms of international conduct.
    First, the JCPOA could be improved. The administration has 
exaggerated the JCPOA's advantages, claiming that it blocks every path 
Iran has to obtaining a nuclear weapon, and that its ``unprecedented'' 
inspection rights and other means will allow the U.S. and its allies 
about a year to prevent Iran from acquiring a nuclear weapon. In fact, 
the JCPOA allows Iran to conduct important R&D and to engage in other 
activities (such as developing sophisticated enrichment equipment) that 
will put it in the position to break out rapidly, especially after the 
JCPOA is no longer in effect. Increasing the amount of time Iran will 
need to obtain a nuclear weapon will have real value, moreover, only if 
the U.S. is simultaneously seeking results that reflect a more far-
reaching impact on Iran's conduct and aims.
    Second, it is naive to think that lifting sanctions and reaching 
out to Iran will lead its present government to respond positively. 
Every such effort has failed in the past. The administration hopes that 
the JCPOA will lead to a better relationship and a reduction in Iranian 
militancy. More likely, Iran's success in getting economic sanctions 
lifted in exchange for limited concessions related to a weapon it 
claims it does not want will increase the influence of its most 
militant factions. The IRGC have proved repeatedly that their strategy 
of disregarding U.S. warnings has worked.
    The safer policy is to continue vigorously to enforce nonnuclear 
sanctions now, in order to deter Iran's policies of supporting 
terrorism and other illegal and inhumane activities. It would be more 
dangerous to wait, as we did after the Algiers Accords of 1981, 
allowing Iranian and Iranian-sponsored misconduct to resume in the form 
of hostage taking and terrorist attacks. To have to reimpose sanctions 
years into the process, as will be inevitable if Iran continues its 
policies, risks giving Iran an excuse to free itself of all the JCPOA's 
constraints, and the motive to go further with its nuclear weapons 
program than it otherwise might have gone.
    Another, obvious element of a sound U.S. strategy would be, simply, 
to enforce the many, nonnuclear Security Council resolutions that Iran 
has ignored. Many concern terrorism. Some prohibit the arming of groups 
in specific countries, such as Lebanon. Others prohibit giving 
sanctuary to terrorists. Several specifically order Iran to stop 
depriving individuals of their human rights. And Iran should be 
compelled to release Americans illegally held without due process, as 
recently confirmed by the U.N. Special Rapporteur for Human Rights. 
These are just the types of objectives which the U.S., in every 
administration, worked hard to obtain in the face of Soviet obstinacy.
    Finally, the U.S. should go beyond sanctions in responding to 
Iranian behavior. The JCPOA could not have been more poorly timed. It 
takes the pressure off Iran, and legitimizes its nuclear program, at a 
moment in time when pressure is likely to succeed. Iran faces a 
situation much like the Soviet Union did in the late 1980s. Its economy 
is in shambles. It has lost over $160 billion in oil revenues and 20 
percent of its GDP. Its foreign interventions have proved costly. Syria 
alone has cost some $6 billion per year. Hezbollah, which Iran supports 
to the tune of $100 to $200 million per year, has lost thousands of 
fighters in Syria. Many IRGC fighters have been killed, including some 
high-ranking individuals. Iran is also supporting, with money, 
equipment, and manpower, the Shiite militias in Iraq, the Houthis in 
Yemen, Hamas and other terrorist groups in Gaza, pro-Iranian groups in 
Afghanistan, and others. These activities drain limited Iranian 
resources and exacerbate Iran's economic problems. Its overwhelmingly 
young population is tired and oppressed by the IRGC's domestic Basij 
Force.
    The U.S. should be doing more to increase these pressures instead 
of relieving Iran from their consequences. Helping Turkey to implement 
its aims in Syria would increase the pressure on Assad and his Iranian 
sponsors. The administration should long ago have assisted in creating 
a zone along Turkey's border in which Syrian refugees can safely be 
assisted, and in which anti-Assad forces can be supported. The U.S. 
should make Iran pay as great a price as possible for its support for 
that murderous regime. The U.S. should long ago also have provided more 
support to the Kurds in both Syria and Iraq. Helping the Kurds more 
robustly would increase U.S. influence in convincing them to refrain 
from threatening Turkey, while allowing them to do as they please in 
Iran. We should understand full well why Iran's 10 percent Kurdish 
population chafes under the control of a religious autocracy that 
murders Kurdish leaders. We should welcome and support any other 
legitimate resistance to a government that kills people because of 
their religion, sexual orientation, or beliefs.
    While President Obama claims he is implementing a Reaganite policy 
in dealing with Iran, his administration has done everything possible 
to allay Iran's concerns rather than to use the excesses of its 
ambitions and ideology as vehicles for its demise, as Reagan did with 
the Soviets. President Obama's policy is much more like the failed 
Reagan policy regarding Iran than the successful one in confronting the 
Soviet Union.
                            iii. conclusion
    Mr. Chairman, the negotiation with Iran has grabbed the world's 
attention. The administration has made a monumental effort to secure 
agreement. Great drama has accompanied each stage of the process. The 
technical nature of many of the issues has diverted attention from the 
strategic consequences of its overall terms. This has led much of the 
criticism to focus on this or that weakness, as though an improvement 
here or there would really matter.
    In fact, if the JCPOA were one aspect of an overall effort to force 
Iran to bring its conduct and policies in line with international law 
and human decency, a deficiency here or there would not matter. But it 
is not. It is deliberately limited rather than ``comprehensive,'' and 
it gives Iran huge benefits in the nuclear arena and essentially an 
implied promise to back off from seeking vigorously to curb the rest of 
its heinous activities.
    The attention the JCPOA has garnered, however, and the hopes it has 
raised, are as ephemeral as any other diplomatic initiative based on 
flawed assumptions. One need only to remember Secretary of State 
Kerry's dramatic promise to negotiate a complete peace between Israel 
and the Palestinians in 9 months. Then, too, the press was filled with 
the drama of diplomacy at the highest levels of importance. People took 
the effort seriously, although it was hopeless from the start. So is 
the JCPOA, as we will learn in due course, unless it is rapidly 
supplemented with greater strength and more effective diplomacy.
    Moreover, lost in the drama of meetings, shuttles, and press 
conferences is the lesson, repeatedly played out but quickly forgotten, 
that ill-considered diplomacy not only fails, but also exacts a price. 
The price for the failed Middle East effort was a new wave of 
bitterness and alienation, and a setback to the hopes for steady 
progress toward peace through economic development and cooperation on 
terrorism and other aspects of coexistence.
    The price for negotiating and signing the JCPOA will be even more 
substantial. But Congress has an opportunity to limit the damage. 
Congress has the power to insist, Mr. Chairman, that the U.S. not 
accept as legitimate an Iranian nuclear program having the capacities 
required to develop nuclear weapons, so long as Iran's Government is 
committed to achieving criminal aims, spews racist rhetoric, and 
engages in wrongful conduct. Congress should insist that the President 
move the U.S. to a truly effective engagement with Iran, that extends 
to all issues between the two States, but that is based on the 
inexorable reality that Iran will give up its radical aims and improper 
conduct only if it sees that as required by its own interests. And that 
outcome is only possible through pressure. Not war, but substantial, 
unrelenting pressure.
    Every administration since 1979 has failed to take on Iran with 
strength and effective diplomacy. Each, in its own way, opted instead 
for policies regarding Iran that fluctuated wildly between refusing to 
negotiate at all, to direct pleas and hopeless plans to convince Iran 
through gestures of kindness and humanity to change its policies and 
practices. Unless properly augmented, the JCPOA will take its place 
among the hopeless plans. And the consequences will be especially 
unfortunate, because the U.S. is missing an opportunity to press Iran 
for change at a time Iran is economically weak, militarily 
overextended, and politically vulnerable. Congress should vote 
disapproval to force the JCPOA to be augmented with a truly 
comprehensive, potentially effective strategy.


                                 ______
                                 

         THE STATUS OF JCPOA IMPLEMENTATION AND RELATED ISSUES

                              ----------                              


                      THURSDAY, DECEMBER 17, 2015

                                       U.S. Senate,
                            Committee on Foreign Relations,
                                                    Washington, DC.
    The committee met, pursuant to notice, at 9:33 a.m., in 
Room SD-419, Dirksen Senate Office Building, Hon. Bob Corker, 
chairman of the committee, presiding.
    Present: Senators Corker [presiding], Risch, Flake, 
Gardner, Perdue, Isakson, Barrasso, Cardin, Boxer, Menendez, 
Coons, Murphy, Kaine, and Markey.

             OPENING STATEMENT OF HON. BOB CORKER, 
                  U.S. SENATOR FROM TENNESSEE

    The Chairman. I want to call the Foreign Relations 
Committee to order. And I want to thank our witnesses for being 
here. I know Senators that are here at the moment. I know 
others will be joining.
    This hearing is the first public meeting the committee has 
held since we began to oversee the implementation of the Iran 
deal, and I would like to underscore the importance that we 
place on the oversight effort. In many ways I think that was 
the strongest element of the Iran Review Act.
    We intend to hold another hearing in January after the 
administration submits the 180-day report, as required by the 
Iran Review Act, and then a third if ``Implementation Day'' 
occurs. I am sure there will be more to follow after that, and 
we will work with the ranking member and others to make sure 
that those are scheduled in a timely fashion.
    As we begin this process, it is worth noting that whether 
or not any of us supported or opposed this agreement, the deal 
is being implemented at present. And I think no matter what 
anyone's view on the agreement is or was, we all support the 
goal of preventing Iran from getting a nuclear weapon.
    One area that we all agree on is the need to be tough on 
any destabilizing or illegal action by Iran. With that view, I 
think the agreement is off to a really terrible start. I know 
we have talked about this some in some classified settings, and 
today, we will talk about it more publicly.
    Since the agreement was signed, Iran has convicted an 
American Washington Post reporter, launched cyber attacks 
against the State Department, defied a U.N. travel ban, and 
sent Soleimani to Russia, exported weapons to Syria and Yemen, 
and then violated the U.N. ballistic missile test ban twice and 
lied to the IAEA in the PMD investigation. And I realize not 
all of those issues are covered by the Iran agreement, but they 
all relate to our relationship to Iran. And it is very evident 
that they are taking a very different tack, I think, than many 
administration officials thought would be the case after the 
agreement was agreed to.
    Can anyone here point to any substantive consequences that 
Iran has faced? I am sure that during this hearing that is 
going to be a constant theme because we see no evidence of them 
paying a price for any of these actions.
    Instead of consequences, Iran got what they wanted, and our 
administration supported a resolution at the IAEA closing the 
PMD investigation, which I think all of us believe--we thought 
they would maybe get a D minus in their actions--was an F.
    I thought that our witnesses--I know that our witness will 
say that most of these actions fall outside of their 
jurisdiction, including the missile test, but I do not think we 
can take a narrow view of this oversight. Failure to impose any 
consequences on Iran for violations of the U.N. Security 
Council resolutions and other destabilizing actions sets a very 
dangerous precedent, which we have talked about, before 
implementation of the nuclear agreement, when sanctions are 
lifted and the leverage shifts to Iran.
    So we hope you are going to talk with us today about how 
you plan to enforce the agreement when it appears we are 
paralyzed at present to act for a fear of Iran backing away 
from the agreement. Most of us have talked about the leverage 
shift that will take place and feel like it is going to be even 
more difficult for them to be pushed back again.
    So we thank you again for being here. I look forward to the 
comments of our distinguished ranking member and certainly your 
testimony and questions.

             STATEMENT OF HON. BENJAMIN L. CARDIN, 
                   U.S. SENATOR FROM MARYLAND

    Senator Cardin. Well, thank you, Mr. Chairman.
    First, let me just pause for one moment on behalf of the 
Democratic members of this committee, but I think I speak on 
behalf of all the members of this committee, when I 
congratulate you on an incredible year as chairman of this 
committee. The way that you have conducted your leadership on 
the Senate Foreign Relations Committee is in the best tradition 
of the United States Senate, allowing us to have input into 
very important foreign policy security issues for the United 
States. So I just really want to thank you and congratulate 
you.
    I do want to remind you, though, that members of this 
committee receive a set compensation. It is not based upon the 
number of committee hearings that we have. I think this 
committee had to set an all-time record on the number of 
hearings and briefings, which I think was because of the 
issues. Senator Menendez's leadership on the Iran Review 
Agreement and with your leadership and Senator Kaine's 
leadership and others we took on a very important 
responsibility of trying to deal with Iran's nuclear ambitions. 
But we also had to deal with Russia's unhelpful activities in 
Ukraine to Syria. We have dealt with a State Department 
authorization bill. We dealt with individual bills and 
resolutions in a way that I think was in the best tradition of 
the United States Senate and this committee. So I applaud you.
    I also want to point out, as I have said many times, your 
timely considerations of nominations--and we have had so many--
and actions in this committee was in, again, the best tradition 
of the Senate in a nonpartisan manner.
    The Chairman. Thank you.
    Senator Cardin. And we thank you very much for that. And I 
could tell the members of this committee--I know Senator 
Menendez will agree--the working relationship among the staffs, 
the majority and minority, could not be better.
     So I just really wanted you to know that and that this is 
fortunately our last hearing, I hope. [Laughter.]
    The Chairman. I do, too, actually.
    Senator Cardin. Thank you. So on to today's hearing. 
Today's hearing is the first on the oversight functions of the 
Senate Foreign Relations Committee in regards to the Iran 
agreement. And as you indicate, we will be having a series of 
opportunities to discuss the Iran agreement over the course of 
next year. We all, all share the common objective to prevent 
Iran from becoming a nuclear weapons state. Together we want to 
work to make sure that Iran does not attain a nuclear weapon 
capacity. So we want to see how we can work in that regard.
    The PMD, possible military dimensions, it was certainly 
disappointing, but I do not think anybody here was surprised. 
What it pointed out is that Iran cheats and they want to 
develop a nuclear weapon through covert activities. That is not 
a surprise, but I think it verifies the point that, as we go 
forward, we need to make sure there is zero tolerance for any 
deviation from Iran's obligations under the JCPOA. So I think 
those are the lessons that are learned.
    I also want to point out--and the Review Act also points to 
this--that we have to be able to consider the other activities 
that Iran's going to participate in outside of the four corners 
of the JCPOA. There is support for terrorism, their human 
rights violations, their ballistic missile ambitions and tests.
    And let me first mention Jason Rezaian and his unlawful 
detention. For over 500 days he has been held in captivity. We 
need to make sure we do not lose sight of that gross violation 
of that individual's rights and Iran's other activities that 
violate the human rights not only of its citizens but citizens 
of other countries.
    Yesterday, in the Helsinki Commission, we held a hearing in 
regards to Azerbaijan and pointed out that the incarceration of 
journalists is a way that you try to prevent a country from 
dealing with the rights of its citizens. And I think this is a 
particular case that I hope you will always keep in mind that 
this person is unlawfully detained, he is an American citizen, 
and we have to use every tool available to bring him home 
safely.
    The ballistic missile test that the chairman referred to, 
not one but two now confirmed on October 10 and on November 21 
are clear violations of the United Nations' Security Resolution 
1929. Do we expect the Security Council to take action? They 
should. But we understand Russia. We understand China. We 
understand their politics. But we also know about U.S. 
leadership and what the United States must do for zero 
tolerance of violations. And it is not only my hope the U.S. 
actions, but we have a coalition of the willing, we hope, with 
Europe. And they will be watching very closely what the United 
States does in response to these violations, as well as our 
influence on our European allies to make it clear to Iran that 
we will not tolerate any violations of their international 
obligations.
    I look forward to this hearing, and I look forward to 
working with you and all the members of this committee in a 
common objective to prevent Iran from becoming a nuclear 
weapons state.
    The Chairman. Ranking Member Cardin, just in light of what 
you said earlier, I want to thank you and your staff for the 
way that you have made sure that we had totally bipartisan 
efforts throughout the year. I want to thank Senator Menendez 
for the tone that he set before that and thank all the 
committee members for putting our national security interests 
and our foreign policy first and causing the other issues of 
disagreement to really go by the wayside. So this has been an 
outstanding year.
    I do want to apologize to the PRMs. We were talking about 
this morning in our office both of us have staffs to cover a 
wide range of issues. You cover all the issues, and I do think 
we have about hit the wall this year as far as the kind of 
things that people have and the bandwidth that people have. So 
I want to thank everybody. We did have numbers of issues that 
needed to be addressed, and I think the committee together has 
addressed those in a good way. But thank you. And I do hope we 
will get some additional nominees confirmed before the end of 
this week somehow.
    Senator Cardin. Thank you.
    The Chairman. With that, our first witness is the Honorable 
Stephen D. Mull, Lead Coordinator for the Iran Nuclear 
Implementation at the U.S. Department of State. The second 
witness today is the Honorable Thomas M. Countryman, Assistant 
Secretary of State for the Bureau of International Security and 
Nonproliferation. Finally, the third witness will be Lieutenant 
General Frank Klotz, Retired U.S. Air Force and current Under 
Secretary for Nuclear Security at the NNSA Administrator at the 
U.S. Department of Energy.
    We want to thank you all for being here. I think you all 
understand we like for you to summarize if you would in about 5 
minutes. Without objection, your written testimony will be 
entered into the record.
    And with that, if you would just go in order in the order 
that I just introduced you, I would appreciate it. Again, we 
welcome you here. We thank you for changing some travel plans 
to be with us today. Thank you.

 STATEMENT OF HON. STEPHEN D. MULL, LEAD COORDINATOR FOR IRAN 
  NUCLEAR IMPLEMENTATION, DEPARTMENT OF STATE, WASHINGTON, DC

    Ambassador Mull. Thank you very much, Chairman Corker and 
Ranking Member Cardin, and all the members of this committee. I 
really appreciate the opportunity to provide an update on how 
we are doing on implementation of the Joint Comprehensive Plan 
of Action, or the JCPOA.
    My name is Ambassador Steve Mull. I have served as a career 
member of the Foreign Service for almost 34 years. And shortly 
after the JCPOA was concluded in July, Secretary Kerry asked me 
to return to Washington from my last post as Ambassador to 
Poland to serve as the lead coordinator for implementing the 
deal. In this job I am leading a terrific team of colleagues in 
the State Department, as well as at the Departments of Energy, 
Treasury, Commerce, and other parts of our government to make 
sure that the JCPOA is fully implemented to enhance not only 
the security of our country but also of our friends and allies 
around the world.
    I am really pleased that two of my colleagues--Department 
of Energy Under Secretary for Nuclear Security and 
Administrator of the National Nuclear Security Administration, 
General Frank Klotz; and Assistant Secretary Tom Countryman, 
Assistant Secretary for International Security and 
Nonproliferation--are here with me today.
    And I am especially honored to meet with this committee, 
which has been such a valuable partner in shaping our Iran 
policy over many decades with bipartisan support for our common 
strategic objective, as you mentioned, Senator Corker, of 
preventing a nuclear-armed Iran.
    Now, as you mentioned, our government has numerous and 
serious concerns about Iran's policy in the region, which are 
unrelated to the nuclear deal. We continue to raise concerns 
about detained Americans that you mentioned, about Iran's 
support for terrorism, its hostility to Israel, or its human 
rights abuses, which are rampant. But my job is solely focused 
on the critical task of making sure the JCPOA achieves its one 
crucial objective: preventing Iran from developing a nuclear 
weapons capability. When fully implemented, the JCPOA will 
dramatically scale back Iran's nuclear program and provide 
unprecedented monitoring and verification tools to ensure that 
it is exclusively peaceful as it moves forward.
    We are making steady progress towards this objective. 
October 18 marked ``Adoption Day'' under the JCPOA when the 
deal formally came into effect. On this day, all the 
participants began making the necessary arrangements for the 
implementation of their JCPOA commitments. That included Iran's 
informing the International Atomic Energy Agency--the IAEA--
that it would provisionally apply the Additional Protocol and 
fully implement Modified Code 3.1, which provides for early 
declaration of nuclear facilities and granting unprecedented 
access to Iran's entire nuclear program from cradle to grave. 
These are two important mechanisms which will ensure the 
international community has much greater insight into Iran's 
nuclear program than it has ever had before.
    The P5+1 and Iran have also issued an official document 
outlining the plan for redesigning the Arak heavy water 
research reactor so that it will no longer be able to produce 
weapons-grade plutonium. And the United States and the European 
Union have taken actions to lift nuclear-related sanctions upon 
reaching, and only upon reaching, Implementation Day when all 
of these commitments will be met.
    Implementation Day is the next major milestone in the 
JCPOA, and it will occur only after the IAEA verifies that Iran 
has completed all of the nuclear steps that we specified in the 
agreement. These are the technical steps that will quadruple 
Iran's breakout time to at least a year from the current 
estimate of less than 90 days. At that time, Iran will receive 
relief from U.S., the E.U., and U.N. nuclear-related sanctions. 
The timing for reaching Implementation Day is primarily within 
Iran's control. However, I reiterate that Iran will receive no 
sanctions relief under the JCPOA until it has verifiably met 
all of its nuclear commitments.
    Since Adoption Day, Iran has been making tangible progress 
to reach those commitments. For example, Iran has begun 
dismantling its uranium enrichment infrastructure by removing 
so far more than 5,000 centrifuges and transferring them for 
storage under continuous IAEA surveillance. It has begun to 
move quickly now to remove the remaining 8,000 in the coming 
days.
    Iran is also reducing its stockpile of various forms of 
enriched uranium to no more than 300 kilograms of up to 3.67 
percent enriched material. It will accomplish this primarily by 
shipping a significant amount of such material outside of Iran 
while diluting the remaining excess to the level of natural 
uranium or below.
    Commercial contracts are in place for Iran to ship its 
enriched uranium stockpiles to Russia. We expect that this 
material--about 25,000 pounds of enriched up to 20 percent low-
enriched uranium -- will leave Iran in the coming weeks. This 
step alone will significantly lengthen Iran's breakout time.
    As I have briefed members the committee before, Iran must 
also remove and render inoperable the existing calandria--or 
core of the Arak reactor by filling it with concrete before 
Implementation Day can occur. These actions will effectively 
cut off Iran's ability to produce weapons-grade plutonium. Iran 
and the P5+1 are also continuing work to advance the redesign 
and reconstruction of the reactor so that it can no longer 
produce that weapons-grade plutonium. The P5+1 have set up a 
working group to facilitate this project, which we will begin 
to meet soon after the New Year.
    Regarding the possible military dimension of Iran's past 
nuclear program, an issue on which all of us have been very 
focused, on October 15 the IAEA announced that Iran had 
fulfilled its commitment under the so-called Road-map for 
Clarification of Past & Present Outstanding Issues, as agreed 
to with the IAEA. Subsequently, on December 2, the IAEA 
director general released the Final Assessment on Past and 
Present Outstanding Issues regarding Iran's Nuclear Programme.
    The report confirmed and corroborated what we in the 
international community have long known, that Iran had a 
structured nuclear weapons program up until 2003, but there are 
no indications that that program is continuing today. This 
candid assessment gives us further confidence that the IAEA 
will perform its duties related to the JCPOA vigorously and 
honestly.
    And just this week, on December 15, the IAEA Board of 
Governors in a special session adopted a consensus resolution 
addressing that report. This resolution, submitted by the P5+1, 
turns the board's focus from confirming what we already knew 
about Iran's past activity towards fully implementing the 
JCPOA. This resolution gives the IAEA much better tools for 
deterring and detecting weapons-related activities going into 
the future.
    We also continue to work closely with the IAEA as it makes 
preparations to implement the JCPOA's unprecedented monitoring 
and verification provisions of Iran's entire nuclear program. 
The IAEA will have continuous monitoring of all of Iran's key 
declared nuclear facilities. This includes uranium mills, as 
well as centrifuge production facilities, a first for the IAEA. 
These measures specific to the JCPOA will give us increased 
confidence Iran is not diverting material or equipment to a 
covert program. We have always said that this deal is not based 
on trust but rather on intense verification of Iran's program. 
That is why we are working so closely with the IAEA to make 
sure it has everything it needs to do this crucial job.
    Meanwhile, we continue to engage with our international 
partners on other matters pertaining to implementation of the 
JCPOA and reaching Implementation Day. U.S. experts continue to 
meet with our P5+1 partners and others, including the E.U. and 
Iran, on setting up the Procurement Channel. That is the 
mechanism by which we will, together with the U.N. Security 
Council, review and approve or disapprove transfers of nuclear 
supplier group-controlled items and technology to Iran's 
nuclear and nonnuclear civilian industry, as well as other 
items that we think are inconsistent with the program.
    And on sanctions we continue to work within the U.S. 
Government, as well as with the E.U. and others, to make the 
necessary arrangements to lift the nuclear-related sanctions 
once the IAEA confirms Iran has completed its commitments and 
we reach Implementation Day.
    Full implementation of this deal is in our interest, in our 
partners' interest as well. It will place Iran's nuclear 
program under an unprecedented verification and monitoring 
regime, and when fully implemented, it will give us and the 
international community the tools necessary to ensure that 
Iran's nuclear program is exclusively peaceful. It will make 
us, Israel, our gulf partners, and the whole world safer.
    Continuing, I am at your disposal 24/7, every day of the 
week as we go forward in this deal. Senators, I look forward to 
this being the first of many engagements with you. We really 
value your partnership and guidance as we go forward towards 
our common objective. I look forward to taking your questions.
    [The prepared statement of Ambassador Mull follows:]

             Prepared Statement of Ambassador Stephen Mull

    Chairman Corker, Ranking Member Cardin, distinguished Members of 
the Committee--I appreciate the opportunity to provide an update on the 
status of implementation of the Joint Comprehensive Plan of Action, or 
the JCPOA.
    My name is Ambassador Steve Mull. I have served as a career member 
of the Foreign Service for 33 years. Shortly after the JCPOA was 
concluded, Secretary Kerry asked me to return to Washington from my 
last post as U.S. Ambassador to Poland to serve as Lead Coordinator for 
implementing the JCPOA. In this job, I'm leading a terrific team of 
colleagues within the Department of State, as well as at the 
Departments of Energy, the Treasury, and Commerce, among others, to 
make sure that the JCPOA is fully implemented to enhance the security 
of our country, and that of our friends and allies around the world.
    I am pleased that two of my colleagues, Department of Energy 
Undersecretary for Nuclear Security and Administrator of the National 
Nuclear Security Administration, General Frank Klotz, and Assistant 
Secretary of State for International Security and Nonproliferation, Tom 
Countryman, are here with me today.
    As you all know, our government continues to engage Iran on a host 
of issues unrelated to this nuclear deal. For example, we continue to 
raise concerns about Iran's actions when it comes to its support for 
terrorism or human rights abuses. But my job is focused solely on the 
critical task of making sure the JCPOA achieves its one, crucial 
objective--preventing Iran from obtaining a nuclear weapon. When fully 
implemented, the JCPOA will dramatically scale back Iran's nuclear 
program and provide unprecedented monitoring and verification tools to 
ensure that it is exclusively peaceful moving forward.
    Steady progress is being made toward this objective. October 18th 
marked Adoption Day under the JCPOA when the deal formally came into 
effect. On this day, all participants began making the necessary 
arrangements for implementation of their JCPOA commitments.
    This included Iran informing the International Atomic Energy 
Agency--the IAEA--that it would provisionally apply the Additional 
Protocol and fully implement Modified Code 3.1, which provides for 
early declaration of nuclear facilities before they are built, starting 
on Implementation Day. These are two important mechanisms which will 
ensure the international community has much greater insight into Iran's 
nuclear program than it's ever had before.
    The P5+1 and Iran have also issued an Official Document outlining 
the plan for redesigning the Arak Heavy Water Research Reactor so that 
it will not produce weapons-grade plutonium. And the United States and 
European Union have taken actions to lift nuclear-related sanctions 
upon reaching Implementation Day.
    Implementation Day is the next major milestone in the JCPOA. It 
will occur only after the IAEA verifies that Iran has completed all of 
the key nuclear steps specified in the JCPOA. These are the technical 
steps that push Iran's breakout time to at least a year, from the 
current estimate of less than 90 days. At that time, Iran will receive 
relief from U.S., EU, and UN nuclear-related sanctions. The timing for 
reaching Implementation Day is primarily within Iran's control. 
However, I reiterate that Iran will receive no sanctions relief under 
the JCPOA until it has verifiably met all of its key nuclear 
commitments.
    Since Adoption Day, Iran has been working to fulfill its 
commitments and reach Implementation Day making tangible progress on a 
number of key commitments. For example, Iran has begun dismantling its 
uranium enrichment infrastructure by removing thousands of centrifuges 
and transferring them for storage under continuous IAEA surveillance. 
It has already removed more than 5000 of its machines and is likely to 
move quickly to remove the rest in the coming days.
    Iran is also making progress on reducing its stockpile of various 
forms of enriched uranium to no more than 300 kg of up-to-3.67% 
enriched material. It will accomplish this primarily by shipping a 
significant amount of such material outside Iran, while also diluting 
the remaining excess to the level of natural uranium or below. 
Commercial contracts are in place for Iran to ship its enriched uranium 
stockpiles to Russia. We expect that this material--approximately 
25,000 pounds of material enriched up to 20 percent LEU--could leave 
Iran as soon as later this month. This step alone will significantly 
lengthen Iran's breakout time.
    As I have briefed members of this Committee before, Iran must also 
remove and render inoperable the existing calandria--or core--of the 
Arak Reactor by filling it with concrete before Implementation Day can 
occur. These actions will effectively cut off Iran's ability to produce 
weapons-grade plutonium. Iran and the P5+1 are also continuing work to 
advance the redesign and reconstruction of the Arak reactor. The P5+1 
have set up a working group to facilitate this project, which we expect 
will begin to meet soon after the New Year.
    Regarding the Possible Military Dimensions of Iran's past nuclear 
program--an issue on which I know you all have been very focused--on 
October 15, the IAEA announced that Iran had fulfilled its commitments 
under the "Roadmap for Clarification of Past and Present Outstanding 
Issues" as agreed to with the IAEA. Subsequently, on December 2nd, the 
IAEA Director General released the "Final Assessment on Past and 
Present Outstanding Issues regarding Iran's Nuclear Programme."
    The report confirmed what the international community has long 
known--that Iran had a structured nuclear weapons program up until 2003 
and there are no indications that it is continuing today. This candid 
assessment gives us further confidence that the IAEA will perform its 
duties related to the JCPOA honestly and vigorously.
    And just this week, on December 15, the IAEA Board of Governors in 
a special session adopted by consensus a resolution addressing the 
Director General's report on PMD. This resolution, submitted by the 
P5+1, turns the Board's focus from confirming what we already knew 
about Iran's past weapons-relevant nuclear activities toward fully 
implementing the JCPOA. This will give the IAEA much better tools for 
deterring and detecting weapons-related activities in the future.
    We also continue to work closely with the IAEA as it makes 
preparations to implement the JCPOA's unprecedented monitoring and 
verification provisions of Iran's entire nuclear program. The IAEA will 
have continuous monitoring of all of Iran's key declared nuclear 
facilities. This includes its uranium mills as well as its centrifuge 
production facilities, a first for the IAEA. These measures specific to 
the JCPOA will give us increased confidence Iran is not diverting 
material or equipment to a covert program. We've always said that this 
deal isn't based on trust but on intense verification of Iran's 
program. That's why we're working so closely with the IAEA to make sure 
it has everything it needs to do this crucial job going forward.
    Meanwhile, we continue to engage with our international partners on 
other matters pertaining to implementation of the JCPOA and reaching 
Implementation Day. U.S. experts continue to meet with our P5+1 
partners and others, including the EU and Iran, on setting up the 
procurement channel--the mechanism by which the Joint Commission and 
United Nations Security Council will review and approve or disapprove 
transfers of NSG-controlled items and technology for Iran's nuclear and 
non-nuclear civilian industry, as well as any other items if a State 
determines it could contribute to activities inconsistent with the 
JCPOA.
    And on sanctions, we continue to work within the U.S. government, 
as well as with the EU and others, to make the necessary arrangements 
to lift nuclear-related sanctions once the IAEA confirms Iran has 
completed its key nuclear commitments and we reach Implementation Day.
    Full implementation of the JCPOA is in our and our partners' 
national security interest. It will place Iran's nuclear program under 
an unprecedented verification and monitoring regime, and when fully 
implemented it will give the international community the tools 
necessary to ensure that Iran's nuclear program is exclusively peaceful 
going forward. It will make us, Israel, our Gulf partners, and the 
whole world safer.
    We look forward to continuing to engage with this Committee and 
with Congress more broadly on this important topic. I, along with my 
colleagues, look forward to answering your questions today.


    The Chairman. Thank you so much. And thank you for that 
fulsome testimony. If we could do it a little less fulsome for 
the remaining witnesses, that would be great, but thank you so 
much for that.
    Mr. Countryman?

 STATEMENT OF HON. THOMAS M. COUNTRYMAN, ASSISTANT SECRETARY, 
  BUREAU OF INTERNATIONAL SECURITY AND NONPROLIFERATION, U.S. 
              DEPARTMENT OF STATE, WASHINGTON, DC

    Mr. Countryman. Thank you, Mr. Chairman and Senator Cardin 
and other members, for this opportunity. You have my written 
statement so I will be less fulsome.
    For decades, my bureau, ISN, and its predecessors have had 
as a central assignment, taking every opportunity to analyze, 
impede, and frustrate the development by Iran of technology 
related to nuclear energy and to ballistic missiles and other 
technologies. We did that job before there were any 
negotiations with Iran on its nuclear program, we did it 
throughout the negotiations, and we do it today with the same 
tenacity and creativity and partnership with dozens of 
dedicated agencies across the Federal Government, and we will 
keep doing it.
    Since the negotiation of the JCPOA, we have devoted our key 
resources in support of Ambassador Mull's mission to achieve 
full implementation of the JCPOA. And in particular we work 
hard on support and cooperation with the International Atomic 
Energy Agency, as well as in creation of a Procurement Channel 
that can meet the limited legitimate nuclear needs that Iran 
may have under the JCPOA. It in no way diminishes, as I said, 
the task of counter-proliferation, of interdiction, of 
preventing acquisition of technology.
    I look forward to addressing any concerns or questions you 
have about these two central roles of my bureau or any other 
topic. Thank you again for this opportunity.
    [The prepared statement of Mr. Countryman follows:]

            Prepared Statement of Hon. Thomas M. Countryman

   iran's missile program and the joint comprehensive plan of action 
                                (jcpoa)
    Chairman Corker, Ranking Member Cardin, and members of the 
committee, thank you for inviting me to talk to you today about our 
efforts to address Iran's ballistic missile program. Iran's efforts to 
develop increasingly capable ballistic missile systems remain one of 
our most significant nonproliferation challenges and a very real threat 
to regional and international security. As we have for many years, we 
continue to rely on a wide range of multilateral and unilateral tools 
to work to address Iran's ballistic missile development efforts and our 
use of these tools remains unaffected by the implementation of the 
Joint Comprehensive Plan of Action (JCPOA).
    Currently, multiple United Nations Security Council resolutions 
(UNSCRs) that target Iran's missile development, procurement, and 
proliferation activities remain in effect. In particular, resolution 
1929 prohibits Iran from undertaking any activity related to ballistic 
missiles capable of delivering nuclear weapons, including launches 
using ballistic missile technology. These resolutions require all 
states to prevent transfers from their territory or by their nationals 
of missile-related items, materials, equipment, goods, and technology 
to and from Iran. However, even with these strong provisions in place, 
Iran has continued to engage in activities that clearly violate these 
restrictions. This has been the case since the adoption of UNSCR 1737 
in 2006, and we have continued to draw attention to Iranian violations 
of these provisions. For example, in October 2015, the United States, 
in conjunction with the United Kingdom, France, and Germany, reported 
an Iranian test of a medium range ballistic missile to the United 
Nations Security Council's Iran sanctions committee as an UNSCR 
violation. Other Security Council members joined the United States in 
condemning the launch as a violation, which the UN's own Iran Panel of 
Experts also agreed was contrary to UNSCR 1929. We will continue to 
call on the UN Security Council to address this serious matter, shine a 
spotlight on such destabilizing activities by Iran, and increase the 
cost to Iran of its behavior.
    At the same time, we note that missile tests, such as the October 
launch reported to the UN, are not a violation of the JCPOA. The focus 
of the JCPOA is cutting off all of Iran's pathways to a nuclear weapon. 
We have long said that the JCPOA was not predicated on any change in 
Iranian behavior--including its missile development efforts--other than 
specific changes that would have to be made to its nuclear program. 
Full implementation of the JCPOA by Iran will ensure that Iran's 
nuclear program remains peaceful going forward and thus Iran will not 
be able to produce a nuclear warhead.
    Under the JCPOA, after the IAEA verifies that Iran has implemented 
key nuclear-related measures, the provisions of previous relevant 
UNSCRs will terminate but the measures in UNSCR 2231, which was adopted 
last July after the JCPOA was finalized, still impose restrictions on 
Iran's missile-related activities for a period of eight years or the 
IAEA reaches the Broader Conclusion that all nuclear material in Iran 
remains in peaceful activities. Specifically, UNSCR 2231 prohibits all 
States from transferring all items, materials, equipment, goods, and 
technology set out in the Missile Technology Control Regime (MTCR) 
Annex to Iran unless the Security Council decides in advance on a case-
by-case basis to permit such activities. As a permanent member of the 
Security Council, we would not expect to approve such activities.
    While these provisions will reinforce our overall missile 
nonproliferation efforts with respect to Iran, we also rely on a broad 
set of other multilateral and unilateral tools to impede and disrupt 
Iran's missile development efforts. Specifically, we continue to work 
with many of the over one hundred governments around the world that 
have endorsed the Proliferation Security Initiative (PSI) to interdict 
weapons of mass destruction (WMD), their delivery systems, and related 
items, including Iran's prohibited missile-related imports or exports. 
We also use our participation in the MTCR to prevent the spread of 
critical missile technologies and raise awareness among the 33 other 
MTCR Partners (members) of the proliferation concerns posed by Iran's 
missile development, procurement, and proliferation activities. We 
bolster these multilateral efforts through our bilateral cooperation 
with countries to prevent transfers to Iran's missile program, promote 
thorough UNSCR implementation, and target Iranian missile proliferation 
activities in third countries. In addition, we continue to use 
unilateral authorities to impose sanctions on entities connected to 
Iran's ballistic missile programs and procurement network.
    We have no intention of reducing our focus and determination to 
prevent the development of Iran's ballistic missile capabilities, even 
as we take steps to implement the JCPOA. Thank you again for the 
opportunity to discuss this important security issue with you. I look 
forward to your questions.


    The Chairman. Thank you. Thank you very much.
    General Klotz?

 STATEMENT OF LIEUTENANT GENERAL FRANK G. KLOTZ, USAF, [RET], 
 UNDER SECRETARY FOR NUCLEAR SECURITY AND NNSA ADMINISTRATOR, 
           U.S. DEPARTMENT OF ENERGY, WASHINGTON, DC

    General Klotz. Thank you, Chairman Corker, Ranking Member 
Cardin, and members of the committee. It is a great honor to 
again testify before this committee and to have the opportunity 
to discuss the role that the Department of Energy and the 
National Nuclear Security Administration play and will continue 
to play in support of the U.S. Government's actions to 
implement the JCPOA.
    As my colleagues from the State Department, Ambassador Mull 
and Assistant Secretary Countryman have already stated, the 
JCPOA ensures that Iran's nuclear program is exclusively 
peaceful. It provides unprecedented verification measures, it 
constrains Iran's nuclear program in a manner that gives us 
ample time to respond if Iran chooses to violate its terms, and 
it takes none of our options off the table.
    As we move toward and then beyond Implementation Day, the 
scientific, engineering, and technical expertise within the 
Department of Energy, including our national laboratories, will 
be called upon to help ensure that Iran complies with all of 
the nuclear-related measures of the JCPOA.
    The Department of State is leading the administration's 
efforts to oversee implementation of the JCPOA, but DOE plays--
and, as I said, will continue to play--an indispensable role in 
this process by providing scientific, engineering, and 
technical support and analysis to inform policymakers in making 
sound decisions and judgments.
    Allow me to provide just a couple brief examples of the 
kinds of unique expertise and skills the Department of Energy 
brings to the table. As Secretary of Energy Moniz has 
testified, the JCPOA blocks all of Iran's pathways to building 
a nuclear weapon, including the production of weapons-grade 
plutonium. To this end, as Ambassador Mull has pointed out, it 
requires Iran to redesign and rebuild the Arak reactor, 
effectively eliminating a potential source of weapons-grade 
plutonium. The JCPOA further requires that the final redesign 
of the reactor be approved by the Joint Commission.
    For the United States, the expertise for assessing the 
technical aspects of the redesign, including fuel and safety 
standards, and ensuring it complies with the nonproliferation 
provisions of the JCPOA, resides within the Department of 
Energy and in its national laboratories.
    Another example, the JCPOA also establishes a process for 
review and approval of procurement by Iran of specified 
nuclear-related items. This process will be conducted, as 
Ambassador Mull said, through a Procurement Working Group of 
the Joint Commission. The NNSA's Office of Nonproliferation and 
Arms Control has a unique expertise and a long history in 
working with domestic agencies and with international 
organizations such as the Nuclear Suppliers Group on matters 
related to the expert of nuclear-related and dual-use 
technology and materials. They will play an important role in 
advising the Department of State, which will coordinate the 
U.S. Government's efforts regarding the Procurement Working 
Group.
    Finally, the International Atomic Energy Agency, the IAEA, 
will play a major role in monitoring and verifying the nuclear-
related measures of the JCPOA. The Department of Energy and the 
NNSA work very, very closely with the IAEA in supporting its 
nuclear safeguards mission, including providing training, 
developing technologies, and providing experts to the 
organization.
    By the way, we have just published this brochure which lays 
out our support of that, and if the committee likes, I would be 
happy to submit it for the record. It is also available on our 
website.


    [Editors' Note: The document referred to above can be found in the 
``Additional Material Suibmitted for the Record'' section at the end of 
this hearing transcript.]


    The Chairman. Thank you.
    General Klotz. In conclusion, the JCPOA is not built on 
trust. It is built on hard-nosed requirements that will limit 
Iran's activities and ensure access, transparency, and 
verification. The Department of Energy takes seriously its 
participation and efforts to implement the JCPOA and to help 
ensure that Iran carries out its commitments under the deal, 
including participating in the administration's implementation 
efforts and supporting the IAEA.
    Again, thank you, Chairman, for the opportunity to be here, 
and I look forward to fielding any questions you may have.
    [The prepared statement of General Klotz follows:]

 Prepared statement of Lieutenant General Frank G. Klotz, USAF, [RET.]

    Chairman Corker, Ranking Member Cardin, and members of the 
committee, thank you for the opportunity to discuss the status of 
implementation of the Joint Comprehensive Plan of Action (JCPOA) 
reached between the P5+1 (China, France, Germany, Russia, the United 
Kingdom, and the United States), the European Union, and Iran. I 
appreciate the opportunity to be here to discuss the role the 
Department of Energy (DOE) plays in support of the Administration's 
implementation of the JCPOA. The JCPOA provides unprecedented 
verification of Iran's nuclear program to ensure that Iran does not 
obtain a nuclear weapon. As we move toward and beyond Implementation 
Day, the technical expertise within DOE, including the National Nuclear 
Security Administration (NNSA), and at our national laboratories will 
be called upon to ensure that Iran meets all of its nuclear 
commitments.
    As Secretary Moniz has said, the JCPOA ensures that Iran's nuclear 
program is exclusively peaceful, provides unprecedented verification 
measures, constrains Iran's nuclear program in a manner that give us 
ample time to respond if Iran chooses to violate its terms, and takes 
none of our options off the table.
    As noted by Ambassador Mull, the Department of State is leading the 
administration's efforts to oversee implementation of the JCPOA. DOE, 
including NNSA, plays an important role by providing technical support 
to implementation efforts. In addition, the department and its national 
laboratories will continue to provide technical support and analysis 
throughout implementation of the JCPOA to help ensure that Iran carries 
out its commitments.
    I will detail for you a few examples of the technical support to 
JCPOA implementation that the department is providing:


   The JCPOA blocks Iran's pathway to producing and using nuclear 
        weapons-grade plutonium by requiring the rebuilding and 
        redesign of the Arak Reactor, effectively eliminating a 
        potential source of weapons grade material. The calandria, or 
        reactor core, from the old design will be filled with concrete 
        and made inoperable. The JCPOA calls for a working group to 
        cooperate with Iran to develop the final design of the 
        modernized reactor, and provides for the final design of the 
        reactor to be approved by the Joint Commission. DOE/NNSA 
        technical experts will provide technical support and review the 
        design of the modernized reactor as well as analyze the fuel 
        design and safety standards to verify that it conforms to the 
        characteristics set forth in the JCPOA, including that Iran 
        cannot use this reactor for prohibited purposes.

   The JCPOA establishes a process for review and approval of 
        procurement by Iran of specified nuclear-related items. This 
        process is conducted through a Procurement Working Group of the 
        Joint Commission. Technical experts in NNSA's Office of 
        Nonproliferation and Arms Control will review and make 
        recommendations to the Department of State, which coordinates 
        the U.S. government efforts regarding the Procurement Working 
        Group, on such procurement proposals. The JCPOA prohibits any 
        procurement by Iran of these items outside the Procurement 
        Working Group process.

   As Secretary Moniz has noted, the JCPOA provides the most rigorous 
        inspections that we have ever had in Iran. DOE/NNSA's technical 
        expertise and training supports the International Atomic Energy 
        Agency's (IAEA) monitoring and verification activities that 
        will be important to ensuring that Iran carries out its 
        commitments under the JCPOA. DOE/NNSA is highly engaged with 
        the IAEA in providing training, technologies, and people to 
        support this critical organization.


    The IAEA is responsible for applying international nuclear 
safeguards, through which the IAEA is able to confirm to the 
international community that nuclear material and facilities are not 
being used for the illicit manufacture of nuclear weapons. Nuclear 
safeguards include, for example, on-site inspections, nuclear material 
accountancy, physical measurements, containment and surveillance, and 
environmental sampling.
    Let me take a moment to expand on the support that DOE/NNSA 
provides to the IAEA, and share with the Committee a few examples of 
the substantial nuclear safeguards work that we support. Every year, 
the department hosts training courses for IAEA inspectors and analysts 
on a wide range of topics including measuring nuclear materials, 
inspector access under the Additional Protocol, advanced plutonium 
verification, enrichment technology, export controls and commodity 
identification. These courses are organized and implemented with the 
support of experts from our national laboratories and take place in the 
United States, at IAEA facilities in Vienna, and at international 
nuclear facilities in collaboration with other IAEA Member States. For 
example, every new IAEA inspector since 1980 has had nuclear materials 
measurement training at the Los Alamos National Laboratory, in New 
Mexico.
    The department's national laboratories have played a major role in 
developing and improving safeguards technologies and providing 
expertise since the IAEA's inception in 1957. They develop and transfer 
various technologies to the IAEA for use in safeguards systems all over 
the world. This equipment goes through a rigorous evaluation process by 
the IAEA before being accepted into routine use, including 
vulnerability analyses by independent parties. The On-line Enrichment 
Monitor (OLEM), developed by the Oak Ridge National Laboratory, Los 
Alamos National Laboratory, the Pacific Northwest National Laboratory 
and the IAEA, is one example of a technology jointly developed by our 
national laboratories and the IAEA. The OLEM is an innovative 
safeguards technology that can be used to continuously monitor the 
enrichment levels of uranium in gaseous form at a centrifuge enrichment 
plant. In other words, it will allow the IAEA to determine if Iran 
enriches above permitted levels. And for the first time, as a result of 
the JCPOA, OLEM can be used in Iran.
    In addition to our training and safeguards technology cooperation, 
five of the Department's national laboratories participate in the 
IAEA's Network of Analytical Laboratories, or NWAL, a network of 20 
laboratories in 10 countries that provide analytical services to the 
IAEA. These laboratories undergo a rigorous qualification process by 
the IAEA to ensure that they maintain the highest quality standards. 
While the IAEA analyzes material and environmental samples at its 
laboratory in Seibersdorf, Austria, the agency also relies upon its 
NWAL to assist in sample analysis for logistical purposes, quality 
control and to have access to state-of-the-art techniques. 
Environmental sampling, in particular, is a very powerful tool that the 
IAEA uses to determine if undeclared activities are occurring. The IAEA 
relies on the U.S. laboratories that are part of the NWAL because of 
our world class capabilities for high-precision analysis and quality 
control.
    Finally, the United States provides personnel to the IAEA to 
support the IAEA's Department of Safeguards in a variety of areas, 
including technology development, information and statistical analysis, 
and development of safeguards approaches. As of June, approximately 10 
percent of the workforce of the IAEA's Department of Safeguards was 
from the United States, and many of these Americans have worked for DOE 
or our national laboratory system. We are proud of the assistance we 
provide and the close collaboration we have with the IAEA.
    JCPOA is not built on trust. It is built on hard-nosed requirements 
that will limit Iran's activities and ensure access, transparency, and 
verification. the department takes seriously its participation in 
efforts to implement the JCPOA and help to ensure that Iran carries out 
its commitments under the deal, whether that is participating in the 
administration's implementation efforts or supporting the IAEA.
    Thank you for the opportunity to be here. I look forward to 
answering your questions.


    The Chairman. Well, thank you for your testimony.
    And without objection, we will enter into the record the 
document you just referred to.


    [Editor's Note: The information referred to above can be found at 
the end of this document in the ``Additional Material Submitted for the 
Record'' section.]


    The Chairman. Ambassador Mull, first of all, you have got a 
winning personality and we all like you and, you know, you have 
been very energetic in your meetings with us. At the same time, 
we have not verified, the U.S. Government has not verified this 
second missile launch to my knowledge. Is that correct?
    Ambassador Mull.  Sir, we are aware of the reports of that 
launch. We are analyzing those reports.
    The Chairman. So we have not formally stated that it 
occurred?
    Ambassador Mull.  The U.S. Government has not.
    The Chairman. Yes. You came before us--and I just want to 
make sure that as we go forward we are all really clear with 
each other, but you came to our committee on December 2. The 
launch took place on the 21st. No mention was made of that in 
this classified briefing. I am just curious as to why that did 
not occur.
    Ambassador Mull.  Senator, I had not seen any of those 
reports at our last meeting on December 2, so I was not in a 
position to comment on it.
    The Chairman. So you were unaware of it happening on 
December 2?
    Ambassador Mull.  On December 2 I had not seen any reports.
    The Chairman. You had no knowledge of it whatsoever?
    Ambassador Mull.  I had heard that someone said that there 
might have been a launch. It was an unconfirmed source. I had 
not seen any reports of that, though, verifying it.
    The Chairman. Okay.
    If you would just, you know, again, so we can maintain an 
appropriate relationship, even things like that would be 
useful, especially in the kind of setting we had, which was 
very casual. We would like to know those kind of things in real 
time. Okay.
    Iran is obviously conducting work on long-range ballistic 
missiles. I know this is, again, a little bit outside of the 
purview. The only use for those in history up until this point 
in time is to put a nuclear tip on those, is that correct? I 
think General Klotz would agree that intercontinental ballistic 
missiles up until this point in time have only been used to 
deliver nuclear weapons, is that correct?
    General Klotz. Long range, Mr. Chairman.
    The Chairman. And I mean long range, yes.
    General Klotz. I am drawing on my experience as an Air 
Force missile officer. Long-range intercontinental ballistic 
missiles, to my knowledge, have only been used for delivering 
nuclear--or being capable of delivering nuclear weapons. 
Shorter-range systems have been used by a variety of countries 
to use conventional munitions.
    The Chairman. Ambassador Mull, as we understand that this 
is the case, that that is the only purpose, we know that they 
are doing that now, is there anything--what is the 
administration drawing from that activity?
    Ambassador Mull.  Well, I think the administration, as 
Ambassador Power mentioned in her meeting with this committee 
last week, the United States has strongly condemned the 
violation of U.N. Security Council resolution, which legally 
forbids that missile program from going forward. In fact, the 
United States was the leader in mobilizing U.N. Security 
Council resolution 1929 to make that illegal.
    The Chairman. But I am really talking about the intent. I 
mean, since history has said--we are a pretty sophisticated 
country ourselves--you only develop those for the delivery of 
nuclear weapons, they are continuing to do that now in 
violation of U.N. Security Council resolutions. We have taken 
no action. That is a side issue that is very, very important, 
and I am sure many committee members will focus on that.
    But what does the administration draw from the fact that 
they are testing missiles that throughout history have only 
been used to deliver nuclear weapons while ``dismantling'' the 
antique centrifuges that they are dismantling now?
    Ambassador Mull.  Senator, well, one of the reasons that we 
have pursued the JCPOA is that Iran has in fact, as you 
mentioned, repeatedly violated Security Council resolutions on 
that missile program. So Iran is going to develop that program 
regardless of the consequences it has paid for that. An 
important part to remove that threat, if Iran is going to 
continue to develop that program, let us make sure it does not 
have the capability to put a nuclear payload in such missiles.
    And by reducing the amount of enriched nuclear material 
available to Iranian's nuclear program by 98 percent, Iran now 
has--today, within 90 days, it could amass enough material to 
produce a nuclear weapon. Following implementation of this 
deal, it will take us more than a year. So the missiles may 
continue to fly, but we have made it a lot harder to put a 
nuclear payload on those missiles.
    The Chairman. I understand all that. Can you share with me 
why--any thoughts that the administration has over this 180-
degree inconsistency where they are continuing to develop the 
ability to deliver a nuclear weapon? That is the only purpose 
in history that these long-range ballistic missiles have been 
used. What is the thinking inside Iran from your perspective?
    Ambassador Mull.  Well, the thinking--I mean, first of all, 
the missile launch that took place, the most recent one, was a 
medium-range nuclear missile. It was not an ICBM. The thinking 
that we apply to this is that we need to make it as hard as 
possible----
    The Chairman. I am not asking about your thinking. And if 
you do not--please do not read those paragraphs anymore to me. 
I am asking you what the administration thinks Iran is doing 
when this is totally inconsistent with rational thinking.
    Ambassador Mull [continuing]. Well, I am not in a position 
to characterize what Iran or the Iranian Government is 
thinking. We are focused on making sure they cannot develop a 
nuclear weapons capability.
    The Chairman. Let me ask you another question. Senator 
Menendez really pressed Secretary Kerry when he was here, and 
many of us since that time, relative to whether the launch of 
these ballistic missiles as defined will be in violation of the 
new agreement that is being implemented now. It was in 
violation of 1929. We have done nothing about that, which is 
unfortunate. But there is some really cute language that was 
utilized that we discussed while we were trying to understand 
what the agreement really said. Secretary Kerry was adamant 
that they could not continue to test missiles even after this 
agreement was put in place. There is some weird language in 
UNSCR that this refers to. It says ``they are called upon.'' 
Out of curiosity, after the implementation, if they launch 
these types of missiles, is it or is it not in violation of the 
agreement?
    Ambassador Mull.  It is not in violation of the JCPOA. It 
is a violation of Security Council resolutions.
    The Chairman. So the called-upon language from your 
perspective makes it clear that going forward it will continue 
to be a violation?
    Ambassador Mull.  The called-upon language, it would 
violate that part of the U.S. Security Council resolution, but 
that Security Council resolution contains legal prohibitions on 
any international support for Iran's nuclear weapons program. 
Any exception to provide materials or other resources to 
Iranian's missile program is forbidden by U.N. Security Council 
Resolution 2231. Exceptions can be sought. The United States 
will veto any such exceptions that are requested.
    The Chairman. Thank you. I am going to reserve the 
remainder of my time for interjections.
    Senator Menendez.
    Senator Menendez. Thank you, Mr. Chairman. And thank you 
all for your testimony.
    I would like to follow up a bit on what the chairman's, I 
think, line of question was from what I could see. But before I 
do so, I want to echo Senator Cardin's comments about the 
chairman's process of leading the committee. I do appreciate 
probably the most bipartisan committee in the United States 
Senate, and it speaks incredibly important to what U.S. foreign 
policy needs to be, which it needs to be as bipartisan as it 
can.
    The Chairman. If I could, I was ranking when you were 
chair, and you have no idea how much I appreciate the way that 
you dealt with me and your staff, the respect. And just know 
that when someone like you is chair sets that kind of example, 
it really causes those who come behind you to want to do the 
same. So thank you.
    Senator Menendez. Thank you. I hope to do so again. 
[Laughter.]
    The Chairman. I hope not, but we will see. [Laughter.]
    Senator Menendez. Well, there had to be a point of 
divergence.
    But in any event, I have a very clear sense--and I hope I 
am wrong--that what we have here is a permissive environment. 
We have a set of circumstances where, regardless of what you 
saw of the PMD issue, we, for the longest period of time, 
pushed to get a real sense of what was the breadth and scope as 
to how far Iran got in development of its efforts for a nuclear 
weapon. And for the longest period of time, the government of 
the United States said that we needed to know that. And then 
what we got really was a process in the JCPOA that gave Iran 
the easy out by just simply answering questions as they wanted 
it without really fully coming clean. And the result was that 
that is closed.
    Now, the administration consistently came before this 
committee and said that if we move aside from the nuclear 
portfolio that we would aggressively pursue Iran's violations 
of international order, missile technology, weapons 
trafficking, human rights, and its hegemonic interests in the 
region.
    And so what have we seen since? We have seen not one but 
two missile tests. And we have seen an interdiction of arms 
shipments off of Oman. And I do not think we can expect the 
Security Council to do anything about it because of Russia and 
China.
    So the question is, is the administration ready to act and 
find its own set of actions so that Iran understands the 
consequences for violating the international order and setting 
the tone so that when the full implementation of the JCPOA 
takes place, that we will have a very clear understanding by 
them that failure to comply fully will have consequences.
    Ambassador Mull.  Senator, I would stress that we fully 
concur with you and the rest of this committee that Iran has 
violated the Security Council resolutions in its missile 
program and does commit many other things that are very hostile 
to our interests and our friends' interests.
    Senator Menendez. So what are we going to do about it? That 
is the question. Well, there have been--Iran is one of the most 
sanctioned countries on earth thanks to a really effective 
partnership that we have had with this committee over two 
presidential administrations in putting together a patchwork of 
sanctioned regime that has exacted serious cost to the Iranian 
economy. We believe going forward, you know, as these--as we 
confirm these missile launches, we have been swift in 
condemning them, as we did, as Ambassador Power did in the 
Security Council. And measures that we will take in response to 
those confirmed missile launches, we are actively considering 
additional measures at this moment.
    If you say to me, Ambassador, that they are the most 
sanctioned, it almost implies that there is nothing else we can 
do. If that is the case, then we are in deep trouble. But those 
sanctions are going to be coming off, assuming implementation. 
So the bottom line is--and I see Ms. Hafta shaking her head 
no--but as far as I understand, those sanctions are going to be 
coming off upon implementation.
    Ambassador Mull.  Sir, those nuclear-related sanctions will 
come off when Iran has rid itself of 98 percent of its enriched 
uranium stockpile.
    Senator Menendez. That is what I am talking about. They are 
going to be off.
    If those sanctions no longer exist and if you are saying 
they are the most sanctioned country in the world, I assume 
that you are referring to their nonnuclear sanctions. So then 
what is left to do? Basically to let Iran violate without 
consequence.
    Ambassador Mull.  Senator, I would underscore that a very 
important part of the agreement that we negotiated with Iran 
was the snapback provision that allows the re-imposition of 
sanctions for any violation of the agreement. And the United 
States is no bound by any--
    Senator Menendez. But, Ambassador, these are nonnuclear 
actions. Let us put the nuclear portfolio aside. If Iran 
continues to violate nonnuclear actions that are in violation 
of U.N. Security Council resolutions, in violation of what 
Secretary Kerry said before the committee, that we will 
aggressively pursue Iran on violations that take place for 
missile technology, for human rights, for arms trafficking, 
then what is left?
    Ambassador Mull.  Well, we will use the considerable full 
authorities that we have to take action. And perhaps I could 
ask my colleague, Assistant Secretary Countryman, who oversees 
those authorities in pursuing our nonproliferation interests.
    Mr. Countryman. Specifically, with regard to ballistic 
missile technology, we rely on two related concepts. One is 
sanctions; one is strategic trade controls. It is correct that 
we have sanctioned virtually every Iranian entity that is 
connected with the ballistic missile program so that they 
cannot do commerce with the U.S. or acquire U.S. technology 
legally or use U.S. financial system. And we have also used 
such sanctions and designations against commercial entities in 
other countries that have traded with the Iranian ballistic 
missile program.
    Those sanctions remain in effect. We retain the authority 
to impose those sanctions even after the nuclear-related 
sanctions are lifted. And we retain, as the previous 
administration and I think the next administration, the 
determination to do so.
    Strategic trade controls are different. They allow us, 
through the missile technology control regime, through the 
proliferation security initiative, in support of the U.N. 
Security Council resolutions, to partner with dozens of nations 
around the world in order, as I said, to interrupt, delay, 
impede in every way possible the transfer of such technology.
    We have not and we cannot entirely stop that trade, but we 
believe that our efforts, which will continue after nuclear-
related sanctions are lifted, have made the Iranian missile 
program less productive, less accurate, less of a threat to our 
friends in the region than it otherwise would have been.
    Senator Menendez. Well, let me close by saying, Mr. 
Chairman, number one, I am going to be looking forward to see 
what actions you take, and so far they have not been 
forthcoming.
    Number two, you talk about snapback. You have to snap back 
to something, and the Iran Sanctions Act that I authored and 
that my colleagues here all helped us with and passed 
unanimously through the Senate expire this coming year. And I 
am going to seek its reauthorization because you have to snap 
back to something.
    And, number three, I have been following Iran since my days 
in the House of Representatives, for the better part of 20 
years. And I know some of my colleagues think that this is a 
question internally in Iran of showing that the hardliners have 
still some strength by firing missile technology and testing 
it. I know that Iran, over the last two decades, has tested the 
will of the international community, and that is why they got 
to the point that they are on the verge of having the nuclear 
power that could be converted to nuclear weapons. And 
basically, we said, well, it is too big to roll back.
    So at the end of the day, if we allow them to continue to 
test us--they have a history. They have tested us and the 
world. And if we allow them to continue to test us without 
consequence, believe me that they will continue to expand. And 
that is the risk here, and that is what I hope we can come 
together, not only in an understanding but in an action.
    The Chairman. Before moving to Senator Isakson, just to 
follow up, I am getting the strong sense that the reason we are 
doing nothing and creating a permissive environment, which I 
think is going to be very problematic over the long term, I 
think we are doing that because we are trying to effect the 
internal elections that are taking place this spring. And that 
is just not in keeping with the integrity of this agreement. I 
can understand a desire by some to do that. I know that is why 
they are dismantling so quickly so that the sanctions will be 
relieved before the election. But I get the sense that you and 
others are complicit in trying to affect their internal 
elections, and that is why we are not taking actions. When I 
say you and others, I am talking about our U.N. Ambassador and 
I am talking about the administration.
    But with that, Senator Isakson.
    Senator Isakson. Sorry I just called you, Johnny. Excuse 
me. [Laughter.]
    The Chairman. Tell Diane hello.
    Senator Isakson. He said hello, sweetie. [Laughter.]
    Senator Isakson. Is it my turn, sir?
    Let me echo what Senator Cardin, Senator Menendez, and 
Senator Corker said about each of you having been great leaders 
for the committee. We appreciate very much what you have done.
    But I want to share something with the whole committee 
before I ask my question. Yesterday afternoon, the surviving 
hostages from the American embassy in Iran learned that this 
Congress will compensate for them in the omnibus bill we will 
take up later on this week.
    The emotional relief for those 43 surviving hostages of 
that ordeal is not expressible in words, but I want the 
chairman, the ranking member, and every member of Democrat and 
Republican alike to know that you did a great deal of work to 
help us over a 7-year period of time to make that a reality, 
and you have made the lives of some people who were tortured, 
beaten, and held captive by the Iranians at least get closure 
on an event that was a terrible part of their lives. I want to 
thank the chairman, the ranking member, and all the committee 
members for making that possible.
    The Chairman. Well, I hope all 43 of them know it is 
because of your persistence and leadership that this is 
happening. And we all sometimes get frustrated with the impact 
that we are able to have with a 100-person body, but there is 
no question you have had incredible impact on these 43 
citizens. Thank you.
    Senator Isakson. Well, thank you. But it was a great team 
effort and I appreciate it. And it really is the template for 
my comments to Mr. Mull.
    In 1981 when President Carter obtained the release of those 
Americans from the Iranian hostage-taking in the embassy, to 
get them released by the Iranians he had to negotiate away 
their ability to be compensated for their ordeal. That was the 
way the Iranians negotiated that deal. We finally got a hold of 
some sanctions money in the Paribas settlement, which the 
Department of Justice has, which is the money we are 
compensating those hostages from.
    But the Iranians never want to accept responsibility or 
culpability for any crime they have perpetrated against the 
American people up to now. And I worry, as Senator Menendez has 
said, that if we are very passive about the JCPOA enforcement 
and just look the other way, the Iranians will just look the 
other way and do whatever they want.
    By way of example--and I am quoting here--the Iranian 
regime has declared ``they would consider any type of sanction 
at any level or under any pretext a breach of the deal that 
would release Iran from any obligations it has.''
    So, in other words, if we reach Implementation Day--and as 
I understand it, the President says the sanctions are then 
waived--and then we take any action to snap back, which is the 
enforcement mechanism we were all told by Secretary Kerry we 
would have, the Iranians will call the snapback a violation of 
the agreement and they will be free to do whatever they want 
to. So it is kind of like having it both ways. Now, am I 
missing something? Mr. Mull?
    Ambassador Mull.  Sir, we believe that this deal is a 
political commitment by all sides. The United States has been 
very firm both in the negotiations, as well as publicly, in 
explaining the deal since then that any violation of that 
agreement will draw consequences. And we have a wide range of 
consequences from re-imposing some of the sanctions, partially, 
to re-imposing all of them and walking away from the deal. So a 
number of the factors in this deal are close to irreversible.
    If Iran goes forward, as it says it will, in the next few 
weeks to disable the reactor core of the heavy water reactor at 
Arak, that, in one swift action, will remove Iran's ability to 
produce weapons-grade plutonium for the foreseeable future. 
That is a huge win for our interests and those of our friends 
in the region.
    If Iran decides to walk back--they will have, for Iran, an 
unprecedented inspection regime. They are going to be 130 to 
150 IAEA inspectors given full-time, 24/7 access to all of 
Iran's nuclear facilities. And so we will be able to determine 
if they are in compliance or not, and if they are not, there 
will be consequences.
    Senator Isakson. On that point, then it would seem like to 
me what Senator Menendez has said he wants to do would probably 
be the appropriate thing for the Congress to do, and that is if 
in fact we reach Implementation Day, which I assume we will, 
and if in fact the sanctions regimen goes away when we reach 
that date, should we not have in place before that date comes 
what sanctions we would snap back to if in fact there was a 
violation?
    Ambassador Mull.  Sir, we have in place and will have in 
place on Implementation Day and far beyond Implementation Day a 
comprehensive network of sanctions authorities both through the 
legislation that the Congress has passed, as well as a complex 
of executive orders, which has the ability to impose sanctions 
on Iran swiftly should that be required. So we believe that we 
have the tools in order to do that.
    Senator Isakson. General, can I ask you a question, please?
    The Iranians are going to be sending 25,000 pounds, is that 
correct, of nuclear-enriched material to Russia as a part of 
the agreement?
    General Klotz. Is that the total amount?
    Ambassador Mull.  Yes.
    General Klotz. Yes.
    Senator Isakson. Okay. If my math is right, that is a 
number of tons of nuclear-enriched material. Are we certain 
that the security of that material in Russia will be watched 
after, and will we have any ability to monitor how they take 
care of that material?
    General Klotz. Senator, we have worked very, very closely 
with Russia over decades to enhance cooperatively their 
security and safeguards of their nuclear sites. Also, many of 
the sites in Russia are subject to IAEA safeguards in the same 
way that other sites are.
    I think on this one, you know, the impression that we get 
is this is a move that the Russians are taking very, very 
seriously, very, very professionally. They know how to move 
nuclear material, they know how to store nuclear material, and 
they know how to account for nuclear material.
    Senator Isakson. The reason I ask the question is--and I 
think I am correct here and you can correct me if I am wrong--
but there was a significant breach in the integrity of some of 
that material in Russia a number of years ago, which brought 
about the creation of the Nunn-Lugar nuclear threat initiative 
and the inspections that took place in the old Soviet Union, 
which had let some of that stuff get loose and was never 
accounted for. So I think this is--we want to make sure we 
never revisit that chapter in history if they are getting that 
much nuclear-enriched material going into Russia now.
    General Klotz. I could not agree more, Senator. And let me 
just add sort of parenthetically that the Nunn-Lugar 
Cooperative Threat Reduction measures that were taken 
immediately after the fall of the Berlin Wall and the 
dissolution of the Soviet Union was probably one of the single-
most important achievements in U.S. foreign and national 
security policy that I personally had an opportunity to 
participate in.
    We were quite concerned in those early days about security 
and safety at nuclear facilities in Russia, both civil and 
nuclear. And it is because of the work of Senators Nunn and 
Lugar and a whole bunch of very patriotic Americans who have 
made countless trips there working with Russian counterparts 
that it is better than it was before. There is still work to be 
done.
    In my opinion, in the opinion of the NNSA and the DOE and 
we ought to--but under the current political circumstances, it 
has been very, very difficult to get the Russians interested in 
pushing forward, but we will continue to look for opportunities 
to do that.
    Senator Isakson. Thank you very much. Thank you to all of 
you for your service.
    The Chairman. Senator Kaine.
    Senator Kaine. Thank you, Mr. Chairman. Thank you to the 
witnesses.
    I strongly supported this deal and continue to, and I 
strongly support tough enforcement of the deal. I was very glad 
to join with Senator Corker and others in the letter to the 
President following the October missile test, and I am 
gratified that the U.N. report about that test is so 
unequivocally clear that it was a violation of the Security 
Council resolution.
    The reason, among many, that I supported the deal is I 
think the U.S. has to try diplomacy first. We have to. We 
started a war in 2003 over a nuclear program that turned out 
not to exist. And we need to try diplomacy first. We need to 
keep a military option on the table, but actually, that option 
is strengthened legally, it is strengthened strategically, it 
is strengthened in terms of coalition partners. It has even 
strengthened in terms of the intel we get if we go forward on 
this deal. So we keep that option on the table, but we need to 
try diplomacy first.
    And the good thing about trying diplomacy is that we are 
now in a hearing like this where we are keeping the focus on 
Iranian behavior. That is where the globe's focus should be, 
Iranian behavior. If we had walked away from the deal, the 
focus would have been on American negotiating tactics. Why 
would America tank a deal that the international community--
that would have been the focus. Now, the focus is on Iranian 
behavior, and we have got to keep the focus on Iranian behavior 
and what the consequences should be.
    I was gratified--I think Senator Corker said we were kind 
of expecting the IAEA report to be a little bit kind of a fudge 
factor, but the IAEA was really clear. Iran had a nuclear 
program. And we were gratified with the clarity because it kept 
the focus on Iranian behavior.
    I am gratified by the U.N. panel conclusion that has been 
reported on in the last couple of days about the October test. 
Clearly, this was a test and it was a test in violation of U.N. 
Security Council resolutions.
    So I expect we are going to be having a lot of these 
hearings, and I just hope the focus is always primarily on what 
is Iranian behavior because that then lays a predicate for all 
kinds of actions that needs to be laid globally.
    I do think, to the chair's question about what is going on 
in Iran, you know, we should all be humble about, you know, 
psychologizing any situation, but I think it is fair to say 
that just as we know we are not monolithic, we have divisions 
about things, I think a lot of what is going on Iran is a non-
monolithic dispute within that political society about this 
deal and about broader issues of whether they want to be 
reintegrated into a global economy or continue to be an 
outlier.
    And when you see the way this deal has been treated by the 
Iranian legislature and the degree to which hardliners hate it, 
threaten to kill those involved negotiating with it, I think 
you see some of the challenges that are underway there.
    So I think what we need to do is we need to have these 
hearings every time there is activity, we need to keep the 
spotlight on, and we do need to demand of the administration 
consequences but precision in the consequences. I mean, to use 
an example of something that I think has been done pretty well 
by this committee and the administration, we had a pretty broad 
set of sanctions that we could have used vis-a-vis Venezuela. 
The extent of the sanctions that were used were sort of a 
smaller subset of what could have been done.
    And the reason for that precision was of a concern, I 
believe, that if we went maximal in what we could have done, 
then that can have the effect of subverting internal political 
opposition. It gives the ruling authoritarians the ability to 
blame all their troubles on the United States, and then that 
crushes internal political opposition.
    But what we just saw in Venezuela was a stunning rebuke to 
an authoritarian government because people rose up and said, 
no, you are trying to blame this on the U.S. but it is not the 
U.S. You have mismanaged our country. And they demanded 
significant political change.
    So harsh spotlight on any violation either of this deal or 
of any other U.N. Security Council resolution is exactly what 
we ought to be doing, and we ought to be demanding--you know, 
when Senator Menendez asked the question what are you doing--
that we are thinking about doing stuff really is not a good 
enough answer. And I recognize that we are still just a few 
days out from the U.N. definitely issuing the report about it.
    There has got to be consequences but we have to be very 
precise in the consequences that we use because we do not want 
our actions to undermine legitimate political opposition, 
legitimate desires of the Iranian people for a different path 
than the regime has pursued in the past.
    I am interested in this question, and I was not able to ask 
Ambassador Power this other day, so the U.N. has now definitely 
concluded--the panel that analyzed this--that the activity in 
October was a violation of the U.N. Security Council 
resolution. We have reason to believe, okay, Russia and China 
will probably not go along with this U.N. Security Council.
    I hope--and, Ambassador Mull, I guess this is a question 
for you. I hope our attitude on things like this is not, well, 
Russia and China will probably veto it so we probably should 
not do anything. I hope any time there is something like this 
we get our colleagues to put a resolution on the table and put 
it on the table in the light of day backed up by a clear U.N. 
Security Council report.
    And we ask that you undertake action and we make Russia and 
China, before the whole world, be an apologist for something 
that is clearly a violation of the U.N. Security Council. And I 
hope we do that every time, and I hope we also think of other 
steps that we can take. But let us not give up any lever at our 
disposal to keep the spotlight on Iranian misbehavior or 
violation of rules.
    So with respect to this U.N. Security Council situation 
about the October missile firing, we have got a great report 
out of the U.N. that definitely establishes that this was a 
violation. What is the strategy right now about how we pursue 
that in the Security Council? And let us make Russia and China 
use their veto power and use it publicly and then trash them 
for doing that. Walk us through the steps that you are thinking 
about right now.
    Ambassador Mull.  Well, Senator, I am proud to say that our 
colleague Senator Power in fact has been the leader on the 
Security Council in drawing the Security Council's attention to 
this issue first when we confirmed it in October and then this 
week when the report came back from the panel of experts. She 
was very forthright urging the Security Council to take action 
and calling out those who would reject such action as being 
inconsistent with our common objectives to keep this very 
serious threat to international security under control.
    I mentioned in terms of responses to that action. We are 
now actively considering the appropriate consequences to that 
launch in October.
    In terms of moving forward, perhaps Ambassador Countryman?
    Mr. Countryman. I will have to get you an answer on exactly 
how this will play out in New York. We have no hesitated 
previously to ask for resolutions even when we knew they would 
be vetoed if it was valuable for making a point, as you have 
suggested it is. There is obviously much broader dynamics at 
play in the U.N. Security Council, and I just cannot speak for 
Ambassador Power on what the next steps are, but we will get 
you an answer--
    Senator Kaine. Well, can I just say then let me tell you 
what I hope you will do? And I bet many people up here would 
feel the same as me. I think we ought to make the point every 
time we can. And if we are sure they are going to veto it, we 
should still make the point. When it comes to Iranian behavior 
that is clearly in violation of the U.N. Security Council 
resolution, we should never say, well, somebody else is going 
to veto it, so why bother? We should make that point.
    Here is another question that I was confused about. Senator 
Menendez was asking questions about the ballistic missile--the 
U.N. Security Council resolution versus the JCPOA and the 
ballistic missile. There is an article in the Guardian from the 
15th of December about the experts' report about the ballistic 
missile test clearly violating U.N. Security Council 
resolution. And it says, ``under the July nuclear deal, most 
sanctions on Iran will be lifted when its provisions are 
implemented in exchange for curbs on the nuclear program.''
    But the experts' report noted that ``ballistic missile 
launches would be covered under the 20 July resolution.'' So 
the experts, in concluding that there was a firing, that it was 
in violation of the U.N. Security Council resolution are saying 
it is covered under the July 20 resolution, I guess that is not 
the same thing as saying it is covered under the JCPOA. But 
they are saying it is covered by the July 20 resolution, which 
was embracing the JCPOA.
    So what is the status of this vis-a-vis the JCPOA? And 
maybe I am going to ask that question for the record because I 
think we should all have a clear understanding of that.
    Ambassador Mull.  Yes--
    Senator Kaine. But I hope soon you will be able to come 
back. And I will probably ask this for the record, too, and lay 
out what are the steps that we are going to pursue with respect 
to the clear violation of the U.N. Security Council resolution.
    Ambassador Mull.  Yes, sir. That is a very good question. I 
am happy to answer it. The JCPOA, as I mentioned to Chairman 
Corker, does not address Iran's ballistic missile program, U.N. 
Security Council Resolution 2231. The purpose of that was to 
endorse and give the Security Council blessing to the JCPOA, as 
well as address some other elements about Iran's policy, 
including continuing the embargo on conventional weapons sales 
to Iran from the world community for the next 5 years, and 
preventing trade and otherwise support from the international 
community for the Iranian ballistic missile program for 8 
years. So 2231 was about JCPOA but also about these other 
issues as well.
    Senator Kaine. All right. Thank you. Thank you, Mr. Chair.
    The Chairman. I would say that regardless of whether U.N. 
Security Council takes action or not, which we all know they 
are not, we still have, just like we have done with North Korea 
recently, the ability to--the demonstration today can implement 
unilaterally sanctions in a surgical way, as you are 
describing. So hopefully, that is going to happen after the 
U.N. Security Council unfortunately does not take action.
    Senator Gardner?
    Senator Gardner. Thank you, Mr. Chairman.
    And to echo the comments made by other members, I, too, 
want to thank you for your leadership of the committee and to 
Senator Cardin for his leadership on this committee. He has 
also served as the ranking member of the East Asia 
Subcommittee, so he has pulled double-duty and done an 
outstanding job in both, so thanks to both of you for your 
bipartisanship and your leadership.
    I wanted just to ask a brief question. General Klotz, 
remind me what the JCPOA states about the 25,000 pounds of 
enriched material, what type of inspections. Will there be IAEA 
inspections of that material in Russia, anytime, anywhere 
inspections, as the word or phrase was used, by the United 
States?
    General Klotz. Well, thank you, Senator. What Iran is 
required to do under the JCPOA is to reduce its stocks of 
enriched uranium down to 300 kilograms or less of uranium that 
has been enriched to--
    Senator Gardner. Right. But if they do that, and once it is 
in Russia, assuming they do that, the 25,000 pounds, will there 
be inspections of that? Remind me the JCPOA terms.
    General Klotz. Well, there will still be IAEA inspections 
under its safeguards regime and the additional protocol in 
Iran.
    Senator Gardner. But in Russia with the 25,000 pounds to 
verify that?
    Ambassador Mull.  Senator, I would be happy to take that 
question. We are in fact in the midst--it is a very active 
period for us right now--of negotiating the removal of that 
material. It is still in Iran. As I mentioned in my testimony, 
I believe its departure from Iran is imminent. However, we are 
working very closely with Russia and the IAEA to make sure that 
that material will be removed and stored wherever it ends up--
    Senator Gardner. And what is the inspection requirement 
once it is stored in Russia?
    Ambassador Mull.  Sir, we are in the process of discussing 
that very issue--
    Senator Gardner. So we do not have a plan in place to 
inspect the 25,000 pounds of enriched material--
    Ambassador Mull.  We--
    Senator Gardner.--in Russia?
    Ambassador Mull.  We would certainly not be comfortable in 
releasing that amount of nuclear material anywhere without 
appropriate safeguards.
    Senator Gardner. So we do have--
    Ambassador Mull.  We are--
    Senator Gardner.--a plan?
    Ambassador Mull.  We are pursuing with the IAEA--
    Senator Gardner. Can you share the plan with the 
committee--
    Ambassador Mull. --and Russia--well, we are in the midst of 
negotiating. I will be happy to brief you--
    Senator Gardner. So you do not have a plan in place right 
now?
    Ambassador Mull.  We are negotiating the terms of how that 
material will be safeguarded--
    Senator Gardner. Yes or no, do we have a plan in place to 
inspect the 25,000 pounds of enriched material once it is in 
Russia?
    Ambassador Mull.  Well, today, we do not because we are 
developing--
    Senator Gardner. So the answer is no--
    Ambassador Mull. --what that plan will be.
    Senator Gardner.--we do not have a plan. Thank you.
    We have heard testimony from the panelists that we are 
actively considering sanctions against Iran when it comes to 
ballistic missiles. We have strongly condemned Iran for the 
ballistic missile launches. We have swiftly condemned Iran for 
the ballistic missile launch, and we have raised concerns about 
Iran's ballistic missile launch. In your response to Chairman 
Corker, you stated in response to the ballistic missile test 
one of the reasons we pursued this JCPOA is that Iran has 
repeatedly violated security resolutions on that program. And 
then you stated Iran is going to develop that program 
regardless of consequences. You stated that Iran will violate 
the ballistic missile provisions, resolutions, regardless of 
consequences. Knowing that, what plan for sanctions do we have 
in place upon verification that they violated it?
    Ambassador Mull.  Violating the missile--
    Senator Gardner. Yes.
    Ambassador Mull. --provisions? Well, as I mentioned 
earlier, Senator, we have substantial sanctions in place. 
Practically every entity involved in Iran's missile program--
    Senator Gardner. But in relation to the two launches--
    Ambassador Mull. --has come under sanctions--
    Senator Gardner.--what are we doing--if you knew all along 
that Iran is going to develop that program regardless of 
consequences, do you believe it is appropriate that they have 
access to billions of dollars that they will have access to 
once the implementation arrives and the sanctions are lifted, 
freeing their economy of the sanctions that prevented those 
billions of dollars from going there?
    Ambassador Mull.  Just correcting the record, I said that 
in fact Iran has continued to develop its--
    Senator Gardner. Well, I am reading from the--
    Ambassador Mull. --ballistic missile program.
    Senator Gardner.--unofficial record. Again, it is 
unofficial playback, but you stated Iran is going to develop 
that program regardless of consequence.
    Ambassador Mull.  Iran has developed that regardless of the 
consequences that have been imposed. We are considering active 
measures, active consequences for this latest launch, and we 
will share those with the committee, of course, as soon as we 
make that decision.
    Senator Gardner. Mr. Countryman, in your testimony you 
said, ``we continue to use unilateral authorities to impose 
sanctions on entities connected to Iran's ballistic missile 
programs and procurement network.'' What unilateral authorities 
to impose sanctions has the United States used after the last 
two ballistic missile tests the last 2 months?
    Mr. Countryman. The authorities we have include the Iran, 
North Korea, Syria Nonproliferation Act. It includes Executive 
Orders 13382 and Executive Order--sorry, there was another one; 
I do not have it in my fingertips--under which, as I said, 
virtually every Iranian entity connected to the missile program 
has been sanctioned. We are actively considering what steps to 
take in response to the October 10 test.
    I have to say I do not understand the argument about a 
permissive environment. The Obama administration is doing 
exactly the same thing that the Bush administration did, which 
is to respond to every violation of ballistic missile 
resolutions, of human rights, of terrorism, of hostage-taking 
with the legal authorities Congress has given us in an 
aggressive manner to designate, sanction, and reach out to hurt 
those taking that action and at the same time pursuing an 
active diplomatic policy in the United Nations and in other 
bodies. That is what we do. We do it aggressively. It is what 
we have been doing for 15 years. And I have not heard an idea 
for doing something different that perhaps goes beyond the 
legal authorities we have and the diplomatic capabilities.
    Senator Gardner. Well, perhaps one idea that could be 
different would be to prevent Iran from receiving the billions 
of dollars that they are going to receive, which will then go 
in to continue a ballistic missile program that will continue 
regardless of the consequences.
    Mr. Countryman. And that violation by us of the JCPOA would 
lead to a resumption of the nuclear program. Do you think--
    Senator Gardner. Again, I think somebody used it, this 
permissive environment that we have created, which we 
acknowledge that Iran is going to continue a program of nuclear 
development, ballistic missile development regardless of the 
consequences, that we have referred these violations to a 
committee, that we have talked about it, we have sternly 
reprimanded them, we have wagged our finger. It had done 
nothing to protect the American people.
    And this committee has, I think, done an incredible job of 
making sure that we understand the facts, but the fact is we do 
not have the response and the actions to back it up when Iran 
has clearly violated. In fact, we have not taken any steps 
necessary to prevent them from growing their ballistic missile 
program, which they will and has been admitted here.
    Mr. Countryman. I think that the--
    Senator Gardner. Mr. Chairman, my time is expired.
    The Chairman. Let him respond.
    Mr. Countryman. The action taken by the Security Council 
Sanctions Committee into clearly identifying this as a 
violation of a U.N. resolution has a cost and it has a benefit 
to us in enabling us to fortify those partners around the world 
who work actively with us in preventing the diversion of 
ballistic missile technology to Iran.
    The Chairman. Senator Coons.
    Senator Coons. Thank you, Chairman Corker and Ranking 
Member Cardin, for holding this hearing. And I would like to 
thank our witnesses today.
    Before I go on at any length, let me just briefly make sure 
I have understood the point you are making, Mr. Countryman. Is 
it not correct that the U.N. experts' report on the ballistic 
missile launches by Iran is just a few days old?
    Mr. Countryman. Correct.
    Senator Coons. And in your testimony you said that ``we 
will continue to call on the Security Council to address this 
matter, shine a spotlight on destabilizing activities, and 
increase the cost to Iran of its behavior.'' I respect that you 
are actively considering action, but could you just say will 
you act?
    Mr. Countryman. It is certainly my intent. The bureaucratic 
process is complicated in part because we want to get the facts 
right and we want to get the right target. But it is certainly 
the mandate of my bureau to push for such action, and I think 
that we will continue to do so.
    Senator Coons. Thank you, Mr. Countryman. I think the focus 
that all of us as members of the Foreign Relations Committee 
have on this issue is important because at a time when our 
country, our constituents are focused on other things, whether 
it is ISIS or terrorism or refugees or concerns about our 
economy, it is the challenge and the job and the responsibility 
of this committee, in partnership with you, in partnership with 
the administration, to insist on a relentless implementation 
and enforcement of the JCPOA and the continued and aggressive 
enforcement of the sanctions against other inappropriate, 
illicit activities by Iran, whether it is support for 
terrorism, human rights violations, or their ballistic missile 
program.
    And my willingness to support the JCPOA was rooted in a 
clear-eyed commitment to holding this administration and the 
next accountable for active enforcement of the JCPOA and, 
frankly, was rooted in a deep suspicion of Iran's intention, 
suspicions which I think have been amply confirmed by the IAEA 
PMD report and by these two ballistic missile tests.
    So while I do commend the administration for its active 
outreach to Congress and for a recent successful high-seas 
interdiction of a weapons shipment from Iran to support the 
Houthi rebels, I think we need to continue to work together 
because if we take our eye off this ball, if we fail in any way 
to relentlessly enforce what we have got in terms of both U.S. 
unilateral and multilateral abilities to constrain Iran's 
actions, they will take that as a clear signal that we have 
taken our eye off the ball and that they have carte blanche to 
continue their actions that are antithetical to our values and 
our interests.
    So let me first, if I could, because we were talking about 
what authorities you have both unilaterally and multilaterally, 
in January many Members of Congress will call for the swift 
renewal of the Iran Sanctions Act, which expires at the end of 
2016. What is the administration's opinion on the renewal of 
the Iran Sanctions Act? And do you believe Iran would consider 
that the United States would be breaking our commitments under 
the nuclear deal if it is extended? I suspect Ambassador Mull 
would like to take that.
    Ambassador Mull.  Certainly, I would be happy to, Senator 
Coons.
    As I mentioned earlier in my testimony, the administration, 
thanks as a result from work with this committee and other 
parts of the Congress over the past decade and more, have 
developed an incredibly powerful toolkit for imposing sanctions 
on behavior by Iran that threatens our critical interests. The 
Iran Sanctions Act has, of course, been a very important part 
of that. It is in full force through the end of 2016.
    The administration looks forward to working with this 
committee in considering, as we get close to the expiration of 
that authority, whether it makes sense to continue. But it is 
in place for the next year. We have a good, solid toolkit to 
use in protecting our interests with Iran.
    Senator Coons. And do you believe Iran credibly would argue 
that we had somehow violated the JCPOA if we extend it? Given 
these recent actions, I think we will have more reason than 
ever to try to constrain their actions?
    Ambassador Mull.  It is difficult for me to predict how 
Iran would respond. I do underscore that, as we exercise our 
sanctions authority, we do so to protect our interests, not to 
anticipate or overcome any anticipated reactions.
    Senator Coons. Well, I think tireless work with our P5+1 
partners as well, as well as continuing to enforce what 
sanctions authorities we have and extend them as a key piece of 
this.
    I mentioned the interdiction on the high seas of a ship 
loaded with weapons being sent in violation of international 
standards. I think we have to continue and increase our 
interdiction both of weapons flows and capital flows going to 
terrorist proxies in the region. Tell me something about the 
administration's plans to heighten the pace of interdictions in 
the coming months and whether you are successfully working with 
our regional partners to prepare for this?
    Mr. Countryman. Well, of course interdictions can refer 
both to critical technology for nuclear ballistic missile 
programs. It can also refer to the transfer of conventional 
arms covertly, which Iran is heavily involved in, and 
unfortunately, a number of other states and actors in the 
Middle East region are involved in.
    Interdiction depends crucially upon intelligence. It 
depends also upon building a framework of confidence with 
partners in the region. And I think that we have successfully 
developed such a partnership with key countries in the region. 
I would be not only willing but downright proud in a closed 
session to tell you some of the successes that we have had 
working with friends in the region. It has been our business 
for over 20 years to make the Iranian program more expensive, 
less successful, and we have done that.
    Senator Coons. Well, thank you, Mr. Countryman. And I would 
welcome that briefing as well. My concern, having been briefed 
in a classified session about a number of successful 
interdictions, my concern is that other colleagues and the 
general public are not as aware of it. A metaphor I have used 
before is that when a sheriff conducts a successful drug bust, 
you put all the drugs and guns and money out on a table so that 
the rest of the community interested in conducting illegal 
activity recognize that there are costs and there are 
consequences. And I think we need to be doing some of that at a 
bigger and more visible way.
    Let me ask you one last question. Given what I understand 
to be the actions by China and Russia in blocking the U.N. 
Security Council from condemning the ballistic missile tests, 
are you concerned that we do not have reliable partners in the 
snapback of sanctions when or if there is credible evidence of 
Iranian cheating on the JCPOA?
    Ambassador Mull.  Senator Coons, we worked very hard --my 
colleagues who negotiated this deal worked very hard throughout 
the negotiation to make sure that there would be absolutely no 
stricture on the ability of the United States to impose, to 
fully use the sanctions tools at its disposal to respond to 
Iranian violations of U.N. Security Council resolutions, of 
challenges to our interests.
    In terms of broader international sanctions, we have also 
structured a process that, when there is a credible report to 
the Joint Commission that administers this deal of a violation, 
any member of the Joint Commission can bring such a complaint 
to the commission. And if a limited number of members of the 
Joint Commission refer that to the Security Council, the 
presumption is that those sanctions will be snapped back. It 
will be impossible for any member of the Security Council to 
veto a recommendation to re-impose sanctions. That is the 
autopilot. It is the assumption of how the Security Council 
will handle that. And we believe that that protects our 
interests and our equities very well.
    Senator Coons. I understand and I am hopeful that that 
mechanism will work as intended, and I expect that we will work 
on a relentless and bipartisan basis to ensure that our allies 
understand that we intend to continue to enforce sanctions 
against Iran's ongoing bad behavior in the region.
    Thank you, Mr. Chairman.
    The Chairman. Thank you. I think it would be helpful if 
something more certain could be given from the administration 
to us relative to this extension of the Iran sanctions. I do 
think Senator Coons is right. There will be efforts immediately 
after the 1st of the year to extend those. If there are things 
you need to share with us in a classified setting relative to 
that, that would be fine, too, but I do not think this vague 
response does us a lot --and I am not criticizing you. I know 
that is where the administration is right now. But I do not 
think the vagueness of their thinking is particularly helpful 
to us, and there may be things you want to share that we are 
unaware of at present. Okay.
    Ambassador Mull.  I certainly will be happy to take that 
request back to my colleagues.
    The Chairman. Senator Perdue?
    Senator Perdue. Thank you. And I appreciate you guys and 
what you are trying to do. You have got a tough job. I think we 
are very naive in what we are trying to do, and I just look at 
history. I am not trying to predict the future. I just look at 
history, you know, to come to that conclusion.
    I have a couple questions related to some of the reports 
coming out. The IAEA just this month released their report that 
basically says Iran has lied about their PMD efforts. When the 
foreign minister of Iran, Zarif said, and I quote, ``the 
Islamic Republic of Iran has never sought nuclear weapons, nor 
will it seek them in the future,'' that is in clear 
contradiction of the IAEA report as I read it of their activity 
prior to 2003 on into 2009, as late as 2009.
    And my question is, you know, given the missile violations 
that have already been asked about today--I will not go there--
the violating 1929 and Resolution 2231, the question is about 
the 90-day certification that the Secretary of State has given 
Congress--and I am going to quote in here--``Iran has not taken 
any action, including covert activities, that could 
significantly advance its nuclear weapons program.'' If they 
are firing missiles while we are in here before the 
Implementation Day in violation of the U.N. resolutions, they 
are thumbing their nose at us.
    And my concern is I am not clear on how the Secretary can 
make the certification that, including covert activities that 
could significantly advance nuclear weapon program, that they 
have not taken any actions when, just last year, the Defense 
Science Board concluded that in the case of Iran, our 
capabilities detect ``undeclared facilities and/or covert 
operations are either inadequate or more often do not exist.''
    I am just not sure how to believe the facts here. The 
revelation that they were--our own report in a December IAEA 
report basically says that they were doing this all the way 
through 2009, but there was also a report the U.S. National 
Intelligence estimate--this is back in '07--assessed Iran's 
nuclear weapons program was halted in the fall of 2003. And we 
now know they--and they went on to say has not restarted the 
program as of mid-2007.
    Now, I know those are old reports, but it goes to my 
question. And I would like the general to first address this, 
is what confidence do we have, given our own intelligent 
community's reservation to assure us both in public and in 
private about our own ability to detect true covert activity?
    General Klotz. Thank you for the question, Senator. My own 
sense, having worked in and around the intelligence community 
for decades, is that we have very good capabilities. We have a 
lot of different tools in the toolkit that can be brought to 
bear. Sometimes it takes time to ferret out all the details and 
put all the pieces of the jigsaw together, but I would commend 
our colleagues in the intelligence community for eventually 
getting to that particular point.
    I am also struck, as I read a couple times, three times to 
be exact, the IAEA report that came out earlier in December on 
possible military dimensions just how detailed it was in terms 
of it laying out the very nature of Iran's program and 
following up on those issues which had not been resolved at the 
time it wrote its 2011 report. It is, I think, very clear, very 
frank, and very candid about what the Iranians have done, what 
they have denied doing that we know that they have done, and 
what we need to pay attention to.
    The areas that are laid out in the PMD report that the IAEA 
put out in terms of specific capabilities, in terms of the 
development of nonnuclear capabilities that would be necessary 
to weaponize a nuclear weapon, find their way back into the 
JCPOA, as the people who negotiated this structured that 
agreement in such a way that we would place limits on those 
very things that our intelligence community and that the IAEA 
have identified as issues.
    Senator Perdue. The second question--Ambassador, I would 
like you to address this if you will--the fourth item that was 
in this certification is that this is the--``the suspension of 
sanctions related to Iran pursuant to the agreement is 
appropriate and proportionate to the specific and verifiable 
measures taken by Iran with respect to determining its illicit 
nuclear program and is vital to the national security interests 
of the United States.''
    So am I to read this to say that we are already certifying 
after the first 90 days that we are in support of--I would like 
you to clarify this for me in terms of ``appropriate and 
proportionate'' release of sanctions--suspension of sanctions, 
as it says.
    Ambassador Mull.  Sir, yes. There has been some limited 
sanctions relief up until now. That was negotiated as part of 
the Joint Program of Action, which was a mechanism by which to 
build some good negotiating faith to go forward in exchange for 
Iran's cessation of certain enrichment activities and other 
steps to begin to limit the nuclear program that were later 
codified in the JCPOA. The United States did agree to allow the 
unfreezing of a small percentage of Iran's frozen assets.
    Senator Perdue. Can you be a little more specific? I mean 
can you quantify what that release entails?
    Ambassador Mull.  Yes. It amounts to permission for Iran to 
withdraw $700 million of its frozen assets in various 
institutions around the world.
    Senator Perdue. Okay. Mr. Secretary, thank you again for 
your testimony. I appreciate your objectivity. I do take issue 
with one comment you made earlier that the administration has 
done everything it can to protect U.S. interests when in this 
negotiation we did not even mention and negotiated the four 
hostages. And I do not want to fail to remember that we have 
got four U.S. citizens being held by this regime, and we are 
not even addressing that.
    The real question I have for you is in the United Nations, 
realistically with the Security Council veto sitting in front 
of us, what can we expect to be the reaction of the United 
Nations, and what are we really trying to get them to do 
specifically related to the violations of these two 
resolutions?
    Mr. Countryman. Well, thank you, Senator.
    You know, on the first point I absolutely share your 
frustration that we cannot solve every problem at once. In 
negotiations with the Soviet Union on arms control, we were 
never able to settle human rights questions, questions of 
foreign intervention in the Warsaw Pact countries, or a host of 
other issues. And yet those agreements were vital to U.S. 
national security, and I think, without making any kind of 
prediction about Iran, laid the groundwork for eventual 
progress that was made in Eastern Europe and, ultimately, the 
Soviet Union. But they were limited. They did not solve every 
issue at once.
    Now, in the case of what we can expect from the Security 
Council, I take very well Senator Coons' point that we should 
force people to be on the record. Further, I think that it is 
important that we continue to support with our own expertise 
the U.N. Sanctions Committee, which will have, I hope, a bigger 
role in identifying and publicizing violations by Iran and 
violation by companies and merchants outside of Iran. That kind 
of publicity is what we rely upon when we go make the argument 
to an exporting country or a transshipment company you have got 
to do something to stop that shipment of technology.
    So even if there is not, in the end, a U.N. Security 
Council resolution, what the Sanctions Committee has already 
done is valuable to our counter-proliferation efforts.
    Senator Perdue. Thank you.
    The Chairman. Senator Boxer.
    Senator Boxer. Thank you so much, Mr. Chairman. I want to 
thank the panel. You are working overtime to protect the world 
from a nuclear-armed Iran. I can think of no higher calling, 
and I so appreciate what you are doing.
    And thanks to the chairman's generosity of spirit. I do 
have the privilege of introducing Ali Rezaian. Would you stand, 
please, Ali? Would you stand? We welcome you here today. His 
brother is Jason. As we all know, Jason, a Washington Post 
reporter, is being held in Iran and convicted. And thank you so 
much.
    I want to give a message to the government there if they 
are listening. And I would like to use this opportunity to echo 
my friends and so many of our pointed views about the need for 
this government, the Iranian Government to release Jason 
Rezaian. December 3 marked the 500th day of his detention. And 
Jason's family lives in California and they yearn for his 
release. And as a Senator who stood with those who were willing 
to take a chance at a new relationship with Iran and as someone 
who took huge heat for that, I make this humanitarian request 
to release Jason and ease the extreme pain of his family.
    You know, as I listened to everyone, and it has been so 
interesting, and in some ways you come a little later you get 
to hear everybody and it is very important. What I hear is kind 
of a narrative developing here that is painting an 
administration that is permissive and one of my colleagues said 
naive in terms of Iran.
    And I personally believe the facts belie this. And I 
personally believe you do not have to scream every day and 
pound the table to be strong. And I know this President did not 
scream and pound the table or take a victory lap when he took 
out Osama bin Laden. He just did it. And so I just do not see 
the narrative that way. I totally respect my colleagues' views 
on it, and they certainly back it up with a lot of passion and 
policies that they see bolsters that narrative. But I just do 
not see it.
    I just read Samantha Power's comments, and I want to ask 
you rhetorically if you think this is soft stuff? She says 
this--as we know, she is our U.N. representative. ``This past 
October Iran launched a ballistic missile that was obviously 
capable of delivering a nuclear weapon. Security Council 
Resolution 1929 still enforced prohibits this kind of launch. 
After reviewing this incident, the U.N. own independent panel 
of experts concluded definitively that it was a violation, yet 
instead of an effectively, timely response, the Security 
Council has dithered''--has dithered. ``We intend to keep 
working.'' She is speaking for the administration. ``We intend 
to keep working with council members to acknowledge and respond 
appropriately to this serious incident.'' Then, she goes on and 
she says, ``we do not see how council members can cast doubt on 
these violations.''
    So to me, to say this administration is naive and, you 
know, soft or whatever the word you want to use, I just do not 
see that permissiveness. I just do not see it. And then there 
is a letter that was sent by the President to Senator Coons in 
which he says, quote--he signed the letter, President Obama--
``robust enforcement of sanctions related to Iran's nonnuclear 
activities will continue to be a critical''--a critical--
``element of our policy. I will maintain powerful U.S. 
sanctions under a host of domestic authorities countering 
Iran's support for terrorism, its human rights abuses, missile 
proliferation, and the illicit sale or transfer or Iranian 
conventional weapons.'' I would ask unanimous consent that I 
place both these documents in the record--
    The Chairman. Without objection.


    [Editor's Note: The information referred to above can be found at 
the end of this document in the ``Additional Material Submitted for the 
Record'' section.]


    Senator Boxer.--Samantha Power's and this letter because we 
all know that we have sanctions to counter Iran's support for 
terrorism, human rights abuses, missile proliferation, illicit 
sale or transfer of Iranian conventional weapons. And those 
sanctions have not been changed. They still will continue.
    So I just do not like this narrative that is coming out of 
here because I think it sends a bad message to Iran because I 
think our message is we are united on this. We are not divided. 
Maybe we were divided on giving them a chance, but we are not 
divided at all on standing together to enforce those kind of 
sanctions. And I feel--anyway, I will move on.
    Is there anything in this agreement--I would ask Ambassador 
Mull--that would prevent the United States from taking action 
if the Iranians violate our agreement, the nuclear agreement?
    Ambassador Mull.  No, ma'am, absolutely nothing.
    Senator Boxer. So everything is on the table. And I think 
that is very important.
    I want to switch to questions about the IAEA because I 
think they are very important in this. I guess I would ask 
Lieutenant General. In your testimony you mentioned the 
extensive coordination and cooperation between the IAEA and the 
Department of Energy. With regard to the training, how would 
you describe the quality and capability of IAEA personnel?
    Ambassador Mull.  Thank you very much for that question, 
Senator. I rate the quality, professionalism, seriousness of 
IAEA personnel, including those who work at the headquarters 
and the inspectors, to be very high.
    Now, we support the training of IAEA inspectors. In fact, 
every single IAEA inspector takes a course on nuclear material 
management at Los Alamos National Lab in New Mexico. Other 
inspectors and other members of the staff receive what you 
might call continuing professional education or graduate-level 
education on monitoring plutonium, other aspects of the fuel 
cycle at other of our national laboratories here in the United 
States.
    We also provide, at the request of the IAEA, a number of 
people to support their safeguard staff. There are about 800 
people in the safeguard staff at IAEA. Roughly 10 percent of 
those, 80, are American citizens, many of whom have come 
through our national lab structures across the United States or 
have worked in DOE or NNSA. We also provide about 15 what we 
call cost-free experts to serve on the staff over there and on 
short-term consultancies.
    The other thing that we do besides training if I might take 
just a little more time on this is our national laboratories 
are also developing a lot of the processes and the technologies 
which are part of the process for them carrying out their 
inspections and continuous monitoring. I have visited Lawrence 
Livermore Laboratory just last week and saw some of the work 
that they are doing there, other of our laboratories in 
developing the seals, the cameras, the monitors that the IAEA 
uses, will use in Iran, but also uses in all the other 
countries that have agreed to safeguards agreements or the 
additional protocol with the IAEA. So it is a very professional 
organization. It ought to be. We have been working very closely 
with them since the late 1950s.
    Senator Boxer. Okay. I will close with this. Thank you. I 
think the IAEA is so critical for all of us, whether we support 
the agreement or not. And I would just urge you, if you see 
anything that you feel is changing your view of the IAEA, we 
need to know because they are key to this whole agreement. 
Thank you very much for your generosity, Mr. Chairman.
    The Chairman. If I could, I do want to say that this 
permissiveness issue is one that has been felt strongly on both 
sides of the aisle, and there was, as I understand it, a strong 
letter that went from a large group of Democrats yesterday to 
the administration. I think the concern is that we have known 
of the violation, we have had multiple --I think Ben and I met 
directly with the U.N. Security Council and Samantha Power, and 
we know that Russia and China are going to block. And I think 
people see this breakneck thing happening where likely at the 
end of January all the sanctions are going to be relieved, and 
yet potentially no pushback on this issue.
    So just for what is worth I would like to engage in it 
since you answered my point. I never said it was partisan.
    The Chairman. Yes. No, I know.
    Senator Boxer. I said that there is some--you know, a 
narrative being written, yes, both sides of the aisle. You look 
at who voted against this nuclear agreement: both sides of the 
aisle. There is a disagreement, and it is not partisan. I did 
not mean to suggest it and I never said it. I just frankly 
disagree with it. You can write 100 letters 100 ways to Sunday.
    The Chairman. Yes.
    Senator Boxer. I just read Samantha Power; I just read the 
President of the United States. So you can create any 
scenario--not that it hurts. It probably emboldens our people 
to do even more. But the point is I just do not agree with it. 
And we could argue it all day.
    Senator Cardin. Let me--if I might----
    Senator Perdue. Mr. Chairman, I am sorry, but we----
    Senator Cardin [continuing]. ----interject----
    Senator Perdue [continuing]. ----For the record, we never 
really got to vote on this agreement.
    Senator Cardin [continuing]. ----If I just may interject 
myself for one moment here, and that is there is, I think, 
unanimous support in the United States Senate for zero 
tolerance for violations by Iran. I think there is 100 percent 
support to work as hard as we can to prevent Iran from becoming 
a nuclear weapon power. We are committed to that.
    And I think there is pride that the engagement of Congress 
has given us a better opportunity to achieve those objectives. 
I think that is where we are together, and I know that we can 
continue to work together.
    The Chairman. Senator Flake.
    Senator Flake. Well, thank you. And thank you for the 
testimony. And I apologize if I am plowing old ground here.
    But with regard to--and let me just say I come out against 
the agreement, but I feel it was a close call. It was 
difficult. You never want to be on the other side of almost all 
of your allies here. But my concern in the end and what tipped 
the balance for me is the concern that our ability or our 
desire for Iran to stick to the nuclear side of the agreement 
might prevent us from challenging Iran or punishing Iran on 
their nonnuclear behavior. And the ballistic, you know, weapons 
thing is kind of fuzzy. It is only used for a nuclear payload 
we are told, but it is kind of a nonnuclear side or not part of 
the JCPOA agreement.
    But I am concerned that it seems as if we are just kind of 
accepting, oh, the Security Council is not going to act on 
this, Russia, China will veto, so that is it. What other 
remedies do we have outside of that? I understand you can 
publish and try to work with others who might be participating 
or supplying Iran or helping them with this program, but what 
other remedy do we have outside of the Security Council for 
this breach? Mr. Countryman?
    Mr. Countryman. Well, a couple of points. One, this should 
not be taken in any way excusing an Iranian violation, but in 
fact, the missile launched on October 10 was a medium-range 
ballistic missile, not an ICBM. We do have, by the way, a 
general concern about the proliferation of medium-range 
ballistic missiles by a number of countries in the Middle East 
that is making the region more dangerous. But of course our 
number one concern and our number one target for action is the 
Iranian program.
    Now, the authorities that we have, we have used 
aggressively and creatively and we will continue to do so. But 
they are the authorities that Congress has given and that the 
President has established, previous Presidents under executive 
order in order to designate specific Iranian entities and 
entities outside of Iran to impose a genuine economic cost upon 
the entity and upon the program of development of ballistic 
missile technologies.
    When those sanctions and designations touch companies 
outside of Iran, it is a matter of significant commercial harm 
to those companies and those countries that allow countries to 
participate in that kind of behavior. That is what we have the 
authority to do, and that is what we do very aggressively.
    On the diplomatic side I think Ambassador has already 
described what we can do within the United Nations. We of 
course reach well beyond the United Nations. Just last Friday, 
I was in Brussels for a meeting with all 28 of my counterparts 
from European Union states where I emphasized again the 
necessity to stand strong on preventing the shipment of 
technology in ballistic missiles to Iran. So those are the 
authorities we have, and I sincerely welcome ideas on how to 
use them more effectively.
    Senator Flake. Ambassador Mull, my concern is that Iran has 
already said, the government has stated over and over that it 
will consider any implementation or going back to the sanctions 
that we have on the books for any behavior of Iran a violation 
of the agreement. If Iran were to take action outside of the 
nuclear agreement that we thought to be egregious enough to 
justify implementing sanctions, in particular here, let us face 
it, the ones that really--that we can do on a unilateral basis 
that matter, the capital market sanctions or central bank 
sanctions, will we hesitate to use that lever if we need to 
because that has been the difference. We have said yes, we 
will, or the administration has, and the Iranians are saying if 
you do, that violates the JCPOA and we are out of our 
obligations. What is your sense of our willingness to use those 
levers that we have?
    Ambassador Mull.  Thank you, Senator. The administration 
has been quite clear both publicly and throughout the entire 
negotiating process that this deal is exclusively about the 
nuclear question. And we will not hesitate to use other 
authorities to address other threats to our interest outside of 
that nuclear deal.
    Senator Flake. Even if it is the same sanctions that we 
imposed on the nuclear side, in particular, the sanctions on 
their central bank?
    Ambassador Mull.  Yes. Well, we have a wealth of 
authorities available to confront all of these threats to our 
interest, whether it is on human rights, the missile launches 
that we talked about, Iran's regional destabilization 
activities, its support for terrorism. We have a wide variety 
of sanctions that target any number of aspects of Iran.
    Senator Flake. All right. As I mentioned, I was prepared to 
vote against the agreement had we gotten to the vote. Having 
said that, this is going forward. I hope it works. I hope that 
this committee and the Congress ensures that it does work. But 
it is important, I think, that we not count, even from the 
beginning, violations of the agreement on the Iranian side. If 
we do, then it is all gone. It is all for naught.
    So thank you, Mr. Chairman.
    The Chairman. Thank you. Senator Markey.
    Senator Markey. Thank you, Mr. Chairman, very much.
    Secretary Countryman, last spring this committee held a 
hearing on the new U.S.-China Civil Nuclear Cooperation 
Agreement. During that hearing, we discussed very credible 
allegations about China's inability, or, as I suggested, 
unwillingness to enforce its commitments to prevent bad actors 
like Karl Lee from selling ballistic missile technology to 
Iran, North Korea, and other countries of concern.
    As has been discussed here today, Iran has conducted two 
ballistic missile tests in the past few weeks in violation of 
U.N. Security Council Resolution 1929. Which countries do you 
believe are providing ballistic missile technologies to Iran, 
Mr. Secretary?
    Mr. Countryman. My assessment is the same as it was this 
spring, that the primary source of advanced technology for 
Iran's ballistic missile program are companies in China. I 
believe the Chinese Government has stepped up its efforts to 
enforce its own laws and U.N. sanctions. However, I cannot say 
that they have reached a satisfactory point of enforcement.
    Senator Markey. Yes. And so again, that continues to be my 
very serious concern. It was my concern about the approval of 
the China Civil Nuclear Agreement without conditions attached 
to it. Now, I did not have the support on this committee or in 
the Senate to attach those conditions, but those conditions 
would have imposed upon China requirements to put in place the 
safeguards against Karl Lee and others transferring ballistic 
missiles into Iran and into North Korea and to other countries. 
I mean, we essentially have the equivalent of the nuclear 
materials, which I think are now under very close safeguards 
being the bullets, but the missiles are the guns, and we are in 
a gun control discussion here today, ballistic missiles. They 
can deliver those nuclear bullets to other countries in the 
world. And China is the gun manufacturer.
    And so from my perspective we missed a great opportunity 
here to condition that agreement. I think we should have 
because this whole discussion on ballistic missiles now goes 
back to that China agreement since they are, from the 
administration's perspective, the most likely source of the 
ballistic missile technology. And we had a lot of leverage at 
that point. I argued that we should condition it at that time. 
But, again, I think it was a great historic missed opportunity 
to draw a line on nuclear proliferation issues to create the 
linkages so that we could have in one year put tough safeguards 
on the bullet program, the nuclear materials program, and on 
the gun program, the ballistic missile delivery.
    That was China, though, not Iran. They will receive 
whatever can come through clandestinely, and as long as Karl 
Lee and people like that are able to move around China with 
impunity, I think we are going to continue to have a very 
serious problem. And we might as well just have the hearing on 
that subject, you know, because that is the ballistic missile 
discussion in Iran. And it is going to be other countries like 
China who believe that, notwithstanding their public support 
for gun control, that they find their own way around a 
relatively poorly enforced restriction because we do not step 
up and use our leverage when the historic opportunity arrives. 
And that was the China Civilian Nuclear Agreement. If anything 
was directly related to Iran and its nuclear program, it was 
what China was looking for at that point to have that 
discussion, did not happen.
    So going forward, having lost that opportunity, what else 
do we have as a tool to let China know how serious we are about 
this and how we do not intend on countenancing a circumvention 
of an international agreement that the entire world at least 
ostensibly says that they believe is very important to long-
term global stability?
    Mr. Countryman. Well, briefly, I will be in Beijing again 
next month. I do not wish to have whatever I say there 
dismissed as finger-wagging because I think it will be a pretty 
strong message. But I also cannot predict and cannot forecast 
at this moment what additional actions we will take against 
Chinese entities that are complicit in providing ballistic 
missile technology. I will only say, as we said earlier, that 
under active consideration right now are additional effective 
measures in response to the October 10 test.
    Senator Markey. I appreciate that. I think it is 
inadequate. I do not think it is, you know, going to actually 
have the kind of weight, force behind it that rejection of or 
conditioning of the China Civilian Nuclear Agreement would 
have. But again, it just continues to raise the whole question 
of China--of nuclear 123 agreements on the very high hypocrisy 
coefficient that it then sends out as a message to the rest of 
the world.
    And I would hope that, Mr. Chairman, next year that we take 
up once again, you know, the 123 agreement climate that we have 
created around the world where we are suppliers ourselves and 
unfortunately turn a blind eye too often to other gun suppliers 
who are out there who do not believe that there is going to be 
a sufficiently well-enforced international response when it is 
clear that there are violations which are taking place.
    And I do not think there is any question that Karl Lee is 
the gun dealer, the ballistic missile dealer, one of them 
anyway but at the top of list, and that there still is not 
sufficient Chinese response to it, and I do not think there is 
sufficient response from our own country's perspective on it. I 
just think we have to take a harder line on it, and there is 
really no point in trying to convince people that Iran is 
sincere if they are engaging in an ongoing clandestine 
ballistic missile program with supplies coming in from China, 
you know?
    That just leaves the very clear impression that we are just 
in a temporary period of abeyance before they attach the 
bullets to the top of these ballistic missiles, okay, and that 
is really a cynical approach which they are taking, the Chinese 
are taking, and I just think that we had an opportunity, but I 
think we have to focus upon this next year. I think we need 
those hearings so that we come back to this China question once 
again.
    Thank you, Mr. Chairman.
    The Chairman. Well, thank you. And thanks for your 
continued vigilance there. I know that you and I shared 
concerns. I think we both realized where the issues stood in 
the United States Senate as a whole, but, again, I thank you 
for your continued efforts in that regard.
    Senator Risch?
    Senator Risch. Thank you very much. I am not going to 
belabor this. You guys know where I am on this. Just so you 
know, the comments by Senator Boxer are not shared equally by 
members of this committee. You have apologists here. The 
administration has apologists here. I get that. This is a joke 
and has been for months and years now.
    I am going to answer her rhetorical question. She read 
Samantha Power's letter and she read the President's letter and 
she said do you think this is soft stuff? Yes, I think this is 
soft stuff.
    Let me tell you what is not soft stuff is the Iranians 
standing up, shaking their fist in our face and saying death to 
American, and we are going to prove it. We have prohibitions 
against us developing ballistic missile systems, but we are 
going to continue to develop them and we are going to continue 
to test them, and we do not care and what you do. And, Mr. 
Mull, you are absolutely right in your statement that it does 
not matter. They are going to continue to do it regardless of 
consequences.
    So the only hope that we have--this--you know, Senator 
Kaine, who I have great respect for and generally agree with, 
talks about how we need to spotlight their violations. They 
love a spotlight in their violations. They just love that. They 
say look at us. We are Iran. We are violating this and you know 
what the United States of American can do about this? Nothing. 
And we are going to continue to do it.
    The PMD report, the report of the U.N. on the ballistic 
missile firing, we had to wait. No, we did not have to wait. 
Everybody in the world knew when they fired those ballistic 
missiles, that that was a violation of the agreements.
    Do I think this is soft stuff? I think it is tremendously 
soft stuff, and we are going to keep getting the exact same 
thing out of Iran until we toughen up. My prayer is that 402 
days from now when we inaugurate a new leader, that leader is 
going to convince the Iranians that indeed we are going to do 
something about this, we are going to protect the American 
people, and we are going to stop them from testing ballistic 
missiles and doing what we all know they are going to continue 
to do with this agreement.
    So thank you very much, Mr. Chairman.
    The Chairman. Senator Murphy.
    Senator Murphy. Thank you, Mr. Chairman. I appreciate you 
being here today.
    I want to try to put a finer point on Senator Boxer's 
comments. I do not necessarily appreciate some of the name-
calling here. I support the agreement not because I am an 
apologist for the administration but because I think it is the 
right thing to do for American national security. And I think 
she and Senator Corker are right and Senator Cardin's point are 
correct that I think there is broad agreement here that we need 
to take definitive steps to respond.
    And we take Ambassador Countryman at his word that this is 
not just loose talk about a consideration of options. This is a 
predicate to action, and I think there is agreement that that 
is an absolute necessity.
    The disagreement is over this broad labeling of the culture 
that may exist with respect to the actions that Iran is taking. 
And frankly, the report that was issued by the IAEA describes a 
culture of permissiveness that allowed for the Iranians up to 
2003 and in some respects after 2003 to conduct a military-
scale nuclear weapons research program.
    There was a culture of permissiveness created by a lack of 
international consensus that in the years after 2003 allowed 
for the Iranians to stockpile up to 8,000 kilograms of enriched 
material to get up to 19,000 centrifuges. And in many ways this 
agreement ends a culture of permissiveness that had allowed for 
the Iranians to conduct a nuclear program that was 
unprecedented in scope, 8,000 down to 300, 19,000 down to 
6,000.
    And with respect to the ballistic missiles program, again, 
we are united in the idea that there should be a response, but 
whether we like it or not, this is not new. The Iranians have 
been engaged in a ballistic missile program since their war 
with Iraq, and there have been regular tests under Republican 
and Democratic administrations.
    And so if you want to argue that there has been a culture 
of permissiveness relative to the ballistic missile program, 
you can make that argument, but--and maybe I will ask this 
question to Ambassador Countryman because you know the history 
of this program better than I. I think we have used strong 
words, but I imagine we have used strong words in the past. 
This has been a longstanding commitment to building a ballistic 
missile program that we have clearly tried to build 
international consensus to stop but predates the Iran nuclear 
agreement, am I right?
    Mr. Countryman. You are absolutely correct that the 
ballistic missile program goes back to the time of the Iran/
Iraq war in the 1980s, that it actually preceded an active 
nuclear weapons program in Iran.
    And I think it goes back a little bit to your question, Mr. 
Chairman. There are multiple reasons for Iran to engage in this 
program, including the desire ultimately to have a nuclear 
weapon to put atop an ICBM, but also including the fact that 
there is a proliferation of such systems throughout the region, 
and they have made enemies out of just about all of their 
neighbors. So they are building a whole bunch of them.
    But it also includes an element of national pride, as it 
has been in other countries. An indigenously produced ballistic 
missile technology becomes something that both military and 
politicians boast about, as well as a number of other motives. 
So it is a longstanding program. You are absolutely correct.
    Senator Murphy. And I think the chairman's point is that 
our inability or refusal to act this time may have greater 
consequences because now we are in business with them at a 
different level than we were before. And I get that. But I 
think having a scope of the full program is important as well.
    Two specific questions on other points, I wanted to follow 
up on a question that Senator Gardner asked you, Ambassador 
Mull, about what happens to the material that is being sent to 
Russia. And I know he was not satisfied with the fact that 
there was not an agreement. But let me just clarify. As a 
member of the IAEA, Russia has obligations to safeguard that 
material, and the IAEA has ability, I assume, to assure that 
they live up to those safeguards that exist separate and aside 
from an agreement that you may be negotiating today. I just 
think that--and I am happy to have you take that question, 
General.
    General Klotz. If I could just give a very brief answer--
    Senator Murphy. Yes.
    Mr. Klotz.--before the Ambassador speaks on this. The way 
in which the safeguard system works is for existing nonnuclear 
weapons states. If they are going to have a safeguards 
agreement with the IAEA, that has to be voluntary. That is the 
case for us. It is the case for Russia as a recognized nuclear 
weapons state.
    I do not know the--it will depend, of course, at the end of 
the day where this material actually goes, and as the 
Ambassador said, that is still a discussion that is going on as 
to whether or not safeguards exist there.
    But let me go back to a point I made earlier if I could. 
You know, the Russians have been in this business for a long 
time. They know how to package, store, ship, safeguard, account 
for nuclear materials. We have collaborated and worked with 
them in terms of improving their capability of doing that over 
the years under such things as the Nunn-Lugar Cooperative 
Threat Reduction. So we are very confident that this will be 
done in a professional manner.
    Ambassador Mull.  Well, thank you, General.
    Senator Murphy, thanks for the question. I do not want to 
leave any room for doubt at all that we have any concerns that 
this material, when it ultimately arrives in Russia, will not 
be subject to safeguards. We are in the process of negotiating 
very closely, discussing very closely with the IAEA and Russia 
what exactly that will look at. But there are 27 nuclear 
storage facilities in Russia that are subject to safeguards, 
IAEA safeguards. And this material will end up at a safeguarded 
facility.
    Senator Murphy. One last quick question, we are about to 
pass a reform of the Visa Waiver Program that will include in 
it a naming of Iran such that individuals who have traveled to 
Iran will no longer be eligible for the Visa Waiver Program. 
There has been a suggestion that because there is an element of 
the agreement that obligates us not to take steps that would 
stop economic relations between other countries and Iran, that 
we could perhaps be in jeopardy of breaching the agreement.
    I think there are some other things that trouble me about 
this visa waiver reform proposal, including how it affects dual 
nations. But have the Europeans raised concerns to you or have 
others raised concerns to you about that specific provision? 
Should it be something we should be thinking about in the wake 
of its, I think, pretty clear imminent passage?
    Ambassador Mull.  Yes, sir. I have heard from very senior--
and Secretary Kerry has as well--from very senior officials of 
differing European allies of ours that it could have a very 
negative impact on the deal.
    Senator Murphy. Okay. I think it is early days but just 
something for the committee to consider. Thank you, Mr. 
Chairman.
    The Chairman. Thank you. And if I could on that note, I 
think because of the way the omnibus came together there were 
some concerns about some of those technicalities being looked 
at. My sense is that down the road they will be. But, Ranking 
Member Cardin?
    Senator Cardin. Thank you, Senator Murphy. I do think, 
Senator Corker, this is an issue that we are going to take a 
look at. Obviously, there has been a great deal of 
congressional interest in the Visa Waiver Program and refugees, 
et cetera, since the Paris attacks and the attacks in our own 
country. But including this in the omnibus was not the right 
venue. We should have had an opportunity to debate this issue 
and look at the consequences far beyond just the immediate 
impact on individuals who wish to come to the United States.
    So I thank Senator Murphy for raising that issue, and I 
hope that we have an opportunity early next year take a look at 
this from the point of view of the Senate Foreign Relations 
Committee.
    The Chairman. And if I could just say one thing, I want to 
make sure they understand this is not of our jurisdiction--
    Senator Cardin. Well, I understand the direct interest of 
the legislation may not be ours, but the connection that 
Senator Murphy made to that issue is very much in our 
committee's jurisdiction. If it was on the Floor as a separate 
bill, our committee could have weighed in.
    The Chairman. That is right.
    Senator Cardin. And we did not have that opportunity. I 
appreciate that.
    And, Senator Murphy, I agree with you completely that a lot 
of the activities in Iran are not new, and we should not expect 
that it will change. And as I said in my opening comments about 
the Americans that are being held, this is an area that we know 
that we are going to have to be aggressive. And I appreciate 
the response from the administration, as they have said 
consistently throughout this that the Iranian activities in 
regards to human rights violations, in regards to ballistic 
missiles, in regards to support of terrorism, that our response 
to these issues has not been at all hampered by the Iran 
agreement, which is focused on stopping Iran from becoming a 
nuclear weapons state. So I appreciate all those matters.
    So my first question, and it has been talked about by most 
members of this committee, and is in regards to Iranian 
violations of the U.N. Security Council resolutions on 
ballistic missiles. My question is pretty specific. Yes, the 
United States will respond. I think that is clear we are going 
to respond, but we have a mechanism under the Iran agreement 
where an individual country that is a participant can take 
action unilaterally. That is true. But we are depending upon 
the coalition with our European partners to have a day-to-day 
strict compliance with the agreement by Iran.
    So it would seem to me this is the first test of the unity 
with our European partners. And I just hope--and I am going to 
ask that question--that we are trying to coordinate a response 
with our European partners because it seems to me they also 
understand the importance of that coalition to the successful 
implementation of the Iran agreement.
    Ambassador Mull.  Yes, sir, I completely agree. I think one 
of our strongest--we do have a really powerful toolbox that we 
can use unilaterally, but to the extent that we can get others 
in the international community to join us, that substantially 
increases the impact of these sorts of measures.
    And I think that has actually been one of the great success 
stories of American diplomacy in confronting these threats from 
Iran over the past several decades.
    Senator Cardin. Mr. Ambassador--
    Ambassador Mull.  And--
    Senator Cardin.--I would say to you we are looking at the 
math of the P5+1 in actions with the compliance within the Iran 
agreement. Yes, we want to get international support to respond 
to Iran, but it is important that we have the numbers that will 
be important in enforcing the Iranian agreement.
    Ambassador Mull.  Yes. And in response to your specific 
question about this missile launch, we in fact had the very 
full support at the Security Council in reporting this 
violation of U.N. Security Council Resolution 1929 from France, 
the United Kingdom, and Germany, who joined with us in bringing 
it to the attention of the Security Council.
    Senator Cardin. And we will be watching their actions to 
the U.N. resolution violation because to me it is telling 
whether we will have zero tolerance for compliance with the 
Iran agreement. Yes, we can take unilateral action, but a lot 
of this depends upon Iran understanding that we have the 
support of our coalition partners in Europe.
    Let me move on to a second issue that has me concerned, and 
let me get your response to it. Throughout the Iran review of 
the agreement itself, the estimate from all of the 
administration witnesses was that Iran would most likely be 
eligible for sanction relief in the spring. That was the 
timeframe given. In many of the specific estimates, they said 
they had so much to do that it would take at least to the 
spring.
    Now, we understand it is likely that Iran will be in 
compliance and entitled to sanction relief as early as January. 
So I guess my point is--and obviously, we want them to comply 
as quickly as possible. Do not get me wrong. But are we 
underestimating Iran's participation in this agreement that 
could affect other aspects here as well? And why do we misjudge 
so badly the date which was likely for compliance?
    Ambassador Mull.  Senator Cardin, I think the agreement is 
very clear that Implementation Day comes and the sanctions 
relief comes only when Iran has completed every single step 
that it must do in terms of reducing the capacity of its 
nuclear program for weaponization----
    Senator Cardin. I do not mean to----
    Ambassador Mull [continuing]. Activities.
    Senator Cardin [continuing]. Interrupt but I want to focus 
on this. Based upon intelligence information, based upon 
technical information as to how long it would take to dismantle 
the centrifuges and ship the equipment, et cetera, there was a 
thought that it would be spring. Now, it is December--January. 
So is that of concern or not?
    Ambassador Mull.  Well, I assume that during the time of 
the negotiation there were assumptions that some members of our 
administration did speculate on how long it would take. But 
what ultimately guides the answer to that is has Iran done 
everything it is supposed to do? And so the pacing of that is 
fully in Iran's hands.
    We have been very firm and clear in delivering a message 
that they have to do this right. They do not have to do it 
quickly. In fact, beginning with Adoption Day, they moved very 
swiftly to begin dismantling their centrifuge operations.
    So we are not there yet. We are working very closely with 
the IAEA to make sure that they have full insight to be able to 
verify everything that Iran has done. We will get to 
Implementation Day only when Iran has completed those steps. I 
do not think anyone in the United States is able to predict 
when that will be. The responsibility for that lies with Iran, 
as verified by the IAEA.
    Senator Cardin. My last question deals with the shipment of 
the enriched uranium outside of Iran to Russia and perhaps to 
Kazakhstan. As I understand, there is also considerations that 
some of this material may end up in Kazakhstan.
    My question is a follow up to a question asked earlier, and 
that is from a legal point of view will we know whether Iran, 
after the time period on restrictions of their stockpile has 
elapsed, whether they will have the legal right to reclaim this 
material and have it shipped back to Iran?
    Ambassador Mull.  According to paragraph 60 of Annex I of 
the JCPOA, Iran, even before the agreement ends, is eligible to 
receive in 5 kilogram increments those bits of fuel for its 
Tehran Research Reactor. And it can only receive those 
increments as the IAEA verifies that the preceding amount of 
fuel has been used. So that is going to be under very tight 
control.
    After the end of the JCPOA, years from now in the future, 
there is no restriction on Iran's enrichment activities 
beyond--I mean, they have committed to us that they will 
develop an enrichment program consistent with peaceful purposes 
whether we have this agreement or not. That is going to be a 
constant focus of the U.S. Government.
    Senator Cardin. Well, I understand that. My question is the 
agreement--will we know whether the legal agreement entered 
into between Iran and Russia and perhaps Iran and Kazakhstan 
today will give them the right to reclaim this material after 
the JCPOA restrictions are eliminated?
    Ambassador Mull.  The only exception for that is getting 
the fuel increments. Whether or not they will have the ability 
to get the stockpile that will be moved to Russia back, that is 
not addressed in the agreement. They, according to the 
agreement, must keep below 300 kilograms.
    Senator Cardin. Right. So we will not know legally whether 
they have the right to reclaim? That is not something that is 
required to be disclosed contemporaneous with the arrangements 
being made for the shipping of the enriched uranium?
    [Discussion off the record.]
    Ambassador Mull.  Sir, that is just not addressed within 
the agreement. The agreement only requires them to stay below 
300 kilograms.
    Senator Cardin. Thank you. Thank you.
    The Chairman. Thank you. Before turning to Senator Perdue, 
I know Ali Rezaian is in the audience. We talked earlier before 
he arrived relative to your efforts to secure his brother and 
get him back into the country. Would you want to address that 
one more time briefly before I turn to Senator Perdue?
    Ambassador Mull.  Yes, sir. I can say that this is a 
subject of grave concern for the administration. Secretary 
Kerry repeatedly raises the plate of Mr. Rezaian and the other 
detainees in Iran, whether it is Mr. Hekmati or Saeed Abedini, 
as well as asking for help and cooperation in finding out what 
has happened to others such as Robert Levinson who have 
disappeared, last seen in Iran.
    I am not in every meeting that Secretary Kerry has with his 
Iranian counterpart, but every one in which I have been, he has 
raised this issue in the most unambiguous terms.
    The Chairman. And you can understand how there is broad 
concern about our--and I know Senator Perdue spoke to it very 
eloquently earlier, that in spite of this massive agreement 
that is being put in place, these issues of these four people 
not being addressed causes a lot of consternation here in our 
country, and there is a lot of lack of understanding as to why 
that cannot be resolved much more easily than it is.
    Ambassador Mull.  Yes, sir.
    The Chairman. Okay. Senator Perdue.
    Senator Perdue. Thank you for the courtesy. And I really 
appreciate your testimony today and for what you are doing. I 
mean that seriously. It is not the first time you guys have 
been before this committee. It may not be the last.
    But I want to make two comments very quickly. One is I want 
to applaud the ranking member and the chairman for your 
leadership in this committee. And really, I have used this word 
before. This committee is more nonpartisan, not bipartisan, 
nonpartisan. This is about national security. It is about 
global security.
    I used the word naive earlier, and I stick by that word. 
But, Mr. Secretary, you mentioned something before that you 
have not heard any alternatives. Well, of course you have. We 
did not talk about the third alternative. War was never talked 
about. We had talked about this negotiation. We never talked 
about what got these people to the table in the first place.
    I am a business guy and I know how serious these sanctions 
have hurt them, and I think that we could have doubled down and 
at least talked about that as an alternative.
    But I want to come back to the word naive, but before I do 
that, let me set the record straight. My colleague from 
California said this was done in a bipartisan way, and I take 
issue with that. This committee unanimously passed a bill 
recommending--it was an act that gave us a look at this bill. 
Otherwise, we would not know--or this agreement. Otherwise, 
nobody would know what was in this agreement other than the 
administration. So I give you guys full credit for that.
    But we never got a vote on it. We could not even get it to 
the Floor of the Senate to have a vote on it. That is what 
drives my people back home absolutely apoplectic. I am sorry, 
but that is what is wrong with this process. It is all talk. 
Fifty-eight to forty-two. Four Democrats voted to even put it 
on the Floor. The rest of them unanimously almost--or 42 votes 
voted to not even move this bill to the Floor to have a debate 
on it.
    The last thing I would say about the word naive, I did not 
use that word lightly. Not just this administration, other 
administrations, this country, we do not have a great record 
dealing with rogue nations. In 1993 another administration said 
trust us; this deal will preclude the potential of ever having 
a nuclear weapon on the peninsula of Korea. We know how that 
worked out.
    Of course these guys are headed toward a nuclear weapon. I 
mean who are we trying to kid? The United Nations has no 
ability right now in my view except to talk because of the 
vetoes that are part of that Security Council situation.
    So I just think we were faced with a false choice here. I 
wanted to set the record straight. But I do want to commend 
this committee for its bipartisan/nonpartisan approach to this 
whole topic and for the leadership you guys--and for what you 
guys are trying to do to make sure that the implementation of 
this thing goes properly. Thank you.
    Senator Cardin. Mr. Chairman, can I just--Senator Perdue is 
one of the most effective members of not only this committee 
but the United States Senate, and I very much appreciate all 
the comments he made.
    I just really want to put on the record the negotiations 
took place with Senator Kaine and Senator Menendez and Senator 
Corker and other members of the committee. It was always 
envisioned that we would not have an expedited process for the 
consideration of the Iran agreement. Interpreted in layman's 
language, it was always anticipated there would be a 60-vote 
threshold in the United States Senate so that it had to be a 
bipartisan action considering that we have divided government 
between Congress and the White House by party. That was always 
envisioned in the agreement.
    And I know there is a different interpretation among the 
Democrats and Republicans as to whether we had a vote on the 
substance or not. I fully understand that, and I understand 
what Senator Perdue was saying. But I think the American people 
know that 58 Senators opposed the agreement and 42 supported 
the agreement, and that it did not hit the 60-vote threshold 
that was the ground rules on which the legislation was 
negotiated. That legislation got the unanimous support of this 
committee and near unanimous support of the United States 
Senate.
    I just really wanted to put that on the record because I 
think there was a difference among parties as to how that was 
to be handled, and I respect that, but I think clearly there 
was anticipation that it would take 60 votes.
    The Chairman. I think I am just going to refrain from 
entering into----
    [Laughter.]
    The Chairman. [continuing]. A discussion regarding that. I 
thank you both for your comments. I want to thank you for the 
tremendous role you have played this year as a new member in 
Foreign Relations. I am so glad that things worked out where we 
could have two Senators from Georgia. And thank you so much for 
digging into the issues the way you have.
    I want to just mention a couple things. This snapback 
provision, just for what it is worth, if we cannot get the U.N. 
Security Council to act relative to the missile issues, I do 
not think any of us really believe the snapback itself is real. 
You know, we can call for it, but the other countries have to 
implement. And if they are not willing to implement, it has no 
effect.
    So I think if the U.N. Security Council--and I think --
look, I understand what Senator Boxer was saying. I think much 
of the discussion here is to try to shame the administration 
and shame the U.N. Security Council into taking action. I mean, 
that is what people want to see happen, and much of our 
comments about Russia and China are to hopefully push them into 
being willing to address this issue that a panel of experts has 
said occurred. But again, if they are not willing to do that, I 
think it renders the snapback provision over time totally 
useless. Yes, sure, we can call for it to happen, but the other 
countries do not have to follow suit and cause those sanctions 
to snap back into place. It is just not real.
    So that is a concern. And, again, I think we are not 
talking at you. We are talking with you. We know there are 
others that will be taking these actions.
    On the issue that I left hanging out there and was not 
followed up on, is there any pressure--I realize the reason 
that Iran is doing what it is doing relative to moving quickly, 
which again, as Senator Cardin just mentioned, that is what we 
want them to do--but we understand there are political issues 
that are occurring within the country that--there is an 
election that is going to be taking place.
    And we understand that the people who negotiated this 
agreement want those sanctions lifted prior to that election so 
that it is going to affect the outcome. I mean, we understand 
that. I do not think you would question that.
    My question to you is are we dragging--is there any 
pressure within the administration to drag--is that one of the 
reasons you do not want us to implement the sanctions that are 
going to be expiring next year right now? Or is there pressure 
relative to this agreement to somehow cause inaction to have, 
again, an effect within the Parliament elections that are 
taking place in March?
    Ambassador Mull.  Mr. Chairman, I agree with your analysis 
of the political situation in Iran. In the same breath, I 
hasten to stress that what happens internally, politically in 
Iran is not part of my brief in terms of implementing this 
agreement.
    We have a very specific roadmap of what Iran has to do, and 
on the first day that my office in the State Department was 
created, President Obama stopped by the State Department to 
congratulate the negotiating team, and he pulled me aside and 
he said you know what you have to do in making sure that this 
agreement is fully implemented. You cannot make a single 
mistake. It was a pretty impressive way to start work in a new 
job.
    The Chairman. Yes.
    Ambassador Mull.  But nevertheless, it has been very clear 
that we are fully focused. There are politics in every country, 
but we have a deal that we need to implement and that Iran 
needs to implement regardless of its internal political 
situation.
    The Chairman. But outside of your purview--I understand 
that you are not the enforcer; you are the implementer. Outside 
of your purview there are others within the administration that 
have the ability to put in place sanctions, right? I mean, 
Countryman can call for them but there are others that are 
going to actually decide.
    And my question to you is have you sensed any issues 
relative to, you know, enforcing, punishing relative to the 
elections that are coming up in the spring?
    Ambassador Mull.  Senator Corker, Secretary Kerry, as 
recently as yesterday, as well as other members of the 
President's national security team, have all said that we need 
to follow up--we need to make sure there are consequences for 
violations of international prohibitions, such things as the 
recent missile launches. So we are fully committed as an 
administration to exercising those sanction authorities when it 
is warranted.
    I do not know if you want to add anything.
    Mr. Countryman. No. I would only add that no one has asked 
me to modulate, accelerate, or slow down the implementation of 
the steps that we are considering due to considerations about 
an electoral calendar in Iran. I have seen no such indication.
    The Chairman. Well, I think all of us again hope that if we 
are unsuccessful at the U.N. Security Council, very quickly, 
the abilities that the administration has to implement surgical 
and directed sanctions at Iran will take place.
    Let me just ask one last question. The Procurement Channel, 
I understand that is going to be--when do you think that 
process will be fully agreed to and in a place where we begin 
implementation?
    Ambassador Mull.  Senator, at the last meeting of the Joint 
Commission, which I attended along with Ambassador Shannon last 
week in Vienna, we reached agreement on how the channel would 
work within the Joint Commission. And in fact, this week as we 
speak, we are doing a test run of the process with a number of 
tests. The personnel managing this process will meet in Vienna 
next Tuesday--the P5+1, as well as representatives with Iran--
to scrub how we did in the test run, and we will make necessary 
improvements.
    A piece of this that has yet to be agreed upon, and we are 
very close to coming to agreement on this, is how that process 
interacts with the Security Council because ultimately it is 
the Security Council that has to give its blessing for the 
transfer of any of this technology to Iran. We are very close 
to agreement with the Security Council how the Security Council 
will staff that process and interact with the Procurement 
Channel.
    The Chairman. Any other questions or comments?
    Senator Cardin. Thank you all very much.
    The Chairman. Yes, we thank you for being here. We thank 
you for your service to our country, and we wish you well as 
you ensure that this is implemented with every t crossed and i 
dotted. And I think you can tell we certainly are going to be 
paying attention to that. We thank you for being here today.
    Without objection, the record will remain open until the 
close of business Monday. If each of you would respond fairly 
promptly, we would appreciate it.
    We wish you a very good holiday season. And with that, the 
meeting is adjourned. Thank you.
    [Whereupon, at 12:01 p.m., the hearing was adjourned.]


                              ----------                              


              Additional Material Submitted for the Record


           Response of Ambassador Stephen Mull to a Question 
                Submitted by Senator Benjamin L. Cardin

    Question. Large amounts of low enriched uranium 3.5 percent will be 
shipped from Iran to Russia, in order to reduce Iran's nuclear 
stockpile below 300kgs. In addition, it has been reported that the 
United States is working on an arrangement that would send another 
portion of Iran's nuclear fuel stockpile to Kazakhstan.

   What are the details of these arrangements?
   Who retains legal possession of the nuclear stockpile if 
        this arrangement is finalized?
   Could Iran retake possession of this stockpile once the 
        limitations in the JCPOA expire?

    Answer. Under the Joint Comprehensive Plan of Action (JCPOA), Iran 
is allowed to maintain a total enriched uranium stockpile of no more 
than 300 kilograms of up to 3.67 percent enriched uranium hexafluoride 
(or the equivalent in different chemical forms) for 15 years. To meet 
this JCPOA requirement, Iran has shipped nearly its entire stockpile of 
low-enriched uranium (LEU) to Russia, including all nuclear material 
enriched to near-20 percent not already fabricated into fuel plates for 
the Tehran Research Reactor. Iran shipped all of this material to 
Russia under commercial arrangements.
    Russia has taken ownership of all of the up-to-five percent LEU 
material shipped out from Iran, and Iran no longer has a claim to this 
material. In return for the up-to-five percent LEU, Russia provided an 
equivalent amount of natural uranium in the form of uranium ore 
concentrate (yellowcake).
    In addition, Iran has sent to Russia scrap material enriched to 
near-20 percent and partially fabricated near-20 percent enriched 
uranium fuel and targets. Iran no longer has ownership of the scrap, 
but does retain ownership of the partially fabricated fuel and targets, 
which can only be returned to Iran in small increments for use in the 
Tehran Research Reactor consistent with the JCPOA, subject to 
conditions decided upon by the Joint Commission. In return for the 
near-20 percent material, Kazakhstan provided an equivalent amount of 
natural uranium in the form of yellowcake. Norway provided the funding 
for the natural uranium.
    After 15 years, Iran may possess a stockpile over 300 kilograms, 
but it cannot use any nuclear material it possesses or acquires at any 
time for nuclear explosive purposes, and such material will be subject 
to all the obligations under the Nuclear Non-Proliferation Treaty 
(NPT). Furthermore, all nuclear material will remain subject in 
perpetuity to the robust monitoring and verification measures in Iran's 
Comprehensive Safeguards Agreement and, as a result of the JCPOA, the 
Additional Protocol. This includes monitoring at all nuclear fuel cycle 
sites, including enrichment facilities and nuclear reactors. These 
measures are designed to detect any diversion from Iran's uranium 
stocks for nuclear explosive purposes. Any such diversion would violate 
Iran's obligations under the NPT and its IAEA safeguards agreement.


                               __________

              Responses of Thomas Countryman to Questions 
                   Submitted by Senator David Perdue

    Question. As you covered in your testimony, Iran is prohibited 
under UNSCR 1929 from undertaking any activity related to ballistic 
missiles capable of delivering nuclear weapons, including launches. The 
UNSCR that followed the JCPOA, 2231, also prohibits Iran from missile 
development for 8 years. Iran has tested twice a mid-range ballistic 
missile capable of striking targets as far away as 1200 miles and gone 
unpunished. Would you consider the ballistic missile launches to be 
consistent with the spirit of the JCPOA?

    Answer. We remain deeply concerned that Iran continues to develop a 
ballistic missile capability that threatens regional and international 
security.
    Under UNSCR 2231, important United Nations (U.N.) restrictions on 
transfers of ballistic missile technologies remain in place for eight 
years, or until the IAEA reaches its Broader Conclusion that all 
nuclear material in Iran remains in peaceful activities. These binding 
prohibitions directly constrain Iran's ballistic missile capability by 
limiting its access to new technology and equipment. Under these 
provisions:


   All States are still required to prevent the provision to 
        Iran of technology, technical assistance, and other services 
        related to ballistic missiles.

   All States are still required to prevent transfers from 
        Iran of ballistic missile-related items to or through their 
        territory or by their nationals.

   All States are still required to prevent Iran from 
        acquiring interests in commercial activities in their 
        territories related to ballistic missiles.

   All States are still called upon to inspect cargo in their 
        territories suspected of containing ballistic missile items.

   Flag States are still called upon to allow inspections of 
        their flag vessels suspected of containing ballistic missile 
        items.

   If ballistic missile-related items are found, States will 
        still be required to take actions, in accordance with guidance 
        from the Security Council, to seize and dispose of them.


    Under these prohibitions, the U.N. framework for disruption of 
ballistic missile-related transfers is fundamentally unchanged from the 
status quo. As a permanent member of the Security Council, we would not 
expect to approve any exceptions to these prohibitions.
    In addition, UNSCR 2231 calls on Iran specifically not to undertake 
any activity related to ballistic missiles designed to be capable of 
delivering nuclear weapons, including launches using such ballistic 
missile technology. Since the Security Council has called upon Iran not 
to undertake these activities, if Iran were to undertake them it would 
be inconsistent with UNSCR 2231 and a serious matter for the Security 
Council to review.
    As the focus of the JCPOA is to cut off all of Iran's pathways to a 
nuclear weapon and ensure that the Iranian nuclear program is peaceful, 
Iranian missile tests, such as the October launch reported to the U.N. 
and the reported November launch, are not a violation of the JCPOA. 
This deal is not about trust or hope that Iran will behave in a certain 
way, but rather it is about clear provisions whose implementation can 
be verified through robust transparency and verification mechanisms. 
Indeed, we have long said that the JCPOA was not predicated on any 
change in Iranian behavior--including its missile development 
effortsother than specific changes that would have to be made to its 
nuclear program. Full implementation of the JCPOA by Iran will ensure 
that Iran's nuclear program remains peaceful going forward, and that 
Iran will not develop nuclear weapons.


    Question. Do you view Iranian UNSCR violations even before the 
JCPOA is implemented a red flag for things to come?

    Answer. The international community has long sought to restrict 
Iran's missile programs, adopting a series of United Nations Security 
Council resolutions (UNSCRs) that target Iran's missile development, 
procurement, and proliferation activities. Even with these strong UNSCR 
provisions in place, Iran has continued to engage in activities that 
clearly violate these restrictions. This has been the case since the 
adoption of UNSCR 1737 in 2006.
    The JCPOA was not predicated on any change in Iranian behavior -- 
including its missile development efforts -- other than specific 
changes that would have to be made to its nuclear program. Moving 
forward, we have no intention of reducing our focus and determination 
to prevent the development of Iran's ballistic missile capabilities, 
even as we take steps to implement the JCPOA.


    Question. Aside from statements of concern, what has the 
administration done in reaction to this repeated violation?

    Answer. We have mounted a vigorous response to Iran's October 10 
launch of its new ``Emad'' medium range ballistic missile. In addition 
to strong statements in the U.N. Security Council, on October 21, the 
United States, together with France, Germany, and the United Kingdom, 
submitted a joint report on the launch to the U.N. Security Council's 
Iran Sanctions Committee. We called on the Committee, with the support 
of the independent U.N. Panel of Experts, to review this matter quickly 
and recommend appropriate action. On December 11, the Panel of Experts 
submitted to the Committee its report concerning the launch of the Emad 
in which it concluded definitively that the ``Emad launch is a 
violation by Iran of paragraph 9 of the Security Council resolution 
1929 (2010).'' We have proposed that the Committee send a letter to 
Iran raising our concerns and asking for an explanation.
    In addition to the provisions of U.N. Security Council resolutions, 
we also rely on a broad set of other multilateral and unilateral tools 
to impede and disrupt Iran's missile development efforts. Specifically, 
we continue to work with partners--including many of the over 100 
governments around the world that have endorsed the Proliferation 
Security Initiative (PSI)--to interdict shipments related to weapons of 
mass destruction (WMD), their delivery systems, and related items, 
including Iran's prohibited missile-related imports or exports. We also 
use our participation in the Missile Technology Control Regime (MTCR) 
to prevent the spread of critical missile technologies and raise 
awareness among the 33 other MTCR Partners (members) of the 
proliferation concerns posed by Iran's missile development, 
procurement, and proliferation activities. We bolster these 
multilateral efforts through our bilateral cooperation with countries 
to prevent transfers to Iran's missile program, promote thorough UNSCR 
implementation, and target Iranian missile proliferation activities in 
third countries. In addition, we continue to use domestic authorities 
to impose sanctions on entities connected to Iran's ballistic missile 
programs, as warranted.


    Question. If these tests continue, is the U.S. prepared to act in 
punishing Iran for these violations?

    Answer. We are prepared to act. We have a range of unilateral and 
multilateral tools available at our disposal to counter Iran's missile-
related activities. We have imposed on multiple occasions penalties 
under domestic authorities on foreign persons and entities engaged in 
proliferation-related activities and are actively reviewing the facts 
from the recent launch to determine whether such measures are 
warranted.
    We are continuing to combat the proliferation of missile technology 
and equipment by working with the more than 100 countries around the 
world that have endorsed the Proliferation Security Initiative (PSI) 
and by urging all countries to implement and enforce missile-related 
export controls, such as those established by the Missile Technology 
Control Regime (MTCR).
    In addition, we also will continue to raise such activities in the 
U.N. Security Council as warranted and call on the Security Council to 
address Iranian violations and increase the political and financial 
cost to Iran of its behavior.


    Question. How will the U.S. take action now to stop further testing 
of nuclear-capable ballistic missiles from Iran, which is in clear 
violation of the UNSC resolutions?

    Answer. At the December 15 U.N. Security Council meeting to discuss 
Iran sanctions, Ambassador Power insisted that the Council must take 
greater responsibility to respond to Iran's ongoing violations of U.N. 
Security Council resolutions, including the October 10 ballistic 
missile launch. We are now consulting with Security Council members 
about further appropriate responses. We also are actively reviewing the 
facts from the recent launch to determine whether penalties under 
domestic authorities on foreign persons and entities are warranted.


    Question. Would ballistic missiles, such as the ones tested by Iran 
during the past two months, be an efficient and cost effective way for 
them to deliver a 500 pound conventional warhead? Or is it more likely 
that in fact, the only reason to have a ballistic missile is to deliver 
a nuclear warhead or other weapon of mass destruction? What is the 
administration's view of the purpose of Iran's ballistic missiles? 
Would you agree that Iran's continued development of ballistic missile 
technology reflects its long-term intention to acquire a nuclear 
weapon?

    Answer. Iran has the largest ballistic missile program in the 
Middle East, and has deployed hundreds of conventionally armed 
ballistic missiles--including of the Shahab-3 class. Iran deploys such 
ballistic missiles to project power regionally and deter potential 
adversaries. Iranian officials have stated repeatedly that they see 
conventionally armed ballistic missiles as an integral part of their 
defense capability and have no intention to forgo this capability. 
These missile programs remain one of our most significant 
nonproliferation challenges, contributing to regional tension and 
posing a serious risk to international stability.
    As we reported to the U.N. Security Council, Iran launched a 
medium-range ballistic missile (MRBM) on October 10 called ``Emad'' 
that appears to be a new variant of Iran's Shahab-3 MRBM with a 
maneuvering reentry vehicle. This system is an Missile Technology 
Control Regime (MTCR) Category I missile capable of delivering a 
payload of at least 500 kg to a range of at least 300 km and therefore 
is inherently capable of delivering a nuclear weapon. This missile has 
this inherent capability even if it was not designed for this purpose 
or is normally deployed with a conventional warhead.


    Question. In their December 2nd report, the IAEA asserted that Iran 
concealed, and continues to conceal, efforts to weaponize nuclear 
material. The IAEA has still not verified that all of Iran's nuclear 
program is for purely peaceful purposes. This contradicts the 
requirements laid out during the negotiations. President Obama's lead 
negotiator, Wendy Sherman said to the Senate last February, ``And in 
fact, in the Joint Plan of Action, we have required that Iran come 
clean on its past actions as part of any comprehensive agreement.'' Do 
you believe that Iran has really ``come clean'' on their past actions 
as we were assured during the negotiations? What rationale underlay the 
Obama administration's initial requirement of full PMD disclosure 
during the negotiation of the JCPOA? Why does this rationale no longer 
apply?

    Answer. Under the JCPOA, Iran committed to fully implement the 
``Roadmap for the Clarification of Past and Present Outstanding Issues 
regarding Iran's Nuclear Program,'' which established a time-limited 
process to address the IAEA's concerns regarding the possible military 
dimensions (PMD) of Iran's nuclear program. On October 15, the IAEA 
confirmed that Iran had completed the steps required of it under the 
Roadmap. On December 2, as specified in the Roadmap, the IAEA Director 
General submitted his final assessment on PMD to the IAEA Board of 
Governors. The December 2 report, largely consistent with what the 
United States has long assessed, concluded that Iran pursued a 
coordinated program of nuclear weapons related activities that was 
discontinued in 2003, though certain research and development 
activities continued until 2009.
    Our primary goal continues to be ensuring that Iran's nuclear 
program is and remains exclusively peaceful. The JCPOA is a forward-
looking arrangement, but addressing questions about Iran's past nuclear 
weapons work has always been an important part of the process. For this 
reason, we and our P5+1 partners insisted Iran work with the IAEA to 
address PMD. As the Director General's December 2 report makes clear, 
Iran did not get away with its illicit nuclear activities without being 
made to address each of the 12 areas originally identified in the 
Director General's November 2011 report. Moving forward, the IAEA 
maintains its full authorities to pursue all safeguards-relevant or 
JCPOA-related information in Iran, including any new concerns regarding 
weapons-related activities, through implementation of Iran's 
Comprehensive Safeguards Agreement, Additional Protocol, and the 
enhanced transparency and verification measures contained in the JCPOA.


    Question. How can the JCPOA remain credible if the U.S. repeatedly 
shifts the goal posts in response to Iranian noncompliance?

    Answer. We are not aware of any action by Iran, or failure to act, 
in breach of the JCPOA. We will continue to judge Iran's compliance 
with the JCPOA based on its full implementation of all required 
commitments.


    Question. Yes or no, won't an incomplete understanding of what's 
happened in the past with Iran's nuclear weapons program and the 
country's current capabilities make it harder to determine when and how 
Iran pursues a nuclear weapon in the future?

    Answer. No. The JCPOA includes the most comprehensive nuclear 
verification regime ever negotiated. We remain confident that Iran 
could not divert uranium or centrifuges to clandestine sites, or 
produce weapons grade plutonium, without detection, thereby cutting off 
all of Iran's paths to fissile material for nuclear weapons.


    Question. If the IAEA is closing the book on Iran's PMDs, can you 
describe what parts of Iran's nuclear program will not be investigated 
further?

    Answer. The IAEA maintains its full authorities to pursue all 
safeguards-relevant or JCPOA-related information in Iran, including any 
new concerns regarding weapons-related activities, through 
implementation of Iran's Comprehensive Safeguards Agreement, Additional 
Protocol, and the enhanced transparency and verification measures 
contained in the JCPOA.


    Question. Can you elaborate on why these aspects of the program 
could not be restarted from where they left off according to the IAEA? 
Won't Iran still have the nuclear infrastructure and weaponization 
knowledge that they developed previously?

    Answer. While we cannot erase Iran's knowledge, Iran's nuclear 
infrastructure and materials will be significantly restricted and 
monitored under the JCPOA, ensuring a one year timeline under any 
potential breakout scenario. In the event of non-performance of JCPOA 
commitments by Iran, we have the ability to independently re-impose 
both unilateral and multilateral nuclear-related sanctions.


    Question.  One of the most troubling aspects of this IAEA report 
was what was not found in the inspected facilities. Notably, what was 
missing from the Parchin site was the suspected high explosive test 
chamber. The IAEA assessed that despite an Iranian attempt to contest 
IAEA's imagery-derived analysis by providing Iranian aerial 
photography, the IAEA used new imagery from various sources to 
reinforce its previous assessment that a large cylindrical-shaped 
object was made and installed at the site in the summer of 2000. The 
IAEA stated that this cylinder matched the parameters of an explosives 
firing chamber featured in publications of a foreign nuclear weapons 
expert. To give you a sense of scope, this is not a small piece of 
equipment-this expert's designs show that such a chamber would be 
4.6x19 meters squared, with a volume of 315 cubic meters, with a 
reinforced concrete square section of 7.6 x 7.6 meters squared and a 
mass of 700 tonnes. The IAEA, through a visual observation, allowed the 
Agency to assess that as of September 20, 2015, the test chamber was no 
longer present inside the building. Signs of an Iranian cover-up, 
however, do exist--the IAEA noted a floor with an unusual cross-section 
and an incomplete ventilation system. From what I understand, our 
intelligence community still believed this test chamber was at Parchin. 
Why did we think it was still there? Was there an intelligence failure 
in the US, if this enormous object got out of Parchin? If this was an 
intelligence failure, then how can we reliably monitor Iran and ensure 
there's no cheating?

    Answer. The IAEA Director General's December 2 report concluded 
that Iran's claims about the Parchin facility were not supported by the 
facts available to the Agency, including satellite imagery. Analysis of 
samples taken from Parchin was also not consistent with what the IAEA 
would have expected to find at chemicals storage facility, as claimed 
by Iran. In order to ensure Iran's full compliance moving forward, the 
JCPOA includes the most comprehensive nuclear verification regime ever 
negotiated. The JCPOA ensures both timely and effective IAEA access to 
any location in Iran necessary to verify Iran's compliance, including 
military installations. Any Iranian failure to allow access at the end 
of a time-bound 24 day period would be a violation of the JCPOA, and 
sanctions could be snapped back. The Joint Commission established by 
the JCPOA will be in a position to ensure that the IAEA is satisfied 
with the nature and extent of the access required of Iran.


    Question.  The verification procedures implemented at the Parchin 
military complex--where the IAEA believes that Iran conducted 
weaponization activities--differed from the standard protocols that the 
IAEA has applied in the past, both in other countries and in Iran, 
including at Iran's military sites. Due to the IAEA's limited access to 
information, the Agency is not able to state whether the conclusions in 
its report have been made with low, medium, or high confidence. The 
environmental sampling process at Parchin served as a poor precedent 
for investigations at other locations, including military-related 
sites. How concerned are you about this poor precedent, and what it 
means for future physical sampling of military sites? Will the 
administration demand that future sampling and investigation, in Iran 
and elsewhere, be done on-site by IAEA inspectors and experts? Can you 
explain to me how the Iranian self-sampling worked? Was the IAEA able 
to direct where samples were taken? Were air ducts and other parts of 
the ventilation system swabbed?

    Answer. The U.S. government's nuclear experts remain confident that 
the IAEA's inspection of Parchin was technically sound, and we have 
full confidence in the IAEA to pursue only procedures that meet its 
high standards of independent verification in the future. The IAEA 
confirmed that the Director General, as well as his head of Safeguards, 
visited Parchin. This was the first time that the IAEA had visited the 
location. Before this visit, certain other safeguards activities were 
carried out at the Parchin site, included the taking of environmental 
samples, which the IAEA confirmed were conducted in a manner consistent 
with the IAEA's standard safeguards practices.
    On December 7, the IAEA Board of Governors affirmed that the 
verification and monitoring of commitments set out in the JCPOA should 
not be considered as setting a precedent for the IAEA's standard 
verification practices, and further affirmed that it shall not be 
interpreted to alter the IAEA's right and obligation to verify 
compliance by other states with their Safeguards Agreements and 
Additional Protocols.


    Question. Is it correct that the only other time that the IAEA has 
accepted videotaping of samples was in Japan, a nation with no trust 
deficit, and it was only done via video because it was an area that was 
hot with radioactivity?

    Answer. Arrangements related to safeguards agreements and the 
IAEA's inspections activities are confidential within the IAEA system. 
The U.S. government's nuclear experts remain confident that the IAEA's 
inspection of Parchin was technically sound.


                                 ______
                                 

              Responses of Thomas Countryman to Questions 
                     Submitted by Senator Tim Kaine


    Question. After Implementation Day, would the Administration 
consider the type of ballistic missile tests conducted by Iran in 
October and November to be violations of either the JCPOA or U.N. 
Security Council Resolution (UNSCR) 2231? Why or why not? Does UNSCR 
2231 provide a sufficient basis for restricting Iranian ballistic 
missile activity?

    Answer. We remain deeply concerned that Iran continues to develop a 
ballistic missile capability that threatens regional and international 
security.
    Under UNSCR 2231, important United Nations (U.N.) restrictions on 
transfers of ballistic missile technologies remain in place for eight 
years, or until the IAEA reaches its Broader Conclusion that all 
nuclear material in Iran remains in peaceful activities. These binding 
prohibitions directly constrain Iran's ballistic missile capability by 
limiting its access to new technology and equipment. Under these 
provisions:


   All States are still required to prevent transfers to Iran 
        of ballistic missile-related items from their territory or by 
        their nationals.

   All States are still required to prevent the provision to 
        Iran of technology, technical assistance, and other services 
        related to ballistic missiles.

   All States are still required to prevent transfers from 
        Iran of ballistic missile-related items to or through their 
        territory or by their nationals.

   All States are still required to prevent Iran from 
        acquiring interests in commercial activities in their 
        territories related to ballistic missiles.

   ll States are still called upon to inspect cargo in their 
        territories suspected of containing ballistic missile items.

   Flag States are still called upon to allow inspections of 
        their flag vessels suspected of containing ballistic missile 
        items.

   If ballistic missile-related items are found, States will 
        still be required to take actions, in accordance with guidance 
        from the Security Council, to seize and dispose of them.


    Under these prohibitions, the U.N. framework for disruption of 
ballistic missile-related transfers is fundamentally unchanged from the 
status quo. As a permanent member of the Security Council, we would not 
expect to approve any exceptions to these prohibitions.
    In addition, UNSCR 2231 calls on Iran specifically not to undertake 
any activity related to ballistic missiles designed to be capable of 
delivering nuclear weapons, including launches using such ballistic 
missile technology. Since the Security Council has called upon Iran not 
to undertake these activities, if Iran were to undertake them it would 
be inconsistent with UNSCR 2231 and a serious matter for the Security 
Council to review.
    As the focus of the JCPOA is to cut off all of Iran's pathways to a 
nuclear weapon and ensure that the Iranian nuclear program is peaceful, 
Iranian missile tests are outside of its scope and therefore not a 
violation of the JCPOA.


    Question. Please explain in detail what next steps the 
Administration is planning to take, unilaterally or in coordination 
with the P5+1, in response to the October 10 ballistic missile test, 
which the U.N. just determined to be a violation of UNSCR 1929, as well 
as the November 21 ballistic missile test.

    Answer. The United States has mounted a vigorous response to Iran's 
October 10 launch of its new ``Emad'' medium range ballistic missile. 
In the U.N. Security Council, U.S. Ambassador to the United Nations 
Samantha Power highlighted this violation and condemned the launch as 
destabilizing on October 21, and reiterated a call for Council action 
on December 15. Other Security Council members joined the United States 
in condemning the launch as a violation, highlighting the widespread 
international concern with this act. On October 21, the United States, 
together with France, Germany, and the United Kingdom, submitted a 
joint report on the launch to the U.N. Security Council's Iran 
Sanctions Committee. The Committee discussed our report on the launch 
in a meeting on November 24. We have called on the Committee, with the 
support of the independent U.N. Panel of Experts, to review this matter 
quickly and recommend appropriate action. We have proposed that the 
Committee send a letter to Iran raising our concerns and asking for an 
explanation. On December 11, the Panel of Experts submitted to the 
Committee its report concerning the launch of the Emad in which it 
concluded definitively that the ``Emad launch is a violation by Iran of 
paragraph 9 of the Security Council resolution 1929 (2010).'' At the 
December 15 U.N. Security Council meeting to discuss Iran sanctions, 
Ambassador Power insisted that the Council must take greater 
responsibility to respond to Iran's ongoing violations of U.N. Security 
Council resolutions, including the October 10 ballistic missile launch. 
We are now consulting with Security Council members about further 
appropriate responses.
    The Administration also is carefully reviewing the reported 
November 21 launch by Iran of a medium-range ballistic missile. If 
these reports are confirmed and we assess there has been any violation 
of relevant U.N. Security Council resolutions, we will take appropriate 
action. Such action may include calling on the U.N. Security Council to 
address Iranian violations, shining an international spotlight on 
Iran's destabilizing activities, and increasing the political and 
financial cost to Iran of its behavior.
    In addition to the provisions of U.N. Security Council resolutions, 
we also rely on a broad set of other multilateral and unilateral tools 
to impede and disrupt Iran's missile development efforts. Specifically, 
we continue to work with partners--including many of the over 100 
governments around the world that have endorsed the Proliferation 
Security Initiative (PSI)--to interdict shipments related to weapons of 
mass destruction (WMD), their delivery systems, and related items, 
including Iran's prohibited missile-related imports or exports. We also 
use our participation in the Missile Technology Control Regime (MTCR) 
to prevent the spread of critical missile technologies and raise 
awareness among the 33 other MTCR Partners (members) of the 
proliferation concerns posed by Iran's missile development, 
procurement, and proliferation activities. We bolster these 
multilateral efforts through our bilateral cooperation with countries 
to prevent transfers to Iran's missile program, promote thorough UNSCR 
implementation, and target Iranian missile proliferation activities in 
third countries. In addition, we continue to use unilateral authorities 
to impose sanctions on entities connected to Iran's ballistic missile 
programs and procurement network.


                                 ______
                                 

               Remarks at a Briefing by the Chair of the 
            U.N. Security Council's Iran Sanctions Committee

                                         Ambassador Samantha Power,
               U.S. Permanent Representative to the United Nations,
                                U.S. Mission to the United Nations,
                                                  New York City, NY


                                                  December 15, 2015

                              AS DELIVERED

    Thank you, Ambassador Oyarzun, for your briefing. We are grateful 
for your leadership during this important transition period.
    Five months have passed since the P-5+1 countries, the EU, and Iran 
concluded the Joint Comprehensive Plan of Action, the JCPOA. I, like 
others, am pleased to note that the JCPOA participants are making 
progress in fulfilling their commitments under the deal. Iran is taking 
key steps outlined in the JCPOA, such as removing centrifuges, and it 
has begun work to eliminate 98 percent of its enriched uranium 
stockpile.
    When the IAEA verifies that Iran has completed these steps--we call 
this ``Implementation Day''--then we will enter a new phase of this 
landmark deal. After this day, however, this Council will continue to 
have a crucial role to play in JCPOA implementation and in monitoring 
compliance with Security Council Resolution 2231.
    Prior to JCPOA Implementation Day, all the current U.N. Security 
Council sanctions have remained in place. Nevertheless, we have seen a 
troubling tendency to look the other way when these measures have been 
willfully violated in recent months.
    For example, this past October, Iran launched a ballistic missile 
that was obviously capable of delivering a nuclear weapon. Security 
Council resolution 1929, still in force, prohibits this kind of launch. 
After reviewing this incident, the U.N.'s own independent Panel of 
Experts also concluded definitively that it was a violation of this 
resolution. Yet instead of an effective, timely response, the Security 
Council has dithered. We intend to keep working with Council members so 
as to acknowledge and respond appropriately to this serious incident.
    And there have been other violations. Just last week the 
international affairs advisor to Iran's Supreme Leader acknowledged, 
said outright, that General Qasem Soleimani, who is subject to a U.N. 
Security Council travel ban, visited Russia. This advisor called such 
travel ``absolutely normal.'' That's a direct quote. Also, in late 
September, a shipment of arms from Iran was intercepted off the coast 
of Oman--this shipment was a violation of Resolution 1747.
    We don't see how Council members can cast doubt on these 
violations. In many cases, Iranian officials have boasted publicly 
about taking prohibited actions, leaving them no plausible deniability. 
No desire on their part for deniability. After the October launch, 
Iran's Defense Minister even declared, ``We don't ask permission from 
anyone'' as he went on to describe the ballistic missile's technical 
capabilities.
    This Council cannot allow Iran to feel that it can violate our 
resolutions with impunity. Some Council members may not like those 
resolutions, but they are our resolutions.
    Furthermore, we reject the notion that those countries that raise 
these violations in the Security Council--countries like the United 
States--are somehow responsible for destabilizing the JCPOA. 
Implementing Council resolutions is the sine qua non of a credible, 
enforceable nuclear deal and to suggest otherwise is to miss the point 
of the JCPOA--and the point of the U.N. Security Council. A sense of 
impunity for violators will not help this deal.
    The Council members who raise violations of our resolutions, who 
seek action from this Council in response to violations of our 
resolutions are not the destabilizers. We are not the rule breakers. 
Iran is when it violates Council resolutions. It's not allowed under 
the resolutions and they're admitting it.
    The United States, as well as other Council members, has 
appropriately and firmly condemned these violations. We will continue 
to dedicate resources and work with international partners to make sure 
that U.N. measures are better enforced. We will continue to intercept 
and seize Iranian arms exports in accordance with international law. We 
will continue to identify and obstruct shipments to Iran of prohibited 
ballistic missile-related items. And we will continue to hold Iran 
accountable for violations of the measures imposed by this Council.
    But this isn't enough. The Security Council itself--we here, we 
15--must take responsibility to respond to violations of our 
resolutions. This will be a long-term challenge. After JCPOA 
Implementation Day, there will still be measures imposed under Article 
41 of Chapter VII of the U.N. Charter--this is part of the JCPOA--these 
measures, enforced by the U.N. Security Council, will remain for many 
years; this includes restrictions relating to arms transfers and 
ballistic missile-related items. The United States and our partners 
will continue to bring violations to the Security Council's attention 
and press for this body to respond appropriately.
    All of us are very pleased by the JCPOA. We are glad this exists. 
We think it's good for peace and security. But we have to remember how 
we got this deal. Decisive Security Council action played a major role 
in getting Iran to the negotiating table. But our job here is not done. 
We have to work together-- in that same spirit of resolve that led to 
the JCPOA--to support the implementation of this nuclear deal and to 
enforce this Council's resolutions.
    Thank you.




         Letter Received by Senator Coons from President Obama

                                   The White House,
                                            Washington, DC,
                                                  December 8, 2015.
Hon. Christopher A. Coons,
United States Senate, Washington DC 20510.
    Dear Senator Coons: Thank you for your continued support of a 
strong and robust relationship between the United States and Israel. 
Per your November 9 letter on the importance of the U.S.-Israel 
strategic partnership, I want to respond to your questions about our 
support for Israel and this Administration's continued and 
unprecedented efforts to enhance Israel's security.
    I have consistently viewed Israel's security as sacrosanct. The 
United States and Israel have forged deep and enduring bonds since the 
United States became the first country to recognize Israel in 1948. My 
Administration has pursued an unprecedented level of military, 
intelligence, and security cooperation with Israel to address new and 
complex security threats and ensure Israel's Qualitative Military Edge 
(QME). This commitment to Israel's QME lies at the heart of our 
bilateral security cooperation relationship. As your letter suggests, 
my November 9 meeting with Israeli Prime Minister Netanyahu was another 
demonstration of our countries' enduring bilateral bonds, and an 
opportunity to discuss how we might further strengthen our already 
unprecedented security cooperation. The Prime Minister's trip followed 
the recent visit to Washington of the Israeli Defense Minister, and the 
visit to Israel of my new Chairman of the Joint Chiefs of Staff, all of 
which provided opportunities to build on ongoing conversations with 
Israeli defense officials regarding our robust defense partnership and 
how we might continue to strengthen our partnership. United States-
Israel engagement at all levels speaks to the closeness of our two 
countries, the interests we share, and the depth and breadth of the 
ties between our two peoples.
    As a member of the Senate, you know that since 2009 alone, the 
United States has provided over $20.5 billion in foreign military 
financing (FMF) to Israel, more than half of total U.S. FMF worldwide. 
Thank you for your assistance in this effort. And next year, we are 
confident that Congress will provide the next $3.1 billion installment 
of FMF for Israel and will continue to boost vital funding for Israel's 
life-saving missile defense systems, including the Iron Dome system. 
Above and beyond our FMF assistance, we have invested an additional $3 
billion in the Iron Dome system and other missile defense programs and 
systems for Israel. I have provided Israel with unparalleled access to 
some of the most advanced military equipment in the world, including 
the F-35 Joint Strike Fighter, an unprecedented $1.879 billion multi-
year munitions resupply package that will provide Israel continued 
access to state-of-the-art precision-guided munitions, including 
penetrating munitions (the BLU-113 super penetrator), Joint Direct 
Attack Munitions (IDAM) tail kits, and air-to-air missiles, all of 
which will give the Israeli government access to the most sophisticated 
arsenal for years to come.
    These examples only skim the surface of our bilateral security 
relationship and cooperation, and underscore that no administration has 
done more for Israel's security than mine. We are prepared to further 
strengthen this relationship. First, we are continuing talks with 
Israel on concluding a new I 0-year Memorandum of Understanding (MOU) 
on FMF that would cement for the next decade our unprecedented levels 
of military assistance. As Prime Minister Netanyahu and I agreed, a 
U.S. team traveled to Israel in early December for expert-level 
discussions regarding the MOU. We anticipate intensive conversations 
between the U.S. and Israeli teams over the coming period, focused on 
assessments of the threats Israel faces and its commensurate defense 
needs. Second, I am prepared to enhance the already intensive joint 
efforts underway to identify and counter the range of shared threats we 
face in the region, as well as to increase missile defense funding so 
that Israel and the United States can accelerate the co-development of 
the Arrow-3 and David's Sling missile defense systems. Third, our 
governments should identify ways to accelerate the ongoing 
collaborative research and development for tunnel detection and mapping 
technologies to provide Israel new capabilities to detect and destroy 
tunnels before they could be used to threaten Israeli civilians. 
Fourth, as I proposed to Prime Minister Netanyahu, we have begun a 
process aimed at further strengthening our efforts to confront 
conventional and asymmetric threats. We have an important opportunity 
now to continue to build on and fortify the United States historic and 
enduring commitment to Israel's security.
    Regarding your concerns about countering Iran in the region, the 
Joint Comprehensive Plan of Action (JCPOA) provides a diplomatic means 
to achieve the objective we have sought for the last decade--to ensure 
Iran will not be allowed to obtain a nuclear weapon. It is imperative 
that, even as we effectively cut off Iran's pathways to a nuclear 
weapon through implementation of the JCPOA, we take steps to ensure we 
and our allies and partners are more capable than ever to deal with 
Iran's destabilizing activities, including its support for terrorism.
    Addressing these challenges will take time but it can be done. 
Iran's destabilizing behavior in the region is unacceptable. We can and 
should deepen cooperation and information sharing with Israel and our 
Gulf partners to strengthen their own capabilities to counter a range 
of threats, from potential cyber-attacks to Iran's ballistic missile 
program. This means continuing the work I discussed in May with Gulf 
leaders on improving their maritime security capabilities and ramping 
up the joint interdiction of illicit weapons shipments. In fact, our 
coalition recently successfully interdicted a shipping vessel almost 
certainly attempting to smuggle weapons to Iran's Houthi allies in 
Yemen.
    Under the JCPOA, the international community and the United States 
will retain a wide range of tools to enable us to push back against 
Iran's destabilizing activities. These include a number of binding U.N. 
Security Council resolutions prohibiting arms transfers to Iranian-
backed Hizballah in Lebanon, Houthis in Yemen, and Shia militants in 
Iraq, as well as transfers involving North Korea, among others. My 
Administration will also continue to use the full range of tools at our 
disposal to counter Iran's missile program, including condemning Iran's 
latest test launch of a medium-range ballistic missile in mid-October 
as a violation of UNSCR 1929, which prohibits such action. Our tools to 
counter Iran's missile program include the Missile Technology Control 
Regime, whose guidelines are strongly weighted toward denying transfers 
of sensitive systems like ballistic missile technology, and the 
Proliferation Security Initiative, whose more than 100 members are 
committed to limit missile-related imports and exports. We will also 
continue our efforts in training our allies' special forces so that 
they can more effectively respond to crises such as the current one in 
Yemen, even as we work with our regional allies to resolve the regions' 
civil conflicts diplomatically. We will continue to share with the 
Congress our ongoingstrategy for addressing Iran's destabilizing 
activities.
    Moreover, robust enforcement of sanctions related to Iran's non-
nuclear activities will continue to be a critical element of our 
policy. I will maintain powerful U.S. sanctions under a host of 
domestic authorities, countering Iran's support for terrorism, its 
human rights abuses, missile proliferation, and the illicit sale or 
transfer of Iranian conventional weapons. These include (1) Executive 
Orders 12938 and 13382, which authorize U.S. sanctions on foreign 
persons involved in missile production and exports for a country of 
proliferation concern, such as Iran; (2) the Iran, North Korea, and 
Syria Nonproliferation Act of 2006, which levies U.S. sanctions on 
entities connected to Iranian ballistic and cruise missile activity; 
and (3) the 2006 Lethal Military Equipment Sanctions provision in the 
Foreign Assistance Act and the Iran-Iraq Arms Nonproliferation Act, 
both of which impose U.S. sanctions on individuals and entities 
involved in the sale or transfer of Iranian conventional arms.
    My Administration will maintain and enforce our primary 
counterterrorism sanctions authority, Executive Order 13224. Each of 
these authorities will remain valid during the life of the JCPOA. The 
bottom line is simple: no entity or individual engaged in terrorism-
related activity or in violating human rights is or will be immune from 
existing terrorism or human rights sanctions. Anyone worldwide who 
transacts with or supports individuals or entities sanctioned in 
connection with Iran's support for terrorism or development of weapons 
of mass destruction and missiles--or who does the same with any Iranian 
individual or entity who remains on our sanctions lists--puts 
themselves at risk of being cut off from the U.S. financial system. 
This includes foreign financial institutions, which would risk losing 
their correspondent accounts with U.S. banks. Sanctions will also 
continue to apply to persons who provide Iran with specified weapons, 
dual use goods, and related technologies. This is a point we have made 
clear to our partners, and to Iran.
    As Prime Minister Netanyahu and I discussed on November 9, my 
Administration will continue to consult closely with our Israeli 
partners at all levels on how to strengthen Israel's defensive 
capabilities in light of our mutual concerns over Iran's behavior and 
other regional threats. I look forward to working with the Congress on 
this shared imperative, and I thank you for your already strong support 
of the critical relationship between the United States and Israel. 
Please let me know if you have any additional questions or concerns.
          Sincerely,
                                              Barack Obama.

 Introduction to International Safeguards, Office of Nonproliferation 
                        and Arms Control (NPAC)

Sumitted by Lt. Gen. Frank G. Klotz, USAF, [Ret.], Under Secretary for 
   Nuclear Security and NNSA Administrator, U.S. Department of Energy
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]

                  THE MIDDLE EAST AFTER THE JCPOA

                              ----------                              


                      WEDNESDAY, JANUARY 20, 2016

                                       U.S. Senate,
                            Committee on Foreign Relations,
                                                    Washington, DC.
    The committee met, pursuant to notice, at 10:00 a.m. in 
Room SD-419, Dirksen Senate Office Building, Hon. Bob Corker, 
chairman of the committee, presiding.
    Present: Senators Corker [presiding], Risch, Flake, 
Gardner, Perdue, Cardin, Menendez, Shaheen, Coons, and Kaine.

             OPENING STATEMENT OF HON. BOB CORKER, 
                  U.S. SENATOR FROM TENNESSEE

    The Chairman.  I would like to call the committee to order.
    I want to thank our witnesses for being here, and I think 
this is a very timely hearing. We have one witness, Senator 
Cardin, as we both know, that supported the Iran agreement. We 
have one that opposed it. I understand they just traveled 
together to the region. They were not going to broadcast that, 
but I am going to broadcast it for them. [Laughter.]
    The Chairman.  I just met with leaders of one of the 
countries you visited a just few minutes ago in the office. And 
I think all of us have been very concerned about how the 
agreement is going to affect the region. And I think there is 
no question that our friends in the region believe there is a 
realignment that is taking place relative to how the 
administration is approaching the region. I know that there are 
a lot of concerns on both sides of the aisle within the 
committee here as to how that is going to take shape. As a 
matter of fact, after the agreement was entered into, we had a 
number of hearings to ensure that we did not allow the Iran 
nuclear agreement to be our policy, if you will, in the Middle 
East, that we would leave in a vacuum.
    And so there are significant concerns. I am not going to 
speak to which country, but I know there is this debate that is 
taking place relative to the moderates versus the hardliners, 
if you will. And I would love to tease out if there really is a 
significant difference in that point of view. Unfortunately, 
with our help in Iraq, I mean, they are achieving all of their 
goals. This moderation that took place, quote, quote, quote, 
relative to the Iran deal could be something, as we just 
discussed a few minutes ago, that is very tactical and yet 
benefits them hegemonically in the region, and we would love to 
hear your points of view.
    I know both of you made comments that have turned out to be 
true in our last hearing, again from differing points of view.
    So we look forward to this. We want to make sure that as a 
committee we are doing everything we can to deter Iran from 
doing the kinds of things that we all have feared after 
receiving the large amounts of money that they obviously are 
receiving now. A lot has happened. We are glad to get our 
hostages back. At the same time, somewhat hazy about some of 
the transactional issues that occurred relative to that.
    They have already violated the ballistic missile issue 
twice. I was despondent that we waited so long. It is one point 
I guess we realize the hostages were part of the reason we were 
hesitating and understood that, by the way.
    But we have general concerns. We look forward to hearing 
from you today. I think this, again, hearing is very timely. 
And with that, I will turn it over to Senator Cardin.

             STATEMENT OF HON. BENJAMIN L. CARDIN, 
                   U.S. SENATOR FROM MARYLAND

    Senator Cardin. Well, Mr. Chairman, first let me thank you 
for today's hearing. I think it is extremely important.
    You point out that we have two witnesses, one who supported 
the nuclear agreement, the other that opposed it. We have 
members of this committee who supported it and opposed it, but 
we all share the same common objective, and that is to prevent 
Iran from being a nuclear weapons state and to deal with its 
nefarious activities not only in the region but globally.
    So I look forward to this hearing.
    But I am going to start with an apology as I told the 
chairman privately. At this moment, the Environment and Public 
Works Committee is meeting, and several of my bills are on 
markup--it is a business meeting--that deal with fish and 
wildlife. So I am going to have to excuse myself. And I 
apologize for that. But the conflicts here are what they are 
and I have to deal with that.
    But it has been a very busy start to a new year. There has 
been a lot of activity in the Middle East. Implementation day 
is here. The nuclear agreement is reality, and I think we all 
need to now acknowledge how we proceed with the nuclear 
agreement being implemented.
    It opens up positive opportunities. There is no question 
about that. And we saw that with the release of our 10 sailors 
dealing with Iran, and to be able to get those sailors released 
as easily as we did is certainly a positive development. The 
Americans that have been unlawfully held by Iran are now home. 
That is certainly a very positive development. We all are 
looking for Iran's participation in the Vienna talks as it 
relates to Syria, and perhaps we will have some positive 
outcome from those discussions. So there are positive 
consequences to the Americans' involvement with Iran.
    But we must remember at the end of the day Iran is still an 
anti-American, anti-Semitic, revolutionary regime cultivating a 
network of proxies to challenge stable governments in the 
region and protect dictators such as Assad in Syria. It is a 
regime that continues to violate U.N. resolutions on ballistic 
missiles. It is escalating its human rights violations by 
executions of its own people. Its dangerous rhetoric of Iran's 
leaders against U.S. partners in the region is causing major, 
major action and concern.
    Congress needs to focus on a rigorous oversight and 
enforcement of the JCPOA. Mr. Chairman, we set the stage for 
that in this committee's activities in passing the Iran Review 
Act, which places Congress very much involved in the 
implementation of any nuclear agreement. There are certain 
requirements that the administration must comply with, and the 
United States Congress is going to be very much involved.
    The chairman knows that during the discussion of the Iran 
agreement, after congressional action I introduced legislation 
that deals with trying to strengthen the congressional role on 
oversight. I was joined by several of our colleagues. It 
requires strict compliance, and we all want strict compliance. 
And I would hope that we will look at ways that we can improve 
strict compliance. It is aimed at making sure Iran never ever 
becomes a nuclear weapons state, which is our objective. It 
also works with our coalition partners recognizing the United 
States must have the support of our coalition partners. And we 
need to look at how we can strengthen sanctions if we need to 
impose them in regards to snapbacks. We also need to look at 
Iran's nefarious actions beyond its nuclear weapon ambitions to 
make sure that we can take appropriate actions in regards to 
ballistic missile violations, human rights violations, or to 
support terrorism. That is particularly important for us to be 
able to do that recognizing that Iran now has additional 
resources, which we hope they will use for their own economy 
and their people, but we also know it is very likely that they 
will be using that to escalate their international activities 
in violation of international standards.
    We also have to be mindful of the security of our partners. 
There is no question about that, including Israel. We are now 
in the process of talking about the next level of the 
memorandum of understanding. We still have some time, but 
active discussions are taking place on that, but also the Gulf 
States.
    The chairman mentioned this, and I just really want to 
underscore this. Whether it is real or perceived, there is a 
concern that U.S. strategic realignment is taking place in the 
Middle East and our priorities are changing in the Middle East. 
That presents challenges for security, U.S. security 
commitments. And I think we have to be very careful as we go 
forward to make sure that our allies in the region know that 
they have a trusted partner in the United States. This region 
is undergoing an unprecedented period of sustained violence, 
civil conflict, human suffering, and challenges to regional 
order. In this tinderbox, the danger of misunderstanding and 
miscommunication can quickly escalate with dangerous 
consequences. It is why communication and commitment to the 
politic processes are so critical, whether it is securing the 
swift, safe return of our sailors or ensuring commitment of all 
stakeholders to the Vienna process on the Syrian civil war or 
obtaining the release of innocent Americans.
    I want to make one point very clear. There is no military-
only solution to any conflict or crisis that we have discussed 
today. In my view, the United States must work in concert with 
other stakeholders to encourage negotiated political 
settlements to address these challenges and end the regional 
conflict and support for legitimate political institutions. 
This will require political will, investment of resources, and 
a clear long-term commitment. It also demands a willingness to 
call out and confront counterproductive destabilizing actions 
especially from Iran. There may be opportunities in the 
aftermath of the JCPOA's implementation for engagement with 
Iran like the release of U.S. prisoners. But we must remain 
clear-eyed about Iran's intentions.
    And I hope that this hearing will help us figure out how we 
can carry out our commitments to make sure that Iran's 
activities are understood and the United States can maintain 
strong international leadership against nefarious actions that 
can destabilize the region.
    The Chairman.  Thank you, Senator.
    So with the backdrop that there seems to be no moderation 
in Iran's activities in the region--actually there seems to be 
a lot of momentum in their activities in the region and the 
fact that we have allies that are very concerned about our 
position there--I would like to introduce outstanding 
witnesses. Our first witness is Mr. Michael Singh, Managing 
Director and Lane-Swing Senior Fellow at The Washington 
Institute. We thank you and we thank you for the input you gave 
us as we were trying to deal with the actual agreement itself. 
Our second witness today is Mr. Brian Katulis, Senior Fellow at 
the Center for American Progress, again representing two very 
different points of view with similar concerns. We thank you 
both very much for being here.
    Having been here before, if you could summarize for about 5 
minutes your major points, your written testimony, without 
objection, will be entered into the record. And if we would 
start with you, Mr. Singh, I think that would be great.

   STATEMENT OF MICHAEL SINGH, MANAGING DIRECTOR, LANE-SWING 
 SENIOR FELLOW, THE WASHINGTON INSTITUTE FOR NEAR EAST POLICY, 
                         WASHINGTON, DC

    Mr. Singh. Well, thank you, Chairman Corker, Ranking Member 
Cardin, and members of the committee. It is a real pleasure to 
be here, and it is an honor to be sitting with Brian whom I 
respect quite a bit.
    As I stated when I testified earlier before this committee, 
the nuclear agreement with Iran is a flawed agreement. It does 
leave Iran with a significant nuclear weapons capability and 
allow that capability to grow over the life of the agreement. 
And it does nothing, as we have seen, to constrain Iranian 
regional policies while offering the broad, upfront sanctions 
relief that we have now offered to Iran.
    Many of the consequences, as you said, Mr. Chairman, that 
we feared would flow from the JCPOA we are now seeing come to 
pass. Iran has not moderated its regional policies. It has 
continued them. It has not softened its approach towards the 
United States, but instead, we have seen Iran's Supreme Leader 
in the aftermath of the JCPOA try to reiterate or reinforce his 
anti-American bona fides and the ideology of the regime. And 
those Iranian moderates have faced mounting attacks from their 
domestic rivals ahead of Iran's parliamentary elections. And 
this all comes even before Iran has received the full financial 
benefit of the deal.
    And I am happy to talk, Mr. Chairman, about the differences 
between the so-called moderates and hardliners perhaps in the 
question period.
    That Iranian forces and especially the IRGC have not 
changed their behavior was illustrated vividly by some of these 
incidents to which you and Senator Cardin referred, Mr. 
Chairman. The arrest of another American citizen in October 
after the deal was concluded, ballistic missile tests in 
October and December in violation of U.N. Security Council 
resolutions, a live-fire exercise in the Gulf in close 
proximity to U.S. naval vessels and commercial shipping also in 
December, and of course, the seizure of our U.S. Navy personnel 
and what looked to me like ill-treatment earlier this month.
    The Obama administration has pointed to some of these 
things, some of these episodes such as the quick release of 
those sailors or the recent prisoner swap as vindications of 
its policies or evidence that the regime is changing its 
behavior. I do think, though, that those conclusions are 
premature at best, and I will say why. But I do not dismiss the 
possibility that the role of the Iranian foreign ministry, for 
example, in resolving some of these matters represents a shift 
in Iran's internal dynamics. This is something I think we need 
to watch over time to really prove or to really test. Nor am I 
one who downplays the value of engagement in our policy towards 
Iran or others. In my view it is a tool that we should use in 
concert with others, diplomacy backed by force, to achieve our 
ends and our objectives. And of course, we know that Iran is 
perfectly willing to engage when it suits its own interests and 
its own purposes.
    However, I would say that by and large these incidents mere 
resolve crises that Iran itself is responsible for creating and 
would not have developed if Iran had behaved in a responsible 
manner like a responsible state. And we have to be careful, I 
think, not to fall into the trap of rewarding Iran for that bad 
behavior in which it engages. I do not see any sign that 
overall Iran does not remain a force for instability in the 
region, determined to act contrary to American interests and to 
try to hasten our exit from the region.
    In addition, as you referred to, Mr. Chairman, the JCPOA 
has clearly reinforced a preexisting view among our allies that 
the United States is disengaging from the region or even 
embarked, as you said, on a realignment in the Middle East. 
These allies consider Iran one of the top threats they face, 
and they do not believe that it is a threat that we are 
seriously prepared to counter based on our actions so far. The 
region's vacuums from their perspective--and I think this is 
right--are not just filled by jihadists but they are filled 
also by Iranian forces and Iranian influence. It is not a 
problem that arose with the JCPOA. It is not because of the 
JCPOA, but it has been exacerbated by the JCPOA and what has 
followed. As a result, these allies, as we have seen across the 
region, are acting increasingly independently in ways that we 
do not often like, in ways that sometimes we think undermine 
our interests.
    So as we move past implementation day, as we consider our 
post-deal Iran policy and post-deal regional policy, I think it 
is important that we start not with tactics but, as Senator 
Cardin said, with our objectives, despite all the tumult that 
we see in the Middle East, though our interests in the region 
really have not changed: nonproliferation, counter terrorism, 
the free flow of energy and commerce, and some others. But the 
obstacles to achieving those interests I would say have 
multiplied, and so we need a new strategy.
    This is not really the forum to talk about that full 
strategy or to really articulate one, but our approach to Iran 
after implementation day needs, I think, to be nested in and 
consistent with a broader strategy that considers all these 
problems. We need to focus on not just preventing Iran from 
acquiring a nuclear weapon--I think that remains our top 
priority with respect to Iran--but also countering the Iranian 
threat to regional stability and enhancing the security and 
capability of our allies.
    So I think this will require, among other things, first 
fixing the shortcomings of the JCPOA with respect to 
nonproliferation. And these in my view are threefold.
    First, the JCPOA is not strong enough to provide assurance 
that Iran cannot clandestinely develop a nuclear weapon.
    Second, it leaves unaddressed how we are going to approach 
Iran in 10 to 15 years when all these restrictions expire.
    And third, it creates this clear incentive for other 
states, which I have heard again in the aftermath of the JCPOA, 
to pursue their own nuclear capabilities. And in my written 
testimony, you see more details on these things.
    We also need to move to counter the Iranian threat to 
regional stability, and this has to, I think, begin with a more 
serious effort, again both diplomatically and militarily, to 
address the problem of Syria and not just to solve the conflict 
there, to end the conflict there, but to impede Iran's ability 
to use Syria to project power into the Levant, as well as a 
campaign to hinder the malign activities of the IRGC and also 
the other Iranian proxies we see operating there.
    I think we also need to take steps to more explicitly 
counter Iran's anti-access/area denial, A2AD, strategy in the 
Gulf, which we have seen vividly on display in recent months 
and reassert our commitment to freedom of navigation in the 
Gulf.
    And then finally, just to end, we need to repair and expand 
our regional alliances, as I think you have seen, Senator. It 
is tempting to view foreign policy as a problem-solving 
exercise to sort of focus on how do we end the conflicts, but 
sometimes a dollar invested in allies who are not yet problems 
is a sounder investment than a dollar invested in solving those 
conflicts. I think it needs to begin with a more concerted 
effort to understand and respond to our allies' priorities and 
needs, and as we work with them to address those needs, I think 
it needs to be multilateral. So, for example, one thing I heard 
when I was out in the region was that the tens of billions of 
dollars that the GCC states are spending on military 
procurement--those are not coordinated. Those are not 
complementary, and I think that we need to do a better job of 
that.
    And of course, our allies will be more secure and more 
resilient if they have responsive security, political, and 
economic institutions, and I think we can help build those.
    So for more details, I just refer you to my written 
testimony. I look forward to your questions.

             [The prepared statement of Mr. Singh follows:]

                  Prepares Statement of Michael Singh

    Chairman Corker, Ranking Member Cardin, and members of the 
committee, thank you for this opportunity to again appear before you 
and discuss the implementation thus far of the Joint Comprehensive Plan 
of Action (JCPOA) and its implications for the Middle East and for 
American policy.
    The next president will inherit a flawed nuclear agreement with 
Iran. The JCPOA enshrines Iran's status as a nuclear threshold state, 
leaving it with the key fuel fabrication, weaponization, and missile 
capabilities it would require in the future to develop a nuclear 
weapon. It fails to address the missile issue entirely, and does not 
touch upon Iran's support for terrorism or its destabilizing regional 
activities. Yet it provides Iran broad relief from economic sanctions, 
tens of billions of dollars in unfrozen assets, and invites it to come 
in from the diplomatic cold.
    In a broad sense, whether one feels that the JCPOA was worthwhile 
or not comes down to the question of whether we have averted a crisis 
or merely deferred one. Advocates of the deal must hope that the next 
ten to fifteen years will witness changes in Iran and its relations 
with the United States and neighbors that rid it of its nuclear weapons 
ambitions. Skeptics, on the other hand, believe that we have purchased 
a pause, and an incomplete one at that, at a high price. Regardless of 
which view one adopts, however, the policy upshot is the same - we must 
use the coming years to our advantage, ensuring that when the JCPOA 
expires or unravels, we and our allies are well-positioned to deal with 
the consequences.
    Yet Iran's enduring nuclear program is not the only problem that 
the next president will face in the Middle East--far from it. He or she 
must contend with the rise of ISIS and reinvigoration of global 
jihadism, the tumult that has gripped Iraq, Syria, Yemen, and Libya, 
the new boldness of Russia in the region, the Syrian refugee crisis and 
the heavy burden it has placed on Jordan, Lebanon, and Turkey, 
persistent instability in Egypt, the dimming of Israeli-Palestinian 
peace prospects, and many other concerns. Alarmingly, one of these 
problems, as seen from the region, is us--our alliances have weakened 
across the board, and we do not enjoy the credibility and trust with 
our regional partners that we once did.
    The JCPOA has contributed to some of these problems, but we should 
harbor no illusions that an effort to put Iran policy on the right 
track will be a cure-all. Iran policy must be devised not in isolation, 
but in concert with a broader set of regional policies that are 
mutually reinforcing and designed not only to advance our near-term 
objectives but to improve our readiness and capacity - together with 
allies - to confront problems in the future. In doing so, we must avoid 
the essential errors that have plagued our Middle East policymaking in 
for many years, among them a persistent failure to match means and ends 
and to use the full range of tools available to us in concert to 
achieve our aims, a failure to comprehend regional realities and take 
our partners' concerns into account and to nurture and enhance our 
alliances, and a tendency to craft policy reactively and for the near 
term rather than engage in serious strategic planning or long-term 
agenda-setting.
Implementation of the JCPOA to Date and Its Broader Impact
    The United States government, along with other members of the P5+1 
and the IAEA, announced that ``Implementation Day'' of the JCPOA had 
been triggered on January 16, 2016. This means that the IAEA had 
confirmed that Iran had met its initial commitments under the accord, 
which in turn has triggered the suspension or lifting of sanctions by 
the United States, European Union, and United Nations, as well as a 
range of other activities related to the monitoring of Iran's nuclear 
activities and civil nuclear and other forms of cooperation with Iran.
    While I am not in a position to verify or dispute the IAEA's 
conclusion that Iran has met its initial requirements, several other 
observations about the initial implementation of the JCPOA can be made. 
First, it bears reiterating that Implementation Day marks the 
completion only of Iran's initial, ``table-setting'' obligations under 
the accord; however, Iran's obligations under the JCPOA are ongoing and 
must be continually verified. It is one thing for Iran to cooperate 
sufficiently to achieve the transfer of frozen assets and the 
dismantling of the international sanctions regime. It is quite another 
for it to cooperate on an ongoing basis after these aims have been 
achieved.
    Second, the IAEA has confirmed only that Iran has met its initial 
obligations under the JCPOA; this should not be taken to imply that the 
IAEA or other parties are prepared to fully perform their duties under 
the agreement. This is a separate question that the U.S. government 
should investigate on an ongoing basis.
    Thirdly, the resolution of concerns regarding Iran's past and 
possibly ongoing nuclear weaponization efforts - the ``PMD'' issue in 
IAEA parlance - was far from satisfactory. While the IAEA affirmed that 
Iran met its modest obligations under a protocol negotiated in parallel 
between the Tehran and the Agency, it does not appear that Iran 
submitted a complete declaration of its past and possibly ongoing 
activities related to weaponization, nor that it provided the IAEA with 
access to personnel, facilities, or documents related to those 
activities. In addition, the IAEA's report on the matter makes it seem 
as though Iran did not answer all of the IAEA's questions regarding 
weaponization, calling into question whether Iran can truly be 
considered to have cooperated. While the IAEA Board of Governors has 
decided to close the PMD issue, it should be borne in mind that absent 
the sort of cooperation I describe above, it will be difficult to have 
any confidence that Iran is complying with the JCPOA's requirement that 
it refrain from weaponization work.
    Finally, I am concerned that the sanctions relief that has been 
provided to Iran is effectively broader than stipulated in the JCPOA. 
Even before Implementation Day, it was clear that the administration 
was reluctant to impose penalties on Iran for activities such as its 
ballistic missile tests in October and December, a dangerous and 
provocative live-fire incident in the Gulf, the seizure and 
inappropriate treatment of U.S. Navy personnel near Farsi Island, or 
Iran's ongoing activities in Syria and Iraq.
    It is reasonable to assume that two concerns lie behind this 
reticence - first, a desire to avoid derailing the implementation of 
the nuclear deal, and second, a desire to avoid undermining the 
electoral prospects of Iranian moderates ahead of Iran's February 
parliamentary election. However, having negotiated a narrow nuclear 
accord in which Iran accepted no limits on its regional activities, 
missile development, or support for terrorism, we cannot ourselves 
accept limits on our freedom to penalize Iran for the same. If we do, 
Iran will receive the benefits of a comprehensive accord while 
incurring the obligations of a narrow one, and the opposite will 
pertain to the United States and our allies.
    In terms of the JCPOA's broader impact, the incidents I note above 
suggest that there has been little change in Iran's regional policy. 
And because Iran has only begun to receive the benefits of sanctions 
relief and its unfrozen overseas assets, the full impact of the JCPOA 
on Iran's regional agenda will not be apparent for some time. Any 
increase in Iranian aid to the Assad regime, Hezbollah, Hamas and other 
Palestinian terrorist groups, or proxies elsewhere in the region could 
further destabilize an already chaotic region. The administration has 
insisted that Iran will use the benefits of the JCPOA only for domestic 
priorities, but this strikes me as unrealistic; Iran has invested a 
great deal in its regional pursuits when it might have been more 
prudent to focus on domestic development, and I believe that we can 
expect Iran to spend its post-deal windfall both on domestic and 
regional priorities.
    Nor has the deal yet proven a boon to Iran's pragmatists, who might 
be most inclined to moderate Iran's behavior. If anything, internal 
divisions within Iran have grown sharper as those opposed to it and to 
President Rouhani seek to prevent him from gaining ground domestically 
in its wake (especially with parliamentary elections around the 
corner), and as Iran's Supreme Leader attempts to undergird the 
regime's anti-American ideology and make clear no broader 
transformation is under way.
    Meanwhile, from what I have observed, the JCPOA has fueled 
preexisting fears among our allies that an American regional 
disengagement and/or realignment is under way, which has undermined 
their trust in us and increasingly prompted them to act independently 
in ways that we sometimes find unhelpful. By and large, these allies 
are less concerned with the particulars of Iran's nuclear program than 
with Iran's regional aims, which they fear have been abetted by 
American accommodation of Iran and by the sanctions relief provided by 
the JCPOA.
    It is worth noting that since the JCPOA was concluded, the United 
States and Iran have reached several other agreements through direct 
engagement. The first of these was the release of U.S. Navy personnel 
seized by the Islamic Revolutionary Guard Corps (IRGC) Navy near Farsi 
Island. The second was a ``prisoner swap'' in which five American 
citizens detained by Iran were freed in exchange for the pardoning of 
seven Iranians imprisoned in the United States and the lifting of 
Interpol Red Notices for fourteen others. The third was the settling of 
a 1970s-era Iranian claim against the United States for $1.7 billion.
    Each of these outcomes has been touted as evidence that direct 
engagement with Iran is paying dividends, and even that U.S. diplomacy 
has succeeded in shifting the internal dynamics within Iran. However, 
such claims strike me as exaggerated. The seizure of additional 
Iranian-Americans since the conclusion of the JCPOA, as well as the 
seizure and apparent ill treatment of the U.S. Navy personnel, suggests 
that the IRGC continues to act with impunity and continues to target 
U.S. interests. Furthermore, engaging in prisoner swaps - especially 
given that the American citizens involved were little more than 
hostages held on trumped-up charges - is a questionable enterprise 
which risks rewarding bad behavior and encouraging more of it. Iranian-
Americans previously held by Iran were released without such swaps.
    Nevertheless, these incidents should be carefully analyzed, not 
dismissed. The speed with which the U.S. Navy personnel were released, 
and the apparent role of the Iranian Foreign Ministry in securing their 
release by the IRGC, contrasts starkly with similar episodes in the 
past. It bears watching whether reflects a shift in internal regime 
dynamics or the regime's attitude toward such matters, or whether it 
was merely a function of Tehran's desire to receive sanctions relief 
and its frozen assets without delay.
    Whatever one feels about the outcomes achieved, these episodes 
suggest that Iran is increasingly willing to engage directly with the 
United States on a variety of issues. It is important, in my view, that 
we not conflate engagement as a tactic with the particular outcomes 
this administration has achieved via engagement, any more than our 
dissatisfaction with the Iraq War should lead us to forswear the use of 
military means in our foreign policy. Nor should we fall into the trap 
of thinking that engagement is meritorious in and of itself, or that 
every outcome achieved via engagement is necessarily a diplomatic 
triumph. When doing so would advance our interests, we should not 
hesitate to engage diplomatically with Iran; yet we should not allow 
such engagement to deter us from simultaneously pursuing firm and 
forceful policies toward Iran. We should instead consider engagement 
one tool among many, to be utilized when needed in concert with other 
tools. We achieve our best results when we employ diplomacy backed by 
force.
Post-Deal Iran Policy
    Discussions of foreign policy too often begin with tactics - 
whether, for example, to enforce the JCPOA strictly or to walk away 
from it altogether. I believe we will arrive at better policy if we 
instead begin by considering the objectives and outcomes we hope to 
achieve, and mapping our way to achieving them. We also have a 
regrettable tendency to think of foreign policy as an exercise in 
problem-solving, focusing first and sometimes last on addressing 
conflicts, and neglecting the more prosaic work of building 
relationships and heading off new problems. Yet in the Middle East, we 
are likely to have far more and faster success in bolstering alliances 
that have weather the region's storms - such as those with Jordan, the 
GCC, and Israel - than in, say, ending Syria's civil war or building a 
new government in Libya. Finally, we have a tendency to think and plan 
in short increments, considering what must be done over the coming 
months, without reference to any clear longer-term agenda.
    Despite the dramatic developments of recent years, our interests in 
the Middle East have not fundamentally changed. They include things 
like nonproliferation, counter-terrorism, the free flow of energy and 
commerce, and the security of Israel. However, the obstacles to 
advancing those interests have changed starkly - they include not only 
a flawed JCPOA, but also the rise of ISIS, the fall of allies (albeit 
problematic ones) in Egypt, Tunisia, and elsewhere, and so forth. This 
new context demands a new strategy - a set of actions that, given the 
obstacles and opportunities we face, holds the best chance of advancing 
our interests. This is not the forum for articulating a new Middle East 
strategy in full. But as we consider how we move forward in the 
aftermath of the JCPOA, it is important that the post-deal Iran policy 
we devise be consistent with and reinforce such a strategy. It is worth 
noting that none of the policy steps I recommend below strictly require 
that the JCPOA be renegotiated.
    The first objective of our policy toward Iran should remain 
preventing nuclear proliferation in the Middle East. While the JCPOA 
provides some useful tools in this regard - chiefly by increasing the 
access of IAEA inspectors and recommitting Iran to implementing 
enhanced safeguards arrangements - it also has significant weaknesses.
    The first and most critical weakness of the JCPOA is that it is not 
strong enough to prevent Iran from pursuing a nuclear weapon 
clandestinely. Iran is permitted to continue R&D on advanced 
centrifuges, the efficiency of which would be well-suited to the 
operation of a small, secret enrichment facility; it was not required 
to provide the IAEA with access to facilities and personnel involved in 
weaponization, making it difficult to have confidence that these will 
not be utilized again in a future weapons push; and it is permitted to 
openly pursue a ballistic missile program, and may receive 
international aid to do so within eight years. Uncovering a clandestine 
nuclear weapons program is complicated by the IAEA's lack of "anytime, 
anywhere" inspection authority, and the relative paucity of enforcement 
mechanisms, either in the JCPOA or in the national policies of the 
United States and its allies.
    To address these weaknesses, I recommend the following steps:



   IAEA efforts to gain access to PMD-related facilities and personnel 
        should be resumed, using the access provisions of the 
        Additional Protocol and the JCPOA;

   The IAEA should use those same access provisions to verify the 
        completeness of Iran's initial declarations regarding its 
        uranium stocks, inventory of centrifuge components, and any 
        related declarations;

   The IAEA should use those same access provisions to perform end-use 
        verification of both nuclearrelated and dual-use items, even 
        though the latter is not specifically provided for in the JCPOA 
        procurement channel;

   Whenever possible, the 24-hour inspection requirement of the 
        Additional Protocol should be applied, rather than the 24-day 
        schedule of the JCPOA dispute resolution mechanism;

   The United States and its allies should press the IAEA to be 
        forward-leaning in its access requests, and ensure that the 
        next Director-General of the IAEA is focused and credible on 
        this matter;

   The United States, European Union, and other partners should agree 
        on a "menu" of penalties short of full snapback to be applied 
        in the event of Iranian delays or violations of the JCPOA, and 
        indicate their willingness to begin applying those penalties 
        during the 24-day dispute resolution mechanism if Iran proves 
        slow or reluctant to cooperate with the IAEA;

   The U.S. Treasury and State Departments, in conjunction with 
        counterparts in allied capitals, should continue to actively 
        educate U.S. and foreign firms about remaining sanctions on 
        Iran, and invest resources in detecting Iranian efforts to 
        circumvent them;

   The United States and its allies should provide the IAEA with the 
        funding it requires to carry out its mission in as robust a 
        manner as possible;

   The United States continue to invest in detecting illicit Iranian 
        nuclear activities, and the United States and its allies should 
        enhance their cooperation to gather intelligence on Iran's 
        nuclear program and furnish information as appropriate to the 
        IAEA to assist in its monitoring and verification mission;

   The United States, European Union, and other partners should assist 
        other states in putting in place and executing sufficient 
        export controls to prevent illicit Iranian procurement, and 
        should urge states to institute a presumption of denial for the 
        export of sensitive goods to Iran; vigilance will also be 
        required to monitor Chinese, and North Korean compliance;

   The United States and its allies should invest in deterrence, 
        indicating clearly their continued willingness to use the 
        military option if Iran violates the JCPOA, and ensuring that 
        their force posture and actions reinforce the credibility of 
        such statements; this should include investing in a 
        sufficiently large Navy to provide coverage in multiple 
        geographic theaters so the United States is not forced to 
        "choose" between Asia and the Middle East.


    It should be noted that many of the above steps rely on the United 
States retaining the support of four other members of the JCPOA's 
eight-member joint commission - the EU, UK, France, and Germany. But 
there can be no guarantee that coming elections in France, Germany, and 
elsewhere will ensure these governments' continued support. Should 
political developments in Europe leave the United States with less 
support on the Joint Commission than needed to rigorously enforce the 
above actions, the United States will be left with little choice other 
than to reconsider its adherence to the JCPOA.
    The second threat to nuclear nonproliferation posed by the JCPOA 
comes with the expiration of its limitations in ten to fifteen years' 
time. After this period, there is nothing explicitly in the JCPOA to 
bar Iran from significantly expanding its enrichment and reprocessing 
capacity and reducing its nuclear breakout time to essentially zero. I 
recommend the following steps to mitigate this danger:


   The United States and its allies should make clear that they do not 
        accept the proposition that simply because something is not 
        explicitly barred by the JCPOA it is implicitly accepted by the 
        international community; instead, the United States and its 
        allies should make explicit their opposition to the future 
        expansion of Iran's nuclear activities, and their intention to 
        negotiate further reductions rather than increases in those 
        activities;

   To further constrain Iran's future nuclear activities, the United 
        States and its allies should consider supporting international 
        arrangements that would limit the proliferation of enrichment 
        and reprocessing technology globally;

   To prevent Iran from using the next ten to fifteen years to perfect 
        the elements of its nuclear program not constrained from the 
        JCPOA, the United States and its allies should endeavor to 
        impede the development of Iran's missile program and prevent 
        other states from assisting Iran's centrifuge or other 
        enrichment R&D efforts.


    Additionally, the permissive nature of the JCPOA enhances the 
prospect that other states in the region will develop their own nuclear 
programs in an effort to match or exceed Iran's capabilities. They will 
assume that Iran will either possess a nuclear weapon or will be a 
screwdriver's turn away from one in ten to fifteen years, and plan 
accordingly. While the United States can urge our allies to refrain 
from such destabilizing actions, they are more likely to be influenced 
by the seriousness of our actions to counter Iran and address the flaws 
of the JCPOA than by any demarches we issue.
    The second objective of our policy toward Iran must be to counter 
its threat to regional stability. Regional instability threatens a 
number of U.S. interests, as it creates an environment in which 
terrorism has thrived, has endangered our allies, including Israel, and 
has given rise to a refugee crisis whose full effects have not yet been 
felt. This threat is compounded by the easing of pressure on Iran, 
insofar as many of the sanctions lifted were not strictly nuclear-
related but also imposed pursuant to Iran's support for terrorism and 
regional policies, as well as Iran's enrichment through the transfer of 
previously frozen assets and the removal of restrictions on Iran's 
export of oil and banking activities.
    To address this threat, I recommend the following actions:


   First and foremost, the United States needs to revisit its policy 
        towards Syria with an eye toward not only ending the conflict 
        there, but to denying Iran the ability to project power in the 
        Levant; One element of a new U.S. strategy in Syria should be 
        firmer efforts to counter the activities there of the IRGC and 
        its proxies, including Hezbollah as well as foreign Shiite 
        militias; this is not only vital to countering Iran's regional 
        threat, but to winning the support of our allies in the region 
        and in Europe - where Syria has become a domestic political 
        issue, not just a foreign policy concern - for our broader 
        agenda;

   Work to disrupt Iranian control over certain Shiite militias (PMU) 
        in Iraq, to prevent Tehran from permanently capturing the Iraqi 
        security establishment in the manner it has done via Hezbollah 
        in Lebanon;

   The United States and its allies should embark on a focused 
        financial campaign against the IRGC, especially the IRGC-Quds 
        Force, utilizing the robust financial tools we have developed 
        over the last decade; if these tools prove insufficient, 
        Congress should consider new legislation to add to them;

   In the same vein, act to prevent the transfer of funds, arms, 
        equipment, and personnel by Iran to proxies such as Hezbollah, 
        Hamas/PIJ, the Houthis, and Shiite militias, and make use of 
        existing authorities to degrade those entities;

   The United States and likeminded members of the P5 should make 
        clear our intention to deny requests for the export of banned 
        arms or missile technology to Iran under the "case-by-case" 
        mechanism established in UN Security Council resolution 2231;

   The United States should seek to drive a wedge between Iran and 
        Russia to prevent the emergence of a de facto Tehran-Moscow-
        Damascus-Hezbollah alliance;

   The United States and its allies should be willing to engage with 
        Iran on issues of mutual concern, but for the sake of 
        transparency and to assuage allies' concerns, should whenever 
        possible do so in multilateral rather than bilateral settings, 
        and should view further engagement with Iran as a means to an 
        end rather than an end in itself.


    A related but distinct threat is to the free flow of commerce and 
freedom of navigation through the Gulf and the Arabian Sea, which 
recent Iranian actions--the live-fire incident, seizure of U.S. Navy 
personnel, and earlier the diversion of the Maersk Tigris cargo 
vessel--have called into question. To address this we should, beyond 
simply reiterating our willingness to resort to military force against 
Iran, design a force posture that specifically addresses Iran's anti-
access/area denial strategy and asymmetric and unconventional and 
subversive tactics. We must not only prepare for a theoretical future 
conventional war against Iran--one which will hopefully never come to 
pass--but address Iran's present-day actions, which are concerning in 
their own right.
    Another element of countering Iran's threat to regional stability 
is improving the strength of American alliances in the region and the 
capabilities of our allies, so that Iran faces a capable, unified 
front. This line of action is also vital to securing our allies against 
the threat posed by jihadist groups, and to restoring the United 
States' standing in the region. To these ends, I recommend the 
following steps:


   Refocus the now-diffuse responsibility for U.S. policy in the 
        Middle East in an empowered official at the Department of State 
        (such as the Assistant Secretary for Near East Affairs), and 
        charge that official with reestablishing smooth lines of 
        communications with our Mideast allies and reaching an 
        understanding of their priorities and needs;

   Attach particular importance to rebuilding cordial ties and 
        effective cooperation at the strategic level with Israel;

   Continue the high-level consultations begun with the GCC at Camp 
        David in 2015, and carry out the agenda outlined there; expand 
        this forum to include Jordan and Egypt, similar to the GCC+2 
        mechanism utilized in the 2000s;

   Devise with key allies a multi-year procurement and training agenda 
        designed to address their needs and vulnerabilities; coordinate 
        this effort multilaterally within the region so that allies' 
        capabilities complement rather than replicate one another's, 
        especially in areas such as missile defense and naval 
        activities where joint action makes the most sense;

   In the longer-term, seek to create a regional security forum 
        focused on U.S. allies that can serve as a mechanism not only 
        for policy consultations but for coordinated military, 
        diplomatic, and other forms of planning and action, as well as 
        a body suitable for multilateral engagement with Iran and 
        others;

   Help our allies to improve their resilience in the face of Iranian 
        and jihadist attempts at subversion by assisting them to build 
        capable security, political, and economic institutions that can 
        better weather crises such as those we have seen in recent 
        years.

    The list above is not exhaustive--others have proposed good ideas 
which can be readily added to it. However, I believe that by focusing 
on objectives rather than tactics, and engaging in long-term planning 
rather than continuing to think reactively or in six-month to one-year 
increments, the United States and its allies are more than up to the 
challenges posed by Iran and other regional threats.


    The Chairman.  Thank you.
    And, Mr. Katulis, I should have thanked you also for your 
counsel during the period of time we were looking at the 
agreement. We thank you for being back and look forward to your 
comments.

STATEMENT OF BRIAN KATULIS, SENIOR FELLOW, CENTER FOR AMERICAN 
                    PROGRESS, WASHINGTON, DC

    Mr. Katulis. Great. Thank you, Chairman Corker, and I want 
to thank you and Ranking Member Cardin for extending this 
invitation to me.
    I wanted to start with my bottom line upfront assessment 
that the nuclear agreement, at a time of widespread regional 
instability, has produced very important and tangible benefits 
for U.S. and international security. It has severely restricted 
Iran's ability to produce a nuclear weapon in the next decade 
and perhaps beyond. It has produced concrete results, as we 
have seen from the IAEA certifications, in terms of actions 
with Iran dismantling its centrifuges and shipping low-enriched 
uranium stockpiles out of the country. And it has established 
an inspection regime that substantially increases our ability 
to know what Iran has been doing and is doing. So compared to 
where we were 5 and especially 10 years ago, when Iran was 
moving forward without few impediments, we are in a much 
stronger position.
    The deal is far from perfect, of course, and the value of 
the deal depends on Iran's continued adherence to its 
obligations to its terms. And as I think we all agree, the 
United States needs to be focused on what we can do to ensure 
that the international community makes sure that Iran sticks by 
the deal.
    I wanted to highlight three main points in my presentation 
here today, and my written testimony has a more complete 
analysis.
    One, I wanted to provide an assessment, a brief snapshot, 
of where we are in the Middle East as 2016 starts.
    Second, four things that I think we can expect in a period 
of uncertainty in the next year as the JCPOA is implemented.
    And then I will conclude with complementary remarks to what 
Michael has offered here in terms of what the U.S. should do 
next, some recommendations.
    So briefly, my assessment of Middle East strategic 
dynamics. The JCPOA has not, obviously, abated any of the 
regional tensions as we have seen in the instability between 
Iran and Saudi Arabia just in the past few weeks. Region-wide 
there is a competition for influence between these two major 
powers that has weakened the region's overall state system. 
States like Iraq, Syria, and Yemen have become arenas for this 
competition as their governing authorities have broken down in 
struggles for power and legitimacy. This collapse of state 
authority I want to highlight in my testimony because I think 
it is central to the question of where we go in the Middle East 
more broadly.
    In this context of regional fragmentation and strong 
divisions, it is my assessment that it is highly unlikely that 
one country, including Iran or Saudi Arabia, will be able to 
dominate the landscape. The regional security structure as it 
is today places limitations on what regional powers like Saudi 
Arabia and Iran can achieve. A more likely and I think more 
complicated threat is the continued breakdown of state 
authority within the region, something that could accelerate if 
the tensions between Saudi Arabia and Iran remain high.
    So that is the first point. It is not a very optimistic 
picture of the region. It is one I think we need to keep in 
mind as we discuss the Iran nuclear deal.
    Second, possible regional moves as the JCPOA moves forward 
this year.
    Number one, proxy wars in places such as Yemen and Syria 
are likely to continue, alongside sporadic diplomatic efforts 
to reach these settlements. And the success of those diplomatic 
efforts will depend heavily on the connection between the 
military balance of power on the ground and the diplomacy.
    Number two, we can expect and we can see from the last 6 
months Iranian bad behavior unrelated to nuclear issues will 
continue. Tehran will continue to support terrorist groups like 
Hezbollah, as well as perhaps conduct cyber attacks against its 
enemies.
    Third, the ongoing conventional military arms race in the 
Middle East appears likely to continue, even after a decade in 
which Gulf countries have purchased tens of billions of 
dollars.
    And fourth, a bit of wild card, but I think it is important 
to keep in mind. The sharp drop in oil prices has placed 
pressures on all of the countries in the region, including 
Saudi Arabia and Iran. And I think all of these factors are 
important things to expect in the next few years.
    Let me conclude briefly with a summary of what I think we 
should do with U.S. policy moving forward.
    The first point--and I think it is important to stress--is 
that the United States remains the unrivaled power in the 
region. As you mentioned, Chairman, Mike and I were just in the 
region. We go regularly. And despite all of the talk about U.S. 
disengagement, no country possesses the broad networks of 
relationships with countries in the region, the security 
capabilities, the ability to shape dynamics through diplomacy 
that the United States has. Not Russia. Russia I think has 
punched far above its weight in its recent engagement in Syria 
but does not have the potential that we have. Not China. Even 
though China has increased economic and energy interests in the 
region, they do not have the networks of relationships that we 
have, the capacities. The question that we have, that you have, 
we all have before us is how are we willing to use these 
capacities.
    And very briefly and in sum, I think there are five things 
we need to focus on in the next year.
    One, we have all said it. The strict implementation of the 
JCPOA. Congress has an important role in this, and I think it 
needs to continue to play that role.
    Two--and we can talk in detail about this--continue to 
respond to Iran's bad behavior whether it is ballistic missile 
tests, support to terrorist groups, its efforts to undermine 
state authorities in the region.
    Three--and I highlight this because I think it has been 
forgotten--we need to continue to elevate Iran's human rights 
record and its record in how it deals with its own people in 
American policy. It is important I think for the long-term 
challenge in Iran.
    Fourth--and I have said this before in testimony on the 
ISIS challenge--is that the United States needs to present a 
much more coordinated security approach to the region. I 
mentioned just a minute ago that we have a deep military 
footprint, a broad array of security partners. It is my 
assessment that if you add up everything we do in terms of 
bilateral relationships with key allies like Israel, like the 
GCC states, all of the bilateral security efforts we have with 
them, combined with the international coalition to counter 
ISIS, and combined with what has been promised post Iran 
nuclear deal--none of these have been properly synchronized 
just yet. If I were sitting in your seat, I would be asking 
tough questions to the Defense Department, to the White House 
about how all of these different pieces will sync together.
    And the fifth I think--and I will close here--is that we 
need to continue to test the possibilities for de-escalation, 
deconfliction, conflict resolution in places like Syria and 
Yemen, but we should not be naive about it. We should be clear-
eyed about who we are dealing with.
    So in conclusion, the JCPOA is far from a perfect deal, but 
given the realistic alternatives we have today, it is a strong 
framework for the United States and the international community 
to prevent Iran from getting a nuclear weapon. But I think Mike 
and I agree. I think we all agree we need a much more coherent, 
much more assertive approach that deals with these regional 
security tensions.
    Thank you.

            [The prepared statement of Mr. Katulis follows:]



                  Prepared Statement of Brian Katulis

    Chairman Corker, Ranking Member Cardin, and members of the 
committee, thank you for this opportunity to appear before you today to 
discuss the Middle East after the start of the implementation of the 
Joint Comprehensive Plan of Action, or JCPOA.
    I have structured my testimony today around three main points:


  1. An overall assessment of strategic dynamics in the Middle East 
        today

  2. An overview of the likely continued challenges with Iran as the 
        JCPOA is implemented

  3. Recommendations for U.S. policy in the region


    At the outset, I want to offer my main analytical assessment of 
strategic dynamics in the Middle East as the JCPOA, or Iran nuclear 
agreement, is implemented. \1\
---------------------------------------------------------------------------
    \1\ U.S. Department of State, ``Joint Comprehensive Plan of 
Action,'' August 14, 2015.
---------------------------------------------------------------------------
    The Middle East remains in a period of instability and high 
tensions between states, particularly Iran and Saudi Arabia. This 
region wide competition for influence has contributed to a weakening of 
the region's state system. Other states such as Iraq, Syria, and Yemen 
have become arenas for this competition as their governing authorities 
have broken down due to internal struggles for power and legitimacy. 
The collapse of state authority in some countries has enabled a range 
of non-state armed groups to grow in power and influence, including 
quasi-state terrorist organizations such as the Islamic State of Iraq 
and al-Sham, or ISIS, and Hezbollah.
    At a time of widespread regional instability, the nuclear agreement 
with Iran produces very important and tangible benefits for U.S. and 
international security. It has severely restricted Iran's ability to 
produce a nuclear weapon in the next 10 to 15 years. It has established 
an inspections regime that substantially increases the international 
community's knowledge of Iran's nuclear program and enhances the 
ability to detect any possible move by Iran to start a new weapons 
program. The JCPOA, if strictly and properly implemented, could open up 
new opportunities for promoting regional stability. In short, the JCPOA 
offers the best option among the realistic and available alternatives 
for addressing Iran's nuclear program.
    Achieving greater Middle East stability will require more than a 
strict implementation of the JCPOA. It will also require a more 
coherent and assertive U.S. strategy for the region than we have seen 
in the past 15 years. Regional tensions have not abated with the 
implementation of the JCPOA, and the United States can play an 
important role in de-escalating these tensions and contributing to 
greater Middle East stability over the long term if it uses the full 
range of its diplomatic and military tools.
   assessment of middle east strategic dynamics at the start of 2016
    Five years after the Arab uprisings, the leading countries in the 
Middle East remain involved in multidimensional and multipolar 
competition for influence. This competition is multidimensional because 
it involves governments using traditional forms of regional power 
projection-direct military action, military and intelligence support to 
partners in other countries, direct economic assistance to other 
governments in the region, and diplomacy.
    But it also involves other types of actions that have directly 
affected the viability of the Middle East state system-funding and 
arming of non-state groups that have challenged the state system, the 
use of religious symbolism and sectarian appeals in public 
communications, and aggressive propaganda and media campaigns aimed at 
shaping popular perceptions across the region. Some countries in the 
region are more susceptible to the impact of this regional competition 
due to a crisis of political legitimacy in which some governments lack 
the support and sense of allegiance from key sectors of their 
populations.\2\
---------------------------------------------------------------------------
    \2\ For greater detail, see Brian Katulis, ``Assessing the Anti-
ISIS Campaign After the First Year,'' Testimony before the Senate 
Foreign Relations Committee, September 16, 2015
---------------------------------------------------------------------------
    The struggle for influence and power in the Middle East is 
multipolar because it involves a complex number of state actors; the 
latest skirmishes between Iran and Saudi Arabia represent just one 
layer of conflict. Other countries such as Jordan, Qatar, Turkey, and 
the United Arab Emirates have all carved out unique positions on as the 
Iraq, Syria, and Yemen conflicts, the Iran nuclear agreement and 
tensions between Iran and Saudi Arabia.
    Weakened governments suffering from crises of legitimacy, combined 
with tensions between more stable regional powers, has contributed to 
conflict and fragmentation across the Middle East. This conflict and 
fragmentation has in turn created a massive humanitarian challenge, as 
millions of people flee conflict-many across borders.\3\ Worse still, 
this combination has given terrorist organizations such as ISIS time 
and space to evolve, recruit thousands of foreign fighters, and become 
threats to international security.\4\
---------------------------------------------------------------------------
    \3\ U.N. High Commissioner for Refugees, ``Worldwide displacement 
hits all-time high as war and persecution increase,'' June 18, 2015.
    \4\ Eric Schmitt and Somini Sengupta, ``Thousands Enter Syria to 
Join ISIS Despite Global Efforts,'' The New York Times, September 26, 
2015.
---------------------------------------------------------------------------
    In this context of regional fragmentation and strong divisions, it 
is unlikely that one single country or actor in the region will achieve 
hegemony, or an overriding influence and authority across the region. 
The regional security structure places limitations on what one actor, 
including regional powers such as Saudi Arabia or Iran, can achieve. A 
more likely and more complicated threat is the continued breakdown of 
state authority within the region-something that could accelerate if 
tensions between Iran and Saudi Arabia remain high.
    As the Joint Comprehensive Plan of Action moves forward in 
implementation, regional threat perceptions remain strong and varied. 
Certain gaps exist between the current U.S. policy toward the region 
and the policy that some of America's close regional partners advocate. 
One primary threat perception gap centers on Iran's regional role and 
the impact of the JCPOA. While the Obama administration touts the 
security benefits of the JCPOA and seeks to elevate dealing with the 
threats posed by ISIS higher in its agenda most Gulf countries and 
Israel, see Iran as the primary strategy threat to stability.
    From the perspective of many regional leaders, the JCPOA has opened 
the pathway for an unchanged Iranian regime to expand its wealth and 
access to resources and to re-emerge from its international isolation 
and become a greater threat to their interests. Iran's support for 
Hezbollah in Lebanon, the Assad regime in Syria, and Yemeni and Iraqi 
elements sympathetic to Iran has unnerved some of America's closest 
regional security partners. The top concern among many in the region is 
that in 10 to 15 years, Iran will emerge wealthier and more powerful at 
a time when many of the JCPOA restrictions on Iran are set to expire.
    As a consequence, Saudi Arabia has signaled through actions and 
words that it will seek to adopt a more assertive regional approach to 
counter Iran, as witnessed in its military campaign in Yemen and its 
recent efforts to engage on Syria.\5\ Many Saudi leaders view the 
struggle with Iran as existential, and the JCPOA's implementation has 
not reassured them.
---------------------------------------------------------------------------
    \5\ Brian Katulis, ``How Saudi Arabia is Expanding its Role in the 
Middle East,'' Washington Wire, December 13, 2015.
---------------------------------------------------------------------------
    Six months after the international community and Iran announced 
their agreement in the JCPOA, Iran and Saudi Arabia remain engaged in 
proxy battles across the region, and both countries have taken steps 
that escalated tensions. On a positive note, the two countries have 
started to engage in nascent diplomatic efforts aimed at ending the 
conflict in Syria, a process that the Obama administration is working 
to advance, although these efforts remain fraught with challenges.
    Overall, Saudi Arabia appears poised to continue to counter Iran in 
the region. Just two examples of this are its announcement last month 
of a new Muslim coalition to fight terrorism that notably did not 
include Iran and its cutting of diplomatic ties with Iran in reaction 
to the attack on the Saudi embassy in Tehran.\6\ Indicative of the 
overall diplomatic fragmentation in the region was some countries' 
surprised reaction when they were named as members of this new 
coalition and the differing responses to Saudi Arabia's cutting of ties 
with Iran. Possible regional moves as JCPOA implementation moves 
forward
---------------------------------------------------------------------------
    \6\ Ben Hubbard, ``Saudi Arabia Cuts Ties With Iran Amid Fallout 
From Cleric's Execution,'' The New York Times, January 3, 2016.
---------------------------------------------------------------------------
    The uncertainties of today's Middle East make it difficult to 
predict events over the coming year, but four developments are likely. 
First, proxy wars in places such as Yemen and Syria are likely to 
continue, alongside sporadic diplomatic efforts to reach settlements. 
The success of diplomatic efforts will depend heavily on their 
connection to the military balance of power on the ground in both 
conflicts.
    Second, Iranian bad behavior unrelated to nuclear issues will 
continue unabated. Tehran will continue its support for terrorist 
groups such as Hezbollah, as well as cyberattacks on those it considers 
its enemies. In addition, Iran may attempt to stretch the limits of 
ballistic missile testing or attempt to raise tensions with the United 
States and its regional partners through other means.
    Third, the ongoing conventional military arms race in the Middle 
East appears likely to continue-even after a decade in which Gulf 
countries purchased tens of billions of dollars of military hardware. 
In recent months, Iran, Saudi Arabia, and other Gulf states have all 
announced significant arms deals. Without a coherent, well-functioning 
regional security framework, the states of the Middle East will remain 
locked in their current security dilemmas. Fourth, the sharp drop in 
oil prices has placed pressure on oil-producing states' budgets. This 
pressure is likely to affect the regional geopolitical competition, 
possibly by reducing the ability and willingness of state actors to 
continue projecting power throughout the region.
         anticipating continued challenges with iran post-jcpoa
    The Joint Comprehensive Plan of Action offers a strong tool to 
continue to limit Iran's nuclear program and block its pathways to a 
nuclear weapon. But dealing with Iran in a way that enhances regional 
security will require continued vigilance on the part of the United 
States on two primary fronts:


  1. Strict implementation of the JCPOA. The JCPOA has produced 
        concrete results in the past six months. The International 
        Atomic Energy Agency, or IAEA, certified that Iran had 
        dismantled more than two-thirds of the centrifuges it once used 
        to enrich uranium.\7\ Iran also removed the core of the Arak 
        heavy water reactor and poured concrete into it, closing off 
        another potential pathway to a weapon by making the reactor 
        incapable of producing plutonium.\8\ Iran also shipped 98 
        percent of its low-enriched uranium stockpile to Russia last 
        month; it kept a small amount in-country that is far short of 
        what is needed to make a weapon.\9\ But the merits of the deal 
        depend on Iran's adherence to its terms--and the United States 
        needs to remain focused on working with the international 
        community to ensure that Iran abides by the deal.
---------------------------------------------------------------------------
    \7\ Kelsey Davenport, ``Iran Dismantling Centrifuges, IAEA 
Reports,'' Arms Control Association, November 19, 2015.
    \8\ Reuters, ``Iran fills heavy water nuclear reactor core with 
cement: Fars,'' January 11, 2016.
    \9\ Laura Wagner, "Iran Ships Over 25K Pounds Of Uranium To Russia 
As Part Of Nuke Deal," NPR, December 29, 2015.

  2. Stronger efforts to counter destabilizing regional actions by 
        Iran. One top concern that many have about the JCPOA is that 
        the deal provides Iran with additional financial resources and 
        opens the country to greater trade and investment, and that 
        Iran's regime might direct these resources into actions that 
        destabilize the region. The European Union has lifted nuclear-
        related sanctions on oil trade and financial transactions, and 
        the United States will suspend nuclearrelated sanctions that 
        prevented non-U.S. actors from buying oil and investing in 
---------------------------------------------------------------------------
        Iran's energy sector.


    Estimates of how much sanctions relief Iran will receive vary 
substantially. The impact of years of economic sanctions and 
international isolation means that Iran needs to dedicate substantial 
investment to restore oil and gas production and jump-start its overall 
economy. It remains unclear how the Iranian leadership will prioritize 
its spending in the coming years--it has a strong incentive to deal 
with domestic discontent with the economy.
    Yet at the same time, Iran's long-standing support for terrorist 
groups such as Hezbollah and its willingness to spend substantial 
resources and send forces to places including Syria indicate that Iran 
could use the additional funds to play a negative role in regional 
security and work to undermine the security of close American partners.
    The United States needs to be prepared to push back against the 
malign actions by Iran in the region. The past few years have 
demonstrated that the Iranian regime has several different factions, 
and these factions have been jockeying for position in reaction to the 
deal.
    For example, the Islamic Revolutionary Guard Corps, which expressed 
opposition to diplomatic efforts by the Rouhani government, has 
continued an aggressive stance toward regional security. It remains to 
be seen how the new economic dynamics post-JCPOA will impact the 
Islamic Revolutionary Guard Corps' economic interests, and whether the 
introduction of more foreign investment and trade will undermine its 
position.
    Regardless of these uncertainties, the United States has a strong 
interest in working with regional partners to address actions by 
elements of the Iranian regime that further destabilize the Middle 
East, weaken state authorities, and bolster to nonstate actors in 
Syria, Yemen, and Iraq. The United States must have a robust effort to 
counter violent extremism, terrorism, and sectarianism supported by 
Iran, as well as other countries in the region.
                    recommendations for u.s. policy
    The United States faces a major challenge in piecing together a 
coherent strategy for the Middle East that advances its interests as 
well as its values. While the Joint Comprehensive Plan of Action has 
provided an effective framework to address Iran's nuclear program, it 
has not ushered in a new period of regional stability. Tensions between 
regional powers remain high, and the prospects for settlement of 
internal conflicts plaguing the Middle East remain slim.
    Nonetheless, the United States remains the unrivaled power in the 
region: No other country possesses the broad networks of relationships 
with countries in the region, the security capabilities, and the 
ability to shape dynamics through diplomacy. Russia's recent engagement 
in the Syria conflict has not substantially advanced Russia's position 
with most countries in the Middle East, who still look to the United 
States as the primary outside power to help advance their interests. 
China's increased economic and energy interests in the region have 
ushered in a new level of diplomatic engagement by its leadership in 
the region, that still falls short of what the United States has 
provided over the past few decades and continues to provide to a wide 
range of countries, including Israel, Egypt, Turkey, Jordan, Saudi 
Arabia, the United Arab Emirates, Qatar, and Kuwait.
    To stabilize the Middle East, the United States needs to adopt a 
more assertive strategy that takes into account the increased scale and 
pace of activities by countries in the region and seeks to minimize the 
most extremist elements that have been upsetting the regional balance. 
At present, Iran remains one of the top destabilizing elements in the 
region, but it is far from the only actor in this regard. Also, Iran is 
not a unitary actor, as witnessed in the internal divisions on display 
in the JCPOA negotiations and their aftermath. Five key steps the 
United States should seek to take in the Middle East as the JCPOA moves 
forward in 2016 are:


  1. Ensuring strict implementation of the Iran nuclear agreement. The 
        United States should continue to work toward the successful 
        implementation of this historic agreement that has enhanced 
        international leverage over Iran and created important tools to 
        prevent the spread of nuclear weapons in the Middle East. The 
        agreement has already produced tangible results, but the United 
        States needs to support international efforts to monitor Iran's 
        program closely. It should prepare a range of contingencies if 
        there are signs that Iran is not abiding by the terms of the 
        agreement, including new economic sanctions, efforts to isolate 
        Iran diplomatically, and possible security and military 
        measures. The United States remains an unrivaled security 
        presence in the Gulf region, and it should be prepared for all 
        contingencies given the uncertainties that remain.
      Importantly, the JCPOA saw Iran agree to extensive monitoring by 
        the IAEA, which is already underway. Given the complex and 
        extensive nature of this agreement, the United States and other 
        leading countries will need to continue to provide oversight of 
        this monitoring. Congressional oversight and engagement on the 
        monitoring and verification provisions of the JCPOA will be 
        vital; if the JCPOA continues to prove its value by placing 
        strong limits on and providing more information about Iran's 
        nuclear program, it can contribute to greater stability in the 
        region.

  2. Continuing to respond to Iran's bad behavior. The United States 
        should work closely with partners in the region, including 
        Israel, the Gulf States, and Jordan, to respond more 
        effectively to the threats posed by elements of the Iranian 
        regime.\10\ The United States has already done so by 
        interdicting weapons shipments from Iran to forces in Yemen 
        last year, and it should work with partners to cut off support 
        for terrorist groups across the region. In so doing, the United 
        States also should recognize that Iran is not the only actor 
        that has offered support to extremist and terrorist groups that 
        have undermined stability in the region, and it should take 
        actions to motivate all countries in the region to cease 
        activities that benefit terrorist groups.
---------------------------------------------------------------------------
    \10\ For more analysis on possible efforts, see Peter Juul, Brian 
Katulis, and Shlomo Brom, ``Countering Iran's Destabilizing Actions in 
the Middle East'' (Washington: Center for American Progress, 2015).

  3. Elevating Iran's human rights record in America's policy. The 
        United States should continue to highlight the poor human 
        rights record of Iran and put a spotlight on the regime's 
        actions that are inconsistent with international standards for 
---------------------------------------------------------------------------
        basic rights and freedoms.

      Iran is quite likely to experience unprecedented economic and 
        social changes in the coming years, given the demographic 
        pressures and likely changes in its environment. The United 
        States should continue to send the signal that it supports the 
        basic rights and aspirations of the Iranian people, even as it 
        works closely with the current ruling authorities in Iran to 
        implement the nuclear agreement and work diplomatically to de-
        escalate conflicts in places such as Syria and Iraq.

  4. Presenting a more coordinated regional security approach. The 
        United States has a deep military footprint and a broad array 
        of regional security partners. In addition to long-standing 
        bilateral military and intelligence cooperation efforts across 
        the region, the United States has built an international 
        coalition working to counter ISIS. Furthermore, the Obama 
        administration has begun discussions with key partners about 
        the future of military support and security cooperation in 
        recent talks with Israel \11\ and discussions with Gulf States 
        started last year at the Camp David summit.\12\
---------------------------------------------------------------------------
    \11\ Phil Stewart and Dan Williams, "Israel, U.S. signal security 
ties back on track after Iran feud," Reuters, October 18, 2015.
    \12\ Office of the Press Secretary, ``U.S.-Gulf Cooperation Council 
Camp David Joint Statement,'' Press release, May 14, 2015.
---------------------------------------------------------------------------
      All of these potential streams of conventional military support 
        and cooperation should be synchronized and coordinated; the 
        United States too often allows its regional security efforts to 
        remain disconnected and uncoordinated. Recent efforts to 
        support greater regional security cooperation is a step in the 
        right direction, and the United States should take steps to 
        create a foundation for a more coherent regional security 
        framework in the future-one in which the United States remains 
        a key partner but where there is greater effective coordination 
        among actors in the region. If they produce tangible results 
        that counter the malign influence of countries such as Iran, 
        additional dialogue with close partners in the region can do 
        much to counter the perceptions of an American tilt toward 
        Tehran in the post-JCPOA environment.

  5. Continuing to test the possibilities for de-escalation, de-
        confliction, and conflict resolution efforts. Strategic 
        dynamics and the threat perceptions in the region mean that the 
        chances for diplomatic and political success in the short run 
        on these fronts remain low. But it remains important to try to 
        test the possibilities for a breakthrough that de-escalates the 
        conflicts and marginalizes the influence of terrorist 
        organizations. This means pursuing diplomacy with all 
        countries, including Iran, with the recognition that many of 
        the key countries have been actively supporting or coordinating 
        with terrorist and extremists groups in these theaters-and that 
        countries have been actively supporting brutal regimes such as 
        the Assad regime in Syria or nonstarter groups that threaten 
        civilians.
      If prospects for resolution of these conflicts appear poor, the 
        United States, its regional partners and Iran should keep the 
        lines of communication open to avoid inadvertent conflict in 
        the Gulf. The recent episode of American military craft 
        drifting into Iranian waters and the subsequent capture of 
        their crews serves to highlight the importance of avoiding 
        future incidents at sea or in the air. During the Cold War, the 
        United States signed an agreement with the Soviet Union to 
        avoid such incidents that could serve as a model for a similar 
        agreement with Iran.


    The Chairman.  Thank you. I am going to start it off with a 
few questions and maybe reserve some of my time for interacting 
as we move along.
    Your fourth point of five that you just outlined, Mr. 
Katulis, I think speaks to the fact that I think many of us on 
both sides of the aisle have looked at our policy towards the 
Middle East recently as being more transactional. And I think 
the purpose of these hearings is to figure out a way to apply 
that pressure appropriately to the administration to have 
something that is much more coordinated and certainly of longer 
view.
    So let me just follow up a little bit on that and ask you 
the question. So our allies, our friends in the region, our 
traditional friends, have the perception that we are 
disengaging and potentially realigning, as both of you have 
alluded to. Is that real or not? I mean, is that perception not 
reality, or is that perception reality from your perspective?
    Mr. Katulis. I think the perception is strong. I do not 
think it is the reality. When you look at the networks of 
relationships, the footprint, the fact that when we were in the 
region, we were building military installations and hearing 
about this, that we are going to last for decades. That 
perception exists in part I think because of sometimes the 
language we use, the body language that we have, and how we 
engage with partners in the region.
    And the main point I would say, just to emphasize it a bit 
more, is that I know we are discussing with Israel an MOU about 
long-term security, and I think that is important to complete 
and complete it quickly. There is also a discussion about our 
relationship with the GCC post Camp David, and the follow-up I 
think needs to be accelerated on all of that. Plus we have the 
normal relationships that we have that are longstanding.
    My concern is that all of these need to be synchronized 
towards a greater set of objectives that include deterring 
Iran's negative presence in the region, but also being clear 
with some of our partners when they act in ways that have led 
to the rise of non-state terrorist groups or have led to the 
erosion of state authorities, we often do not have that quiet, 
candid conversation.
    So the two things I think we need to do to erode this 
perception of disengagement is not move episodically from an 
Israel-Palestine peace process, to a Syria attempt to resolve 
the conflict, to moving through JCPOA implementation. I think 
we need a much more holistic strategy--and this is where I 
think Mike and I agree quite a lot--that states our long-term 
objective and states that we are going to stay there as a 
partner for the long term. Again, restating what I just said 
before, if you look at all of the other outside powers, Russia, 
China, others, they do not have the potentials and the 
relationships that we have. We are just not using it in ways 
that I think are as forceful and assertive as I think they 
could be.
    The Chairman.  Let me move to another point because I am 
worried about the time.
    We saw where, first of all, there is no question the 
Iranian--you know, the leaders of Iran were moving quickly to 
implement them. And I think this has been implemented probably 
2 months more quickly than we thought. It was though that the 
moderates were rushing to make this happen so that it would 
affect the economy in a positive way prior to the election. And 
yet we saw over the last couple days where, quote, most of the 
moderates that would be part of the group, if you will, that 
were running to actually select the next Supreme Leader were 
actually disqualified. I think only 1 percent of them that had 
put their names forward were qualified, if you will, to 
actually run, which certainly speaks to the fact that the 
hardliners still, it appears, have an outsized role in 
determining the direction.
    So, number one, do you agree with that? And do you see 
things not going in the direction that many thought it would 
that were for this agreement and a change of, if you will, how 
Iran conducted its business?
    And number two, is there any real difference between the 
moderates inside of Iran and the hardliners relative to how 
they view the activities that they should be undertaking to 
continue to achieve their goals, if you will, in the region?
    Mr. Singh. Well, Senator, I will start with the second part 
and then sort of lead into the first.
    My own view of the sort of different camps in Iran--it is 
obviously very complicated, but to boil it down, I would say 
you have got one camp--and I should preface this by saying I 
think both of these camps have as their first objective regime 
survival. They want the system to survive. They do not want to 
see democratic change. They do not want to see a fundamentally 
different system in Iran.
    The Chairman.  Both moderates and hardliners want to 
continue to have a Supreme Leader like a Khamenei leading the 
country.
    Mr. Singh. The regime system. That is right. There are 
those I think who do not want to see that. Those are the people 
who are, though, largely under house arrest, who are in jail, 
and so forth in Iran.
    I think what we would consider the moderate or pragmatic 
camp led by President Rouhani--I think these folks think that 
in order to survive, the regime needs to adapt. It needs to 
change. And that change is largely sort of economic and social 
and so forth. Whereas I think there is a sort of hardline camp 
that thinks that to survive, the regime needs to sort of go 
back to purify, to go back to the 1979 values of economic self-
sufficiency, exporting the revolution, and so forth. These are 
fundamentally opposed world views, and you could think of it 
almost like China in the 1970s, Senator.
    The Chairman.  If you do not mind, do the moderates believe 
they should export the revolution also?
    Mr. Singh. I think the moderates do not necessarily 
emphasize that, but I think that their regional strategy 
ultimately is basically no different than the sort of hardline 
regional strategy. I think it is about projecting Iranian 
power. It is asymmetric power. It is not necessarily 
conventional power. It is about pushing the United States out 
and sort of taking what they see as Iran's rightful place as 
the preeminent power in the region. So I do not think that 
their conflict really is over the issues that matter most to us 
is I guess the way I would put that. It is not over the nuclear 
issue. It is not over regional security issues. It is more over 
the character of Iran itself, economic issues, social issues, 
and so forth. And that is why often we make the mistake of 
saying, well, who is our guy and who is on our side. I do not 
think that is the right way to think about it.
    The Chairman.  So if I could, they both have exactly the 
same goals relative to the region. They have differing views as 
to how to strengthen their ability to make that happen.
    Mr. Singh. I think that is right. So I think that you would 
not see, for example, a big difference between those two camps 
on what should Iran's role in the region be, what should the 
United States' role in the region be, what should their policy 
in Syria be, in Iraq be, and so forth. I do not see big debates 
over that. There are debates over what are the right tactics to 
use. What is the role of diplomacy? Can you deal with the West 
diplomatically and so forth? You see those things very clearly 
in some of these incidents that we have had recently. But that 
does not mean the ultimate objective is different I would say.
    The Chairman.  Mr. Katulis?
    Mr. Katulis. If I may just supplement because I agree with 
all of what Mike said there, is that I think the broader 
landscape, the longer term, if you look at the demographic 
changes that are likely to happen in Iran, the social and 
economic changes that may occur--and again, not overnight, not 
before the next election--this is why I highlighted the need 
for the U.S. to continue to have a stronger voice than I think 
it has had in the last few years about representing the basic 
rights and interests of Iranian people. There is a new 
generation that I think quite likely at some point in the next 
10 years--there is going to be some short of shift and change. 
And today we see a calcified political leadership that is 
trying to maintain its grip by disqualifying all of these 
candidates and things like this.
    But I suspect in Iran, as I think in Saudi Arabia as well, 
these are societies that are going to see tremendous stresses 
on their economy, on their social system. And we need to 
prepare ourselves in terms of articulating more consistently a 
voice that says we stand by the Iranian people when they are 
abused by their own government, when their rights are not 
respected. And I think this broader landscape, the longer game 
is something that we lost a little bit of sight of in the past 
few years.
    The Chairman.  Thank you both.
    Senator Menendez?
    Senator Menendez. Well, thank you, Mr. Chairman.
    Thank you both for your testimony and your insights to the 
committee at various times.
    Mr. Chairman, I just want to get from you--I assume that at 
some point you are seeking administration witnesses to talk 
about the aftermath of the plan.
    The Chairman.  Yes.
    Senator Menendez. So without relitigating the nature of the 
agreement because we live in the reality of the agreement, I do 
think taking stock of certain things is important as a compass 
point moving forward. And I am not surprised that the Iranians 
met their initial implementation because that was the essence 
of what was necessary to get the multibillion dollar relief 
that was necessary. And some of us who have a problem with the 
agreement and voted against it is because it is not in the 
short term that we did not think that they would live up to it. 
It is in the longer process where they can realize their goals 
just by following the outline and the framework of the JCPOA. 
If they have the patience to do so, they will get to where they 
want to be. And so that is a concern for us.
    And certainly can it be argued that 12 months is better 
than 3 months, which is where we were at breakout? Yes. Is it 
great that Iran received billions of dollars in relief? 
Concerning about how they use that money, which I would like to 
explore with you. Regional adventurism whether in Syria or Iran 
and Lebanon, Yemen, or elsewhere? That continues.
    I rejoice in the Americans that are now home safely, but I 
think the important questions of U.S. policy have to be 
determined as what are we doing in terms of bartering for 
innocent Americans for convicted spies and others in the United 
States. What is the global message there? Because if we are 
going down a pathway as we did in the exchange in Cuba, in 
which one person was convicted of conspiracy to commit murder 
and gets released, and in this case we have seven Iranians 
involved in all manners of conspiracy, material support to a 
state sponsor of terrorism, and 14 more who get clemency, the 
question is, what is our policy? Is our policy now to exchange 
for innocent Americans those who have been convicted in 
violation of U.S. law? And what degree of conviction are we 
going to look at in terms of who is exchangeable or not?
    I think it is important to raise that question at least in 
the presence or the absence of hostages except for Mr. Levinson 
obviously who we still do not know what is happening in his 
case, so that it is not about a person but about a policy. And 
I think that is an important one to look at here.
    And then I look forward to understanding the $1.7 billion 
paid by American taxpayers for an agreement that took place 
with a different Iranian Government that was ultimately in line 
with the United States and for which at the end of the day I 
cannot imagine this Iranian Government wanting the same things 
that that Iranian Government wanted in terms of the military 
elements that were being sought.
    So I look at this and I say that, and then I see the 
missile violations and I think a rather soft response to them, 
and I think that is alarming. I had called upon the 
administration to use a robust response in the absence of the 
Security Council doing anything. I think we got a soft response 
to that, and I am concerned about that.
    And I see the Iranian Revolutionary Guard, obviously, not a 
force who wants to moderate their positions of Iran with the 
United States, propagandizing American military personnel on 
their knees across the world.
    So a little bit of stock from my perspective at least to a 
compass moving forward.
    So I would like to ask both of you. You know, in the New 
York Times'' interview with Tom Freedman in July of last year, 
President Obama said that, quote, the truth of the matter is 
that Iran will be and should be a regional power. Will be and 
should be a regional power.
    Now, I think our friends and allies in the region heard 
this and they are putting it together with the following 
observations, that Iran, having violated the international will 
for well over a decade, results in negotiations in which those 
negotiations accomplish or nears accomplish many of their goals 
and that others in the region see it as an existential threat 
to their own interests and their own security.
    So is it fair to say that we are going through a very 
difficult time in the region in which our partners, our 
traditional partners, are wondering what the end game is here 
and are going to be acting increasingly more independently, at 
times maybe even in conflict with what we would see as our own 
interests because they have taken the view that if the 
President of the United States says that Iran should be a 
regional power, that that is in conflict with everything they 
fear about Iran being a regional power?
    Mr. Singh. Senator, I would agree with your statement. And 
I think that that type statement--it feeds the fears amongst 
our allies that we are either disengaging from the region and 
sort of just leaving them to their own devices. And you are 
right, Senator. What that encourages them to do is to form 
these ad hoc blocs that we have seen forming in the region to 
jockey amongst themselves to accomplish their goals because 
that is what they need to do, sometimes using methods and tools 
which we find alarming frankly. And there is no sort of real 
winner in that contest because none of them will really rise 
above and impose regional order.
    It also, frankly, comes across very badly in the region 
because of the way that Iran asserts its power in the region. 
It is not through conventional military means. It is not 
through diplomacy and so forth. But it is through subversion of 
sovereign governments in places like Lebanon, in places like 
Yemen, in places like Bahrain, and so forth. It is by feeding 
proxy forces. It is through asymmetric power. It is by doing 
things which are very dangerous to the fabric of the regional 
order such as it is in the Middle East. And I think that is 
also another reason why it strikes the wrong chord because Iran 
is not behaving like anything we would consider a responsible 
power.
    So certainly you do hear that when you go to the region, 
and I do think, frankly, that that feeling of disengagement, 
which you were asking about before, Chairman Corker, is very 
real even though we have an extensive presence on the ground 
because they do not see that we share their interests, that we 
share their sort of concerns in the region, and they do not 
feel as though at the highest level, at the strategic level 
there is that sort of coordination and that sort of meeting of 
the minds between us and our allies any longer.
    Mr. Katulis. If I may add. I think these concerns and the 
question you asked about partners wondering what our end game 
is--this has been a problem for U.S. policy for more than a 
decade. It is my view that one of the consequences of the 2003 
Iraq war was we ended a policy of dual containment of Iran and 
Iraq. And this actually helped facilitate and contributed to 
the rise of Iran's power in the region. It also I think had 
down sides in terms of the state structures. I mentioned this 
in my opening testimony about the coherence in the strength of 
state structures.
    So to your question of what should be our next steps, I do 
not disagree with much of what you said, your concerns about 
the missile tests, the questions about the prisoner/hostage 
releases. All of these questions I think need to be asked of 
this administration.
    But the biggest question I think we all need to ask is 
where do we want to be 10 years from now in the Middle East. We 
had a policy of dual containment of Iran and Iraq. Now the 
Middle East is in chaos. The state system I think has been 
weakened. I think two fundamentals I think we need to do is 
help try to strengthen and clarify the nature of the state 
system while remaining true to our values. And this is why I 
think it is important in looking at the nature of regimes like 
Iran, like even some of our partners who do not like Iran in 
the region. We need to have, if not public talks, quiet talks 
about their actions in the region, who they support in terms of 
their own proxies and non-state actors.
    And going back to my central point is that the U.S. still 
has no rival in the Middle East. The fact that the foreign 
ministers of Saudi Arabia and Iran are having dueling op-eds in 
the ``New York Times'' I think speaks volumes about how 
important the leaderships of those countries view the United 
States. The question is I think our reticence, our reluctance 
to engage as strongly and as assertively as I think we should 
have is in part borne out of some of the mistakes of the 
previous decade. And I think all of us, analysts, leaders here 
in the Senate need to think about a new role in the Middle East 
for the United States where it is not us sending tends of 
thousands of troops and these straw men arguments that you 
often hear from people who do not want to do anything about 
Syria. But it is how do we actually partner up with those most 
reliable and capable partners in the region, Israel, Jordan, 
the United Arab Emirates, the Kurds. There is I think the 
makings of a coalition that one could form. And in fact, if you 
look at the Anti-ISIL Coalition, we have got a lot of people on 
that team. The question is do we have a game plan. And I think 
the answer, quite frankly, is we have got episodic engagement 
that is trying to advance the ball on different pieces, but we 
do not have that bigger picture of how do we stabilize the 
Middle East and help integrate it with the rest of the world as 
a much more functioning region of the world.
    Senator Menendez. I just have a comment, Mr. Chairman. I 
have a bunch of other questions, but I will wait for the next 
round.
    I totally agree with you about the dual containment and 
what we did in Iraq, which is one of the reasons I voted 
against the Iraq War when I was in the House of 
Representatives, including that spending a lot of time looking 
at intelligence information, I saw no evidence of weapons of 
mass destruction. And so I do not send America's sons and 
daughters needlessly into a war of choice versus a war of 
necessity.
    Having said that, in the aftermath of that, it seems to me 
that by what we have done with Iran is that we have further 
confused the reality of what our policy is going to be in the 
region because we did not have a parallel track that many of us 
were advocating for to think about if you get this agreement, 
what is going to be set alongside with it so that you deal 
within the region. So now, having unlocked the resources, given 
Iran some sense of legitimacy in the international order, even 
though from my perspective, it has not fully earned it, it is a 
moment in which we are way behind the clock here in terms of 
engaging. We still may have the most significant presence in 
the region, but that significance means nothing if at the end 
of the day you are not asserting it and pursuing a plan of 
action pursuant to the national interests and security of the 
United States.
    The Chairman.  Thank you.
    Senator Gardner?
    Senator Gardner. Thank you, Mr. Chairman, and thank you 
both for being here today.
    I want to follow up a little bit on what Senator Menendez 
was talking about. The coalition, Mr. Katulis, I think that you 
talked about of finding allies in the region who have a common 
interest to achieve solutions to present stability to the 
region--I think Israel, Saudi Arabia--you mentioned some 
others--were all nations, though, that as this agreement was 
moving forward, had great concern with the destabilizing 
possibilities that went along with this kind of engagement. And 
in the interview, as the President had stated that Senator 
Menendez pointed out, a regional power--if Iran is able to 
reach that, to achieve that goal, what does the future of this 
regional power of Iran mean for our allies in the region who 
view this as destabilizing to their futures? Mr. Singh?
    Mr. Singh. Well, look, I think that what Iran would like to 
see in the region is, of course, it would like to see itself 
preeminent and would like to see itself able to project power 
even more than it can today through the Levant and against what 
it considers foes like Israel, for example, or Saudi Arabia. It 
would like to also see us out of the region. It does not want 
to see freedom of navigation for the U.S. Navy in the Persian 
Gulf, for example, or the Arabian Gulf. It does not want to see 
American forces in the Middle East. In a sense, Iran shares 
with countries like, I would say, Russia and China to an extent 
this broader goal of wanting to see a fundamental reshaping of 
the international order to see the role of the United States 
decline. And you can see this in repeated comments by Iran's 
Supreme Leader and other regime leadership.
    Senator Gardner. So, Mr. Katulis, if you want to respond to 
that, I think this notion that a regional power wanted the 
United States to leave, what that means to Israel, how that 
could be in any way shape or form stabilizing.
    Mr. Katulis. Well, I think what we need to do is to be 
clear first, as I was trying to highlight in my opening 
remarks, that I think there will be inherent natural limits to 
how far any power in the region itself can go. Iran has high 
aspirations, but as we see in their support to the Assad regime 
and the high costs of the Syria conflict, as we see in the 
engagements in Yemen, the counter-reaction from regional 
forces, for every action, there will be a reaction.
    The point I want to try to drill down is that in this 
context of Iran's aspirations and Saudi Arabia--I was in Riyadh 
last month, and you hear them talking a much more assertive 
game. They announced a Muslim coalition against terrorism. It 
did not include Iran or Iraq or other key countries there. You 
see countries that are moving to exercise their own self-
interests I think in part because they see a reticence on the 
part of the United States to get engaged.
    But what I hear when I talk to our friends in Israel and 
Jordan and some of the Gulf countries is that if the U.S. 
wanted to serve more like a quarterback role--we are in 
football season here--we do not have to run all the plays--
    Senator Gardner. Why do we not say ``go Broncos''? I am not 
sure. [Laughter.]
    Mr. Katulis. Yes. We do not have to run all the plays, but 
they are really still looking for some sort of game plan beyond 
what I think has been this tactical reactive crisis management 
mode except for certain episodes. Of course, the Iran nuclear 
deal was one episode. The attempt at negotiations on the 
Israel-Palestine process. The Syria peace process, if it comes 
together, is another one.
    I think what we need--and this is where I am more pragmatic 
about it--is we really truly need a bipartisan consensus here 
at home that agrees on the U.S. is going to be a little bit 
more assertive here. That does not mean we are going re-invade 
countries and occupy them with no end in sight. But the 
important thing I think is that the tools that we want to put 
into the game, the things that Mike and I heard I think on this 
last visit, of some of our partners want us to help them more 
in the conflict in Yemen. I think we need to have that 
conversation, but we need to have it realistically, to 
understand are what these partners doing moving towards a 
sustainable resolution of that conflict, one that marginalizes 
extremist forces, whether it is non-state groups like ISIS or 
the Houthis or state groups like Iran, which I think is a very 
malign strategic actor in the region. And that is what I think 
we are missing right now is sort of that broader game plan. 
Again, I do believe that if we are willing to use those 
resources and build a bipartisan consensus for it, we could 
actually have a positive impact.
    Mr. Singh. If I could just add one thing, Senator. I do not 
disagree with what Brian said. I agree there is a limit really 
to what Iran can achieve. You are not talking about a 
classically powerful country. As I said, they use proxies, 
asymmetric power. They have struggled in Syria. But they do not 
need to succeed to create big problems for us. I mean, if the 
Iranians were not helping us out in Syria--I mean, it is the 
IRGC, it is those Shiite proxies from Pakistan and Afghanistan, 
it is Hezbollah--I do not think Assad could have fought the war 
that he has fought. And that in turn has created that vacuum 
you see in eastern Syria which ISIS has taken hold of. And so 
it is not as though Iran likes ISIS or is allied with ISIS, but 
Iranian actions have helped to create those vacuums and break 
down those state institutions which allow such groups to 
thrive.
    And then the reactions, even by folks who are allied with 
us, sometimes then further sort of create problems that we 
think are not good for our interests. Right? So sometimes the 
reaction to ultimately does not help American interests in the 
region. And that is as a result of Iran sort of reaching for 
this power even if they cannot ultimately achieve it.
    Senator Gardner. And does our allies acting--I think you 
have both identified ways that they may act in manners that are 
not in the interest of the United States as they are expressing 
or showing expressions of concern about the United States' 
willingness and commitment to the region. I think we also have 
to develop the strategies that we talked about which I think as 
Secretary Gates said in a recent Business Insider'' article, he 
talked about working with our allies, both Arab and Israeli, in 
the region to counter Iranian meddling, support of terrorism 
and other activities. So what over the next year do we need to 
lay out to those allies in concrete terms to make sure that we 
have that strategy? You both have identified steps and 
strategies, but what concrete in the next year should the 
United States lay out?
    Mr. Katulis. Well, if I could start and maybe Mike can add.
    First, the sort of actions we took last year when we 
interdicted weapons shipments that were going into Yemen was an 
important--you know, actions speak louder than words, and that 
was an important action. And if we continue to do that--I know 
the case of re-arm and supply of Hezbollah and Syria is very 
complicated. It is tied up with Iraq airspace and the 
challenges there. But working that issue where we demonstrate 
with partners and our closest partners, including Israel, that 
we are stopping these shipments, we are stopping Iran from 
moving forward, arms embargos against some of these proxies, 
which I think have been undertaken, a very robust 
implementation of the Camp David discussions moving forward 
with what types of security cooperation we will have, but 
importantly, how do we synchronize that with the discussion 
that we have ongoing with Israel to ensure its qualitative 
military edge? Those are I think some of the tools that--again, 
going back to a central point I have here, is that no other 
country has the breadth of relationships that we have from 
Qatar to Turkey to Saudi Arabia, countries that are often at 
odds with one another. Let us use those tools to actually 
disrupt Iran's malign influence and also use it quietly to talk 
about the proxies that other countries in the region support as 
well.
    Senator Gardner. Mr. Singh?
    Mr. Singh. Look, I agree with Brian.
    I think that the answer to your question really has three 
parts. I mean, one is our own posture in the region and how we 
respond to what is an emerging and will be a strengthening A2AD 
strategy by Iran, potentially with the help, for example, of 
China or Russia with some of the military aspects of that. I am 
not sure that right now--I am not an expert on this question, 
but I am not sure that right now our posture in the Gulf is the 
right posture to deal with that.
    And you have to bear in mind that when there are pictures 
around the world of Iranian forces taking our sailors captive, 
even if they are quickly released, those pictures have a 
strategic impact in the Gulf, in the Middle East, and beyond. 
When you see those live fire exercises in which Iran engages in 
the Gulf, these are the types of activities in which Iran 
engages. So maybe we could beat them in a conventional war, but 
we also need to be able to address these types of more 
unconventional actions that Iran takes.
    The second part is what we actually do to counter Iran's 
actions around the region. To me that starts with Syria. I 
think we just need to get much more serious about our policy in 
Syria rather than sort of standing back as we have been doing 
now for too many years. And there is a whole bulleted list in 
my written testimony, including things like a financial 
campaign against the IRGC, stronger measures against Iran's 
missile program.
    And I would say just in response to something Senator 
Menendez said it is true that the Iranians have fulfilled those 
initial requirements, as far as we can see, under the JCPOA. 
That is in part because we set a very low bar. The resolution 
of the BMD issue was pro forma. We did not ask for anything on 
the missile question. That is part of the reason they were able 
to do it is we did not ask what they could not do or would not 
do.
    And then the third element of that is the regional security 
element and how we bolster the security of our allies. And I 
think it has to start with, at the strategic level, 
understanding what their priorities are like Yemen, for 
example, having that conversation, responding to their needs 
because that is what allies do. It has to involve multiyear 
sort of agendas for their procurement and training. And it has 
to involve coordinating all that so that you do not have sort 
of the UAE over here doing this and Saudi Arabia doing 
something else, but you have a sort of a bloc, a unified front 
that can confront both Iran, as well as jihadists and other 
threats that we face.
    Senator Gardner. Thank you, Mr. Chairman.
    The Chairman.  Yes, sir.
    Senator Coons?
    Senator Coons. Thank you, Chairman Corker, and thank you 
for holding this hearing and thank you for the skilled and 
insightful testimony we received from both witnesses so far.
    Well, here we are on the other side of implementation day. 
And as has been reviewed, Iran has taken several important, 
significant steps to delay their ability to quickly develop a 
nuclear weapons capability. And I am relieved by the long 
overdue release of five Americans from unjust Iranian custody 
and the steps the administration has taken to sanction 
individuals and entities that were involved in supporting 
Iran's ballistic missile program.
    But I am deeply concerned that where we are now is that 
Iran has tens of billions of dollars of additional resources 
and that despite a lot of important efforts and a lot of 
valuable progress made through the JCPOA, I think our 
responsibility working together to deter Iran and contain Iran 
is more urgent and more difficult than ever before.
    So it is my hope that we will achieve the view that Mr. 
Katulis offered at the outset of a more coherent and more 
assertive approach in the region. I appreciate your recognizing 
the interdiction of a weapons shipment to the Houthis.
    In pressing the administration over and over for more 
information and more details about interdictions of weapons 
flow or funding flow, I am repeatedly told we can brief you on 
that in a classified setting. And I say that is very helpful, 
but it would be more helpful if our allies in the region and my 
constituents and our country were briefed on this in open 
setting. And I understand the tension, but we need to show what 
we are actually doing. Saying is good; doing is better.
    I am also interested in your views on how we can strengthen 
our regional allies and demonstrate that our policy is one of 
containment of Iran and that our attitude towards them remains 
one of suspicion. They remain a nuclear threat because the 
knowledge of how to enrich uranium and produce a weapon is 
widely distributed amongst their technical and engineering 
staff, and we will have to stay on this for decades to come.
    So if I could first to both of you, many Members of 
Congress, including my colleague, Senator Menendez, have called 
for the swift renewal of the Iran Sanctions Act, which expires 
at the end of this calendar year. What is your opinion on the 
renewal of the ISA, and what do you think would be the views of 
our P5 Plus 1 partners? And what do you think its consequences 
would be?
    And then second, if you would speak to the unfrozen 
revenues, the Iranian assets that have been held in banks 
around the world and are now going to be flowing back to them. 
How do you expect Iran to use these dollars? And are there 
mechanisms by which you believe we can track and report to the 
world their deposits in the Central Bank of Iran, their 
distribution into the Iranian system, and be more effective at 
interdicting cash flows to their terrorist proxies in the 
region? Mr. Singh?
    Mr. Singh. Well, thank you, Senator Coons.
    On the renewal of the Iran Sanctions Act, I do think it is 
important to do. I think it is important that we be in a 
position to actually executive the snapback of sanctions if it 
comes to that. I do think that at this stage the concern that 
our allies would have about doing it now that we are past 
implementation day is probably a lot less than would have been 
pre-implementation day. I think now it is unlikely that 
renewing the ISA would unravel the deal somehow.
    I do think, though, it is important too that we have other 
penalties in place to punish Iran short of full snapback and 
that we also enforce the sanctions which are on the books, 
which you yourself have said, Senator. So I think that it is 
one element of what needs to be a broader sort of look at 
sanctions.
    And we also have to look at the ways that Iran is going to 
try to get around those existing sanctions because I expect 
them to come up with new ways to circumvent sanctions as they 
have in the past.
    On the question of the unfrozen revenues, we have heard a 
lot about how Iran will or will not use the revenues. I think 
only Iran knows the answer to this question fully and maybe 
only the Supreme Leader of Iran. But I will tell you my view is 
under President Rouhani in his first budget, there was an 
increase in military and security spending, and I would expect 
that Iran's regional priorities are sufficiently important that 
it is going to use some of this money on regional priorities. 
We have seen a decline, for example, in the funding that Iran 
has given to Hezbollah in recent years. It would not surprise 
me that went back up. It would not surprise me if some of this 
money went into defending the Assad regime or into Hamas or 
Palestinian Islamic Jihad.
    And that is for two reasons. One is simply that these are 
important issues to Iran. They have shown that time and time 
again when we would have thought it would be prudent to develop 
their own country, they have instead spent the money on a 
nuclear program or terrorist groups or things which do not 
benefit Iranians.
    And second, from a macroeconomic perspective, there is a 
reason that you would not necessarily want to immediately 
repatriate $50 billion or whatever the exact figure is because 
of the sort of inflationary or currency effects that might 
have. So I do expect they will use some on things which we find 
very concerning.
    We do, I think, have tools at the Treasury Department to 
try to track these things, to try to interdict these things, 
but frankly, some of the removal of the sanctions on the banks 
and now the much more permissive environment will, I think, 
complicate that. It will be a harder task. And we will need to 
be quite sure that banks around the world understand that we 
are still determined to enforce the sanctions which are on the 
books, make sure they understand what those sanctions are. And 
so we will need to be engaged, I would say, as heavy an 
educational campaign and enforcement campaign as we were in, 
say, the 2007-2008 period when sanctions were ramping up.
    Senator Coons. Thank you.
    Mr. Katulis?
    Mr. Katulis. Just really quickly because I think Mike 
covered much of your questions, but the one question on the P5 
Plus 1 partners and how they might respond to the renewal of 
sanctions, this is where diplomacy comes in. I think our 
friends in the administration talk I think a very good game and 
I think they are right about tough and hard diplomacy with 
adversaries. But we also need to talk to our partners and 
allies and those in Europe, Russia, and China. I think what was 
the strong point of the Obama administration in the last 8 
years was that we built an international coalition that exacted 
costs on the Iranian regime. We need to have those tools in 
place. As I think you have said many times and have written 
recently, this is not done. You know, the implementation day is 
just one day and one moment, but Iranian behavior needs to be 
monitored closely and not only monitored but it has to be 
structured in such a way that they understand we have all of 
these tools at our disposal.
    On the unfrozen revenues, I think there is a lot of 
conjecture here. I mean, I think Mike nailed it and I think our 
Treasury Department, some of our intelligence agencies may 
understand what is happening here. But there are so many 
different moving targets in terms of what the Iranian regime 
might or might not do.
    But let us be clear. Even when it was under the harshest of 
sanctions, it was supporting some of the most malign actions 
and behaviors, supporting people who wanted to assassinate the 
Saudi ambassador in this town. So that is why I think we all 
need to be vigilant and have stronger tools. And these sorts of 
questions that I think have been raised already about has our 
response been too tepid in reaction to Iranian provocations--
these are the sorts of questions that I think we all in this 
country need to ask if we want this JCPOA to succeed in its 
objectives.
    Senator Coons. Thank you. Well, I appreciate both of your 
testimony. If I had more time, I would ask additional questions 
about the Kurds and how we support our Saudi allies.
    I have taken the initiative to meet with both the British 
and French ambassadors recently and to just reinforce my view 
that there are sanctions that remain on the books that we will 
enforce and that we intend to enforce and to meet with banking 
leaders from Europe to convey that same point. I think that is 
a message worth repeating over and over and over so we do not 
find ourselves at counter-purposes with our P5 Plus 1 allies. 
And I agree strongly we need a graduated menu of responses. I 
expect Iranian cheating to be initially marginal and initially 
modest, and if they are not responded to promptly and 
effectively in a coordinated way with our allies, we will lose 
whatever advantage we may have gained through this agreement.
    Thank you, Mr. Chairman.
    The Chairman.  Thank you. I appreciate the questions.
    I would just interject that I think we have seen the 
response of our coalition when the ballistic missile violations 
took place. It is gone. That was the flaw in this deal. And I 
think thinking that unless there is something so out of bounds 
that it is egregious that we are going to be able to easily put 
that coalition back when everybody is in Tehran trying to do 
business right now is just not going to happen. I do not know 
how you could be more clear about a violation and yet have no 
response at the U.N. Security Council.
    So I appreciate the line of questioning because I think it 
highlights the fact that there now is no coalition. There is no 
coalition. And to me that is one of the greatest flaws of this 
deal now that they have what they want.
    Senator Perdue?
    Senator Perdue. Thank you, Mr. Chairman.
    You know, following up on that, I am very concerned about 
the lack of response of the United Nations. Over the weekend, 
the U.S. did impose sanctions on Iran on their ballistic 
missile program and I am encouraged. But I am very concerned, 
as the chairman just alluded, about the lack of response. And I 
would like to talk about that.
    Also, we see continued testing in North Korea. We have had 
evidence in the past that Iran participates with Korea as 
observers or whatever. It looks to me like that we have one 
country testing, a rogue country, North Korea testing possibly 
for two countries.
    Having said that, I am very concerned that we get after the 
people involved, and that is the sanctions--instead of going 
after individuals in these shell companies, you know, my 
suggestion was--and we put a letter to the President last 
week--I think 14 Senators signed it--that encouraged the 
administration to go after the foreign banks that are actually 
financing these ballistic missile tests and the program instead 
of these shell companies and individuals. We all know how 
people can maneuver around those with paperwork. We saw that in 
the sanctions on the Russian individuals just in the last year 
or two.
    My question is, what do you suggest that we actually do to 
impact their ballistic missile program now that the coalition 
is absolutely gone? I agree with the chairman. This is a 
practical matter as far as I am concerned. And I would like to 
get your thoughts about what the administration should be doing 
now, what we should be thinking about as the Senate to 
basically enforce the sanctions and the position we already 
have taken. Mr. Singh, would you start that?
    Mr. Singh. Sure thing. Well, Senator, I agree with your 
concern, and I agree with your concern about the lack of U.N. 
Security Council response.
    And just one thing I would point out maybe to add to your 
concern, Senator, is that so much of what we are talking about 
when we talk about even the enforcement of the JCPOA, much less 
things that are not in the JCPOA like the missile question, 
depend on this joint commission where we have to have five out 
of the eight members of the joint commission on our side. Well, 
in the coming year or 2, we are going to have elections in 
France, in Germany, and elsewhere. The EU is obviously is not 
an elected body. I do not think we can be 100 percent sure that 
we will have all those folks on our side as they are pursuing 
business with Iran and so forth. And so I think we will need to 
be taking a lot of this leadership ourselves unfortunately. It 
should have been in the nuclear deal. There is no doubt about 
that. Missiles are part of a nuclear program and we have seen 
that with North Korea. And I think to simply wave them away and 
treat them as a sort of separate matter is the beginning of our 
problem here.
    And so now we are left with the question, well, what do we 
do as a rearguard action to stop this. I think there will need 
to be stronger sanctions. I think it cannot just be 
designations, but it will need to be sanctions which are felt 
more strongly in Iran and, as you said, by those outside of 
Iran who are abetting the actions that Iran is taking. I think 
it will need to be interdictions and export controls.
    One thing to bear in mind about implementation day is 
implementation day means that Iran has been certified by the 
IAEA as having done its initial obligations. That does not mean 
that other countries, say, in Asia and elsewhere are themselves 
ready to implement those export controls, the procurement 
channel that is talked about in the JCPOA or in resolution 
2231. And so part of this has to be to work with those 
countries to ensure that they have the controls in place, they 
have a strong presumption of denial, and they also have a worry 
about the penalties they will incur if they fail to implement 
that.
    Then I think there also has to be a ballistic missile 
component to this. I think if Iran is going to be taking 
provocative missile tests, I think it is very important that we 
show as an alliance there in the Middle East that we are well 
prepared to deal with that Iranian missile threat, to deter 
that Iranian missile threat by having a strong theater-wide BMD 
capability. And that requires investment from the United 
States. It requires getting our allies together in a 
complementary fashion to do that in the region.
    Mr. Katulis. If I could add to it because I think Mike 
offered a very cogent list of moves that we can do on the 
sanctions front and then also on the defense with the ballistic 
missile defense.
    But as I was saying before, our footprint, our military 
presence in the region is quite robust. There are things that 
we could do in terms of actions with partners in the region 
whether it is exercises or similar responses which we have not 
seen in recent years. We have seen before. We have seen in 
terms of multilateral naval exercises in the Gulf where we 
bring a number of these countries in.
    Senator Corker mentioned that we have no coalition left. 
The best way to reinforce a coalition, to rebuild it is not 
only through these actions and sanctions and things that 
restrict their ability, but then also things that we can do in 
terms of calculated very measured actions that send a signal to 
the Iranian regime that you have done this, we are going to 
sanction you, but we are also going to put on full display what 
our capabilities are. And if you do this again, if you do this 
again, you are going to see on full display what we can do with 
our partners in the region.
    And again, I am not advocating war or anything like this, 
but the sort of signaling, the sort of games that Iran plays, 
as we saw with their photographs of our soldiers who went off 
course there--these sorts of things I think we should be more 
inclined to look to in terms of responses as opposed to just--I 
share your concern about the lack of action at the U.N. Well, 
guess what. It should not surprise folks that the U.N. 
sometimes does not do enough in terms of what it should do in 
its responsibilities.
    But my main point is that there are things that the U.S. 
can do as the unrivaled leader in the Middle East with partners 
that can send messages to Iran. And taking actions through 
naval exercises, through different exercises in response to 
these provocative measures I think would be a very good thing.
    Senator Perdue. So my last question--and this is a broad 
question, but I appreciate you both have spoken about this in 
your testimony before today and actually alluded to this today. 
I mean, how close are we to the actual ultimate fear that most 
of us have that we are going to drift into an ultimate Sunni-
Shia war in the region, Iran, Saudis? You have got Egypt 
sitting there. And then our intransigence really in Syria with 
Bashar al-Assad and Russia, given that we have created a second 
power vacuum in the region that Russia has now stepped into--
put on top of that $100 billion plus of cash that Iran looks 
like they are going to have access to here in the near future. 
And we know that there are past activities relating to support 
of Hezbollah, Hamas, Houthis, and so forth. Are we really 
drifting in that direction or are we actually racing in that 
direction with our own intransigence? I would like you both to 
respond to that quickly if you could.
    Mr. Katulis. Senator, to a certain we are already there, if 
you look at the conflicts in Syria and in Yemen.
    Senator Perdue. I agree.
    Mr. Katulis. I would hesitate as an analyst to simply 
classify it as just Shia-Sunni. I understand that paradigm and 
I think it is relevant. I am not dismissing it completely. But 
essentially this is about power between different nation states 
and the leaders of those nation states, Iran and Saudi Arabia. 
But then there are other layers of complexities. If you look a 
little bit westward to Libya, you see also a government that is 
fractured under the weight of regional competition not between 
Iran and Saudi Arabia but between different parts of the Gulf 
Cooperation Council countries and Egypt and their different 
view on political Islam. So there are layers of complexity 
here. But to a certain extent, we passed that point maybe 
several years ago.
    What I would say is that the U.S. is not responsible, 
though, for this vacuum primarily. I think our posture could 
have led to a different outcome, literally to a different 
outcome if we have much more assertive posture. But the primary 
responsibility for this breakdown of the state system in 
certain parts of the region, I think rests in the hands of the 
leaders of the region. Iran, as we have discussed here 
extensively, is a key part of the problem. I would also argue 
that many of the other Gulf allies out of fear, out of concerns 
about Iran, out of other motivations have also contributed to 
the problem.
    But a much more coherent and I think robust presentation of 
U.S. aims towards the long term in the Middle East I think will 
not solve all of these problems but could actually lead to a 
much more practical conflict resolution and a reinstitution of 
the state system that is not simply just on the shoulders of 
authoritarianism and the sorts of values that run contrary to 
our system. That may seem too ideal, but I think part of that 
is the quiet discussion we need to have with countries like 
Saudi Arabia, like Qatar, like all of the members of the Gulf 
Cooperation Council.
    Mr. Singh. I agree with what Brian said. I would not call 
it a Sunni-Shia conflict, and the reason is that some of our 
Sunni allies are almost as concerned about Sunni jihadism as 
they are about Iran. Iran for its part is quite happy to 
support some Sunni extremist organizations like Hamas. They 
supported the Taliban in the past. And so sometimes a sectarian 
affiliation is a convenient way to extend influence, but I 
think it is not the only way. And I think that you see that. 
Really what we are engaged in here is this is a battle amongst 
states and blocs of states for preeminence in the region.
    And I think what you have seen is a breakdown of the 
regional security order. You have seen a breakdown of states, 
as Brian has said. And that has caused this spreading chaos and 
I expect it will spread more unless something concerted is done 
to stem that. And I think we have a big role there. We have a 
big role in reconstituting a regional security order.
    Senator Perdue. What should that role be?
    Mr. Singh. I think we need to be in the lead. ``In the 
lead'' does not mean we have to do it. It does not mean we have 
to take the burden on ourselves, but I think we have to be the 
organizing force. We have to be the one that convenes our 
allies, brings them together, helps set the agenda, and again 
also helps them with building their institutions because I 
think that the states who have done best, who have fared best 
throughout all this are those that have resilient institutions. 
And I would like to see us invest not only in trying to solve 
what is happening in Syria and sort of help build governments 
in Libya. That is very hard. That is going to take a long time, 
even in the best of circumstances. But let us also make sure we 
are investing in shoring up the institutions in allied states 
that have not yet succumb to this chaos because I think that is 
going to be quite important for them. They have to be 
responsive institutions to their people as well. We cannot lose 
that as part of our policy just because of the problems that we 
face.
    Senator Perdue. Thank you both. Thank you, Mr. Chairman.
    Senator Cardin. Well, once again, thank you for being here 
and for your input.
    There is clearly a concern of our partners in the Middle 
East on their security as a result of the changing strategies 
in the Middle East. We have heard that from all of our 
partners. We have no closer friend than the state of Israel. 
Could you share with us what you think the United States should 
be doing post the Iran nuclear agreement to make it clear our 
unwavering support for the state of Israel?
    Mr. Katulis. If I can start with one and this is in part 
borne out of my own trips to Israel and the fact that I have 
some colleagues at this moment who are on the Golan Heights 
looking down into the chaos. And I was talking with them just 
earlier this morning.
    This is going to be a little tactical, but I think one of 
the main concerns that I have about the current environment, 
the post-JCPOA implementation phase and what is going on in 
Syria and the actions of Hezbollah is a particular 
vulnerability for Israel along its northern border. I was there 
last year several times, and I think there is more that we can 
do in the way that I think U.S. engagement with Israel over the 
last few years in support for the Iron Dome system and how that 
saved lives from the rockets and missiles coming from Gaza, 
coming from the chaos in the Sinai Peninsula at times. Those 
sorts of measures, whatever is being discussed in the MOU and 
the 10-year plan, looking at how can we reinforce Israel's own 
security along that northern border because as we look at the 
conflict in Syria and also the complications in Lebanon right 
next door, there is a lot of uncertainty there, and the fact 
that Hezbollah has used the last 10 years since--essentially 10 
years since the war with Israel in 2006 to rearm itself with 
the support of Iran, with the support of Syria--I think one of 
the first things that I think we need to do is talk about what 
sort of weapons systems we can do, what sort of intel platforms 
we can help the Israelis develop to ensure that they know what 
is going on and how to protect their citizens along the 
northern border.
    Mr. Singh. I agree with all that.
    I will say that based on my own recent trip to Israel, I 
think that things are getting back on the right track. The 
sense that I get is that as bad as the relationship has gotten, 
that in recent months it is improving. And I credit the 
administration for that and I think it is very important 
because this is our most important ally in the region.
    And I agree with some of those things that Brian listed. 
Some of this is aid, not just the amount of aid and not just 
the MOU but the sort of strategic planning that goes behind the 
aid. And that means we also have to have consultations at a 
high level. What do we do now about Iran? We disagreed on the 
JCPOA but let us make sure that we are hand in glove when it 
comes to detecting any efforts by Iran to cheat on responding 
to the missile threat, on responding to the proxy threat, which 
are all threats that Israel feels obviously much more keenly 
than we do given their geographic position.
    Then I think there is also something that is just a little 
bit more intangible which is I think we need to restore a level 
of sort of cordiality to the relationship. I think we need to 
act more like friends than we have in the past, fewer sort of 
public statements chiding the other, and more sort of private 
discussions about the threats that we face and about the 
concerns we might have about one another.
    And I think that also probably requires a trusted channel 
between the U.S. and Israel, which we have not really seen I 
think in recent years, but somebody--two people perhaps, one on 
each side--who can help to sort of address any concerns and 
disputes before they happen and also help to make this type of 
dialogue and strategic planning happen.
    Senator Cardin. Certainly all the signals that we are 
getting recently is that is being done, that there is much 
better direct conversations particularly among the sharing of 
intelligence information and strategies as it relates to common 
concerns in the Middle East. So I appreciate that response.
    Let me move to a different subject, and that is what 
confidence you have in the announcement made by the Saudis of 
the Islamic counterterrorism coalition, whether that in fact 
can be an effective partner in our campaign against ISIL, 
whether that in fact can be utilized for more unity among our 
Arab partners in the Middle East in our fight for the 
extremists that have been so dominant in that region.
    Mr. Katulis. First, I would not dismiss the announcement in 
and of itself. I think it is an important gesture on the part 
of the new Saudi leadership, and any time there is an actor in 
the region that says it wants to do the sorts of things that we 
would like it to do, I think it is potentially a good thing.
    But let me qualify that overall observation with some 
analysis informed by a trip to Saudi Arabia last month where we 
spent about a week and met with many of the top leaders. When 
this coalition was announced, Saudi Arabia caught many 
countries by surprise, including countries that were named in 
the coalition. So whatever the aspirations that are friends in 
Riyadh may have here, the simple fact of how the rollout was 
flubbed should raise some concerns about its implementation and 
its capacity to do that.
    Second, it is clear from the new Saudi leadership, its 
actions in Yemen last year and ongoing into this year, its 
efforts--while I was in Saudi Arabia, there was a conference to 
try to unify the Syrian opposition to Assad yet again--that it 
is trying to be more assertive and play a role.
    But I think a lot of those attempts will be constrained by 
two main factors: one, the regional fragmentation and the 
constraints that both Mike and I have talked about. There is 
only so much I think Saudi Arabia will be able to do. Look at 
sort of the response to the rivalry and the skirmish between 
Iran and Saudi Arabia earlier this month. Saudi Arabia 
completely cut off ties and canceled flights. Some of its 
closest partners in the GCC had a much more modulated response. 
So herding cats in the Middle East, because of the structure of 
these different views vis-a-vis Iran, other things will be 
harder for Saudi Arabia to do.
    The second constraint will be internal. And this is one I 
fear we are going to be talking a lot about more in the next 
year and beyond, is that the Saudi leadership has I think a 
very interesting vision about how it wants to transform its own 
social contract. It understands it has a lot of problems 
economically and socially inside the country.
    But I think my top line is, yes, it is great that Saudi 
Arabia announced that it wants to form a coalition. We should 
discuss how this fits with the coalition that we formed a year 
and a half ago to fight ISIS, but then we should also keep our 
eye on the ball that, A, the region is still fragmented and 
then, B, inside of Saudi Arabia there are going to be major 
challenges that I think could impact not only what is going on 
inside of Saudi Arabia but what is going on in the region. I do 
not know if it will be instability, but there are going to be 
moves made by the Saudi leadership and their internal dynamics 
that I think will create new possibilities and also new 
uncertainties that we have not seen before.
    Senator Cardin. Mr. Singh?
    Mr. Singh. I will just say I guess I would put a slightly 
most positive spin on it. I agree with Brian that there are 
real limitations here strategically, when it comes to 
interoperability as I mentioned before.
    But I think what this is a manifestation of--it is a 
manifestation of our allies in the region are increasingly 
acting and they are acting together. They want to act together. 
And I think that that is a real opportunity for the United 
States because we can help with some of these problems that 
they face. We can help, for example, with the strategic 
planning. We can help with the interoperability. We already are 
selling tens of billions of dollars of military goods to these 
countries every year or every couple of years. Let us make sure 
that all works together.
    I would like to see us have more of a sort of regional 
security forum, regional security consultations with, say, the 
GCC, with Jordan and Egypt as well perhaps in the room. That 
would be a real upgrade to how we do things now. As Brian has 
said sort of the whole is less than the sum of its parts when 
it comes to U.S. security assistance and cooperation in the 
region. This I think is an opportunity to correct that.
    Senator Cardin. Thank you.
    Thank you, Mr. Chairman.
    The Chairman.  Thank you.
    And, Senator Menendez, Monday evening at 5:00 we have got a 
classified briefing with the administration regarding what just 
has occurred.
    Senator Flake?
    Senator Flake. Thank you, and thank you for the testimony.
    Let me focus on the sanctions relief, what impact that will 
have domestically on Iran, along with the falling oil prices. 
To what extent does the fall in oil prices completely outweigh 
the sanctions relief? Has anybody done an analysis, oil at 30 
bucks a barrel over a period of 5 years, what that will mean?
    Mr. Singh, in your testimony you talked about there really 
has not been a domestic political benefit for the so-called 
moderates under Rouhani. How does this play out with falling 
oil prices?
    Mr. Singh. Well, Senator Flake, I think I do not want to 
say there has been no benefit for Rouhani and the pragmatists. 
I think Rouhani probably is popular, and I think the nuclear 
deal was popular amongst ordinary Iranians. The question is 
will that translate into, say, an electoral triumph for 
Rouhani's faction in February. That is where I am much more 
skeptical because you have a vetting process which is 
controlled by the Guardian Council, which is a more hardline 
body, and I think the Supreme Leader historically has not 
wanted his presidents to kind of ascend or rise too much.
    When it comes to those falling oil prices and the sanctions 
relief, the best analysis I have seen is that, yes, Iran will 
get more by selling its oil on the market than it would have 
gotten, say, under the JPOA when we were just sort of writing 
checks to the Iranians once every 6 months or something like 
that. But it will not be much more obviously, given the fall in 
oil prices. And of course, all that Iranian oil coming onto the 
market has probably depressed prices even further in 
anticipation of that. So it will not be nearly as much as they 
might have gotten had the oil prices been higher. But it will 
be better for them and, more importantly perhaps, the relief of 
the financial sanctions will spur all sorts of other kinds of 
economic growth. So it will not be as good as it could have 
been, but I think that you will still see strong growth in the 
Iranian economy.
    The problem is for the Iranian people. This does not mean 
that it will suddenly be a boon for ordinary Iranians because 
you have corruption. You have a lot of these sort of 
foundations and others who will capture I think a lot of the 
economic benefits of the sanctions relief in Iran. The IRGC I 
think will capture a lot of the benefits of the sanctions 
relief. And you also have economic mismanagement in Iran, which 
has been there for a long time.
    So this might actually be a danger for President Rouhani 
and the pragmatists. Expectations are high and what they are 
able to actually deliver might be low.
    Senator Flake. Mr. Katulis?
    Mr. Katulis. I think that was a very sound analysis on the 
internal dynamics.
    If I could note one point on the broader oil market and the 
competition in the region. It is not related to your question 
on Iran, but I think Mike's answer I think responded well to 
it. I think there are a lot of questions about what will the 
new Iranian leadership do or the current Iranian leadership do 
in the current context with the windfall from sanctions relief. 
There are some indications that they need to spend on 
infrastructure investment and things at home. There is a lot 
that they need to do in their internal economy.
    But on the broader point of the drop in oil prices--it is 
one I tried to highlight in my testimony--I think it is very 
important when it comes to strategic dynamics in the region. It 
is one where I think we analysts need to think a little bit 
more and you as leaders think a little bit more about what this 
means for the broader Middle East. It means after 10 years of 
essentially very high oil prices where some of our Gulf 
partners had a great capacity to spend and they are using those 
resources now in play in conflicts in Yemen, in Syria, and 
other places. If we think a little bit ahead of the curve in 
the next year or 2, the competition between Iran and Saudi 
Arabia, but not only Iran and Saudi Arabia, but Iraq, if it 
continues to get more oil on the market, is going to be I think 
tremendous no matter what happens with the global economy. And 
that I think leads an environment of continued competition not 
only in the military and security sphere and ideological sphere 
but one where OPEC essentially has broken down. And what that 
means for us on our regional and then our global strategy I 
think is very important.
    Senator Flake. With regard to the so-called windfall that 
comes with the post-sanctions regime here, part of that is due 
to the assets coming back that were frozen, but the bigger part 
is investment in the Iranian economy. With dropping oil prices, 
how much of that is not going to materialize? I guess I am 
asking how much of that is going to be in the oil sector, will 
not be in the oil sector now with prices where they are.
    Mr. Singh. So, Senator, I am not sure I know specifically 
the answer to that question. I think you will still see 
significant investment because there are opportunities to 
exploit, and there are opportunities not just in the oil and 
hydrocarbon sector. There are opportunities because Iran is a 
big consumer market. So I think you do see considerable 
interests from firms to go into the Iranian market. Obviously, 
there is also a certain amount of wariness not only because of 
the continued presence of sanctions but also because it can be 
tough to operate in the Iranian market whether because of the 
nature of oil contracts, which has actually recently been 
changed, although that is obviously quite new, or the role of 
groups like the IRGC and sort of the heavy hand they have in 
commercial activities in Iran.
    So my sense talking to people is that firms in places like 
Europe and Asia see this as a big opportunity, a sort of 
untapped market, but they also approach it with real caution.
    Mr. Katulis. If I could add. I think there may be two 
limits on what outside investors and international businesses 
might do inside of Iran.
    One is the simple practical matter that their banking 
system is outmoded and out of date. It is not in sync with the 
international system. There is a very good article--several 
articles about this recently in the ``Financial Times'' and 
other places.
    And then secondly--and this is simple and it comes back to 
the point of hostages and prisoners. The fact that this is a 
regime that has still detained an Iranian American who is 
involved in business--this sends sort of a signal that is this 
an environment where someone can go in and actually feel like 
they are safe and transact business. I think that is a big 
worry that I think a lot of people will have. I think people in 
Europe, businesses in Europe may have a slightly different view 
than American businesses. But I think the way that this regime 
behaves, the way that the system behaves I think will operate 
as a natural constraint on the opening of flood gates of 
investment inside of Iran.
    Mr. Singh. I would just add as an addendum I think the 
message is actually a little bit different. I think the message 
is you can come do business in Iran but you better have the 
right partners if you want to be secure.
    Senator Flake. Thank you, Mr. Chairman.
    The Chairman.  Senator Kaine?
    Senator Kaine. Thank you, Mr. Chair, and thank you to the 
witnesses.
    Who is a bigger enemy of the United States? Refugees from 
Syria or ISIL?
    Mr. Singh. That is an easy one, Senator. It is ISIL.
    Senator Kaine. ISIL. Just the reason I asked is we are 
debating a bill later today called the American Security 
Against Foreign Enemies Act. It is a bill to go after foreign 
enemies. And the enemies specified in the bill are refugees.
    Let me ask you a second question. In February, 11 months 
ago, the President sent to Congress a draft authorization for 
use of military force against an enemy, ISIL. There has not 
been a vote or debate about it in either house. Are you aware 
of any other instance where a President has submitted an 
authorization for use of military force to Congress and 
Congress has not taken it up for 11 months?
    Mr. Katulis. No.
    Mr. Singh. Not that I am aware of, Senator.
    Senator Kaine. I was at an Armed Services hearing earlier 
today, to kind of switch topics, and Ambassador Crocker was 
testifying. I am kind of going back and forth between--and he 
talked about the Iran-Saudi Arabia tension that you guys have 
described in your testimony and I am assuming you talked about 
when I was gone. And he said it is really important that the 
U.S. pick a side.
    Is there a danger in the U.S. picking a side in a sectarian 
divide?
    Mr. Katulis. Yes, there is a danger. In my testimony and 
what we discussed here before, I talked about what I see as a 
central challenge in the Middle East, which is the 
fragmentation of the nation state. And that is certainly Iran, 
and its support to sub-national actors, non-state actors in 
Iraq, in Syria, Yemen has contributed to that. But then the 
counter-reaction to some of our partners in the region have 
also had a deleterious effect on just the notion of central 
authority of governments that are coherent. So this is where 
Mike may have a different view than I do.
    But I think we need to be very cautious about picking sides 
in particular conflicts that feed into this notion of Shia-
Sunni divisions, that a better strategy would be to try to 
figure out ways to help reinforce the nation state in ways that 
these governments--and this is a long-term vision--rule justly, 
that rule according to international standards. We are so far 
away from that in Syria right now, and that is why anyone who 
talks to me about the Assad regime being a potential 
negotiating partner is ignoring the fact that that regime has 
killed more than 80 percent of its own casualties in the 
conflict there.
    So I would be not persuaded by an argument that says we 
have to pick sides. We have to be clear-eyed about it, and I 
think we have to be clearer than I think the current 
administration has been about the U.S. role being assertive to 
try to marginalize extremist voices and forces that want to use 
sectarianism.
    Senator Kaine. Mr. Singh?
    Mr. Singh. I may give you a very similar answer, which is I 
actually do not see the conflict in the region as being a 
Sunni-Shia conflict. We talked about that just a few minutes 
before.
    But I do think that it is very important that we stand with 
our allies and that they get the feeling that we are standing 
with them. You know, Saudi Arabia is an imperfect ally. I do 
not think anyone here would dispute that. But even some of our 
best allies sometimes do things we do not like, but we still 
stand with them. We are on the same page with them 
strategically. We share their interests, and we do a lot of 
things together over time. And I think that is what is 
important here. Our allies right now in this region and in some 
other places around the world are questioning where does the 
United States really stand. They should not have that question.
    Senator Kaine. It depends on how you look at it. Right? Is 
it a Sunni-Shia divide? Is it an Arab-Persian divide? Is it 
just nation state politics between Iran and Saudi Arabia? Is it 
Revolutionary Guard against monarchies? It is a worry about 
economic competition? There are a lot of different elements to 
this. I think that is a fair thing to say. It is hard to reduce 
it to a single ``this is a sectarian conflict'' because it is 
quite complicated.
    And so I guess the challenge for us is how do we be a 
quarterback, to use your analogy, or how do we actively engage 
without making it look like we are planting our feet on one 
side of a sectarian divide, probably accidentally really 
without trying to. It has been perceived, just because of who 
we have been allied with in the past, that we have been strong 
for the Sunnis and kind of irate against the Shias. That was 
not our intent, but that has been the perception. So how do we 
then begin to counter that notion that we are taking a side in 
a sectarian divide and explore some of the other complexities? 
That is the challenge that we have.
    Mr. Katulis. If I could say, I think one place to start 
would be to make sure that we are placing a higher emphasis on 
those reliable and capable partners that are closer to our 
values. Israel certainly is there. I think the Jordanians, when 
it comes to inclusivity, the welcoming of millions of refugees, 
the Kurds of Iraq. Any force and element--and this is the thing 
when you look at these societies, including Saudi Arabia and 
Iran, as these unitary actors. And the simple fact, as you 
know--you travel the world--is that there are so many different 
voices that I would call progressive voices--
    Senator Kaine. They are more unitary than we are. 
[Laughter.]
    Mr. Katulis. Yes, yes, exactly. Yes.
    And going to your first question about refugees versus ISIS 
as well, the values of inclusivity, of not looking at 
individuals in particular categories of Shia, Sunni, or Muslim 
and trying to ban them or bar them, working with those partners 
and building a much more coherent coalition than we have right 
now I think would be one.
    Second--we have talked about this a lot--is trying to help 
reinforce the state system in the Middle East in a way that 
reflects not only the power balance but then also our values. 
Again, far afield, I think we are trying in Iraq. I think the 
leverage and the tools of U.S. assistance to try to get a 
different complexion of the Iraqi Government was an important 
first step, but it has not been followed through on. Those 
sorts of tools we have not used I think effectively across the 
region or as effectively as I think we could.
    Mr. Singh. Look, I agree with that. I think that these 
alliances are based on shared interests, and that will always 
be sort of really at the forefront of our relationships. But I 
think that we can make the case to these allies that it is in 
their interest and it is in our mutual interest frankly that 
their institutions, their political institutions, economic 
institutions, security institutions, be inclusive and 
responsive to the people, including minorities. And I would 
make an analogy with, say, Eastern Europe and the Russian-
speaking minorities in Eastern Europe. If you worry that these 
are vectors for Russian influence, what you do not want to do 
is sort of marginalize them and cut them off. You want to make 
sure you are embracing them and integrating them essentially 
into the state. And I think we can make the same argument here 
when it comes to minorities in the Middle East.
    Look, I think we should make that argument as sort of 
forcefully and as candidly as we can, but they are going to 
listen to us I think only if they see us as an ally and as a 
friend.
    Senator Kaine. Thank you, Mr. Chair.
    The Chairman.  Thank you.
    Just to follow up, I will ask a similar question, and that 
is do you remember any time in history when an administration 
believes they fully have the authority to conduct a war, are 
conducting a war, that they send up an AUMF saying if you guys 
would like to participate, you can but we already have the 
authority. I think the answer is no.
    Mr. Singh. No.
    The Chairman.  Senator Shaheen?
    Senator Shaheen. Thank you, Mr. Chairman. And thank you 
both for being back before this committee.
    I am going to follow up a little bit on some of the issues 
that Senator Kaine was raising because like him I was just at 
the Armed Services Committee, and so I am sorry I missed your 
testimony.
    But one of the points that Ambassador Crocker made in that 
hearing is he said--he was talking about the JCPOA, the hostage 
release, and he said we have to recognize that we have not made 
a strategic shift in the Middle East with Iran. These have been 
transactional. And so it has been a transactional shift.
    So I wanted to ask you all how would you define a strategic 
shift. What do we need to do in order to accomplish a strategic 
shift with respect to Iran?
    Mr. Singh. Well, thank you, Senator. First of all, I agree 
with the premise. I agree with what Ambassador Crocker said. I 
mean, we have not seen a strategic shift by Iran.
    It is important to bear in mind, as I think everyone here 
would agree, in all these cases, none of them would have ever 
come to pass if Iran behaved as a responsible state. In most of 
these cases, in a sense we are rewarding or praising Iran for 
solving problems of its own creation. And that is always a trap 
with states like Iran. We see it with North Korea as well where 
they create a crisis, and then they de-escalate it and they get 
sort of praise for the de-escalation, rather than punished for 
the original provocation.
    What will it take to achieve a strategic shift in Iran? I 
think it takes something internal in Iran. They would really 
need to change the way that they view their role in the region, 
the way they view their relationships with their neighbors. And 
I think that to the extent we can hasten that or facilitate 
that, it is by making sure that we are punishing behavior which 
we find destabilizing and irresponsible but also engaging in 
rewarding constructive behavior.
    It is tough to pull that off and I think we have not pulled 
it off. My worry about our recent policy is that you can easily 
slide into this policy of sort of serial accommodation for fear 
of, say, derailing the JCPOA or undermining the moderates and 
so forth. I do not think that works because I think that one of 
the reasons that President Rouhani is President of Iran is that 
he made the case in his campaign that, look, the actions we 
have taken have caused us a lot of problems. And he could not 
have made that case if we had not had tough sanctions in place, 
if they had not had to pay a price for what they were doing. 
And so I think it is important that when they do something that 
is irresponsible and destabilizing, that there is a price that 
they pay.
    Senator Shaheen. Mr. Katulis?
    Mr. Katulis. Yes. I would add to that. I mean, I think the 
onus is on Iran and how it behaves in the region and in the 
world for that matter is I think the key litmus test.
    But a second thing I would add is how it deals with its own 
people. And again, I want to highlight this because I think it 
has become out of vogue. It is not in fashion anymore to talk 
about freedom and democracy. And I started my career working 
with groups like the National Democratic Institute. And I 
understand that change needs to come on the society's own 
terms, but I think for us to really be able to even conceive of 
a strategic shift towards Iran, you need to have a regime that 
operates differently, that rules more justly, that respects the 
basic rights of all of its society.
    And the republic of fear that is still in Iran right now is 
one that I--again, we should not be naive about the nature of 
this regime. Its actions in the region post JCPOA I think speak 
volumes about how it still has not made a decision to fully 
rejoin the international community, but in my view also, a 
decision to rejoin the international community means changes 
inside the country as well. I would never feel confident about 
the reliability of a country like Iran the way that it rules 
right now.
    Senator Shaheen. I am sorry to hear you say that support 
for freedom and democracy is out of vogue because I think that 
is one of the underlying tenets of our foreign policy or 
certainly should be.
    I understand that earlier in the hearing there was some 
discussion about efforts to address Iran's support for 
terrorist activities in the region. And one of the things that 
is still pending in Congress is the nomination of Adam Szubin 
to be Under Secretary of the Treasury for Terrorism and 
Financial Crimes. Would it not be helpful for us to get that 
nomination approved so that we have Adam Szubin place in the 
Treasury Department to continue to look at where money is being 
spent to support terrorist activities and to help us go after 
that?
    Mr. Katulis. Absolutely.
    Mr. Singh. Yes. Look, I would say, Senator, I have a 
conflict of interest because Adam is a former colleague and a 
friend, but I think he is a good guy and that is an important 
position. I do not know the nature of the holdup, but----
    Senator Shaheen. I think it is fair to say it is politics.
    Mr. Singh [continuing]. He has done great work for the 
country.
    Senator Shaheen. Thank you. I am sure, Mr. Chairman, you 
would agree with that.
    I have a few more minutes, and I just wanted to ask. I know 
there has been a lot of discussion about the response to Iran's 
ballistic missile test and what is happening at the U.N. and 
what else we can do to sanction bad actions by Iran over this 
period of time of the JCPOA.
    So what other options do we have to respond to Iran's 
activities? We have our own unilateral sanctions. I think it is 
probably going to be a little more challenging to get the 
Europeans on board for sanctioning various activities. So what 
other options do you all think we have got as we are assessing 
what Iran may be doing that borders on violation of some of the 
tenets of the JCPOA?
    Mr. Katulis. Well, I want to reiterate a point I made is 
that we could use our military footprint and our partnership 
with allies in the region to send signals back to Iran, whether 
it is naval exercises or more robust brush-back pitches. They 
do it all the time. You know, I do not want to sound like some 
sort of--I am talking about measured, calculated responses that 
reminds Iran and the people in their military forces and the 
Revolutionary Guard and others that we are the strongest force 
in the region with our partners.
    So the sanctions in Mike's testimony covers it very well. 
He went through I think very thoroughly, may add to it. There 
are any number of steps that we can take. Whether the U.N. acts 
or not is somewhat in our control if we are much more 
diplomatically forceful, but it depends on what Russia, China, 
and others want to do. But there are things that we can do, we 
should have done in my view in response to ballistic missile 
tests. And again, I do not mean in escalating into some sort of 
conventional war, but demonstrating that our presence is there 
and reminding Iran of that presence.
    Mr. Singh. I would only add a couple points. I have a long 
list of sort of bullets in my written testimony which go into 
specific actions we can take. I would just make two broad 
points, though.
    One is I think that it is not enough to rigorously enforce 
the JCPOA or prevent cheating per se because I think the JCPOA 
needs to be fixed. I think we can do that without having 
necessarily to renegotiate the deal, but I think we need to 
strengthen it in addition to rigorously enforcing it.
    The second broad point is I have often said that I think 
our efforts to counter Iran really need to start with Syria not 
only because Syria is perhaps the most important conflict we 
see, and Iran is perhaps the most important player in that 
conflict in quite a negative way, but because I think our 
allies around the world, especially in Europe, are looking for 
us to provide leadership on Syria because if you are in Europe, 
you are in France or Germany, this has become a domestic 
political issue for them and they are looking for an answer. 
And if that involves sanctions on Iran, I think we have a 
powerful case to make. But so far we have not really stepped up 
with that strategy.
    Senator Shaheen. Thank you.
    Thank you, Mr. Chairman.
    The Chairman.  Thank you.
    I am going to close with some questions, but I know Senator 
Menendez had a few, and out of courtesy, I will let you go 
first and then close out.
    Senator Menendez. Thank you, Mr. Chairman, very much.
    Just one quick comment before my three questions I would 
like to get your insights on. And this has been very helpful, a 
lot of good insights that you have both shared.
    On the Iran Sanctions Act, it just seems to me that if we 
are going to have the potential to snap back to something, you 
have to have something in place. And if you know what it took 
not just to pass the law but to then go through the whole 
process of global notification to countries and businesses and 
then enforcement of it, it is a year easy. So at the end of the 
day, the suggestion that Congress would be willing to do that 
at any time is not as meaningful as the time frame that it will 
take to make it of value, and if breakout is a year and if 
there is to be a violation, then the sanctions without being 
enforced at the time will be meaningless. So I think it is very 
important to have something to snap back to, and I will be 
pressing that issue.
    You both have been asked questions here, and I want to just 
see if I can get any greater thinking from you on how does 
decision-making take place in Iran as it relates to the 
decision on how to expend money. I think that is incredibly 
important because that is going to, to some degree, dictate how 
much is this going to go for civilian purposes, infrastructure, 
the things that the most optimistic people who will look at 
what Iran is getting, say, will spend on versus the Ayatollah. 
There are published reports of his vast holdings that I am sure 
it did not happen by accident that he acquired those vast 
holdings or that the Iranian Revolutionary Guard has some of 
the elements of Iran's economy that they operate and that they 
are going to want to get a piece of the action even if they 
were opposed to the agreement in the first place. Now that 
money is flowing, they are going to want to get a piece of the 
action.
    So I look at what just happened with the Guardian Council 
and the number of people that were excluded. Of the 12,000 
candidates, about two-thirds who applied to run for the 
parliamentary elections were excluded. And one of the 
reformists actually said that their camp was overwhelmingly 
targeted with one saying barely 1 percent has been approved. 
Now, we do not know whether that is just an anecdotal 
observation. But nonetheless, clearly a fair universe of those 
who might want to see greater engagement in the world did not 
seem to win out the day, and if the legislature is part of 
deciding the parliament there, how money is going to be spent, 
and the Ayatollah clearly has a say because he has six of the 
appointees to that Guardian Council and then the other six 
elected by the legislature which has his voice as well, then at 
the end of the day, do you have any insights as to how, based 
on the past, the decision-making about the expenditure or 
allocation of money is taking place?
    Mr. Singh. Well, Senator, I wish I could give you a clear 
answer to that. I cannot. It is something that I would also 
urge you to ask the administration for a briefing on because I 
think it is an important question.
    I will say that clearly the President of Iran has a strong 
role in sort of setting a budget and so forth. In his budget 
last year, he increased spending for military and security 
matters. But there are clearly a lot of organizations which, as 
you said, are very powerful, these bonyad foundations, the 
IRGC, the broader intelligence apparatus in the Supreme 
Leader's office which clearly have a role in that and clearly 
do quite well not just from the transfer of unfrozen assets, 
but they also have a very strong role in Iran's economy and so 
stand to benefit from new investment and new commercial 
activity where you need to, as we have alluded to before, have, 
say, an IRGC partner working with you if you are a foreign 
investor coming into the country. So clearly there is a lot 
that is going to happen that is not strictly on the books, not 
strictly in the budget, which is worth paying attention to.
    Senator Menendez. Let me ask you this. Do you not think it 
is fair--I know one of the observations--I think Mr. Katulis 
said that we should be supportive of a more robust budget for 
the IAEA so that the enforcement mechanisms--and I believe the 
IAEA needs the resources. But do you not think it is fair to 
have the Iranians either pay or at least contribute to the 
IAEA's budget because they created the circumstances that the 
global community said you are headed on a path towards a 
nuclear weapon? And so the whole monitoring process is created 
because of the conditions that they created in the first place. 
So is it not fair to seek the Iranians pay either all or at 
least contribute towards that especially since they now have a 
windfall of money?
    Mr. Singh. Well, sure, Senator, I would love to see that. 
In a sense, the Iranians, if they want to keep this deal, have 
as much interest as anybody else in ensuring that the 
monitoring and verification proceeds the way it is supposed to.
    I would just want to add to your point, though. Yes, we 
should make sure the IAEA has the resources to do what it needs 
to do, but I think we need to go well beyond that, I would say, 
including ensuring that we push the IAEA to be forward-leaning 
in its requests for access and the way that it carries out its 
mission because there will probably be some intimidation coming 
from the other side and we need to have their backs.
    Second is the next DG of the IAEA needs to be a person who 
really embraces this mission and is serious about it in the way 
that I think so far DG Amano has been, but his predecessor was 
not, frankly.
    And then third, I would say we cannot just rely on the 
IAEA. I really am concerned that as this is considered a sort 
of done deal, an issue of the past, that the funding and the 
attention and the resources within our government focused on 
this issue, on detecting cheating and things like that, will 
shift elsewhere. And I think that would be a big mistake.
    Senator Menendez. Certainly the IAEA is an intelligence 
body. And so everything we hoped for in the implementation of 
the accords is going to have a big intelligence element to make 
sure it takes place.
    Are you in agreement with Mr. Singh on his comments?
    Mr. Katulis. Yes.
    Senator Menendez. And one final question. In the reality of 
Russia's bombing having succeeded for the purposes of 
strengthening Assad, Iran seems to be pretty linked with Russia 
maybe for different purposes, but pretty linked with Russia in 
their end goal for Syria. Should we expect that Iran is 
actually going to be a constructive player on helping us get to 
the goal, the diplomatic or political solutions we want in 
Syria if it means getting rid of Assad?
    Mr. Katulis. I would not have high expectations on that 
front. I would not.
    Senator Menendez. You would?
    Mr. Katulis. I would not. Yes, I would not because I think 
actions speak louder than words, and you see not only what Iran 
has done but then some of its proxies like Hezbollah and moving 
in different episodes in the Syrian conflict. So I would not 
have high expectations, though I am on the record for seeing 
what can be done if there is anything possible here because the 
crisis in Syria--we should have responded I think earlier and 
things have gotten out of control. So we need to test every 
possible way to bring an end to that conflict even if it 
includes talking with and bringing Iran into the process as 
they have been brought into in Vienna.
    The last thing I would say on it, though, and I want to 
stress is that no matter if we can get to some sort of 
foothold, some sort of endpoint in conflict resolution, the 
thing that we need to talk about when it comes to power sharing 
and political transition inside of Syria is the nature of the 
regime itself that would be created afterwards, the nature of 
who is involved there. And we need to have a much stronger 
voice than I think we have had. We cannot just leave it to the 
Saudis to organize the anti-Assad coalition, and we cannot just 
leave it to Iran and Russia to shape the battlefield in the way 
that I think they have in the last 4 or 5 months.
    Mr. Singh. I will add one thing, Senator, which is I agree. 
I have very low expectations for this Vienna process. I think 
that Iran and Russia do not have exactly the same aims in 
Syria. You could imagine, although I do not think it is likely, 
Russia accepting some outcome other than Assad being in charge. 
I think Russia has its own motivations.
    I think Iran--Iran is strategically vital for Syria --I am 
sorry. Syria is strategically vital for Iran, and they need a 
compliant government in Damascus that will essentially allow 
them to use Syria as their sort of forward operating base.
    I think one of the things that we need to try to do, 
although I think it is awfully difficult, is to the extent we 
can, drive a wedge between Iran and Russia in this process 
because I worry about a sort of more strategic, deeper alliance 
forming between the Russians, the Iranians, Hezbollah, and 
Assad in a way that could really complicate matters in the 
region, say, for Israel, could really complicate matters in the 
region for the Jordanians and others in a way that we have not 
even seen yet. It is already quite bad, but I think it could 
get much worse.
    Senator Menendez. Thank you.
    Thank you, Mr. Chairman, for your courtesy.
    The Chairman.  Thank you. Absolutely.
    Just to close out, I want to speak just a little or talk a 
little bit about the coalition we talked about earlier. I think 
it was wise of you to point out that we need to continue to 
work with our European, quote, allies relative to Iran.
    But to China and Russia--I mean, we understand how these 
violations need to be dealt with. We understand that five need 
to be a part of it. But I do not think there is any question 
that Russia and China, by virtue of the Syrian conflict, but 
also what China is doing right now relative to selling arms, 
actually view Iran as an ally. Is there any question about that 
now that this deal is being implemented?
    Mr. Singh. I do not think there is any question about that. 
I think both Russia and China see Iran that way. In fact, the 
Chinese President will be in Iran in just a few days, the first 
leader to visit after implementation day.
    Senator Menendez. Mr. Katulis?
    Mr. Katulis. Yes. I agree. I mean, I think Russia has a 
slightly more coherent and robust approach to the region right 
now. My sense from China--and I was in Beijing last year--is 
that they are still trying to figure out--they have clear 
equities in Saudi Arabia with their dependence on energy 
resources there, but perhaps they are shifting with Iran. I 
think they have a slightly different and not as clear view as 
Russia does. Russia I think has operated in ways that we 
understand who it backs and what it stands for.
    The Chairman.  But you usually do not provide defensive 
weaponry to people that are not your allies. Is that correct?
    Mr. Katulis. That is correct, yes.
    The Chairman.  So I just think that when we look at the 
region now, as you look at the group of countries who came 
together to negotiate this agreement, there is a real clear 
divide, a very clear divide that makes over time it even more 
difficult, if you will, when there are inconsistencies, 
problems, violations--make it even more difficult especially at 
the U.N. Security Council to really crack down on those 
violations when you know you have two countries that were part 
of this coalition, quote, quote, candidly viewing Iran as an 
ally.
    Mr. Katulis. I think that is right. And if I can go back to 
one of the points that I wanted to stress, which is so long as 
the region continues to fragment, that the state system 
continues to fragment and Iran is part of that and that China 
and Russia and aiding and abetting that, at a certain point 
that harms their interests as well. You know, the problem of 
their support to Iran is that it will allow Iran to punch far 
above its weight and conduct malign activities in the region. 
And that is why I think we need to continue to have this robust 
engagement with both China and Russia. They are trying to play 
a role in the region, but I go back to my central point that 
they really cannot rival what we have, what we bring to the 
table. But we need to be willing to use those resources and 
deploy them in a military and diplomatic strategy against them.
    Mr. Singh. And I would just comment, Senator, that I think 
you are right. I think China and Russia both had their own 
reasons I think for engaging in the P5 Plus 1 the way they did. 
I think neither wanted to see a U.S.-Iran war for perhaps 
different reasons, you know, China in part because it gets 
almost all of its energy from that area. But neither really 
want to see the flowering of U.S.-Iran friendship either. I 
think that China, while it tries to sort of be friends with 
everybody in the region, really sees Iran as its main strategic 
partner by virtue of its geographic location, by virtue of the 
fact that it is really the only major power in the region which 
is an ally with the United States.
    And so I do think that this will be a point of difference. 
And of course, both, as I said, China and Iran share this sort 
of deeper goal of reshaping the international order in a way 
that excludes us more.
    The Chairman.  And how important are the economic ties that 
are being generated right now between our European allies on 
this issue, quote, quote? How important is that economic 
relationship that is being developed now that implementation 
day has taken place and even before, really?
    Mr. Singh. Well, I think it is important insofar as, you 
know, on the one hand, for the Iranians and for those who have 
been advocates of this deal, they say, well, you have to show 
that the benefits come, and that is what this is. But there is 
another side to that, which is having worked on the sanctions 
issue in the mid-2000s, I think we forget just how hard it was 
to get that initial cooperation because of all these economic 
linkages. And so, look, if we had a great nuclear deal, I would 
say, yes, absolutely this is wonderful.
    But because I worry that this is actually quite a flawed 
nuclear deal and in fact we have not seen the strategic shift 
that we wanted from Iran in the region, I worry that in the 
future this will be a real impediment to effective deterrence 
of Iran, to effectively fixing the flaws in the nuclear deal 
and preventing an Iranian nuclear breakout.
    The Chairman.  Do you want to add to that, Mr. Katulis?
    Mr. Katulis. I share some of those concerns, but I think it 
is still a little too soon to tell that I think we should 
discuss sort of in a few months what we see, how Europe acts, 
and to the point that I made earlier that I think our diplomacy 
and how we try to maintain unity with our partners to have 
structure in place if Iran does not abide by this agreement to 
be able to snap back.
    The Chairman.  Do we have any indications how robustly our 
European partners in this effort pursued ballistic missile 
sanctions at the U.N.?
    Mr. Singh. I am afraid I do not have an answer to that, 
Senator.
    The Chairman.  I think again between the leverage now, from 
my perspective anyway, being with Iran and the fact that we 
have Russia and China that deem Iran to be an ally, and we have 
our European friends deepening their economic ties, I think it 
is going to be very, very difficult in the future to push back 
in any meaningful way against violations that take place. And I 
think your statements earlier about the fact that what that 
will mean is a further fraying, if you will, of our 
relationships in the region, the fact that you are here 
pointing out some of the things that we need to do to make sure 
that we put as much pressure on the administration as possible 
to keep that from happening and to have a much more coherent 
strategy--even though we have been there, it has been more 
transactional--has been important.
    So I want to thank both of you for being here today. I want 
to thank you for helping us in the past. I am sure you will be 
here in the future.
    We are going to keep the record open until the close of 
business Friday. If you would answer questions promptly like 
you always do, we would appreciate it. And with that, the 
meeting is adjourned.
    [Whereupon, at 12:02 p.m., the hearing was adjourned.]

                              ----------                              

                      RECENT IRANIAN ACTIONS AND 
                   IMPLEMENTATION OF THE NUCLEAR DEAL

                              ----------                              


                         TUESDAY, APRIL 5, 2016

                                       U.S. Senate,
                            Committee on Foreign Relations,
                                                    Washington, DC.
    The committee met, pursuant to notice, at 10:00 a.m., in 
Room SD-419, Dirksen Senate Office Building, Hon. Bob Corker, 
chairman of the committee, presiding.
    Present: Senators Corker [presiding], Rubio, Flake, 
Gardner, Perdue, Barrasso, Cardin, Menendez, Shaheen, Coons, 
Murphy, Kaine, and Markey.

             OPENING STATEMENT OF HON. BOB CORKER, 
                  U.S. SENATOR FROM TENNESSEE

    The Chairman.  The Foreign Relations Committee is called to 
order. I want to thank our witness for testifying today.
    Ambassador Shannon, we congratulate you on your 
confirmation. We appreciate your continued service to our 
country, and we look forward to working with you in this 
capacity.
    Today, we are looking forward to hearing your thoughts on 
the implementation of the JCPOA and relations with Iran. I 
think all of us have been, and remain, skeptical of Iran. Many 
of us were and remain skeptical of the nuclear deal.
    There is also bipartisan frustration with the perception 
that previous commitments made by the administration are not 
squaring with reality. Secretary Kerry told us that the 
ballistic missile test ban would stay in place despite language 
suggesting otherwise. He testified before this committee that 
the exact same language in the previous embargo is in the 
agreement with respect to launches. We challenged him, as you 
probably know, --when the ``called upon'' language was put in 
place, and we said we felt that weakened the agreement. They 
pushed back strongly.
    As it turns out, we were right, and that is very 
concerning.
    Now, if I could, our European friends wrote a letter saying 
it was inconsistent instead of saying it was in violation, in 
many ways supporting Iran's position. That was very 
disappointing.
    Ambassador Mull confirmed that launches would be a 
violation of the new U.N. Security Council resolution when he 
testified in December, saying that ``called upon'' language 
would violate U.N. Security Council Resolution 2231. Obviously, 
the U.N. Security Council does not view it that way. It is very 
different than what we have been told.
    There is a lot of speculation that Iran will soon get some 
type of access to transactions involving the U.S. dollar. We 
would like to get your assurance that the dollar will not be 
available to Iran.
    Yesterday, I did have a very good call with Adam Szubin. He 
assured me that that was not the case. Then this morning, 
Secretary Kerry was on a television program and acted as if we 
are going to find some accommodation for Iran.
    So, yesterday, I felt very reassured after talking to Adam 
that we were not U-turning U.S. dollars and that we were not 
going to be involved in helping them outside of the agreement. 
Yet this morning, it seemed that Secretary Kerry indicated that 
we were, so I would love to have your response to that.
    There are also questions about whether or not the 
administration would consider new legitimate sanctions 
authority for violations of the JCPOA. I think you know there 
is bipartisan support for new sanctions authority in response 
to Iran's repeated ballistic missile launches.
    Previous assurances, including some by the President, 
clearly stated that we deserved the right to take new steps 
should we need to increase push back against Iran's nonnuclear 
behavior.
    I think the repeated ballistic missile launches and desire 
to purchase all types of weapons from Russia proves that an 
increased push back is necessary.
    I hope you can help us answer some of these outstanding 
questions in a constructive manner, so that we may know what 
the administration is thinking regarding these important 
matters.
    With that, again, I want to thank you for your service. I 
am glad you were confirmed in the timeframe that you were. We 
appreciate you being here.
    With that, I will turn it over to our distinguished ranking 
member, Ben Cardin.

             STATEMENT OF HON. BENJAMIN L. CARDIN, 
                   U.S. SENATOR FROM MARYLAND

    Senator Cardin. Thank you, Mr. Chairman, and thank you for 
convening this hearing. This is our first hearing on the JCPOA 
since its implementation date on January 16, as we look at how 
we are going to look at the post-JCPOA era.
    Ambassador Shannon, it is a pleasure to have you here. 
Thank you very much for your continued commitment to our 
country. You hold a critically important position as we look at 
the enforcement of the JCPOA and other activities that Iran is 
participating in.
    It is clear to me that we need to work together in regard 
to making sure Iran fully complies with the JCPOA, that we need 
to look at Iran's other nefarious activities. The chairman 
mentioned the ballistic missile test on March 8 and 9. Iran did 
ballistic missile tests that were clearly in violation of the 
missile ban and is clearly out of compliance with the United 
Nations Security Council Resolution 2231. Whether it was a 
formal violation that requires action is something that is 
being debated internationally. But it was clear that those 
types of missile violations were supposed to end and that we 
should be prepared to take strong action, and the 
administration has taken action.
    Throughout the Middle East, Iran is an instigator of 
instability and conflict, fostering violence through its 
financial support of terrorist groups and violent militias, 
committed to the path of sectarian violence. We need to be able 
to take action in regard to those types of activities.
    As the chairman knows, this past period when the Senate was 
not in session, I led a codel to Qatar, Saudi Arabia, and 
Israel. Senator Markey and Senator Gardner of this committee 
joined me, along with Senator Merkley.
    In Israel, I spoke at length with the Israeli leaders about 
ways to further enhance our security cooperation. I have 
witnessed this cooperation firsthand paying a visit to the Iron 
Dome, the anti-rocket battery, a joint Israel-U.S. project that 
saves lives. I was very impressed by the commitment of the 
Israelis working with the United States in regard to their 
missile defense systems.
    The U.S. and Israel are working together to complete other 
systems, including Arrow-3 and David's Sling, all very 
important.
    I sort of expected to hear that from the Israelis, but when 
I was in Qatar and Saudi Arabia, I heard similar types of 
concerns. It was encouraging to see I guess the consistency of 
concerns expressed by the Israelis and by the Saudis and by the 
Qataris. They all are very concerned about Iran's influence in 
that region.
    They are concerned about what Iran is doing in Syria. We 
just saw in today's articles that Iran has sent advisers into 
Syria to support the Assad regime. The ceasefire does not 
appear to be holding. Iran's activities are clearly 
destabilizing in that area.
    In Yemen, we have a delicate ceasefire that we hope will 
yield results, but we know Iran is still actively engaged in 
Yemen.
    So there is concern about what Iran is doing.
    In Saudi Arabia, I learned how continued U.S. defense 
cooperation has significantly bolstered the capacity of the 
Saudi partners, including how U.S.-supplied Patriot missiles 
have shut down SCUD missiles fired by the Iranian-supported 
Houthi movement in Yemen.
    In Qatar, I visited the U.S. troops stationed at the 
Combined Air Operation Center, an incredible operation there, 
and really dedicated men and women in the campaign against 
ISIL, and saw firsthand the impact we are having in that 
region.
    So, Mr. Ambassador, it was encouraging to see the unity. 
But I must tell you I am concerned about the challenges that we 
have in the Middle East, and Iran's role in making those 
challenges more difficult.
    I think we have to talk about how we can most effectively 
deal with those challenges. To me, it is not undermining the 
JCPOA. I opposed the JCPOA, but I want to see it now carried 
out. I want to see aggressive oversight by the administration 
and Congress to make sure there is strict compliance by Iran in 
regard to its nuclear obligations.
    Then we need to work in unity on Iran's other nefarious 
activities that are continuing, including the support of 
terrorism and human rights violations and its ballistic missile 
tests, and how we as Congress, working with the administration, 
can give you a stronger hand to prevent these types of 
activities from continuing.
    So I look forward to this exchange as to how we can work 
together in order to accomplish our mutual objective, to 
prevent Iran from becoming a nuclear weapon state, but also to 
rein in Iran's activities in regard to ballistic missile 
violations, human rights violations, and the support of 
terrorism.
    The Chairman.  Thank you.
    Our witness today is the Honorable Tom Shannon, Under 
Secretary for Political Affairs at the U.S. Department of 
State. I know you have been before us in the past. If you 
could, summarize your comments in about 5 minutes. I think most 
of us have read your written testimony and it will be entered 
into the record, without objection, in full. But if you would 
summarize, we will go to questions. We thank you again for 
being here.

 STATEMENT OF HON. THOMAS A. SHANNON, JR., UNDER SECRETARY FOR 
  POLITICAL AFFAIRS, U.S., DEPARTMENT OF STATE, WASHINGTON, DC

    Ambassador Shannon. Thank you very much, Mr. Chairman. 
Thank you, Ranking Member Cardin, and distinguished members of 
the committee. It is a real pleasure to be here and a great 
pleasure to be here following my confirmation. I thank you and 
all the members of the committee for your support.
    It is a pleasure to be here to talk about our U.S. policy 
toward Iran and especially recent Iranian actions. I will 
summarize, as you noted, the remarks that I have submitted 
officially.
    I want to focus on three key policy objectives regarding 
Iran. The first is our intent to ensure that Iran adheres to 
the JCPOA, and that Iran does not develop a nuclear weapon. The 
second is to counter Iran's support for terrorism, and to 
counter its ballistic missile program while also working 
diplomatically to encourage Iran to play a more constructive 
role in the region. And finally, to promote respect for human 
rights in Iran.
    Iran has taken significant, irreversible steps that have 
fundamentally changed the trajectory of its nuclear program. 
Before the JCPOA took effect, Iran was less than 90 days away 
from getting enough fissile material for a nuclear weapon, 
should it have chosen to pursue that path. Today, Iran is over 
a year away from being able to get that material. Any attempt 
to do so would be quickly detected by the international 
community.
    In exchange for Iran completing its key JCPOA commitments, 
the United States and the European Union lifted nuclear-related 
sanctions on Iran. The United States retains our ability and 
authorities to snap back sanctions into place, should Iran walk 
away from the JCPOA. But as long as Iran continues to meet its 
commitments, the United States will continue to meet our 
commitments.
    While we are encouraged by Iran's adherence to its nuclear 
commitments thus far, I want to emphasize that the JCPOA did 
not resolve our profound differences with Iran. We remain 
focused and determined to continue to address those differences 
and to take all necessary actions to protect ourselves and our 
allies.
    Iran's support for terrorist groups like Hezbollah, its 
assistance to the Assad regime in Syria and to Houthi rebels in 
Yemen, sare at odds with core U.S. interests and pose 
fundamental threats to the region and beyond. That is why we 
have retained our sanctions related to Iran's destabilizing 
activities in the region, including its support for terrorism.
    We also believe the most effective way to push back on 
aggressive Iranian activity is to work cooperatively with our 
allies to deter and disrupt Iranian threats. This is why we 
increased our security cooperation with the Gulf Cooperation 
Council following the Camp David summit and have provided 
additional assistance to Israel.
    Furthermore, we continue to coordinate with our coalition 
partners to interdict illicit Iranian weapons shipments 
throughout the region.
    We also share your deep concerns about Iran's attempts to 
develop increasingly capable ballistic missile systems, which 
are a threat to regional and international security. While full 
implementation of the JCPOA will ensure that Iran is unable to 
develop a nuclear warhead to place on a missile, we will 
continue to use all available multilateral and unilateral tools 
to impede the development of Iran's ballistic missile program.
    Our human rights policy has not changed as a result of the 
JCPOA. Iran violates fundamental human rights of its citizens 
by severely restricting civil liberties, including the freedoms 
of peaceful assembly, expression, and religion. Human rights-
related sanctions are not subject to relief under the JCPOA, 
and we continue to vigorously enforce these sanctions.
    While our concerns about Iran are substantial, we believe 
it is in U.S. national interests to continue a dialogue with 
Iran to address issues directly where we can, make sure that 
Iran is hearing both publicly and privately what we stand for 
and what we will not stand for. We will continue to hold Iran 
to its commitment to bilateral discussions about the 
whereabouts of Robert Levinson, and we will continue to raise 
the unjust detention of U.S. citizen Siamak Namazi and his 
father, Baquer Namazi.
    The Congress plays an essential role in shaping our policy 
and posture toward Iran. The legislative and executive branches 
should continue to work together, as we did to build 
international pressure on Iran, to calibrate our approach to 
countering Iranian threats while remaining willing to engage 
when we judge it into our interests to do so.
    I look forward to continued consultation with the Congress, 
as we strive to find the right balance between keeping this 
hand of friendship and lines of communication open and standing 
strong and resolute in the face of real and dangerous threats 
from Iran to the United States and our partners.
    Again, I thank you for this opportunity to testify, and I 
look forward to your questions.
    [The prepared statement of Ambassador Shannon follows:]


    Prepared Statement of Under Secretary of State Thomas A. Shannon

    Chairman Corker, Ranking Member Cardin, and distinguished members 
of the Committee, I am pleased to appear before you to discuss U.S. 
policy toward Iran. Thank you for the opportunity.
    The successful negotiation of the Joint Comprehensive Plan of 
Action (JCPOA) with Iran created a framework whereby we and our P5+1 
partners could pursue a common goal of ensuring that Iran does not 
obtain a nuclear weapon. Reaching that goal however, will depend on how 
the JCPOA is implemented and whether Iran lives up to its international 
commitments. So far implementation is proceeding well. Should Iran 
continue along this path, we believe that, through the JCPOA, we can 
achieve our goal. Indeed, the significant nuclear steps Iran has 
already taken have put it much further away from a bomb than before 
this deal was in place.
    While we are encouraged by Iran's adherence to its nuclear 
commitments thus far, I assure you that the Administration shares your 
concerns about the government of Iran's actions beyond the nuclear 
issue, including its destabilizing activities in the Middle East and 
its human rights abuses at home. Iran's support for terrorist groups 
like Hizballah, its assistance to the Asad regime in Syria and the 
Houthi rebels in Yemen, and its ballistic missile program are at odds 
with U.S. interests, and pose fundamental threats to the region and 
beyond. Iran continues to violate fundamental rights of its citizens by 
suppressing dissent, restricting freedom of expression, and torturing 
prisoners, among other abuses.
    It is my purpose today to talk about our progress since JCPOA 
Implementation Day and the path forward for the coming years. We have 
several key objectives in our policy toward Iran: First, to ensure 
Iran's adherence to the JCPOA, which will prevent Iran from developing 
a nuclear weapon and guarantees that its nuclear program remains 
exclusively peaceful. Second, to counter Iran's support for terrorism 
and other destabilizing activities, while also working diplomatically 
to encourage Iran to play a more constructive role in the region. 
Third, to promote respect for human rights in Iran. Let me speak 
briefly to each of these efforts.
                          jcpoa implementation
    On January 16, the International Atomic Energy Agency (IAEA) 
verified that Iran had completed the nuclear-related steps necessary to 
reach JCPOA Implementation Day. This meant Iran had dismantled two-
thirds of its installed uranium enrichment capacity, going from over 
19,000 centrifuges before the JCPOA to just 5,060. In addition, Iran 
terminated all uranium enrichment at, and removed all nuclear material 
from, its underground Fordow facility. Reaching Implementation Day also 
meant Iran had shipped out 98 percent of its enriched uranium 
stockpile, reducing it from roughly 12,000 kilograms before the deal, 
to no more than 300 kilograms of up to 3.67 percent enriched uranium 
hexafluoride today, where it must stay. Iran also removed the core of 
the Arak Heavy Water Reactor and filled it with concrete, permanently 
rendering the core unusable and eliminating the nation's only source of 
weapons-grade plutonium, thus blocking that potential pathway to a 
weapon.The reactor is now being redesigned to not produce weapons-grade 
plutonium during standard operation and to minimize non-weapons usable 
plutonium production.
    Additionally, Iran is now adhering to the IAEA Additional Protocol 
and the IAEA has put in place the JCPOA's numerous enhanced 
transparency measures. For example, modern technologies such as online 
enrichment monitors and electronic seals can detect cheating and 
tampering in real time. Iran's key declared nuclear facilities are now 
under continuous IAEA monitoring, and the IAEA also has oversight of 
Iran's entire nuclear fuel cycle from its uranium mines and mills to 
enrichment facilities.
    Thanks to the JCPOA, Iran is now under the most comprehensive 
transparency and monitoring regime ever negotiated to monitor a nuclear 
program.
    On March 9, the IAEA released its first monitoring report since 
Implementation Day. The report affirmed that Iran continues to adhere 
to its JCPOA commitments.
    Iran has taken significant, irreversible steps that have 
fundamentally changed the trajectory of its nuclear program. Simply 
put, the JCPOA is working. It has effectively cut off all of Iran's 
pathways to building a nuclear weapon. This has made the United States, 
Israel, the Middle East, and the world safer and more secure. Before 
the JCPOA took effect, Iran was less than 90 days away from getting 
enough fissile material for a nuclear weapon. Today, thanks to the 
JCPOA, Iran is over a year away from being able to get that material. 
Any attempt to do so would be detected immediately by the international 
community.
    This is why the United States is confident the JCPOA will ensure 
Iran's nuclear program is and will remain exclusively peaceful. In 
exchange for Iran completing its key nuclear steps, on Implementation 
Day the United States and the European Union (EU) lifted nuclear-
related sanctions on Iran. The United States retains our ability and 
authorities to snap sanctions back into place should Iran walk away 
from the JCPOA. But as long as Iran continues to meet its commitments, 
the United States will continue to meet our commitments.
                           regional activity
    I want to re-emphasize that the JCPOA did not resolve our profound 
differences with Iran. We remain clear-eyed about continued Iranian 
destabilizing activity. For decades, Iran's threats and actions to 
destabilize the Middle East have isolated it from much of the world. 
Over the past three decades, Iran has continued its support for 
terrorism and militancy, including its support for Lebanese Hizballah, 
Palestinian terrorist groups in Gaza, Kata'ib Hizballah and other Iraqi 
Shi'a militia groups in Iraq, and Shia militant groups in Syria. Iran 
was designated a State Sponsor of Terrorism in 1984 and remains so-
designated today.
    The Islamic Revolutionary Guard Corps--Qods Force (IRGC-QF) 
cultivates and supports militant groups around the region. Iran has 
been smuggling weapons to the Houthis in Yemen, fueling a brutal civil 
conflict in that country. Additionally, Iran sees the Asad regime in 
Syria as a crucial ally in the region and a key link to Iran's primary 
beneficiary and terrorist partner, Lebanese Hizballah. Iran provides 
arms, financing, and training to fighters to support the Asad regime's 
brutal crackdown that has resulted in the deaths of over 250,000 people 
in Syria.
    That's why we have retained our sanctions related to Iran's 
destabilizing activities in the region, including its support for 
terrorism. We aggressively employ Executive Order (E.O.) 13224, which 
allows us to target terrorists and those who support them across the 
globe including Iranian persons and entities that provide support to 
terrorism. The IRGC-QF, the Iranian Ministry of Intelligence and 
Security, Iran's Mahan Air, Hizballah, and over 100 other Iran-related 
individuals and entities remain subject to sanctions under this E.O. On 
March 24, we designated six additional individuals and entities engaged 
in procurement activities for Mahan Air, which was named in 2011 as a 
Specially Designated Global Terrorist due to its support for the IRGC-
QF.
    We have found through experience that the most effective way to 
push back on aggressive Iranian activity is to work cooperatively with 
our allies to deter and disrupt Iranian threats. This is why we 
increased our security cooperation with the Gulf Cooperation Council--
the GCC--following the Camp David summit and have provided additional 
assistance to Israel. We continue to interdict, and actively work with 
our coalition partners to interdict, Iranian weapons shipments 
throughout the region. Notable successes on this front include Israel's 
seizure of the Klos C vessel carrying weapons bound for Gaza in 2014, 
military and diplomatic efforts to prevent an Islamic Revolutionary 
Guard Corps (IRGC) naval flotilla from docking in Yemen in April 2015, 
and the four dhow seizures since September 2015 carrying weapons from 
Iran that we assess were bound for Yemen.
    We take any threat to Israel extremely seriously and we understand 
that Iran's support for terrorism requires our strong support to one of 
our closest allies. This Administration has provided more than $23.5 
billion in foreign military financing for Israel under the current 
Memorandum of Understanding. Additionally, the United States has 
invested over $3 billion--beyond our Foreign Military Financing (FMF) 
assistance--in the Iron Dome system and other missile defense programs 
for Israel. And we are currently working together on additional long-
term support to Israel.
                     iran's ballistic missile tests
    Iran's attempts to develop increasingly advanced ballistic missile 
systems are a threat to regional and international security. While full 
implementation of the JCPOA will ensure that Iran is unable to develop 
a nuclear warhead to place on a missile, we will continue to use all 
available multilateral and unilateral tools, including sanctions when 
appropriate, to impede Iran's ballistic missile program.
    Following Iran's October 2015 missile test, we sanctioned eight 
individuals and three entities involved in procuring materials and 
other equipment for Iran's ballistic missile program. We also led an 
international effort at the United Nations to highlight and condemn 
Iran's tests, which violated the provisions of UN Security Council 
resolution 1929.
    Iran conducted another set of dangerous and provocative missile 
tests in March. On March 24, we designated two Iran-based entities 
directly involved with Iran's ballistic missile program.
    Additionally, we called for UN Security Council consultations on 
Iran's missile launches on March 14, where Ambassador Samantha Power 
condemned these launches as destabilizing and inconsistent with UN 
Security Council resolution (UNSCR) 2231. As a next step, on March 29, 
we submitted a joint letter along with France, the United Kingdom, and 
Germany to the UN Security Council requesting the UN Secretary-General 
report on Iran's ballistic missile activity as inconsistent with UNSCR 
2231, and calling for additional Security Council discussions in the 
``2231 format'' on the launches so that the Council can discuss 
appropriate responses. The Security Council met at experts-level in its 
``2231 format'' on April 1, where U.S. missile experts briefed on the 
technical details of Iran's launches and explained why they were 
inconsistent with UNCR 2231.
    We will also continue to work through the Missile Technology 
Control Regime and the Proliferation Security Initiative to prevent and 
interdict transfers of material and technology to Iran that would 
support its ballistic missile program.
    In addition to our effects to enhance Israeli security, we'll also 
work closely with our Gulf allies, as part of the Camp David process 
started by the President last year, to develop missile defense 
capabilities and systems.
                              human rights
    Iran violates fundamental human rights of its citizens by severely 
restricting civil liberties, including the freedoms of peaceful 
assembly, expression, and religion. Iran has the world's highest per 
capita rate of executions, which often happen after legal proceedings 
that do not follow Iran's constitutional guarantee of due process or 
international obligations and standards regarding fair trial 
guarantees. There are over 1,000 political prisoners in Iran, including 
19 journalists. Many of them experience harsh treatment and extended 
pretrial detention. Women continue to face legal and social 
discrimination and limitations on their ability to travel, work, and 
access educational opportunities.
    We use a variety of tools to raise awareness of these human rights 
violations and abuses and to hold their perpetrators accountable. This 
policy has not changed as a result of the JCPOA. We continue to have 
human rights sanctions authorities, including under the Comprehensive 
Iran Sanctions, Accountability, and Divestment Act (CISADA) of 2010. 
Since 2010, we have imposed sanctions on 19 individuals and 17 entities 
that were determined to meet the CISADA criteria. Human rights-related 
sanctions are not subject to relief under the JCPOA, and we continue to 
vigorously enforce these sanctions.
    We are also working multilaterally to press Iran to better respect 
the human rights of its citizens. The United States strongly supports 
the annual UN General Assembly Third Committee resolution highlighting 
Iran's poor human rights record and calling on Iran to take measures to 
address its abuses. Additionally, the United States fully supports the 
mandate of the UN Special Rapporteur on the Situation of Human Rights 
in Iran, which was renewed March 23 primarily because of our aggressive 
lobbying campaign.
    We are vocal about our concerns with Iran's ongoing repression of 
human rights and fundamental freedoms of its people. We document the 
Iranian government's human rights abuses in the annual International 
Religious Freedom, Human Rights, and Trafficking in Persons reports. 
Iran is designated as a ``Country of Particular Concern'' under the 
International Religious Freedom Act and is a Trafficking in Persons 
Tier 3 country.
                            the way forward
    As a result of the nuclear negotiations, we have started to talk 
directly with Iran in ways we had not done for decades. While our 
concerns about Iran are substantial, we believe it is in the U.S. 
national interest to continue a dialogue with Iran on the issues that 
divide us--while we also continue to use all tools available to counter 
the Iranian activities we oppose.
    The nuclear negotiations also opened up the opportunity to talk 
with Iran about U.S. citizens unjustly held in their prisons, which was 
done on a separate track. We had a dialogue that freed four U.S. 
citizens--Amir Hekmati, Saeed Abedini, Nosratollah Khosravi Roodsari, 
and Jason Rezaian--and Iran separately released U.S. student Matthew 
Trevithick. The protection of U.S. citizens is a top priority of the 
State Department. We will continue to hold Iran to its commitment to 
bilateral discussions about the whereabouts of Robert Levinson. Iran 
has a responsibility to assist us in locating and bringing home Mr. 
Levinson, as he went missing on Iran's Kish Island. And we continue to 
be concerned by the reports regarding the detention of U.S. citizens 
Siamak Namazi and his father, Baquer Namazi.
    Iran also participates in the International Syria Support Group, 
working with over 20 other countries and international organizations to 
reach a political transition in Syria. We know Iran works against our 
interests supporting the Asad regime, but we also know we can't resolve 
this conflict with Iran outside the tent playing a spoiler role. We 
thus judge that Iran, with its close relationship with and history of 
supporting Asad, needs to be a part of any lasting resolution to the 
conflict. This conflict has gone on far too long, and taken too many 
lives, to not have all the parties at the table trying to find a 
solution that gives the Syrian people a better future.
    We know there is strong hostility towards the United States within 
certain Iranian quarters. We know parts of the Iranian establishment 
fear any relationship with United States. But we also know that 
millions of Iranians want to end their country's isolation while also 
benefitting from new economic opportunities. We now see Iran reengaging 
with the global community via high-level visits and trade agreements.
    U.S. policy toward Iran must be calibrated to talk with Iran when 
it is in our interest while ensuring we address the threats to peace 
and security Iran continues to pose.
    Congress plays an essential role in shaping this posture. The 
legislative and executive branches should work together, like we did to 
build international pressure on Iran, to now calibrate our approach 
such that we are simultaneously resolute when dealing with Iranian 
threats, while willing to engage when we think it in U.S. interests to 
do so. I look forward to continued consultations with Congress as we 
strive to find this balance.
    We also must continue to make clear that our hand of friendship is 
open to the Iranian people despite the significant differences we have 
with its government. That is why President Obama and Secretary Kerry 
yet again this year delivered Nowruz messages addressed directly to the 
Iranian people, expressing the desire for stronger ties between 
Iranians and Americans.
    It is up to Iran to decide the scope and pace of engagement. 
Whether Iran engages substantively with us or not, we are confident 
that the JCPOA makes us and our partners safer. We will continue to 
work with the IAEA, the EU, and the P5+1 to vigorously monitor and 
verify that Iran is keeping its commitments, and will continue to use 
all of the tools, both unilaterally and multilaterally, to address our 
other issues of concern with Iran.
    Thank you for this opportunity to testify. I look forward to taking 
your questions.


    The Chairman. Thank you so much. We appreciate it and 
again, thank you for your service.
    Tell us what is going on with the dollar transactions. 
There have been rumors that have come out of the 
administration. I have actually talked to administration 
officials who do not know where those rumors are coming from 
and are somewhat disconcerted by them. Again, I talked to Adam 
Szubin last night, who reassured me that we are doing nothing 
to accommodate dollar transactions. The President seemed to 
state that on Friday. Yet, Secretary Kerry was on a television 
program this morning, acting as if we were going to do 
something.
    What is going on relative to us accommodating Iran and 
their ability to use dollars in their transactions?
    Ambassador Shannon. Thank you very much for the question. 
It is an important one. As you noted, it has gathered a fair 
bit of media buzz.
    This is, ultimately, a Treasury concern, because they are 
the ones that do general licensing, and Adam Szubin is a great 
person to talk to on this.
    But let me tell you what I know at this point, which is 
that the rumors and news that has appeared in the press that 
the U.S. is preparing to reinstate a U-turn authorization or to 
allow Iran access to the U.S. financial system are not true.
    The Chairman.  This morning, why would Secretary Kerry have 
said that we need to accommodate Iran's ability to have the 
economic growth that they thought they would have under the 
sanctions relief?
    Ambassador Shannon. The point the Secretary was making is 
that, as Iran attempts to access money that is being made 
available to it to through the lifting of sanctions, that there 
will be instances in which we have had to help Iran access that 
money by clarifying the regulations under which money can be 
transferred to them.
    We have found that as Iran seeks those funds, there are 
banks that are unclear about the nature of the regulatory 
structures and what sanctions have been lifted and what have 
not. The Secretary believes it is in our national interests to 
ensure that the commitments we made are being followed through 
on.
    This is part of a larger engagement that we have had with 
the Iranians on different aspects of our commitments, both 
commitments they made and the commitments that we have made.
    The Chairman.  So the dollarizing issue is bogus?
    Ambassador Shannon. As of this moment, as I far as I know, 
yes.
    The Chairman.  So the acting head of OFAC, who is very good 
and I hope he is put in place permanently, told me that there 
was some concern that a little bit of a ``wink and nod'' was 
going on by which the U.S. was basically saying to 
institutions: look, just know that in spite of what the 
agreement says, we are not coming after you for this.
    Do you know of any instance of urging, including by 
Secretary Kerry or the Treasury Department, to turn their head 
relative to the black-and-white agreement that is before us, 
relative to this issue? Do you know any incident of that?
    Ambassador Shannon. I do not. But again, the point that the 
Secretary was making is that we have commitments under the 
JCPOA, and we need to live up to those commitments and ensure 
that the Iranians are receiving, for what they have done, what 
they believe we have committed to.
    And what the Secretary has been clear about, and what 
Secretary Lew has also been clear about, is the importance of 
ensuring that Iran has access to the assets that are now open 
to them.
    The Chairman.  Well, I do not think the administration is 
on the same page internally. I think there are some people that 
are invested in this and have developed relationships. I think 
some people are trying to bend this in a way that will benefit 
Iran. I hope Secretary Kerry, the President, and Adam Szubin 
will end up getting on the same page.
    I guess if we acted to legislatively codify the fact that 
those things could not occur, that would be consistent with 
what the administration and you are saying today, so that would 
not be a problem. Would that be correct?
    Ambassador Shannon. By codifying if you mean not 
authorizing U-turns or not authorizing access to the U.S. 
financial system, that is already present, I believe.
    The Chairman.  So we could codify it, and it would not be a 
problem, and Iran would not consider it a violation. Good. We 
will attempt to do that.
    On the ballistic missiles, I pointed out testimony from 
Secretary Kerry and Ambassador Mull. We knew, when the language 
said ``called upon,'' this situation would likely occur. It has 
occurred, and it is disappointing.
    I was disappointed that a letter from our European partners 
said it was inconsistent and did not say it was a violation. 
Obviously, there was some wordsmithing taking place.
    Would you have any problem with us putting in place some 
sanctions against them for clearly violating the agreement as 
the administration explained the agreement to us?
    Ambassador Shannon. Thank you for the question, a very 
important one.
    As I noted, we remain resolutely and absolutely opposed to 
Iran's ballistic missile program, and we believe that we have 
both multilaterally and unilaterally the tools necessary to 
attack that missile program and do whatever we can to interdict 
the technologies that Iran is seeking to advance its ballistic 
missile program. We believe that we have the necessary 
authorities now, and we will continue to designate individuals 
and entities that we believe are supporting that ballistic 
missile program, as we have done in response to Iran's several 
ballistic missile launches.
    In regard to potential legislation, our only concern about 
this legislation is that it not interfere with JCPOA 
implementation or give Iran any excuse to walk away from the 
table.
    But at this point, we believe that we can address the 
punitive side of Iran's ballistic missile program with the 
authorities we have. But also, as I noted in my opening 
remarks, we are very intent on helping our partners in the 
region defend themselves from Iran's ballistic missile program. 
That is where we are going to begin focusing a lot of our 
effort, to ensure not only that we delay and deter Iran's 
ballistic missile program, but we do what we can to support 
others to defend themselves.
    The Chairman.  I think the majority of people up here, 
whether they supported the agreement or did not support the 
agreement, were very concerned about the ``called upon'' 
language, and we sought assurances because we knew ``called 
upon'' was very different than what had been in agreements in 
the past. Unfortunately, we are where we are.
    My sense is that most people here want to take some action, 
whether they supported the agreement or not.
    Let me ask just one last question.
    By the way, I am disappointed that the administration's 
goals for the agreement did not come to fruition. I am 
disappointed for our country. I am disappointed for all those 
who are counting on this agreement to deter that type of 
action.
    Russia plans to sell Iran Su-30s. Do you consider this a 
violation of the agreement? I know that it is not a violation 
until they actually do it. I know they have entered into 
discussions, and it may not come to fruition. I think it likely 
will.
    If the sale does occur, would you consider that a violation 
of the agreement?
    Ambassador Shannon. You are talking about the S-300 missile 
defense system?
    The Chairman.  No, the Su-30s.
    Ambassador Shannon. The sale of Su-30 fighter aircraft is 
prohibited under UNSCR 2231 without the approval of the U.N. 
Security Council. We would block the approval of any sale of 
fighter aircraft under the restrictions.
    The Chairman.  Since we are getting mixed signals, and the 
assurances we have received in the past have not always worked 
well, if we were to take action to make sure that sale could 
not happen without additional sanctions, you would have a 
problem with it?
    Ambassador Shannon. Sir, far be it from me to tell the 
United States Senate how to legislate. But I would just say 
that the sale of this kind of aircraft is prohibited without 
the approval of the U.N. Security Council, and we would not 
approve it.
    The Chairman.  Thank you so much.
    With that, Senator Cardin?
    Senator Cardin. Thank you again, Ambassador Shannon. I 
appreciate your explanations here.
    I am going to follow up on some of the questions of 
Chairman Corker as to how the United States Senate and United 
States Congress can help to achieve our objectives. I think the 
oversight of the Congress will be helpful in making sure Iran 
does not become a nuclear weapons state.
    But as we discussed during the debate on the JCPOA, 
Congress and the administration have full abilities to deal 
with those issues not covered under the JCPOA. So when Chairman 
Corker asked you about certain congressional action, I am going 
to be very clear, I will not support any congressional action 
that is out of compliance with the JCPOA, because I think that 
would not be helpful by the United States Congress.
    But where I disagree with one of the statements you made is 
that I am not going to allow Iran to determine what is in 
compliance with the JCPOA. Your statement that we do not want 
to give Iran a reason, Iran has used interpretations that are 
far beyond any reasonable coverage of what is in the JCPOA.
    So I would just urge us to be very careful as to how we 
interpret the JCPOA. We will use the international standards, 
but we will not use an Iranian standard.
    So I want to bring you back to how the Congress can help. 
We are an independent branch of government, and I remember very 
clearly the testimony before this committee when your 
predecessor, Secretary Sherman, gave a similar answer that you 
just gave, and that is that we have the authority to take 
action. We do not need congressional action.
    Congress did act, and we did strengthen the Iran Sanctions 
Act, and it was, I think, partially responsible for bringing 
Iran to the negotiating table and was helpful to get a stronger 
agreement, because Congress did take action, even though the 
administration had the ability to take action on its own.
    So there are two areas that I want to get your view on. One 
is the extension of the Iran Sanctions Act. As you know, it 
expires at the end of this year.
    The administration has taken action under the waivers in 
order to implement the JCPOA, but having that as a backstop as 
we go beyond 2016 would seem to me to be critically important 
for U.S. leverage to make sure Iran complies with the 
agreement.
    So I just want to make sure of your view, if Congress takes 
action to extend the Iran Sanctions Act, whether the 
administration will look upon that as consistent with the JCPOA 
and the appropriate actions for an independent branch of 
government.
    The second point I want you to respond to is what Chairman 
Corker talked about, and that is the ballistic missile 
sanctions that have been posed by the administration under 
executive order, basically, not under congressional mandate.
    It seems to me that ballistic missiles, which are not 
covered under the JCPOA, that the United States would be in a 
much stronger position if we had congressional sanction 
authorization in law. As I said, I never met an administration 
that did not think they could not do everything without the 
Congress, but having congressional authority to impose these 
sanctions I think gives us a stronger position.
    So will the administration work with us on legislation to 
both extend the Iran Sanctions Act and to provide congressional 
basis for the ballistic missile sanctions that are being 
imposed?
    Ambassador Shannon. Thank you very much, Senator.
    In regard to the first question, my understanding is that 
ISA expires at the end of this year. Our view is that we should 
not be in a rush, and we should begin to understand how Iran is 
meeting its commitments under the JCPOA. Based on that, this 
will give us a stronger idea and feeling for what a renewed ISA 
might look like.
    But I can tell you that we would be happy to engage with 
this committee and the Congress on a renewed Iran Sanctions 
Act, again, assuming that it does not complicate or prevent us 
from meeting JCPOA commitments.
    Senator Cardin. In regard to a statutory authorization for 
sanctions against Iran for its ballistic missile violations?
    Ambassador Shannon. Again, we are opposed to Iran's 
ballistic missile program, and we are going to do everything in 
our power to delay and deter it, and to protect our allies.
    As noted, and as you noted, we believe we have the 
authorities to do that. And we believe we have acted 
responsibly and rapidly in response to Iran's ballistic missile 
activity.
    But again, we would be happy to talk with this committee 
and the Senate about what that legislation might look like.
    Senator Cardin. I thank you for that. I would just urge you 
to go back and take a look at the congressional record from 
when we passed the sanction regime in 2010 and look at what has 
happened since and how absolutely essential it was for 
congressional action in 2010 to lead to where we are today, 
which the administration is pleased about the JCPOA. 2010 was a 
major chapter in accomplishing that because of what Congress 
did, what this committee did.
    This administration has 9 months left, and the JCPOA goes 
well beyond that. I would just urge you to be aggressively 
working with us to set up the appropriate statutory framework 
to make it clear to Iran that we will not tolerate ballistic 
missile violations. And it is not just a President, it is the 
United States and the Congress working with the President that 
will not tolerate that type of activities.
    Let me move on to just to just one other issue, if I might, 
just very briefly, and that deals with the issue that the 
chairman raised on the Russian participation.
    How does it complicate enforcement of the JCPOA, the fact 
that Russia is preparing to give missile defense support to 
Iran?
    Ambassador Shannon. As you know, Russia has been in the 
process of selling S-300s to Iran since 2008, and, for any 
number of reasons, has not done so. The purchase has not been 
finalized. The delivery has not been made.
    There was a press report today indicating that Russia is 
preparing to move an S-300 system to Iran. The S-300 is not 
prohibited under the U.N. Security Council resolutions, because 
it is a ground-to-air missile, and it is considered a defensive 
weapon system.
    Senator Cardin. I understand that.
    Ambassador Shannon. Nevertheless, we have made it very 
clear to the Russians that we consider this to be a bad move, 
that we consider it to be destabilizing and not in keeping with 
what we have been trying to accomplish not only through the 
JCPOA but broadly in terms of our engagement with Iran.
    Senator Cardin. Well, I would just take it one step 
further. It seems to me that a missile defense system 
modernization from Russia to Iran makes it much more 
challenging for us to deal with the security concerns of our 
partners in that region. So it ups the ante for the United 
States. It very much takes us to a new level of what we are 
going to need to do.
    The Chairman.  Thank you.
    No doubt, a missile system would do that. Also, the sale of 
Su 30 fighter jets from Russia would also complicate that even 
further.
    Senator Perdue?
    Senator Perdue. Thank you, Mr. Chairman.
    I just got back from a week in the region, and the common 
consensus of four different heads of state and several military 
people in the region is that things have gotten materially 
worse, not better, since the JCPOA, in terms of domestic 
security for these four countries that we visited.
    But I am a little confused today, particularly with 
comments that are coming out this week, and I would like to get 
you on the record, Ambassador, about the U.N. violations or not 
violations.
    In December, Ambassador Mull in this committee stated that 
ballistic missile launches would be in violation of U.N. 
Security Council Resolution 2231. We have seen those missile 
firings before and after implementation day, and yet this week, 
American diplomats submitted a joint EU-U.S. report that says 
that the launches, and I quote, ``are inconsistent with UNSCR 
2231, but not a violation.''
    For the record, do you think that the ballistic missile 
launches were, indeed, a violation of U.N. Resolution 2231?
    Ambassador Shannon. Thank you very much, Senator.
    From our point of view, U.N. Security Council Resolution 
2231 prohibits Iran from launching ballistic missiles.
    The language in 2231 is different from 1929, as you know. 
1929 says Iran shall not undertake any activity related to 
ballistic missiles capable of delivering nuclear weapons; 2231 
``calls upon'' Iran not to undertake any activity related to 
ballistic missiles designed to be capable of delivering nuclear 
weapons.
    In international parlance, there is a distinction here. But 
for me, it is a distinction without a difference. From my point 
of view, 2231 is telling Iran that it should not be undertaking 
any activity related to ballistic missiles.
    That is how we act. In other words, we responded to the 
ballistic missile launches with designations, and we will 
continue to respond.
    Senator Perdue. So we responded as if it were a violation?
    Ambassador Shannon. We did.
    Senator Perdue. Okay. So you think it is a violation?
    Ambassador Shannon. Let me put it this way, I believe they 
violated the intent of 2231. Whether international lawyers will 
say it violated 2231, this is why we use the word 
``inconsistent.''
    But from our point of view, these launches are prohibited, 
and we are going to do everything we can to stop them.
    Senator Perdue. So on the sanctions that we put in, and I 
agreed with the administration's view, and I also agree with 
our ranking member, that it would have more teeth if it were 
congressionally sanctioned, but in terms of those January 
sanctions, 11 entities and individuals were named.
    But it was interesting that transportation companies that 
were involved in the procurement and delivery of this 
technology were not included. The financial partners were not 
included. Members up and down the supply chain were not 
included in that. So it seems to me that if we really wanted to 
stop the ballistic missile activity, we would put sanctions on 
the full supply chain from A to B.
    Can you speak to that, about the omissions of those major 
players in the supply chain?
    Ambassador Shannon. Since 2010 when U.N. Security Council 
Resolution 1929 was approved by the U.N. Security Council, I 
believe we have designated over 27 entities and people that 
look not only at those providing equipment, but also those who 
are facilitating the provision of equipment.
    I would be happy to talk with you about specific 
individuals or entities that interest you and respond to that 
question.
    But I believe we have been focusing not just on providers 
of technology, but those who facilitate that technology, the 
provision of that technology.
    Senator Perdue. Thank you.
    I am also concerned about the liquid assets that are now 
available through the JCPOA for Iran and what they are going to 
be doing about that. The administration, when they were 
supporting JCPOA before its enactment, was adamant about 
ensuring that Iran would not continue to subsidize Hezbollah 
and Bashar al-Assad.
    Can you give us an update on what the administration is 
doing to assure people of the region that, indeed, is being 
implemented?
    Ambassador Shannon. Let me answer this in two tranches.
    First, in regard to the monies made available to Iran 
through the JCPOA, we assess that Iran has access to about $50 
billion scattered throughout any number of banks.
    Senator Perdue. That is pretty much cash, that is liquid 
today, correct?
    Ambassador Shannon. If they can get it.
    Senator Perdue. And then there are other assets, as I 
understand it, that are liquidatable, is that correct, in 
addition to the $50 billion?
    Ambassador Shannon. That I am not sure of. What I have been 
told is that there was $100 billion being held in overseas 
accounts, but that about $50 billion of that was already called 
for, either through financial commitments that Iran has made 
through contracts or because of other aspects of the financial 
instruments that are being used, but that the money available 
to Iran is about $50 billion.
    But again, it is scattered throughout the international 
financial system and held at different banks. And therefore, it 
has to be accessed piecemeal and over time.
    This is something that we have been watching closely. And 
this is what Secretary Kerry was referring to when he said that 
there are times when we have to clarify our guidelines in 
regard to sanctions, so Iran does have access to monies that we 
have committed to make available to it.
    In regard to whether or not Iran continues to fund 
terrorism-related activities or destabilizing activities in the 
region, there is no doubt that that is true, and we are seeing 
it, whether it is in Syria, whether it is in Lebanon and 
Hezbollah, whether it is in Yemen with what they are doing with 
the Houthi rebels.
    And we continue to do what we can through authorities that 
we have, both sanction authorities given to us through IEEPA 
and through other legislation and through executive actions, to 
sanction, when possible, and to counteract the activities of 
Iran in the region.
    Senator Perdue. Thank you.
    Real quick, given the increased activity that Iran is 
showing in the region since the JCPOA, can you give us an 
update on the memorandum of understanding with Israel, relative 
to the military assistance there? I know it does not expire 
until 2018, I believe.
    And also, given that Iran continues to make anti-Israel 
statements, even putting ``Death to Israel'' stenciling on the 
missile that they have been testing, I think this is really 
important that we reassert that support for Israel in light of 
this increased activity.
    Can you give us an update on that MOU?
    Ambassador Shannon. We are in the process of negotiating 
the MOU with the Government of Israel, looking at how best we 
can continue to meet the defense needs of Israel, as it faces 
the threats posed in the region, some of the most significant 
being from Iran.
    Since the beginning of this administration, over $20 
billion has been provided to Israel in defense spending, 
including nearly $3 billion to help finance the Iron Dome 
antimissile system.
    Senator Perdue. Over what period of time would that be?
    Ambassador Shannon. This administration, 8 years.
    Senator Perdue. So 8 years.
    Ambassador Shannon. Yes. I can get you kind of the latest 
state of play of our negotiation with the MOU, but it is a 
constant theme of our engagement with Israel.
    Senator Perdue. Our intent is to continue to have the 
qualitative military edge that we have had in the past in eh 
region?
    Ambassador Shannon. Correct.
    Senator Perdue. Okay, thank you.
    Thank you, Mr. Chairman.
    The Chairman.  Thank you.
    Senator Menendez?
    Senator Menendez. Thank you, Mr. Chairman.
    Mr. Secretary, I have the greatest respect for you. I have 
supported you in your role as Ambassador. I have supported you 
in this role. So it is with that respect that I have the 
following statement, though.
    I am seriously concerned. I was at a meeting, but I had the 
TV on and listened to your answers to the chairman and ranking 
member about statements that suggest that we have to watch what 
we do, because we do not want to have Iran walk away from the 
table.
    Well, this administration led by the Secretary of State 
before this committee after question after question after 
question said very clearly that we were free to pursue all 
other actions of the Iranians that are against the national 
interests and security of the United States outside of the 
nuclear portfolio.
    So I see all these cautionary remarks all the time. I see 
all these caveats. I do not understand them. I do not 
understand them.
    I do not understand when the President himself in remarks 
this week said that while Iran may have followed the letter of 
the agreement, they have not followed the spirit, sending 
signals to the world community that is a series of provocative 
actions, and, among that, failure to follow the spirit, the 
President himself acknowledged, launching ballistic missiles, 
repeatedly calling for the destruction of Israel, shipping 
weapons to Hezbollah. Not my comments, the President's 
comments.
    Now, to that I would add its status as a state sponsor of 
terrorism, its acts of aggression designed to destabilize our 
allies in the region, its efforts to disrupt shipping through 
the Strait of Hormuz, its illegal detention and despicable 
humiliation of American sailors, its trafficking in weapons, 
its cyberattack events. I think many of those, you recited in 
your opening statement.
    So what bothers me is that we seem to create a permissive 
environment, as is exemplified by what happened in the missile 
issues that have been raised, and I want to further pursue with 
you, in which we are treading on eggshells about doing anything 
else in this whole universe that we admittedly recognize is 
against the security interests of the United States.
    So why are we, for example, knowing that resources, 
whatever amount it is, is in part going to fund these very 
activities that we acknowledge collectively is against our 
national interests? Why are we, for example, when the President 
says we are not going to use dollars to do business with Iran, 
which is good news, but then goes on to say it is possible for 
them to work through European financial institutions, which 
ultimately transact with the United States? Or that the United 
States reportedly also seeking ways to ensure that U.S. 
regulations do not deter foreign reinsurance companies from 
providing insurance coverage for Iranian shipping as two 
examples?
    Why are we, outside of meeting our strict applications, 
facilitating the possibilities for them to use their resources 
in such a way that is against our interests?
    Ambassador Shannon. Thank you very much, Senator. And 
again, thank you for your support. I am grateful very grateful 
for that.
    Let me be clear, if I was not in my earlier comments. When 
I talked about wanting to make sure that actions taken in 
regard to re-upping sanctions legislation did not interfere 
with JCPOA commitments, my purpose was not to say that we are 
walking on eggshells with the Iranians. My purpose was not to 
say that we are somehow pulling punches or stepping away from 
firm pursuit of the JCPOA commitments or, as you noted, broader 
understandings of concerns about Iran. That is not the case.
    We just want to make sure that, as Iran meets its 
commitments, we meet our commitments. We understand what those 
commitments are.
    And as we look at Iran's behavior broadly in the region, I 
would agree with everything that you have noted. We are 
concerned by it. We are appalled, in some instances, by it. But 
we are working actively to push back on it and to stop it where 
we can, whether it is in support for regional terrorism, 
whether it is in support for groups like Hezbollah and the 
Houthi rebels, or whether it is in pursuit of a ballistic 
missile program.
    And as the Secretary and the President noted, we are not 
going to caveat that, and we are not going to soft-pedal that.
    Senator Menendez. Let me interrupt you. I appreciate what 
you are saying, but specifically, for example, if we wanted to 
pull no punches and make it very clear that instead of 
sanctioning individuals, which is like playing whack-a-mole, we 
would sanction financial institutions that are helping to 
finance the ballistic missiles and other activities. That does 
not seem to be the administration's effort, which we have 
recognized from that Congress that when we sanction financial 
institutions, the broad reach and effect of that is really 
consequential to the Iranians.
    If we understand the nature of their obligations, let's 
turn to the missile issue. Last July, when Secretary Kerry was 
before the committee, I asked him, and I quote, ``Is Iran 
banned from ballistic missile work under terms of Security 
Council Resolution 2231?'' the U.N. instrument endorsed the 
JCPOA and that superseded previous U.N. Security Council 
resolutions with respect to Iran.
    And his answer was rather unequivocal. He said, ``It is 
exactly what it is today,'' and I am quoting verbatim from the 
transcript. ``It is the same language.''
    Well, I disputed that, because there is a difference 
between ``shall'' and ``calls upon.'' And if, in fact, it is 
exactly the same language, if the Secretary's interpretation 
was correct that 2231 explicitly prohibits Iran from testing 
ballistic missiles, then why would the United States and our 
European allies not push for the toughest language in the 
letter that was sent to the Security Council? Why not call it 
what it is, which is a violation?
    Which is it? Is it a violation or did we soften the 
language in such a way that permits exactly what Iran is doing 
now?
    Ambassador Shannon. The language used in the letter was 
that Iran's launch was inconsistent with U.N. Security Council 
Resolution 2231 and not that it was in violation of 2231.
    Again, I would argue that this is a distinction without a 
difference, because we are convinced that 2231 prohibits these 
kinds of launches, that there is a strong international 
commitment to----
    Senator Menendez. If that was the case, why did we not use 
the word ``violation''? If we believe it is prohibited, why do 
we not use the word ``violation''?
    Ambassador Shannon. I am not an international lawyer, sir.
    Senator Menendez. Okay, so let me close on this, you are 
not an international lawyer. I am not an international lawyer, 
but I was a lawyer before I came to this institution, and I 
understand the difference between ``call upon'' and ``shall.'' 
And there is a fundamental difference.
    And finally, I would say to you that, as the chairman and 
ranking member have discussed, the Iran Sanctions Act that I 
authored with others, it needs to be reauthorized now, because 
otherwise we do not send a very clear message to Iran that if 
they violate terms, we have something to snap back to.
    The administration sat before this committee and the Senate 
and said, well, we can snap back. Well, you cannot snap back to 
something that does not exist, at the end of the day.
    So, again, this tentativeness, worried about what Iran will 
do, seems to have frozen us. The suggestion of that is that the 
Senate should be frozen as well.
    I hope the Senate will not, Mr. Chairman. And on missile 
sanctions, which I think should be pursued, particularly on 
financial institutions, on this question of reauthorizing the 
Iran Sanctions Act, among others, I would urge the chair and 
the ranking member, and I have legislation I am happy to engage 
with the chair and ranking member on, to do some of this, 
because I think we are headed in the wrong direction.
    The Chairman.  I could not agree more. I think the issue is 
that most of us do not want to let a national security waiver 
be used to enter into an international agreement. I think if we 
can get past that issue, then we might end up with some very 
strong bipartisan legislation.
    You were working on Venezuela and other issues, which we 
appreciated, but this ``called upon'' language was a message to 
us that we were going to ``wink and nod'' on this issue, and we 
were going to give the other countries the ability not to 
enforce. That is why many of us were concerned.
    While you were working on Venezuela, we were also concerned 
that we were giving away leverage. On the front end, Iran would 
get all of this relief and then we would be on the eggshells 
that Senator Menendez just mentioned, and then all of a sudden, 
the administration will be concerned that if we push back, they 
might walk away, since they got everything they wanted on the 
frontend.
    So know that you are Exhibit A for why there was so much 
concern about this agreement, based on the things that you are 
saying today.
    Senator Barrasso?
    Senator Barrasso. Thank you very much, Mr. Chairman.
    Thanks for being with us. I think we all agree, when you 
said we are opposed to what is happening with ballistic missile 
testing. You want to do everything in your power to delay and 
deter it.
    We just have questions if that is actually happening with 
this administration. I do not believe it is. I think that the 
administration is not doing all that it can. I look at the 
recent sanctions. I think Senator Menendez referred to them 
playing whack-a-mole. There are sanctions on individuals, some 
entities.
    Can you tell us here today that those recent sanctions are 
actually going to change Iran's calculus and actually have an 
impact on Iran's ballistic missile program, given that they 
have done testing in October, testing in November, in March, 
last month, two successive days of ballistic missile testing?
    Ambassador Shannon. Thank you very much for the question.
    Iran is intent on pursuing a ballistic missile program. It 
sees it not only as part of its larger strategic weapons 
program, but it also plays an important political role in Iran, 
especially in the aftermath of the JCPOA. Hardliners in Iran 
lost on the nuclear issue. They are intent on doubling down on 
the ballistic missile program.
    So we can expect more launches. But, in that regard, we are 
very intent on doing everything we can to deter and delay that 
program and, at the same time, work with our partners in the 
region to ensure that they can protect themselves, and that it 
becomes clear that the strategic weapons program that Iran has 
continues to complicate its existence internationally, 
continues to call into question how it behaves internationally, 
and it becomes increasingly less relevant as our partners and 
our allies increase their ability to protect themselves.
    But since 2010, if I have my numbers right, we have 
designated over 27 entities and individuals related to Iran's 
ballistic missile program. And we will continue to designate 
individuals and entities, as we determine their role, and not 
only in response to ballistic missiles, but also as we 
determine which entities and individuals are playing a role, 
not just in the provision of technologies, but also in the 
facilitation of technology.
    Senator Barrasso. I think what we are hearing here is that 
Congress believes the administration needs a stronger backbone 
in legislation to allow you to accomplish the goal that you 
have to delay and deter.
    With regard to the Russian sales to Iran, it came up 
earlier. The chairman raised that. U.N. Security Council 
Resolution 2231 requires Security Council approval of any sale 
of major combat systems to Iran.
    So Russia and Iran have been discussing an agreement for 
Russia to sell Iran Su-30, the combat aircraft, the T-90 tanks, 
helicopters.
    Just to clarify, would the United States veto the approval 
of such a sale at the U.N. Security Council?
    Ambassador Shannon. Yes.
    Senator Barrasso. Can you talk about how the sales of the 
system contemplated that they are talking about to Iran could 
affect the balance of power in the region?
    Ambassador Shannon. Are you talking about the systems you 
just----
    Senator Barrasso. Yes. At this point----
    The Chairman.  The Su-30s or the S-300s?
    Senator Barrasso. The Su-30s.
    The Chairman.  The fighter jets.
    Ambassador Shannon. Obviously, we have no interest in Iran 
having enhanced either air fighter capability or enhanced 
ground combat capability. And any weapons that Iran can use 
offensively, we would seek to oppose in whatever way we can.
    Senator Barrasso. I want to talk a little about terror in 
the area. Iran is a state sponsor of terror, continuing to 
threaten Israel. We have heard that from Senators who just 
returned from the region. It continues to threaten the region 
with ballistic missile testing.
    It appears that the administration can be afraid of Iran 
threatening to pull out of the nuclear deal, truly believes the 
foreign country businesses might risk ties to the United 
States. You read the Wall Street Journal editorial this weekend 
called ``More Dollars for the Ayatollahs.'' It says the 
``latest administration cave-in could have been predicted from 
every previous U.S. capitulation to the mullahs. Expect other 
concessions as Tehran takes the full measure of America's 
weakness.''
    That is a concern. So what other actions do you know that 
the administration is considering that could provide additional 
sanctions relief to Iran beyond what has been committed to by 
the JCPOA.
    Ambassador Shannon. At this point, none. We have met our 
commitments under the JCPOA.
    And I think it is important to note at this point that the 
way the JCPOA was structured, it is really Iran that gave 
everything up front, as opposed to the United States. It was 
Iran that tore down its centrifuges. It was Iran that poured 
concrete into its heavy water reactor.
    And because of this, as I noted in my opening statement, we 
have been able to push back Iran's breakout period in pursuit 
of a nuclear weapon from a few months to over a year.
    And as we continue the implementation of JCPOA, we believe 
we are in a very strong position to ensure that Iran cannot 
develop a nuclear weapon. That is a huge accomplishment. And it 
is an accomplishment that this Senate can take huge pride in, 
as can the executive branch, because we have had to work 
together in pursuit of that, both through the sanctions 
authority that this legislative body authorized and through the 
diplomacy that we were able to fashion built around that kind 
of legislative authority.
    But as we look into the future, we are intent on meeting 
our commitments, period. We are not intent on providing 
additional sanctions relief. And we are intent on successful 
implementation of the JCPOA.
    Senator Barrasso. I just want to get this clarified. What I 
heard from the chairman and others in a bipartisan way is many 
of us believe it is the administration that gave away 
everything up front. You are testifying today that no, no, in 
fact, it was Iran that gave up everything up front.
    Ambassador Shannon. Indeed.
    Senator Barrasso. Thank you, Mr. Chairman.
    The Chairman.  Senator Kaine?
    Senator Kaine. Thank you, Mr. Chair.
    Thank you, Ambassador Shannon.
    I want to repeat an element of your testimony and do some 
follow-up.
    Page 2, Iran has taken significant irreversible steps that 
have fundamentally changed the trajectory of its nuclear 
program. Simply put, the JCPOA is working and has effectively 
cut off all of Iran's pathways to building a nuclear weapon. 
This has made the United States, Israel, the Middle East, and 
the world safer and more secure.
    That is your testimony. I do not need to ask you about it. 
It is for the record. But I was interested that there is now 
starting to be public comment by Israeli officials that might 
be somewhat different, but essentially making the same point.
    The Israeli IDF chief of staff, who is the equivalent of 
our head of the Joint Chiefs of Staff, Gadi Eizenkot, in 
January, the nuclear deal with Iran contains ``many risks, but 
also opportunities'' the IDF Chief of Staff Gadi Eizenkot said 
Monday. Speaking at the ninth annual security challenges 
conference at the Institute for National Security Studies in 
Tel Aviv, Eizenkot said that, ``The nuclear deal with Iran 
constitutes a strategic turning point, compared to what IDF 
faced over the past decade.''
    Eizenkot's long-term assessment is that Iran will make 
great efforts to fulfill their side of the bargain and enjoy 
the benefits. However, Iran will continue to see itself as a 
regional power and, after 15 years, when the terms of the deal 
expire, may turn again toward expanding its nuclear 
capabilities.
    In the meantime, Eizenkot said, the deal reduces the 
immediate Iranian threat to Israel because it rolls back Iran's 
nuclear capability and deepens the monitoring capabilities of 
the international community into Tehran's activities.
    Many of us had heard Israeli officials say those words to 
us as privately. Many of us had seen anonymous reports from 
Israeli officials publicly or had seen reports from former 
Israeli officials.
    Gadi Eizenkot's predecessor, General Benny Gantz, after the 
deal was done in September, said a better deal may have been 
possible but he also acknowledged the final agreement's success 
in putting off a nuclear-armed Iran for at least 10 to 15 
years. Diplomacy, he said, had prevented war from breaking out.
    It is the Israelis who have been the most focused, as they 
should be, to some degree, as to whether this deal would work 
or not. But you now have the current IDF Chief of Staff, 
essentially the equivalent of our head of the Joint Chiefs of 
Staff, and his immediate predecessor, both saying that this 
deal has prevented war and will forestall an Iranian nuclear 
program for at least 10 to 15 years.
    I think that testimony from our key ally, from the IDF 
Chiefs of our key ally, is validation of the point you make on 
page 2 of your testimony.
    Let me now ask this. If that is the current IDF head's 
position about the deal, three of the five individuals 
currently running for President of the United States say the 
United States should exit the deal, the JCPOA. Two said that 
they should rip it up. One said the U.S. should withdraw from 
the deal.
    Based on your testimony and the stated public position of 
the head of Israeli military, talk a little bit about what it 
would mean for the United States alone among the nations that 
negotiated this deal to rip up the deal or back away from it.
    Ambassador Shannon. Thank you very much for the question. 
And thank you for highlighting the comments of the IDF Chief of 
Staff.
    We would agree with him completely. We share that 
assessment. We believe that, through JCPOA, Iran has given up 
its ambition of a nuclear weapon and has submitted to an 
international structure of intervention and compliance that 
allows us great insight into their nuclear program and will, if 
complied with, create a program that is exclusively peaceful.
    That is our purpose and intention. That is the intention of 
the international community.
    In an environment as conflictive and combustible as the 
Middle East, making sure that a country like Iran does not have 
a nuclear weapon has to be a strategic goal of utmost 
importance, and we believe we have accomplished that.
    We would argue that any effort to step away from JCPOA 
would reopen a Pandora's box in that region that we do not 
think we could close again, because it would highlight an 
inability of the United States to maintain a continuity and 
stability in an approach, when we accomplished what the U.S. 
Government and the U.S. Congress has been seeking for more than 
a decade, which is no nuclear weapon in Iran.
    Hypothetically, if we were to contemplate stepping away 
from the JCPOA, we would not be followed by our P5+1 
colleagues. Quite the contrary. This would become an issue of 
extraordinary concern and division between ourselves and our 
P5+1 colleagues.
    But more importantly, it would be grasped by supporters of 
a nuclear program in Iran and by hardliners in Iran to assert 
that we were an unreliable interlocutor and that our stepping 
away from the JCPOA would be a clear signal that they need to 
return to their nuclear weapons program with even greater 
urgency. So we would view that as very dangerous.
    Senator Kaine. Isn't it in the security interests of the 
world that we keep everyone's attention on Iran's activities, 
rather than on the U.S. negotiating tactics?
    Ambassador Shannon. As I noted, and as you noted, we are 
very focused on what Iran is doing. And it is very important in 
our diplomacy and in our engagement with our partners that we 
highlight where Iran steps out of bounds.
    And this is what the President was referring to when he 
said that Iran was not complying with the spirit of the JCPOA, 
because the spirit was one of engagement, the spirit was one of 
highlighting the peaceful nature of the nuclear program, or the 
ambition of creating a peaceful program. But what it is doing 
elsewhere indicates otherwise. And therefore, our ability while 
we implement the JCPOA and while we consolidate this important 
strategic accomplishment that we continue to highlight and 
focus on Iran's bad behavior in terms of its regional 
activities, in terms of its support for Hezbollah, in terms of 
its support for the Houthi rebels, in terms of its support for 
the Assad regime, its support of terrorism, and its ballistic 
missile program, from our point of view, is the centerpiece of 
how are going to deal with Iran.
    Senator Kaine. Great. Thank you.
    Thank you, Mr. Chairman.
    The Chairman.  I know that we worked together and I think 
the types of legislative efforts that people are looking at are 
consistent with the JCPOA. I just want to restate that comment. 
It is to push back on those areas.
    The only way an agreement can bear the fruit that people 
laid out, is to make sure it is not violated. I think that 
there are those issues, but in addition to that the activities 
in the region.
    That is where the legislative focus is, not to counter the 
JCPOA, but to make sure that it is enforced, and to push back 
on other activities that are destabilizing the region.
    Senator Rubio?
    Senator Rubio. Thank you. Thank you for being here.
    I want to go back to this issue of access to the dollar. I 
saw a recent example cited in a blog, and I wanted to get some 
pretty clear understanding about how this would or would not 
work.
    The example that was used was a Swiss company that sells a 
product of any kind to Iran. Now, I think the President and 
everyone has been pretty clear what they are not allowed to do. 
They are not allowed to go to a U.S. bank to turn the rial into 
a dollar and the dollar into a Swiss franc. That is pretty 
clear, and I think that has been outlined.
    But here is what I want to get at, and that is an 
alternative mechanism. This outlines an alternative mechanism, 
and I want to understand whether or not this alternative 
mechanism is allowed or not under this agreement.
    The way it would work under this scenario that was laid out 
is that the U.S. would allow a general license for the U.S. 
bank to provide dollars to a non-U.S. clearinghouse somewhere 
overseas. And then what would happen is that Iran would pay a 
European bank in rials. The European bank would then exchange 
those rials for euros. They would then go to that clearinghouse 
and swap the euro out for a dollar, bring the dollar back and 
exchange the dollars for Swiss francs, and then pay that to the 
Swiss company.
    Is that sort of arrangement something that would be allowed 
under the agreement?
    Ambassador Shannon. I am not sure. I would have to check, 
because if it does not touch a U.S. bank, if it does not touch 
the U.S. financial system, because what our sanction languages 
had done and what we have been able to accomplish in terms of 
limiting Iran's access to our larger financial system, is we 
have not permitted U-turn authorization. In other words, no 
exchange of dollars inside the U.S. financial system. And we 
have not allowed it access to our larger financial system.
    But again, I am not a financial expert here. I would have 
to check with Treasury. But I do not know if what you just 
described is authorized under----
    Senator Rubio. Do you know if that kind of mechanism was 
discussed as part of this negotiation? I know that the chairman 
has already alluded to this earlier, but in an interview today, 
Secretary Kerry implied that Iran deserves the benefit of the 
agreement they struck.
    Is there within that agreement some sort of understanding 
with Iran that we would be helpful to them in figuring out how 
to get access to the dollar, even if it is through a one-step 
removed process like the one that I have outlined?
    Ambassador Shannon. The agreement is clear in terms of what 
our commitments are, and we believe we have met those 
commitments.
    My understanding of the Secretary's remarks is that we have 
worked with U.S. Treasury and with banks to clarify what 
sanctions relief is and what banks are allowed to do, in order 
to avoid any kind of punitive action for taking steps that are 
not permitted under the JCPOA.
    So my understanding is that our efforts to ensure that Iran 
has access to assets that we have committed to release to them 
is really about ensuring banks understand how that money can be 
accessed. It is not my understanding that there is anything 
beyond that.
    Senator Rubio. Has the Department of State received 
instructions from the White House, or has the Department of 
State in any way signaled the Treasury that it needs to search 
for ways to allow Iran to get access to dollars through a 
mechanism that does not directly impact the transaction within 
a U.S. bank?
    Ambassador Shannon. I have not received that instruction.
    Senator Rubio. Again, the fundamental question here--I know 
you say it does not touch the dollar. I just want to make this 
point for the record. By allowing a U.S. bank a general license 
to move this money offshore, it is in essence allowing them 
access to the U.S. dollar. It is not technically happening 
within the United States, per se, but we know what that money 
is going to be used for. The general license would be used to 
provide liability protection to the U.S. bank.
    But the only reason that money would be moving to an 
offshore entity, a clearinghouse, is so that Iran could get 
access to dollars. I think this is an important point that we 
need to get some clarity on. I guess it would be from Treasury.
    But that sort of mechanism has never been discussed with 
the Congress, from my understanding. It is, in fact, part of 
this agreement. We have never been notified of that as well.
    I guess what I am trying to get at the core of is, and you 
are saying your testimony here today is that is not the case, 
but was there ever a moment or is it part of this agreement 
that we would somehow help Iran get access to dollars in some 
way that did not violate the need to deal directly with a U.S. 
bank. And you said here today that you are not aware of that 
ever being part of this agreement or conversation in anyway.
    Ambassador Shannon. Again, I did not take part in the 
negotiations of the agreement. But my reading of the agreement 
indicates otherwise.
    Senator Rubio. One more point on access to the U.S. banking 
sector. This is not just about punitive action. It is also the 
fact that even irrespective of the nuclear program, the Iranian 
banking sector posed a hazard because of its laundering 
activities and so forth.
    Has Iran taken any actions to halt the use of its financial 
institutions for money laundering or for other illicit 
behavior?
    Ambassador Shannon. My understanding is it is much more 
careful about which institutions it uses, but it still is 
engaged in money laundering activities that we attempt to block 
and stop.
    Senator Rubio. Thank you.
    The Chairman.  Since there is a minute left, I think it was 
the money laundering and illicit financing that put these 
restrictions in place and that is still occurring. My 
observation is that Secretary Kerry and/or others within the 
State Department who spent a lot of time on this agreement are 
trying to figure out a way to accommodate Iran. My sense is 
that Treasury, at this point, has held firm and hopefully they 
will continue to do so.
    I do not think there is congruence right now, on the 
administration level. I am glad pressure is being applied to 
ensure that we do not try to accommodate them, that Iran gets 
only what they negotiated, and that we are not trying to make 
this agreement work better for Iran, especially when they are 
violating the ballistic missile testing.
    I mean, it is incredible that we would accommodate Iran 
while we know they are in essence, violating the agreement in 
our face.
    Senator Markey?
    Senator Markey. Thank you, Mr. Chairman, very much.
    Secretary Shannon, in response to recent questions about 
the administration's plan to provide Iran with additional 
relief from U.S. financial sanctions, President Obama stated 
that existing restrictions would remain in place. He also noted 
that Iran's difficulties in doing business abroad has more to 
do with its own aggressive actions, including ballistic missile 
tests, than it does with U.S. financial restrictions.
    This morning, Secretary Kerry reiterated that Iran deserves 
the benefits of the agreement they struck, but that if they 
want to capture the broader benefits of global commerce, they 
need to change their aggressive behavior.
    Rather than changing any current rules that restrict Iran's 
access to the dollar-based financial system, the President 
suggested that the Treasury Department could clarify to foreign 
financial institutions the kind of activities that are 
permissible under current restrictions.
    What kind of changes would we have to see in Iran's 
behavior with respect to missile development, support for 
terrorism, and human rights violations, before we would 
consider changing existing restrictions on Iran's access to our 
financial system?
    Ambassador Shannon. They have to stop. I mean, in terms of 
sanctions that limit Iran's access to the U.S. financial 
system, this is related to a whole series of Iranian behaviors 
that we find reprehensible.
    But what you said at the beginning of your question is 
important. Both the President and the Secretary made clear that 
while we will meet our commitments under the JCPOA, that Iran's 
ability to benefit economically and financially from a greater 
openness to the world and the lifting of sanctions depends not 
just on the lifting of those sanctions. It depends on the 
environment it creates inside of Iran, first to attract 
businesses and investment, but also to establish a degree of 
confidence as Iran engages generally within the larger 
international community.
    As long as Iran behaves as it is behaving in the area of 
terrorism, in the area of regional destabilization, in the area 
of ballistic missile development, there will be a natural 
prejudice against some aspects of economic and financial 
engagement with it.
    Senator Markey. But you are saying Iran does have within 
its own power to change its behavior that would then help to 
give the United States the ability to relax access to the 
financial system.
    Ambassador Shannon. Yes.
    Senator Markey. Okay.
    In addition to imposing restrictions on Iran's nuclear 
weapons programs, one of the great opportunities that the JCPOA 
provides is to raise the standards for the overall 
nonproliferation regime. I recently joined Senator Cantwell and 
other Senators in writing a letter to President Obama that 
detailed a number of steps the administration could take to do 
that.
    One of these would be to expand the worldwide application 
of the additional protocol, which provides that IAEA with 
enhanced inspection rights, including the right to inspect a 
country's entire fuel cycle and to conduct environmental 
sampling beyond declared facilities.
    Iran signed its additional protocol agreement with the IAEA 
in 2003. Under the JCPOA, it has agreed to implement it fully.
    What steps is the administration taking to encourage all 
NPT parties to sign and implement additional protocol 
agreements with the IAEA?
    Ambassador Shannon. Thank you for the point on the 
additional protocol and the IAEA.
    The commitment by Iran to provisionally apply the 
additional protocol, and then ultimately to accept fully the 
additional protocol, is, in the world of nonproliferation, a 
huge deal and indicates that the IAEA will have enhanced 
capabilities to measure and track Iranian compliance not only 
with the JCPOA and broadly with NPT.
    And this is a huge concession on Iran's part and one that 
was viewed with concern around the world by those who do not 
adhere to the additional protocol. So committing to the 
additional protocol is the centerpiece of much of what we try 
to do in our nonproliferation work, and it is something that my 
colleagues at the State Department who work in the area of 
nonproliferation address on a regular basis.
    And we will continue to do so. And it is our hope in this 
regard that Iran's willingness to accept an additional protocol 
should be seen as a point of reflection for our partners around 
the world who have not done so.
    Senator Markey. And another step that the administration 
could take to strengthen nonproliferation would be to achieve a 
ban on the production of fissile material in the Middle East. 
Under the terms of the JCPOA, Iran has agreed not to produce 
uranium enriched beyond the 3 percent threshold for at least 15 
years, but it has expressed a willingness to extend that 
restriction if its neighbors promise to do the same.
    What steps is the administration taking to discourage any 
additional countries from the Middle East from engaging in that 
kind of activity?
    Ambassador Shannon. I think the JCPOA itself is a powerful 
reason for countries in the region not to develop their own 
nuclear enrichment capability, because they are not facing a 
threat from Iran through a nuclear weapon at this point in 
time.
    But we continue in our regular engagement throughout the 
region, in our regular security discussions, to begin to 
identify and understand the security threats and 
vulnerabilities that our partners face and to help them find 
ways to address them without approaching a nuclear threshold. 
We do this with the Gulf Coordination Council. Secretary Kerry 
will be meeting with the Gulf Coordination Council ministers in 
Bahrain at the end of the week, and the President will be 
meeting in Riyadh with the leaders in the near future.
    Senator Markey. So the administration is specifically 
encouraging all states in the Middle East to not pursue uranium 
enrichment or plutonium reprocessing facilities?
    Ambassador Shannon. Anywhere we can, yes.
    Senator Markey. You are doing that?
    Ambassador Shannon. Yes.
    Senator Markey. Okay.
    Thank you, Mr. Chairman.
    The Chairman.  Thank you.
    Senator Gardner?
    Senator Gardner. Thank you, Mr. Chairman.
    Thank you, Secretary Shannon, for your time here today. I 
want to clarify a remark you made earlier. I believe it came in 
response or at least after your exchange with Senator Barrasso, 
where I believe you had said Iran was the one that gave up 
everything up front. I think later on, in perhaps another 
question and answer with another Senator, you had mentioned 
that Iran has given up its ambitions of a nuclear program.
    I do not want to misquote you. What did you say?
    Ambassador Shannon. I will have to go back and check the 
transcript, but my intent was that it has given up its ambition 
of a nuclear weapon.
    Senator Gardner. Do you believe that Iran has given up its 
ambition of a nuclear weapon? That is an accurate portrayal of 
your statement?
    Ambassador Shannon. At this point, the JCPOA, as it is 
implemented, prevents Iran from achieving a nuclear weapon.
    Senator Gardner. At this point. But, I mean, do you believe 
that Iran is testing ballistic missiles with someday the hope 
of putting a nuclear warhead on it?
    Ambassador Shannon. This is one of the reasons why we are 
concerned about the ballistic missile program and especially 
about ballistic missiles that have the capability or are 
designed to have the capability to launch nuclear weapons.
    But the JCPOA, as it is implemented today and over time, 
will not allow Iran to develop a nuclear weapon. Should, for 
whatever reason----
    Senator Gardner. Today or over time, is that what you said?
    Ambassador Shannon. Correct.
    Senator Gardner. Now, how many of the gulf council 
countries agree with you on that point?
    Ambassador Shannon. In terms of?
    Senator Gardner. How many of our allies in the region agree 
with you that Iran has completely given up its nuclear weapons 
program?
    Ambassador Shannon. I think, at this point, they would 
agree, given what Iran has done in terms of tearing down----
    Senator Gardner. Leadership in Saudi Arabia, leadership in 
Qatar privately would agree with you, that they have given up 
their ambitions toward a nuclear weapon and that they are 
testing a ballistic missile to put a conventional warhead on 
top?
    Ambassador Shannon. Qatar, I do not know, because I have 
not been there and spoken with them.
    I have been in Saudi Arabia, and the Saudis view the 
Iranians as a real danger in the region, and they view them as 
a danger in the region for any number of ways.
    Senator Gardner. If I may, though, do you believe, though, 
that they are testing a ballistic missile with someday the 
hopes of putting a nuclear warhead on it?
    Ambassador Shannon. That was the purpose when they began 
their ballistic missile program.
    Senator Gardner. Is it no longer their purpose today?
    Ambassador Shannon. You know, it is not their purpose if 
they cannot achieve a nuclear weapon.
    Senator Gardner. Then why would they test a ballistic 
missile?
    Ambassador Shannon. Because it is a strategic weapons 
system that can carry different payloads.
    Senator Gardner. Like a nuclear weapon?
    Ambassador Shannon. Indeed. And this is why----
    Senator Gardner. Let me just drill down on this, because 
this is important, because if the administration is so 
concerned about a ballistic missile--you have said that they 
have given up their ambitions for a nuclear weapon. Do they 
believe that they would like--do you believe that they continue 
to test a ballistic missile, in hopes of putting a nuclear 
warhead on it?
    Ambassador Shannon. I understand the point, and I would 
just reiterate that we are opposed to this ballistic missile 
program.
    Senator Gardner. I understand that you talking about how 
appalled that we are and how concerned we are. But yes or no, 
do you believe Iran hopes to put a nuclear weapon on top of a 
ballistic missile?
    Ambassador Shannon. At this point, no, because they cannot.
    Senator Gardner. Mr. Shannon, in conversations I have had 
with allies in the region, nobody there believes that they have 
given up their nuclear weapons ambition. I think it is 
important to address, yes, this outrage over ballistic missile, 
but yet we have not put in the full measure of responses that 
we said we would, in order to prevent them from continuing to 
test a ballistic missile.
    And I do not believe that they are testing a ballistic 
missile just to show that they can do it. I believe they are 
doing it with the purpose of continuing to develop a nuclear 
weapons program.
    In fact, I have heard from leaders in the region where they 
talk about, at the end of this 12-year period, where they 
believe they will have just a short amount of time to, indeed, 
possess and develop a nuclear weapon. That is what the leaders 
in the region will tell you.
    Secretary Kerry said in the letter in September, September 
2 to the Senate, saying that the full measure of U.S. response 
would be affected if Iran continues to push its bad behaviors 
like testing ballistic missiles. I do not believe that we have 
done that.
    Do you think we have done everything possible to stop 
Iran's testing of ballistic missiles?
    Ambassador Shannon. Within the authorities that we have 
been given, we have. But this is about an evolving situation. 
And as we determine where Iran is getting----
    Senator Gardner. Within the authorities we been given, what 
authorities are preventing us from fully and effectively 
countering Iran's ballistic missile program?
    Ambassador Shannon. The authorities we have under sanctions 
authorities are being used and being used effectively. The 
problem we face in Iran----
    Senator Gardner. By effective, do you mean that it has 
stopped their ballistic missile program, because that is 
certainly not the case.
    Ambassador Shannon. No, but it has deterred and delayed it 
by limiting the ability of external assistance to that program 
and proliferation assistance to that program.
    Iran has an indigenous capability that we cannot affect in 
the short term, but we can limit and delay Iran's ability to 
build out its ballistic missile program. And in the process, as 
we gain time through that, we can work with our partners in the 
region to ensure that they have the capability to defend 
themselves, and that we have the capability also to help them 
defend themselves.
    Senator Gardner. So let me get this straight. By their 
continual testing of ballistic missiles, we believe that that 
is a delay of their ballistic missile program?
    Ambassador Shannon. Considering where it would be absent 
the sanctions authority, yes. It is not where we want to be, 
obviously, but Iran sees this ballistic missile program as an 
important part of its strategic weapons systems, and it will 
continue along this route. We just need to make sure that it 
does not get there in any fast time.
    Senator Gardner. Secretary Shannon, then do you believe 
that our sanctions efforts against Iran for its ballistic 
missile program has been a success or failure?
    Ambassador Shannon. It has been an effective tool, but it 
has not been a complete success. Obviously, not, because they 
are launching.
    Senator Gardner. In the Wall Street Journal, April 4, the 
UAE Ambassador to the United States stated it is now clear that 
one year since the framework from the deal was agreed upon, 
Iran sees it as an opportunity to increase hostilities in the 
region. But instead of accepting this as an unfortunate 
reality, the international community must intensify its actions 
to check Iran's strategic ambitions.
    Do you agree with the Ambassador's assessment?
    Ambassador Shannon. I do.
    Senator Gardner. Have our allies in the region expressed 
similar concerns?
    Ambassador Shannon. Yes.
    Senator Gardner. And have we acted appropriately in 
response to these concerns?
    Ambassador Shannon. We are working very closely with our 
partners around the region to ensure that they have the ability 
to defend themselves.
    Senator Gardner. So Iran sees the agreement, the framework, 
as an opportunity to increase hostilities in the region. Could 
you outline some of those increases in hostilities?
    Ambassador Shannon. As I noted in my testimony and in 
previous comments, what Iran is doing in Syria, what it is 
doing in Lebanon with Hezbollah, what it is doing in Yemen with 
the Houthis, are destabilizing actions that we believe pose 
significant danger to our allies and partners in the region. 
And we are responding to them by working with our allies and 
partners, by enhancing their capability to defend themselves, 
and by looking for ways to build a broader diplomatic 
connectivity in the region that will allow them to push back on 
Iran in a significant way.
    Senator Gardner. Thank you, Mr. Chairman. My time is 
expired.
    The Chairman.  I think this is an important part of the 
testimony. I know you are new to this particular position and 
you are getting some leeway today because of that. But, for you 
to state that you know they are going to continue to do 
ballistic missile testing, in clear violation of the agreement, 
does speak to the fact that we do not need to be accommodating 
them relative to dollars and instead punishing them for 
violating the intent of this law.
    You mentioned the authorities that you have. I assure you 
that, on a bipartisan basis, if you feel you need additional 
authorities, I think we could pass them out of here very 
quickly.
    I think it is unsatisfying to listen to that line of 
questioning, and for you to state that you know they are going 
to continue to violate the agreement. Yet we have a Secretary 
of State acting as if we need to accommodate them because they 
did not negotiate the deal well enough.
    Senator Shaheen?
    Senator Shaheen. Thank you, Mr. Chairman.
    Under Secretary Shannon, it is very nice to have you here 
finally.
    I want to continue some of the questioning around the 
ballistic missile program, because I was interested in the U.S. 
response to the program. Last week, we blacklisted two Iranian 
companies for supporting the ballistic missile program, and we 
sanctioned two British businessmen for helping an airline that 
was used by the Iran Revolutionary Guards. And France has also 
suggested that there could be unilateral European Union 
sanctions against Iran over the launches.
    As we know, one of the reasons that the sanction regime was 
so effective in pushing Iran to the negotiating table to get us 
JCPOA is because of the international sanctions that really 
worked together to put pressure on Iran.
    So can you talk about how realistic it might be for the 
Europeans to put additional sanctions on Iran over their 
ballistic missile tests?
    Ambassador Shannon. Thank you very much, Senator. And thank 
you for that question.
    I know that our European colleagues--the European Union, 
Germany, France, and the U.K.--agree with us on ballistic 
missile testing. They view ballistic missile testing as a 
danger not just to the region, but to themselves. And for this 
reason, we have worked in concert with them in response to 
ballistic missile tests. It is why they joined us in writing a 
letter to the U.N. Security Council highlighting the recent 
ballistic missile tests.
    So they are partners that were effective and important in 
implementing the sanctions regime that led to JCPOA. And I 
believe that they will work with us to attempt to address the 
ballistic missile launch issue.
    We would have to have a larger discussion with them about 
what an enhanced sanctions regime might look like in regard to 
ballistic missiles. But they would at least be prepared to have 
that discussion.
    Senator Shaheen. Secretary General Stoltenberg of NATO is 
here this week. Is there a role for NATO, given that the 
ballistic missiles pose a potential threat to NATO countries? 
Is there a role for NATO in thinking about how we should 
respond to Iran on the ballistic missile issue?
    Ambassador Shannon. I am sure there is. I am not capable at 
this point of delineating it, except that it would be related 
to how we work missile defense systems internally inside of 
Europe in protection of NATO countries, which we do already in 
some parts of the region.
    Senator Shaheen. I know that whenever Iran has launched a 
missile, that there has been activity at the U.N. to try to 
condemn that, and that Russia has really been the 
obstructionist in many of those cases to our taking stronger 
action at the U.N.
    So can you talk about what other actions we might be able 
to take to counter what Russia is doing?
    Ambassador Shannon. Well, we have been engaging with the 
Russians regularly on this for several purposes, first, in 
order to try to the extent possible to ensure that we have 
coherence and cohesion within the P5+1 as we address JCPOA 
implementation and as we address any other activities of Iran 
that are dealt with in the U.N. Security Council, the most 
recent U.N. Security Council Resolution 2231.
    And in this regard, we have a difference with the Russians. 
So we have been engaging with them at many different levels to 
try to find a way to address that disagreement.
    We have a commitment, however, from the Russians in terms 
of working to prohibit the transfer of technologies to Iran's 
ballistic missile program. And on this, we are trying to ensure 
that they stay firm within the P5+1. And at this point, they 
are.
    Senator Shaheen. So the Russians are actually helping on 
that front?
    Ambassador Shannon. They are in the sense that they are 
complying with their commitment not to transfer these kinds of 
technologies or to facilitate the transfer.
    Senator Shaheen. Thank you.
    I want to switch topics a little bit to the Iranian 
elections and ask what our analysis in the State Department was 
of those parliamentary elections back in February and whether 
we think there is any room to believe that reformers may be 
gaining support within Iran, and whether those reformers are 
actually doing anything that is going to moderate Iran's stance 
with respect to its actions in the international community.
    Ambassador Shannon. An important question. The elections 
are still in play, since there are a variety of runoff 
elections. So it is hard for us to give a global understanding 
or estimate of the impact of those elections.
    However, if we just look at what happened in Tehran and the 
extent to which reformers kind of swept the board in terms of 
the seats there, I think it highlights the fact that President 
Rouhani and his intent on opening Iran to the world. And 
addressing some of the fundamental stumbling blocks has 
resonated in a positive way.
    It is not easy for us at this point to determine the impact 
that is going to have on how Iran behaves strategically, 
largely because Iran is a mix of conflicted entities and groups 
with hardliners aligning themselves both with religious 
leadership and with the security leadership to prevent 
reformists from moving too fast too far. And part of the work 
of the supreme leader is to balance forces inside Iran.
    But it is our hope and our intent that as we pursue the 
JCPOA, and as Iran begins to connect with our colleagues in the 
European Union and elsewhere, that the positive impact of that 
connection or connectivity is going to have a political effect 
in Iran.
    It is important to understand that Iran faces a huge 
demographic population. Sixty percent of Iran is 30 years old 
or younger. In other words, they were born after the 
revolution, and they have lived in a sanctioned society. Their 
ability to connect with the larger world I think is going to 
become a big factor inside of Iranian internal politics. It is 
our hope that will lead to some changes in Iran's behavior.
    Senator Shaheen. I know I am out of time, Mr. Chairman, but 
if I could just follow up with one question.
    Do we see any connection to that and a reduction in the 
human rights abuses that are occurring inside Iran?
    Ambassador Shannon. At this point, we do not see a lot. 
That is because there is a political struggle going on, and a 
definitional struggle. In moments like that, the tendency is 
for human rights abuses to go up.
    Senator Shaheen. Thank you.
    The Chairman.  Thank you.
    Senator Coons, congratulations on passage of your bill last 
night, by the way.
    Senator Coons. Thank you, Mr. Chairman. It is great when we 
get things done here.
    I appreciate deeply your making it possible for us to have 
this hearing today and your close cooperation with the ranking 
member, such that we have a functional and relevant Foreign 
Relations Committee as well.
    Ambassador Shannon, thank you for your testimony here 
today.
    Broadly speaking, I continue to be glad that Iran has taken 
critical steps to restrain its nuclear weapons program, as 
mandated by the JCPOA, to limit its ability to quickly develop 
a nuclear weapon. And I applaud the administration for 
sanctioning both individuals and entities involved in 
cyberattacks against the United States in 2011 and 2013. And I 
am pleased that you worked closely with our international 
partners over three recent incidents to interdict Iranian 
weapons shipments bound for the Houthi rebels in Yemen in the 
Arabian Sea. And I urge continued thoroughness and vigor in the 
enforcement of all the different mechanisms we have for 
preventing the Iranians from continuing to project power in the 
region.
    But I remain deeply concerned that Iran continues to expand 
its influence in the Middle East and increase support for its 
terrorist proxies.
    Iran's recent ballistic missile tests, which I know has 
been discussed at length at this hearing today, contradict its 
commitments under U.N. Security Council Resolution 2231, and I 
think demonstrate that the nuclear deal will not change Iran's 
behavior, at least in the short run, and Iran remains unready 
to meet the obligations required of a responsible member of the 
international community.
    And I remain disturbed Iran continues to flagrantly violate 
the human rights of the Iranian people and has increased the 
pace of arrests and executions of political prisoners.
    So I believe that if we fail to hold Iran accountable for 
these actions and fail to respond to violations of the JCPOA, 
even minor violations, that the viability of the nuclear 
agreement will be in jeopardy.
    So while I commend the administration for its recent 
actions, I encourage that they continue, and I encourage that 
you enhance the implementation of the nuclear accord while we 
continue to work together on a bipartisan basis to be vigorous 
in pressing back on their ballistic missile tests, their 
support for terrorism, and their proxies and human rights 
violations.
    Let me start, if I could, with a question about IAEA 
funding.
    A February 2016 GAO report says that IAEA officials have 
expressed concerns about the reliability of the sustained 
extra-budgetary contributions for JCPOA enforcement activities 
due to possible donor fatigue over the long run. And a visit 
that I made to Vienna to meet with IAEA leadership earlier this 
year reinforced those concerns.
    Does the State Department agree that these are significant 
concerns, and that a failure of the IAEA to have appropriate 
personnel deployed to take advantage of the search and 
inspections made possible under the JCPOA matters deeply? And 
do you believe the U.S. should make a significant, proactive, 
and long-term investment to meet the IAEA's requirements, to 
demonstrate we are fully committed to enforcing the JCPOA over 
the long term?
    Ambassador Shannon. The short answer is yes. The longer 
answer, first of all, we are grateful for the GAO report. We 
have it in draft, and we are commenting on it. We believe that 
the IAEA has the resources it needs in the short term through 
the end of the year to address its responsibilities in terms of 
compliance verification, but we are continuing to look for ways 
with our partners to enhance the resources, especially the 
funding that the IAEA has at its disposal.
    What we are asking the IAEA to do is quite remarkable. It 
is an important organization to begin with, in terms of 
nonproliferation and in terms of nuclear security and safety, 
but we are asking it to take on a role in Iran so intrusive and 
so interventionist that it will be groundbreaking for it, in 
many ways.
    Much it can do technologically, but much of it is also 
going to require inspectors on the ground. This is going to 
require special funding and special training. But we are 
working with our partners to ensure that the resources are 
available.
    But we will have a conversation with this Congress to 
discuss in broader detail where we think additional help will 
be important.
    Senator Coons. Thank you, Ambassador. My strong impression 
is that the IAEA is a thorough, cautious, professional 
organization, and so they are simply being responsible in not 
leaping forward to invest in a whole new generation of 
inspectors, but that is not what this moment calls for.
    One of the real positive features of the JCPOA is the 
opportunity for searching intrusive inspections, as you 
referenced. And nuclear inspectors take a while to train and to 
deploy, and I do not think we should be penny-wise and pound-
foolish in this area and fail to enthusiastically take 
advantage of this window and provide robust support to the 
IAEA.
    One other question. Last month, the U.N. issued a report 
showing the number of people executed by the Iranian Government 
skyrocketed to nearly 1,000 in 2015, twice as many as in 2010, 
10 times as many as in 2005.
    In your testimony, you highlight CISADA, the Comprehensive 
Iran Sanctions, Accountability, and Divestment Act, as a tool 
to potentially draw attention to and punish Iranian human 
rights violations. Do you believe the CISADA authorities should 
be expanded in any way, in light of Iran's ongoing human rights 
abuses?
    Ambassador Shannon. First of all, at the beginning of my 
testimony, I noted the three areas of concern, and one is human 
rights, because of the situation we see right now, and what it 
means for Iran politically and what it means for Iran going 
into the future.
    When it comes to sanctioning, Iranian people and entities 
for human rights abuses, again, we believe we have the 
authorities. And I realize this is an unsatisfactory answer for 
this committee, but we are happy to engage in a conversation 
with this committee and with the Senate about what more we can 
and should be doing to address these issues, as we would be in 
other areas of sanctions, as I noted.
    Senator Coons. I see my time has expired. Let me just make 
two comments if I might, in closing.
    I had the chance yesterday to meet with Vitaly Churkin, 
Russia's Ambassador to the United Nations. He made it clear 
Russia will block U.N. Security Council action in response to 
Iran's recent multiple ballistic missile tests.
    I think it is incumbent on us to work closely together in 
the legislative branch to ensure that we take greater action to 
strengthen our unilateral sanctions against Iran's ballistic 
missile program. And I am very concerned about the ongoing 
debate in this committee and across other committees about the 
possibility of wider access to the U.S. dollar and U.S. dollar 
facilities for Iran.
    I am determined that we make sure that Iran and its efforts 
to expand its reach in the Middle East and to support terrorism 
and finance terrorism is contained appropriately.
    Thank you for your testimony, Mr. Secretary.
    The Chairman.  Thank you.
    Senator Cardin?
    Senator Cardin. I just want to make a comment about U.S. 
leadership. Obviously, it would be preferred to have the 
Security Council take action against Iran for its missile 
violations. That would be preferred. It would also be preferred 
that, in addition to the U.S. actions, we have our coalition 
partners, including beyond the JCPOA. The gulf countries to 
participate with us would be very helpful, in sanctions against 
Iran for missile violations.
    But it really starts with U.S. leadership. We have seen it 
over and over again, that if the United States is not prepared 
to take a very strong stance, it is difficult to get the type 
of attention internationally.
    We did that recently in North Korea with the passage of the 
North Korea sanctions act. It was a strong bill, strong 
message. Working with the administration, we get that done.
    So I would just make a couple comments. You mentioned a 
couple times human rights violations and that, under these 
current circumstances, we see an uptick on what Iran is doing 
on human rights violations. We should have a strategy to 
respond to that, and we will be stronger if Congress gives you 
the way to deal with that, working with Congress to show that 
we are serious about holding Iran's nefarious actions 
accountable.
    And on ballistic missiles, it seems to me this is a 
relatively easy matter, working with the administration to have 
a statutory framework that goes beyond any one administration 
to make it clear we are going to take action against Iran. If 
we are the only country, we will do it. But when we act, we 
generally can get our partners in Europe to pay more attention 
to us and our strategic partners around the world to pay more 
attention to it, perhaps even adding to U.N. sanctions, 
ultimately.
    So I would just urge you, in the strongest possible way, to 
not only show a willingness to work with Congress, but to help 
us come to the appropriate legislative response to the 
realities of Iran today. And today, we see that they are 
violating their missile obligations. They are violating 
international human rights, as you pointed out. And they are 
supporting terrorism.
    Beyond the JCPOA and nuclear responsibilities, which I said 
earlier, we will treat that as a separate basket, but let's not 
be bashful about the need for U.S. leadership, and Congress has 
a critical role in that. And you can help us.
    There is a common agenda in the administration, but there 
is a different attitude in the State Department, Defense, 
Energy, Treasury, the White House, and I think you can play a 
very important role bringing us together with a strong 
statement by the United States Congress, getting us to pass 
legislation that can help you in this effort.
    The Chairman.  Thank you.
    I know Senator Menendez wanted to come back and ask some 
questions.
    Senator Menendez. Thank you, Mr. Chairman, for the 
opportunity.
    Mr. Secretary, just a couple quick questions. Maybe you can 
answer them yes or no. When you hear the question, you will 
probably understand that it is acceptable for a yes or no. I 
know sometimes that is hard, particularly for members of the 
State Department to do.
    Yes or no, are sanctions against ballistic missile testing 
a violation of the JCPOA?
    Ambassador Shannon. No.
    Senator Menendez. Are sanctions against financial 
institutions that are financing, whether it be ballistic 
missile tests or the financing of terrorism activities, in 
violation of the JCPOA?
    Ambassador Shannon. No.
    Senator Menendez. Is reauthorization of the Iran Sanctions 
Act a violation of the JCPOA?
    Ambassador Shannon. Not that I am aware of.
    Senator Menendez. Okay, a little bit more equivocal. I do 
not think it is.
    Now, I am sure that you are aware that I have had the GAO 
investigating some of the assumptions of the administration 
about the JCPOA and the international community's ability to 
ensure that Iran is, and as the President has said, following 
the letter of the agreement, but also the spirit.
    The GAO's observations pointed directly to future problems 
at the IAEA with monitoring, verifying, and meeting the 
requirements of the JCPOA, included but not limited to limited 
investigative capabilities, limited analytical capabilities, a 
limited budget from irregular funding sources, human resource 
shortfalls, certain important equipment operating at capacity 
already, a lack of authorities and a dependence on Iran's 
cooperation, and the tyranny of dichotomy. As the IAEA turns 
its attention almost exclusively to Iran, it turns away from 
other proliferators that we are concerned about as well.
    These are pretty profound challenges.
    Now the GAO has found some additional problems, which I am 
raising with you for the first time, and I hope to hear your 
responses to it.
    Iran has a history of safeguard violations and of denying 
the IAEA access to its facilities. How does the IAEA 
communicate potential violations of the agreement to the joint 
commission or individual parties to the agreement? And has the 
IAEA flagged any activity as a violation or potential violation 
so far?
    Ambassador Shannon. Thank you for that question.
    The IAEA is a central part of compliance with the JCPOA. As 
you noted, the demands of the JCPOA, and as Senator Coons 
noted, are going to place a very special responsibility on the 
IAEA, but also very special demands that will require the IAEA 
to transform aspects of its structure and its behavior. And we 
are prepared to work with the IAEA to ensure that it does so in 
a timely fashion.
    The IAEA communicates with the joint commission and the 
members of the joint commission in a variety of forms. It has 
regular reporting requirements related to JCPOA compliance. It 
also engages with us individually in Vienna on JCPOA 
compliance. And it is in a position to identify aspects of 
JCPOA compliance that need further attention. And we have had--
--
    Senator Menendez. I am sorry to interrupt you, but my 
specific question is how does it communicate potential 
violations with the agreement to the joint commission, and have 
they flagged any activity as a violation or potential violation 
so far?
    Ambassador Shannon. They have not flagged violations. They 
have flagged issues in which there is not a complete 
understanding between both parties about what needs to be done. 
Because of that, we are working within the joint commission and 
working with our partners, and the Iranians have been able to 
address them.
    Senator Menendez. So they communicate to the joint 
commission in writing? verbally? To individuals? I am trying to 
get the process here, because that is one of the things the GAO 
talks about. What is the process to do this?
    Ambassador Shannon. As I noted, there is kind of a two-
tiered process. The first is through its formal reports. But 
secondly, the joint commission members engage regularly with 
the IAEA. That is the reason we do the meetings in Vienna and 
meet with IAEA----
    Senator Menendez. Let me ask you this. You said that there 
was interpretation--correct me if I am wrong--interpretation 
questions. So have there been instances of questionable 
compliance thus far that were resolved outside of the dispute 
resolution mechanism?
    Ambassador Shannon. These are issues that did not kind of 
rise to the issue of a dispute. These are issues in which we 
noticed certain activities that we thought were not in 
compliance. We engaged with the Iranians, and they were fixed.
    Senator Menendez. Because if there was a dispute on 
something, you would be more formal and everyone would know 
about it. The way in which you described those issues, it is 
rather informal, and no one knows exactly what they are, right? 
There is no record of that?
    Ambassador Shannon. I will have to go back and check on a 
couple of the specific ones, whether or not they were 
formalized or written in some fashion.
    Senator Menendez. Let me ask you this. If an access issue 
arose to the joint commission, would the IAEA still get access 
within 24 days, if any members of the joint commission 
disagreed on its significance?
    Ambassador Shannon. I am sorry? Would they get----
    Senator Menendez. An access question, meaning access by the 
IAEA to Iran by the joint commission. Would IAEA still get 
access within 24 days, if any members of the joint commission 
disagreed on its significance? Some might say it is not 
significant, worthy of having access.
    Would the IAEA still get access?
    Ambassador Shannon. My understanding is yes. My 
understanding is the IAEA can access areas----
    Senator Menendez. Even if members of the joint commission 
are in disagreement?
    Ambassador Shannon. Yes.
    Senator Menendez. Okay.
    Finally, how will the IAEA and/or the procurement working 
group know that exporters are going through the procurement 
channel? Are there consequences, penalties, for exporters 
failing to go through the procurement channel?
    Ambassador Shannon. If the material that they are seeking 
to sell is on excluded lists, the answer is yes. But my 
understanding is that anybody that wants to engage with Iran on 
issues that are controlled has to go through the procurement 
working group.
    Senator Menendez. I raise these questions, because this is 
a new onset of the GAO study, and I would invite you, as you go 
back to the State Department, to review your answers to me. And 
if any of them need to be modified, because I am really just 
interested in the facts, if they need to be modified for the 
record, I am sure that the chairman would consider it.
    Thank you, Mr. Chairman.
    The Chairman.  I would actually ask you to reconsider your 
answer. There is a joint commission vote that has to occur, and 
the IAEA can be denied access. I know you are somewhat new to 
this. I know you were not involved in negotiations. I do not 
think you answered that question appropriately, not 
intentionally, of course, but it is my sense is you are going 
to need to correct that.
    Senator Menendez. Mr. Chairman, none of those were gotcha 
questions. They are new questions raised by the GAO study that 
I and Senator Kirk asked to be commissioned. I just want to get 
a definitive answer, so that I understand it, as the chairman 
does.
    But we need to know what the State Department view is on 
it, so that as we are looking at legislation or whatever, we 
can think about that.
    Ambassador Shannon. Okay. I appreciate that. I will take 
that and get back to you.
    The Chairman.  I think one of the concerns, was the period 
leading up to the 24 days, then the 24 days, then the vote of 
the commission. I do think you might want to restate your 
answer.
    Ambassador Shannon. Okay.
    The Chairman.  I think we are closing out. I just would 
like to say I know Senator Shaheen has some questions about the 
election, which I appreciate. The fact is, people are still 
observing whether, there were actually ``more moderate'' folks 
elected and the policies are actually going to change, or 
whether Iran is putting on a moderate image but carrying out 
the same policies. The number of people being executed, the 
human rights violations, and things they are doing to 
destabilize the region, seem to have been on the ascendancy 
since these elections have taken place.
    Secondarily, I would just say that, look, there are people 
on this dais and on this committee that voted in different 
ways, relative to the agreement and that is understandable. I 
do not think a single person today said that they wanted to 
lighten up in pursuit of Iran adhering to this agreement. I do 
not think there is that push. I may have misunderstood, but I 
do not think that is the case.
    No one is advocating putting in place policies that violate 
the agreement, but we want to make sure that Iran adheres to 
the agreement.
    I get the sense that Secretary Kerry has gotten to know 
Foreign Minister Zarif well. They developed a relationship, 
maybe also with Rouhani.
    I get the sense that there is a desire by the Secretary to 
accommodate Iran, to make this agreement work more than the 
language states it should for Iran. My sense is there are other 
parts of the administration that are countering that. I think 
the President is some place in between.
    I just want to say I am glad we had this hearing, and I do 
not think you heard from this committee any desire to provide 
flexibility that does not exist. In fact, I think what you 
heard today that there is desire to push back in appropriate 
ways, because there is a sense that, over time, the will to 
adhere to this agreement could erode. I hope you will take that 
back to the State Department.
    We thank you for your testimony. There will be questions 
asked in writing. The record will remain open until the close 
of business Thursday. If you would respond appropriately, we 
would appreciate it.
    The Chairman.  I know this is a hearing on some technical 
issues today, some of which you are familiar with, some of 
which you are not. We thank you for coming, and we appreciate 
the role you are playing at the State Department.
    Ambassador Shannon. Thank you very much. I appreciate this 
opportunity.
    The Chairman.  With that, the meeting is adjourned.
    [Whereupon, at 11:58 a.m., the hearing was adjourned.]

                              ----------                              


              Additional Material Submitted for the Record


    Responses of Under Secretary of State Thomas A. Shannon, Jr. to 
              Questions Submitted by Senator Barbara Boxer

    Question. I appreciated your testimony, in which you said the 
Administration takes any threat to Israel extremely seriously and has 
strongly invested in Israel's defense. I agree that Israel's security 
should be of utmost concern. Following the implementation of the Joint 
Comprehensive Plan of Action (JCPOA), what measures has the 
Administration taken to boost Israel's defense systems, security, and 
preserve its Qualitative Military Edge?

    Answer. Our commitment to Israel's security is steadfast, and our 
close cooperation with the Israeli government on military and security 
issues continues. We consult closely with the Israeli government to 
determine how we may best support them in defending against emerging 
threats. As Prime Minister Netanyahu recognized during his 2015 speech 
to the UN General Assembly, ``we never forget that the most important 
partner that Israel has always been, and will always be, the United 
States of America.''
    Israel remains the leading recipient worldwide of U.S. Foreign 
Military Financing (FMF). The current ten-year $30 billion Memorandum 
of Understanding between the U.S. and Israel, under which Israel 
currently receives $3.1 billion per year, is just one example of our 
strong, enduring partnership and the U.S. commitment to Israel's 
security.
    The United States also provides Israel with access to highly 
sophisticated equipment to ensure its security, including the F-35 
Joint Strike Fighter. With deliveries starting in late 2016, Israel 
will be the only country in the region with a fifth generation U.S. 
fighter aircraft. We will continue to work with Israel to identify the 
best equipment to meet its security needs.
    Under President Obama's leadership, the United States has invested 
approximately $23 billion in FMF assistance in Israel, and over $3 
billion in the Iron Dome, David's Sling, and Arrow 3 missile defense 
systems. Since 2011, the United States has provided Israel with over 
$1.3 billion for the Iron Dome system alone.In FY 2016 Israel will 
receive an additional $487 million in missile defense support, 
including $55 million for Iron Dome. After successful joint tests of 
David's Sling and Arrow 3 in December 2015, in FY16 the United States 
will fund coproduction and procurement of these systems for the first 
time - further deepening our missile defense cooperation with Israel.


    Question.  How has the Administration pressed Iran to uphold human 
rights, specifically the rights of women?

    Answer. Our position on the human rights situation in Iran has not 
changed as a result of the Joint Comprehensive Plan of Action. We 
continue to condemn Iran's ongoing repression of human rights and 
fundamental freedoms and to call on it to respect the universal human 
rights of all persons in Iran. As your question indicates, women in 
Iran continue to face official and social discrimination, and 
limitations on their travel, work, education, and family-related 
rights. We regularly highlight the situation of women in Iran via our 
social media platforms and public statements. For example, we 
specifically called for the release of female activist Bahareh Hedayat 
as part of the #freethe20 campaign.
    One tool we have for addressing human rights violations in Iran is 
our sanctions targeting Iran's human rights abuses. We have imposed 
sanctions on 19 individuals and 17 entities determined to meet the 
criteria in Sections 105(b) and 105B(b) of the Comprehensive Iran 
Sanctions, Accountability, and Divestment Act (CISADA) of 2010. We will 
continue to vigorously enforce these and other sanctions related to 
human rights violations. These individuals and entities are blocked 
from the U.S. financial system and the individuals are barred from 
traveling to the U.S.
    Additionally, we apply international pressure on Iran for its human 
rights violations through the United Nations. First, we support the 
renewal of the UN Human Rights Council mandate for the Special 
Rapporteur on the Situation of Human Rights in the Islamic Republic of 
Iran, which was most recently renewed March 23 primarily because of our 
aggressive lobbying campaign. Second, we support and lobby aggressively 
for the UN General Assembly 3rd Committee resolution expressing the 
international community's concerns over Iran's human rights violations.
    Beyond these measures, we document human rights abuses in the 
International Religious Freedom, Human Rights, and Trafficking in 
Persons reports. Iran is designated as a ``Country of Particular 
Concern for Religious Freedom'' under the International Religious 
Freedom Act of 1998 and a Trafficking in Persons Tier 3 country.


    Question.  As you know, I supported the Iran nuclear agreement. Key 
to my support was the international community's endorsement of the 
deal, including our partners in the Gulf. Our Gulf Cooperation Council 
(GCC) partners will remain essential in countering negative Iranian 
influence in the region. As Iran continues to test ballistic missiles 
in defiance of UN Security Council Resolutions, it remains imperative 
that we shore up the ballistic missile defense systems of our regional 
partners. Emerging from the U.S.-GCC Camp David Summit last May, the 
United States and our Gulf partners committed to developing a region-
wide ballistic missile defense capability. What is the status of this 
effort?

    Answer. The Department of Defense's (DoD) Missile Defense Agency 
(MDA) committed to undertaking a Ballistic Missile Early Warning System 
(BMEWS) study to determine requirements for the GCC to establish a 
BMEWS. A U.S.-GCC BMD (ballistic missile defense) working group met in 
August 2015, and again from April 18-19, 2016. At the April meeting, 
DoD and State Department officials briefed GCC partners on the status 
of the study, which MDA plans to complete this summer. The GCC was 
satisfied with the proposed architecture and requested the United 
States provide cost and schedule information along with the final 
report. The GCC will then decide how to implement the study's 
recommendations for acquiring an early warning capability.
    The United States is also planning a BMD Senior Leader Seminar. 
This tabletop exercise will be hosted by Kuwait from May 23-25, and 
will be attended by senior representatives from each of the GCC member 
states' ministries of foreign and defense affairs, the GCC Secretariat, 
as well as the U.S. State and Defense Departments. The exercise will 
allow GCC countries to examine military issues, such as defense design 
and BMD planning, as well as the role BMD can play in supporting 
diplomatic solutions to regional crises.
    The United States continues to support GCC member state acquisition 
of BMD systems to assure them of their own deterrence and defense 
capabilities. The United Arab Emirates has acquired Patriot and 
Terminal High Altitude Area Defense (THAAD) systems. Saudi Arabia is 
upgrading its Patriot PAC-2 systems to the more advanced Patriot PAC-3 
and is considering buying THAAD. Qatar has agreed to acquire Patriot 
PAC-3, and is also considering the purchase of an Early Warning Radar 
(another significant BMD capability) and acquiring THAAD. The United 
States continues to work with Kuwait, which has acquired Patriot 
systems.


    Question.  I understand that during your visit to Russia at the end 
of March, you discussed the implementation of the Joint Comprehensive 
Plan of Action (JCPOA) with Russian officials. How is the 
Administration working with Russia to ensure Iran upholds its 
commitments under the JCPOA?

    Answer. (SBU) Russia was an important partner in concluding the 
Joint Comprehensive Plan of Action (JCPOA) and has continued to play a 
constructive role in its ongoing implementation. For example, Russia 
assisted in the removal of Iran's low-enriched uranium stockpile. This 
was a key step Iran had to complete in order to reach Implementation 
Day under the JCPOA and integral to extending Iran's ``breakout time'' 
for production of a nuclear weapon from two to three months before the 
JCPOA to at least one year, where it is now. Russia is also taking a 
lead role in the ongoing process of converting Iran's underground 
Fordow facility for stable isotope production.
    Given Russia's important contributions to the JCPOA which will 
ensure Iran's nuclear program is and will remain exclusively peaceful 
moving forward, I routinely engage with my Russian counterparts on 
matters related to the ongoing implementation of the JCPOA, as I also 
do with my other P5+1 and EU counterparts.


    Question.  How is the Administration, both unilaterally and with 
our partners, working to counter Iran's destabilizing activities in the 
Middle East?

    Answer. Iran's destabilizing activities in the region threaten our 
interests and our allies, and we are working intensively with our 
partners in the region to deter and disrupt Iranian threats.
    Unilaterally, we have forcefully deployed Executive Order (E.O.) 
13224, which allows us to target terrorists of any stripe across the 
globe, against Iran. The IRGC-Qods Force, the Iranian Ministry of 
Intelligence and Security, Iran's Mahan Air, Hizballah, and over 100 
other Iran-related individuals and entities remain subject to sanctions 
under this E.O. Most recently, on March 24, the Department of Treasury 
designated six individuals and entities that have facilitated Mahan 
Air's efforts to circumvent sanctions. Further, under Iran sanctions 
statutes, foreign financial institutions may be subject to secondary 
sanctions for knowingly facilitating a significant financial 
transaction or providing significant financial services for an entity 
on the Specially Designated National (SDN) List, which includes the 
IRGC and its designated officials, agents, and affiliates. These and 
other authorities allow us to continue to target the IRGC for any 
destabilizing activities in the region.
    We continue to work intensively with our partners, especially 
Israel and the Gulf states, to deter and disrupt Iranian threats and 
proliferation. Examples of such cooperation include ongoing security 
cooperation with the GCC following the Camp David summit, sanctions on 
a range of Iranian entities for actions in Syria, and Israel's seizure 
of the Klos C vessel carrying weapons bound for Gaza in 2014. 
Additionally, since September 2015, Coalition maritime forces have 
interdicted four dhows carrying weapons from Iran that we assess were 
destined for the Houthis in Yemen. Each of these three shipments 
contained roughly 2,000 small arms, including rifles, some heavy 
machine guns, sniper rifles, and anti-tank weapons.

                               __________

    Responses of Under Secretary of State Thomas A. Shannon, Jr. to 
             Questions Submitted by Senator Johnny Isakson


    Question.  In the wake of the Iran Nuclear Deal and in light of 
Iran's recent provocative behavior, what are some specific actions the 
United States is taking in response to Iran's actions in the region?

    Answer. We are deeply concerned about Iran's destabilizing 
activities, which are a threat to us and our allies. We continue to 
work intensively with our partners, especially Israel and the Gulf 
states, to deter and disrupt Iranian threats and proliferation. 
Examples of such cooperation include ongoing security cooperation with 
the GCC following the Camp David summit, sanctions on a range of 
Iranian entities for actions in Syria, and Israel's seizure of the Klos 
C vessel carrying weapons bound for Gaza in 2014. Additionally, since 
September 2015, Coalition maritime forces have interdicted four dhows 
carrying weapons from Iran that we assess were destined for the Houthis 
in Yemen.
    We have forcefully deployed Executive Order (E.O.) 13224, which 
allows us to target terrorists of any stripe across the globe, against 
Iran. The IRGC-Qods Force, the Iranian Ministry of Intelligence and 
Security, Iran's Mahan Air, Hizballah, and over 100 other Iran-related 
individuals and entities remain subject to sanctions under this E.O. 
Most recently, on March 24, the Department of Treasury designated six 
individuals and entities that have facilitated Mahan Air's efforts to 
circumvent sanctions.
    Further, under Iran sanctions statutes, foreign financial 
institutions may be subject to secondary sanctions for knowingly 
facilitating a significant financial transaction or providing 
significant financial services for any entity on the Specially 
Designated National (SDN) List, which includes the IRGC and IRGC-
related officials, agents, and affiliates. These and other authorities 
allow us to continue to target the IRGC for any activities which 
destabilize the region.
    The Joint Comprehensive Plan of Action (JCPOA) was meant to address 
the international community's concerns with Iran's nuclear program. An 
Iran armed with a nuclear weapon would be able to project even more 
power in the region. This is one of the reasons we worked so hard on a 
diplomatic solution to the nuclear issue. Full implementation of the 
JCPOA is a step in the right direction to begin addressing the other 
very serious concerns we have about Iran's malign regional activities.


    Question.  One of the keys to bringing Iran to the table in the 
first place was the coalition around enforcing multilateral sanctions 
against the regime. How will that coalition hold together? Especially 
as trade and potential economic benefits return to Iran and some of 
these countries invest there?

    Answer. The Joint Comprehensive Plan of Action (JCPOA) between the 
P5+1 (China, France, Germany, Russia, the United Kingdom, and the 
United States), the European Union (EU), and Iran has cut off all of 
Iran's pathways to a nuclear weapon. This has improved the security of 
the United States and our allies. The best way to ensure that the 
international coalition holds together is to ensure that Iran continues 
to uphold its commitments under the JCPOA. Like the United States, the 
EU understands the threat posed by a nuclear Iran. The EU has been a 
strong partner on Iran sanctions. When the United States was increasing 
sanctions pressure on Iran the EU also took significant steps, despite 
their strong economic ties with Iran. We are confident that the EU will 
again take such steps should Iran breach its JCPOA commitments. UN 
Security Council Resolution 2231 also includes a snapback mechanism for 
UN sanctions, which could be used to reimpose multilateral sanctions on 
Iran.


    Question.  How will we be able to limit the Iranian regime's 
ability to use capital to further destabilize the region? These malign 
activities do not necessarily cost a lot of money, and we can argue 
that they have been doing these things with little money to wreak 
havoc.


   What tools are available to the U.S. and our allies to 
        counter Iran's provocations in the region, especially those 
        that are less capital intensive?

   Do we need additional tools to counter these destabilizing 
        activities?

    Answer. Iran has, over the past three decades, used some of its 
resources to support terrorism. That is why Iran is and remains a 
designated State Sponsor of Terror. And that is why our non-nuclear 
related sanctions on Iran remain, and why we will continue to work with 
our partners in the region to counter Iran's malign activities, 
regardless of the source of funds for those activities.
    Iran's ongoing economic difficulties make it harder to divert large 
portions of its financial gains from sanctions relief away from its 
domestic economy and toward its regional activities. For example, we 
estimate that Iran needs about half a trillion dollars to meet pressing 
investment needs and government obligations.
    What has been most effective in countering Iran's destabilizing 
activities in the region is working with our partners in the Gulf to 
disrupt malign Iranian activities, and we continue to enhance both our 
cooperation and their capabilities. We have established with our 
partners in the Gulf Cooperation Council a set of working groups to 
accelerate arms transfers and improve their military preparedness, 
ballistic missile defense, counterterrorism, and cyber capabilities.
    We have numerous domestic authorities - including sanctions - to 
counter Iran's support for terrorism and other destabilizing 
activities. We will continue to enforce aggressively our sanctions 
related to Iran's support for terrorism, ballistic missile activities, 
regional destabilization, and human rights abuses.


    Question.  What is the Administration's assessment of Iran's human 
rights practices? How effective have international sanctions been in 
altering any of Iran's human rights practices? What further steps can 
be taken to bring about improvement on this issue?

    Answer. We remain deeply concerned by Iran's human rights record. 
We document the reasons for our concern in our annual Country Reports 
on Human Rights Practices, International Religious Freedom Report, and 
Trafficking in Persons Report. The human rights report on Iran 
highlights severe restrictions on civil liberties, limitations on 
citizens' ability to choose their government peacefully through free 
and fair elections, and abuse of due process combined with escalating 
use of capital punishment for crimes that do not meet the threshold of 
most serious crimes. Iran also continues to use the death penalty in 
cases of juvenile offenders. Iran is designated as a ``Country of 
Particular Concern'' under the International Religious Freedom Act and 
a Trafficking in Persons Tier 3 country. We routinely address human 
rights issues in Iran in public statements.
    Our sanctions targeting Iran's human rights abuses remain in place 
and we will continue to vigorously enforce them.
    In general, human rights sanctions that the United States and our 
partners exercise around the world are an important tool for defending 
international human rights norms. They help to shine a light on abuses 
of power and to demonstrate to ordinary citizens of repressive regimes 
that countries like the United States stand with them and against those 
who deny them the right to pursue their aspirations.
    In addition, we believe highlighting Iran's human rights record in 
international forums is a critical method to bring pressure to bear on 
Iran to change its record. We continue to support and lobby for the 
renewal of the mandate of the UN Special Rapporteur on the Situation of 
Human Rights in the Islamic Republic of Iran so that he can continue 
his important work. We also strongly support and lobby for the annual 
UN General Assembly 3rd Committee resolution on human rights in Iran, 
which stresses the international community's serious concern about 
these issues.
    We will continue to press Iran to end its mistreatment of its 
people and we will continue to raise our voice in support of the 
Iranian people and their desire for greater respect for human rights 
and the rule of law.


    Question.  To what extent is Iran receiving the sanctions relief it 
says it was promised under the JCPOA? What steps, if any, might the 
Administration be considering that could provide additional sanctions 
relief to Iran beyond that committed by the JCPOA?

    Answer. In exchange for Iran meeting its nuclear-related 
commitments under the JCPOA, we lifted nuclear-related sanctions on 
Iran. As long as Iran continues to meet its nuclear commitments, we 
will continue to uphold our JCPOA sanctions commitments.
    It is important that the United States follow through on its 
commitments in the JCPOA. It is important that the United States be 
seen around the world as a good faith partner; our ability to deliver 
on what we promise affects American standing in the world.
    We have, therefore, been providing clear guidance to banks and 
businesses about what transactions are possible under the JCPOA. We 
have seen indications that some non-U.S. banks are still reluctant to 
give Iran access to its funds, despite the fact that foreign financial 
institutions can now transfer such funds to the Central Bank of Iran 
without running afoul of U.S. sanctions. This may be due to a lack of 
understanding about the sanctions relief or a misunderstanding about 
the intent of the U.S. government.
    It is not in our interest to create artificial barriers to 
transactions that we committed in good faith to allow. We are, 
therefore, committed to ensuring that those types of transactions can 
occur within the bounds of the JCPOA.


    Question.  According to an Associated Press report last week, 
``While no final decision has been made, officials told The Associated 
Press the Treasury Department has prepared a general license permitting 
offshore financial institutions to access dollars for foreign currency 
trades in support of legitimate business with Iran, a practice that is 
currently illegal.''


   Does the Administration plan to allow this to facilitate 
        Iranian business in dollars?

   Is this beyond the scope of the sanctions relief agreed to 
        in the JCPOA?

   Does this ability to do these transactions in dollars 
        circumvent the assurances the administration gave to Congress 
        during the deliberation of the deal?

    Answer. The recent press reports that the Administration is 
planning to reinstate the authorization for ``U-turn'' transactions or 
give Iran access to the U.S. financial system are inaccurate. In fact, 
we will continue to vigorously enforce the many sanctions that remain 
against Iran, including our primary sanctions that generally prohibit 
Iranian banks from clearing U.S. dollars through the U.S. financial 
system, holding correspondent account relationships with U.S. financial 
institutions, or entering into financing arrangements with U.S. banks. 
These sanctions are an important part of our government's tool kit to 
protect the integrity of our robust and globally influential financial 
sector. As we have said consistently, Iranian banks will not be given 
access to the U.S. financial system under the JCPOA.


    Question.  What is the Administration's position on legislation to 
extend the Iran Sanctions Act (ISA) at this time? How would the United 
States ``snap back'' key sanctions if the authorities of that Act 
expire? What message would it send to Iran for the United States to 
dismantle some of the legal architecture that would be employed to re-
impose sanctions if Iran violates the JCPOA?

    Answer. It is not necessary to extend the Iran Sanctions Act (ISA) 
at this time, since it does not expire until the end of 2016. Right now 
our focus is on continuing to verify that Iran is implementing its 
nuclear-related commitments under the Joint Comprehensive Plan of 
Action (JCPOA). Further, it is not necessary to renew the Iran 
Sanctions Act in order to retain the ability to snap back sanctions. 
The President could utilize his authorities under the International 
Emergency Economic Powers Act (IEEPA) and other statutes to impose a 
variety of economic sanctions that would allow us to recreate sanctions 
currently required under ISA, if necessary. Indeed, much of our Iran 
sanctions architecture has been created through the use of Executive 
Orders that were issued pursuant to IEEPA. These E.O.s can be issued in 
as little as a few days, which means that we could quickly re-impose 
sanctions in a snap back scenario.

                               __________

                     THE IRAN NUCLEAR AGREEMENT: 
                             ONE YEAR LATER

                              ----------                              


                         TUESDAY, JULY 14, 2016

                                       U.S. Senate,
                            Committee on Foreign Relations,
                                                    Washington, DC.
    The committee met, pursuant to notice, at 10:29 a.m., in 
Room SD-419, Dirksen Senate Office Building, Hon. Bob Corker, 
chairman of the committee, presiding.
    Present: Senators Corker, Risch, Rubio, Johnson, Flake, 
Gardner, Perdue, Isakson, Barrasso, Cardin, Coons, Udall, 
Kaine, and Markey.

             OPENING STATEMENT OF HON. BOB CORKER, 
                  U.S. SENATOR FROM TENNESSEE

    The Chairman.  . The Foreign Relations Committee meeting 
will come to order. I want to thank everybody for participating 
in our business meeting and for all of you being here today.
    I certainly want to thank our witnesses for testifying. We 
know them well. Both of you have been great resources for this 
committee as we continue to develop and refine our policies 
toward Iran. So thank you both for appearing before this 
committee again.
    I personally opposed the Iran deal. I did not believe it 
would ultimately prevent the regime from developing a nuclear 
weapon and would instead embolden the world's leading state 
sponsor of terrorism, while diminishing our leverage. Even 
though members of this committee wound up in different places 
on the agreement itself, we continue to pursue vigorous 
oversight in a bipartisan fashion consistent with a mandate 
from the Iran Nuclear Agreement Review Act.
    One year after the agreement concluded, the Iranian regime 
remains as serious of a threat to our national security as ever 
before. The Obama administration readily admits that Iran's 
ongoing support for terrorism, repeated ballistic missile 
violations, human rights abuses, and other destabilizing 
activities in the region continue to take place.
    To restore our resolve in our Iran policy, I am introducing 
a bipartisan piece of legislation today, with other committee 
members, that mandates tough sanctions for ballistic missile 
activity, terrorism, and other threatening behavior. I plan to 
work, as always, with everyone here on this legislation and 
ensure that U.S. policy is not held hostage by Iran's threats 
to walk away from the nuclear agreement. The need for this 
legislation is very apparent. Whether or not Iran is complying 
with the nuclear deal, their hostile intentions are clear.
    Just this week, the U.S. military released photos of the 
IRGC Navy's provocative actions around U.S. naval ships. Last 
week, the Germans released an intelligence report outlining 
Iran's clandestine attempts to procure ``illegal proliferation-
sensitive procurement activities'' throughout 2015. 
Additionally, last week, Angela Merkel warned of Iran's 
unabated rocket program.
    Iran also recently attempted to purchase 5 tons of carbon 
fiber to build centrifuge rotors for which they have no need.
    Meanwhile, Iran has announced charges against four dual 
nationals and foreigners, one of whom is an American citizen. 
They have also doubled down on the support for the Assad regime 
and Hezbollah while Iranian forces are currently assisting on 
the ground to encircle the city of Aleppo.
    I could go on about their use of commercial airlines to 
support terrorism, illicit financial activities, cyber threats, 
and more, but I am sure that we will cover those issues fully 
in this hearing.
    I think it is worth noting that there is broad bipartisan 
support for new Iran legislation. I know both of our witnesses 
would support such legislation.
    Mr. Nephew, who played a prominent role in negotiating the 
Iran deal, wrote in his testimony today that it is reasonable 
to consider new legislation that would impose penalties on 
those who support Iran's development of and trade in missiles 
and conventional arms, as well as violations of Iranian human 
rights.
    We have crafted a bill that does just that, and I hope to 
build even broader bipartisan support for the legislation. So 
today, I hope our witnesses can help us in this effort to push 
back against Iran's continued aggression and recommend ways 
that Congress can remain constructively engaged.
    With that, I want to thank you again for appearing here and 
turn it over to my friend, the ranking member, Senator Cardin.

             STATEMENT OF HON. BENJAMIN L. CARDIN, 
                   U.S. SENATOR FROM MARYLAND

    Senator Cardin. Mr. Chairman, thank you very much for 
convening this hearing. I thank both of our witnesses for once 
again being willing to come back before this committee.
    This is a historic day, the 1-year anniversary of the 
signing of the JCPOA. It provides us an opportunity to reflect 
on its implementation and what has been achieved in rolling 
back Iran's weapons program.
    Over the past year, Iran has fulfilled the nuclear pieces 
of the agreement. On January the 16th, the International Atomic 
Energy Agency, IAEA, confirmed that Iran reduced its number of 
operational and installed centrifuges below the 5,600, which is 
what Iran committed to in the JCPOA; limited its nuclear 
stockpile to no more than 300 kilograms of low-enriched 
uranium; removed the core of the Arak reactor, making it 
physically incapable of producing significant amounts of 
weapons grade plutonium; and agreed to all of the enhanced IAEA 
monitoring inspection, which the JCPOA required to verify that 
no undeclared nuclear materials or activities are occurring in 
Iran.
    Since implementation day, the IAEA has been able to confirm 
in its quarterly reports that Iran is upholding the nuclear 
portions of the deal. This is a welcome development, but we 
cannot evaluate the JCPOA in a vacuum. It must be considered 
within the strategic and regional context.
    From this vantage point, my worst fears expressed last 
year, that the JCPOA would actually increase the likelihood of 
conflict, may be coming true. Since this agreement was signed, 
the Iranian Government has continued ballistic missile testing 
activities, which flies in the face of the spirit of the 
agreement and is in violation of the U.N. Security Council 
resolution that endorsed the JCPOA; doubled down in Syria and 
now openly acknowledges casualties taken protecting the regime 
of Bashar Assad; funded and supported the Iraqi Shiite militia 
in Iraq that have participated in sectarian violence; restored 
relations with Hamas, a U.S.-designated foreign terrorist 
organization committed to Israel's destruction; deployed 
vessels full of lethal aid to the Houthi fighters in Yemen; 
incited riots to attack Saudi diplomat facilities in Iran; 
increased the number of executions and is doing nothing to 
improve the abysmal human rights situation in their country.
    Last year, after deep reflection and evaluation, I 
ultimately did not support the JCPOA. But I was also clear 
that, if it was implemented, my priority would be ensuring that 
our government has all the necessary tools and resources to 
implement it.
    I am also committed to addressing the weaknesses beyond the 
nuclear agreement, the troublesome issues left unaddressed, 
many of which I just enumerated.
    This agreement has the best chance of succeeding if its 
weaknesses are squarely addressed. Congressional action should 
not focus on undermining the agreement by passing legislation 
that clearly violates the JCPOA. Instead, we should be working 
together to strengthen it.
    U.S. policy in Iran has always been strongest when Congress 
stands together, united.
    I introduced the Iran Policy Act last year, over 10 months 
ago, along with many of my colleagues who both supported and 
opposed the JCPOA. That legislation does exactly that, 
strengthen the JCPOA.
    So, Mr. Chairman, I look forward to the work of this 
committee and bringing us together. There is overwhelming 
consensus in this Congress of a common objective to prevent 
Iran from becoming a nuclear weapons state, yes. And to also 
take action to prevent the other nefarious actions of Iran.
    Whether it is ballistic missile violations, conventional 
weapons, human rights violations, interference in other 
countries, we all agree that we need to take action in order to 
deal with that. But let's do that in a bipartisan way, not in a 
divisive way.
    The bill that I filed on behalf of many of my colleagues 
provides for rigorous oversight of the agreement, including 
additional reporting of Iran's nuclear research and development 
activities and the use of sanction relief; clarifies U.S. 
policy to make it clear that Iran does not have an inherent 
right to enrich; and that all options remain on the table, 
including military options to prevent Iran from obtaining a 
nuclear weapon; continues sanctions on Iranian entities and 
individuals engaged in ballistic or cruise missile 
proliferation, and terrorism or human rights violations; and 
provides for expedited considerations on new sanctions if Iran 
directs or conducts an act of terrorism against the United 
States or substantially increases its operational or financial 
support for terrorist organizations that threaten U.S. 
interests or allies.
    The bill, importantly, authorizes additional specific 
security assistance for Israel.
    There are also several other steps that we must work 
together going forward. Mr. Chairman, we must reauthorize the 
Iran Sanctions Act for another 10 years, so that the threat of 
snapback sanctions remains a credible deterrent. We much must 
urge our partners in the P5+1 to coordinate responses for 
Iran's troubling behavior. Last week's U.N. report on Iran's 
ballistic missile activities is a perfect opportunity.
    As the Iranian regime continues its destructive pattern of 
supporting terrorism, proliferation of weapons, threatening 
Israel and violating basic human rights, the Congress has to 
remain strong and united in countering this warped worldview.
    Thank you again, Mr. Chairman, for convening this hearing 
and bringing us two distinguished panelists to continue our 
discussion. I look forward to that discussion.
    I look forward to working with you and all the members of 
this committee on how we can best deal with the Iranian threat.
    The Chairman.  Thank you, and thank you for your comments 
and the way that we have been able to work together on so many 
issues. I think both of us have meticulously stayed away from 
anything that compromises the JCPOA, while attempting to deal 
with Iran's illicit activity. I think we both understand that 
doing anything that would attempt to undermine the agreement 
while we push back against Iran would not be in the mode that 
we have continued to operate within this committee.
    I realize there are some bills that are coming out of the 
House that may do that. I think you will see that the 
legislation that was introduced this morning in a by members of 
the committee is one that does not do that, does not undermine 
the JCPOA, but does push back against the illicit activities 
that are underway.
    I thank you for that and I look forward to continuing to 
work with you.
    Our first witness is Mr. Mark Dubowitz, executive director 
for the Foundation of Defense of Democracies. Our second 
witness is Mr. Richard Nephew, program director for economic 
statecraft, sanctions and energy markets at the Center on 
Global Energy Policy at Columbia University's School of 
International and Public Affairs.
    We want to thank you both for being here. We are obviously 
very interested in your comments. If you could summarize, 
though, in about 5 minutes or so, without objection, your 
written testimony will be entered into the record.
    With that, we will start in the order you were introduced. 
Thank you.

STATEMENT OF MARK DUBOWITZ, EXECUTIVE DIRECTOR, FOUNDATION FOR 
             DEFENSE OF DEMOCRACIES, WASHINGTON, DC

    Mr. Dubowitz. Chairman Corker, Ranking Member Cardin, 
members of the committee, on behalf of FDD and its Center on 
Sanctions and Illicit Finance, thank you for the opportunity to 
testify. It is an honor to be back before the committee.
    It is also an honor to testify with Richard Nephew, whose 
work and service to our country I greatly admire.
    It is worth recalling why this nuclear deal is fatally 
flawed. It provides Iran with multiple patient pathways to 
nuclear weapons capability by placing limited, temporary 
constraints on its nuclear activities. These nuclear sunset 
provisions begin to expire in 8 years, and mostly disappear 
over a period of 10 to 15.
    Iran will become a threshold nuclear power with an 
industrial-sized nuclear program, near zero-nuclear breakout 
capacity, and advanced centrifuge power clandestine sneakout 
capability, an ICBM program, access to heavy weaponry, greater 
regional hegemony, a more powerful economy increasingly immune 
to Western sanctions.
    The deal already has provided Iran with substantial 
economic relief that helped the regime avoid a severe economic 
crisis and return to a modest recovery path. Tehran badly 
needed hard currency, which it received and which frees up 
funds for the financing of its malign activities.
    The Obama administration officials repeatedly have pledged 
the U.S. would continue to enforce nonnuclear sanctions and 
``oppose Iran's destabilizing policies with every national 
security tool available.'' Iran's leaders, however, view any 
imposition of sanctions as a violation of the deal and grounds 
to snap back their nuclear program.
    Those threats have effectively deterred Washington from 
imposing meaningful nonnuclear sanctions. This is what I have 
called Iran's nuclear snapback.
    In fear of this nuclear snapback, the administration has 
missed numerous opportunities to counter Tehran's expanding 
malign activities. Tehran has tested nuclear-capable ballistic 
missiles seven times since July 2015, in violation of U.N. 
Security Council resolutions. Iran attempted to illegally 
procure materials that could be used for its nuclear, missile, 
chemical, and biological weapons programs as recent reports 
from Germany's domestic intelligence agencies and David 
Albright's institute have assessed.
    German intelligence reportedly indicates that this is 
continuing, which is in contravention of the JCPOA. And 
disturbingly, over the past 2 years, according to Mr. Albright, 
``The Obama administration has inhibited Federal investigations 
and prosecutions of alleged Iranian illegal procurement 
efforts.''
    The administration has also not requested that the IAEA 
conduct follow-on inspections, including physical ones at the 
Parchin military base after finding uranium particles highly 
suggestive of military nuclear activities.
    As former IAEA Deputy Director General Olli Heinonen has 
explained, this is standard procedure under the comprehensive 
safeguards agreement with Iran. Not to do so sets a bad 
precedent for future inspections.
    The administration has imposed no human rights designations 
since the JCPOA and only three since Rouhani took power in 
2013, even as Iran's human rights record further deteriorates 
and the regime holds hostage a number of dual nationals and 
refuses to provide information on the whereabouts of Robert 
Levinson.
    In total, the administration has issued only 20 new 
designations since last July as compared to more than 100 in 
the 18-month period of the interim agreement, according to 
former Treasury official Katherine Bauer. These designations 
are highly ineffectual and do not impose the costs needed to 
change Tehran's calculus.
    Committee members, it is worth remembering, for the supreme 
leader, the JCPOA was not the end of the negotiations. It was 
merely the beginning. And Tehran is demanding ever greater 
sanctions relief and is seeking to legitimize itself without 
changing its illicit conduct.
    The Iranian Government is engaged in a full-court press to 
persuade the United States to greenlight Iran's access to U.S.-
dollar transactions with administration officials leaving open 
the possibility of offshore dollarization.
    Iran has pressured FATF to remove it from its financial 
blacklist. While FATF refused to do so recently, it did suspend 
mandatory countermeasures for 1 year, and opened up the 
possibility for future changes.
    Iran is also seeking membership in the WTO, which would 
severely curtail Washington's future ability to use financial 
and economic sanctions. The administration should be asked, 
what is its position on Iran's membership?
    The administration is also greenlighting about $50 billion 
in Boeing and Airbus aircraft deals with Iran Air, which 
continues the malign activities for which it was originally 
sanctioned. To recall, Iran's aviation industry is dominated by 
the IRGC and comprised of four still-sanctioned airlines.
    If Washington does not confront the regime's dangerous 
activities now, future Presidents will have insufficient 
peaceful leverage to respond to an expanding military-nuclear 
program, regional aggression, and global terrorism. If a future 
military option becomes necessary, Iran will be much stronger 
and the consequences more severe.
    In my written testimony, I recommend 16 ways that Congress 
can legislate nonnuclear sanctions fully consistent with the 
JCPOA. I would be happy to discuss them during Q&A.
    Thank you for the opportunity to testify. I look forward to 
your questions.


    [The unabridged version of Mr. Dubowitz's prepared 
statement is located in the ``Additional Material Submitted for 
the Record'' section at the end of this hearing transcript.]


    The Chairman.  Thank you very much.
    Mr. Nephew?

    STATEMENT OF RICHARD NEPHEW, PROGRAM DIRECTOR, ECONOMIC 
  STATECRAFT, SANCTIONS AND ENERGY MARKETS; CENTER ON GLOBAL 
  ENERGY POLICY, SCHOOL OF INTERNATIONAL AND PUBLIC AFFAIRS, 
            COLUMBIA UNIVERSITY, NEW YORK, NEW YORK

    Mr. Nephew. Thank you, Chairman Corker, Ranking Member 
Cardin, and other distinguished members of this committee for 
inviting Mark and me to speak here today.
    Mark and I differ on the JCPOA, but not our shared 
commitment to address threats from Iran.
    A year has passed since negotiations concluded on the text 
of the JCPOA. Much has been achieved, but there is more work to 
be done to deal with the range of threats posed by Iran and to 
ensure that the deal delivers on its promises.
    Thus far, the IAEA has verified that Iran is doing its part 
and is now further away from being able to construct a nuclear 
device. Moreover, because of the enhanced monitoring, including 
IAEA access rights that it has been exercising, we would have 
nearly the full balance of the breakout timeline to mount a 
response to Iran if it cheats. This includes the option to use 
force, as President Obama has made clear.
    We must be vigilant, but prudent and measured. For example, 
though German intel has reported on Iranian procurement efforts 
in 2015 that are troubling, there is no clear public 
information that this continued after the JCPOA entered into 
force in January. Overreacting to reports such as this would be 
inadvisable.
    Taking a measured approach is also important because the 
United States and its partners made their own commitments. The 
Iranians are even now debating whether we are cheating or 
whether their continuing economic difficulties are the result 
of other more systemic issues.
    The Iranian economy has improved since President Rouhani's 
election in 2013. As of today, Iran has been able to regain 
some of the market share it lost when U.S. sanctions clamped 
down on oil exports and other industries are showing signs of 
life.
    Internally, inflation has been reduced from around 45 
percent to around 10 percent. Iran's currency has stabilized. 
And there are indications that the Iranian banking system is 
finally recovering from the insolvency brought on by years of 
bad loans and damage from sanctions.
    On the other hand, though unemployment is down, it remains 
in the double digits. GDP growth has returned after years of 
contraction, but Iran is building on a far weaker, smaller base 
than prior to the Ahmadinejad years. And Iran has yet to see 
major external investment pour in.
    Iran's difficulties primarily stem from three factors: its 
complicated and onerous domestic business environment, residual 
sanctions and the threat of snapback, and low oil prices.
    The problems that these three factors create are 
interrelated, and together they contribute to the risk-reward 
calculations by international businesses that remain heavily 
weighted to risk. Remedying this combination of problems is 
going to be difficult for Iran, notwithstanding what the United 
States chooses to do.
    The United States has executed its responsibilities under 
the JCPOA to the letter and need not, as a legal matter, do 
anything further. But the United States does have an interest 
in ensuring that Iranian leaders believe, and can credibly 
argue, that they saw economic benefit from the JCPOA beyond the 
present stability to preserve the deal and to persuade the 
international community of our sincerity.
    We can do much simply by offering clarity on remaining 
sanctions. Updated frequently asked questions and licensing 
policy statements would help. The judicious use of executive 
licensing authority, for example, for the provision of U.S.-
compliance and legal services to foreign companies who seek to 
do business in Iran and the United States would also help.
    These steps will not solve Iran's problems. Only Iran can 
do that. But they would make foreign business activity with 
Iran easier to pursue and demonstrate that the United States 
takes seriously its responsibilities under the deal.
    At the same time, we should continue to confront Iran for 
its support for terrorism, destabilizing activities in the 
region, and violations of human rights. Sanctions designations 
for those supporting these activities should continue to be 
issued when sufficient evidence exists.
    New legislation that imposes penalties on those who 
contribute to Iran's behavior in these areas is also 
reasonable, but much already exists in law, and the specifics 
of what is proposed merit close scrutiny.
    The provisions of CISADA that give our sanctions global 
effect should continue to be leveraged. In this way, and as 
demonstrated in Iran's inability to reconnect fully with the 
global economy thus far, Iran can and will pay a price for its 
policy choices even under the current sanctions framework.
    But as we use such authorities, we must ensure that in our 
zeal to confront Iran's other illicit conduct, we do not 
inadvertently create grounds for Iran to walk away from the 
JCPOA. This is not acquiescing to nuclear blackmail from Iran, 
just as it is not sanctions blackmail to hold open the 
possibility of snapback. This is acknowledging that we have an 
interest in the nuclear deal, and so do our partners in the 
region.
    Canceling the JCPOA would recreate the existential threat 
that Israeli General Eizenkot, for example, declared over just 
months ago. Seeing whether a deal with Iran can be managed 
while dealing with these challenges could also create a 
foundation for a long-term better relationship that may help us 
address these challenges further.
    Many in Iran have signaled no such willingness. Security 
forces in Iran have sought to prevent any opening, including 
through the most basic and unconscionable of maneuvers, the 
arrest of dual nationals, including Siamak Namazi's father.
    These are activities of strong men in positions of power, 
but not confident ones. They betray a deep sense of trepidation 
and fear that the system they have built may be unraveling.
    Last July, I suggested in this room that these people face 
an existential threat of their own. I see nothing to change 
this assessment in their behavior or developments over the past 
year.
    Our challenge in this is to avoid contributing to the power 
base of Iran's security services by playing once more the 
villain while advancing our own interests. It will not be easy, 
and there are no guarantees of success, but it is worth the 
attempt.
    Thank you very much for this opportunity.
    [The prepared statement of Mr. Nephew follows:]


                  Prepared Statement of Richard Nephew

    Thank you, Chairman Corker, Ranking Member Cardin, and other 
distinguished members of this Committee for inviting me to speak here 
today. It is a privilege and an honor to speak to you once more on the 
issue of the Joint Comprehensive Plan of Action (JCPOA) reached between 
the United States, its negotiating partners in the P5+1 and EU, and 
Iran.
    A year has passed since negotiations concluded on the text of the 
JCPOA. I appreciate the Committee's decision to hold this hearing today 
in recognition of that fact. Anniversaries are good times to reflect in 
general and the Action phase of the JCPOA has largely taken place since 
I was last in this room. Much has been achieved and, in my view, the 
United States and our partners in the region are today far safer than 
we were just one year ago. In fact, it is not just my view: it also 
happens to be the view of Lt. Gen. Eisenkot of the Israeli Defense 
Forces as well as many other national security professionals in the 
United States, Israel and beyond.
    But, my sense of satisfaction of having played some role in 
arresting Iran's nuclear program should not suggest complacency. We 
have not yet dealt with all of the ways in which Iran poses a threat to 
the United States, our interests, and those of our friends and allies. 
Nor have we necessarily prevented Iran from possessing nuclear weapons 
for all time. The JCPOA has improved our situation significantly. It 
has laid a foundation for the future. But, there is more work to be 
done to ensure that its ambitions of preventing a nuclear arms race in 
the Middle East, bringing a modicum of stability to the region, and 
facilitating the emergence of a more constructive relationship between 
the United States and Iran can be achieved. In a paper I published in 
late May with Bob Einhorn, we laid out a series of specific 
recommendations that the United States ought to pursue in order to 
build on this foundation.\1\ I will not dwell on those recommendations 
here, but it is vital to note that I see the JCPOA not as the end of an 
effort but rather the beginning of a much greater one.
---------------------------------------------------------------------------
    \1\ Einhorn, Robert and Richard Nephew. May 2016. ``The Iran 
Nuclear Deal: Prelude to Proliferation in the Middle East?''
---------------------------------------------------------------------------
    And, of course, there is also much more work to be done in order to 
ensure that the JCPOA delivers on its principal, more immediate 
promises: that Iran will keep its nuclear program within its agreed 
limitations during the agreed timetables; that Iran will cooperate with 
monitoring and verification measures consistent with the JCPOA and its 
obligations under its agreements with the IAEA; and, that the United 
States, the European Union, and the UNSC provide the sanctions relief 
and economic engagement to which we committed ourselves.
    I was asked to offer my perspective on the sanctions side in 
particular. However, before touching on those points, I want to make a 
few observations on the nuclear provisions of the JCPOA (mindful that 
it is constraining the Iranian nuclear program that remains the driving 
necessity for the deal and the subject of most of my time working in 
the U.S. government on Iran).
Nuclear
    Thus far, Iran has fulfilled its part of the bargain. The IAEA 
verified on January 16, 2016, that Iran has:


  1. Reduced its number of operational and installed centrifuges down 
        to JCPOA levels;

  2. Reduced its stocks of enriched uranium and heavy water down to 
        JCPOA levels;

  3. Begun the modification of the Arak heavy water research reactor 
        such that it will be physically incapable of producing enough 
        weapons-grade plutonium for even one nuclear weapon in less 
        than four years; and,

  4. Accepted enhanced IAEA monitoring provisions at its centrifuge 
        storage and production sites, its uranium mines and mills, and 
        other locations described in the JCPOA.\2\
---------------------------------------------------------------------------
    \2\ International Atomic Energy Agency. January 16, 2016. 
``Verification and Monitoring in the Islamic Republicof Iran in Light 
of United Nations Security Council Resolution 2231 (2015).''


    In sum, as a result of the JCPOA, Iran's assessed breakout time 
using uranium has increased from 2-3 months to approximately one year 
and, using plutonium, to at least four years. Moreover, because of 
enhanced monitoring, we would have nearly the full balance of those 
breakout timelines to mount a response to Iran. As President Obama has 
made clear, we retained all of our options in the event of Iranian 
cheating on the deal, including the use of force.
    Since the IAEA's initial report of January 16, it has issued two 
further reports. Both of these have confirmed that Iran is fulfilling 
its commitments, though with some implementation challenges (discussed 
below). \3\ \4\ Yet, these reports were not without controversy, 
largely stemming from the absence of some of the data that 
nongovernmental observers and organizations had become used to seeing 
in IAEA reports. In particular, the IAEA has been criticized for not 
publishing data on Iran's exact low-enriched uranium stockpile, which 
had become a normal attribute of IAEA reporting since Iran restarted 
uranium enrichment in 2007.\5\ The nature of this concern has focused 
less on whether the Iran was fulfilling its commitments and more on the 
degree of public transparency that the IAEA (and, by extension, the 
United States, Iran, and the JCPOA parties) was showing into Iran's 
nuclear program so as to permit ``independent determination of Iran's 
compliance'' with the JCPOA.\6\ In my view, it is reasonable for us to 
expect and to request more information from the IAEA and, for that 
matter, from Iran on the specifics of its nuclear program during this 
extended period of confidence-building under the JCPOA.
---------------------------------------------------------------------------
    \3\ International Atomic Energy Agency. February 26, 2016. 
``Verification and Monitoring in the IslamicRepublic of Iran in Light 
of United Nations Security Council Resolution 2231 (2015).''
    \4\ International Atomic Energy Agency. May 27, 2016. 
``Verification and Monitoring in the Islamic Republic ofIran in Light 
of United Nations Security Council Resolution 2231.''
    \5\ Albright, David, Serena Kelleher-Vergantini, and Andrea 
Stricker. February 26, 2016. ``IAEA's First Post-Implementation Day 
Report: Key Information Missing.''
    \6\ Ibid.
---------------------------------------------------------------------------
    That said, the absence of particular details in the report should 
not be confused with lack of transparency on Iran's part with 
international inspectors or with members of the P5+1. The IAEA has 
provided repeated assurances that it can verify Iran's implementation 
of its nuclear commitments. The governments of the P5+1 have indicated 
their satisfaction with their own understanding of Iran's nuclear 
program pursuant to the JCPOA, though some of them--the U.S. government 
included--have expressed a desire for more public accounting of Iran's 
nuclear activities in the IAEA's reports. But, ultimately, it is the 
degree to which the IAEA and member governments of the JCPOA understand 
what is going on that matters most, as the IAEA remains in a position 
to raise a flag should it find indications of Iranian cheating and the 
P5+1 can respond to any such noncompliance swiftly.
    Moreover, this change in IAEA public reporting--while ill-advised 
at this sensitive juncture in JCPOA implementation--does match the more 
general approach taken by the IAEA in reporting on its member states' 
nuclear activities. Pursuant to the provisions of safeguards 
confidentiality enshrined in IAEA safeguards agreements with each 
state, the IAEA is charged to keep ``any information obtained by it in 
connection with the implementation of the Agreement'' confidential.\7\ 
There can be exceptions, as indeed was the case with Iran from 2003-
2015, and it would have been more confidence-enhancing for the IAEA 
(and for Iran) to have maintained a more detailed reporting template 
for the time being. But, the decision to revert to a more restrained--
if still abnormal--approach to IAEA reporting onIran is hardly the same 
thing as walking back the commitments made by the Obama Administration 
that the JCPOA would involve the most intrusive monitoring and 
transparency arrangements ever negotiated.
---------------------------------------------------------------------------
    \7\ IAEA Model Safeguards Agreement, Information Circular 153.
---------------------------------------------------------------------------
    This is especially the case because, as the February 2016 report 
made clear, the IAEA has not been reluctant to report information 
indicating that Iran has broken the terms of the JCPOA. In that report, 
the IAEA found Iran had produced and then possessed slightly more than 
its JCPOA-allotted 130 metric tonnes of heavy water. Iran's overage-
which the IAEA measured at 0.9 metric tonnes-was then resolved by the 
export of 20 metric tonnes of heavy water seven days after the overage 
was identified.
    This breach was not only modest in its import-as heavy water is not 
a nuclear weapons- usable commodity itself but rather a component in 
the production of plutonium for use in nuclear weapons-but also 
something that is entirely expected in the implementation of a deal of 
this sort. Iran will likely violate the terms of this provision again 
and perhaps similarly the provision dealing with low-enriched uranium 
(LEU) stocks because they are products of an ongoing process line that 
must be exported shortly after production. Any problem with shipping 
these commodities out of the country would lead to the potential for 
temporary excess in Iranian stocks of these materials. The real 
sensitivity in this regard is the degree to which Iran believes that it 
can engage in these activities and not be caught. If nothing else, the 
heavy water incident suggests the opposite: the IAEA's identification 
of the excess heavy water occurred quickly--Iran's production of the 
0.9 metric tonnes of excess heavy water occurred between January 16 and 
its identification on February 17--and Iran had to take swift remedial 
action to address the problem.
    This informs my view of the likelihood of Iran pursuing a nuclear 
fuel cycle capability (or even a nuclear weapon itself) covertly. I 
believe that, should Iran seek nuclear weapons, it will absolutely seek 
to do so using undeclared nuclear facilities and undeclared nuclear 
material. The odds of being caught at declared facility are high and 
the risks of doing so are great. Moreover, Iran's modus operandi over 
the past fifteen years has been to provide extensive transparency at 
its declared sites, largely in an attempt to confuse consideration of 
their nuclear program internationally through showmanship (such as 
multiple tours of NonAligned Movement (NAM) ambassadors through 
Natanz).
    I believe that the transparency and monitoring provisions in the 
JCPOA will make it very difficult for Iran to construct a new nuclear 
facility in the country in secret, particularly given that any such 
facility will need to identify a source of nuclear material as well as 
the various devices and materials required to bring it online.\8\ The 
nuclear procurement channel established in the JCPOA and in UN Security 
Council Resolution (UNSCR) 2231 also provides some protection in this 
regard, as well as the potential for consequences for exporters that 
are incautious.
---------------------------------------------------------------------------
    \8\ Nephew, Richard. September 2, 2015. ``How the Iran Deal 
Prevents a Covert Nuclear Weapons Program.''
---------------------------------------------------------------------------
    That said, it is always possible that this layered approach 
intended to deny Iran access to the necessary components of a covert 
site will fail. It may be that Iran has unknown stores of materials and 
equipment necessary to outfit a new site, or that it will be able to 
evade international export controls in order to acquire such a 
stockpile. It may also be possible that Iran has a fully complete, 
covert site waiting in the wings. To my knowledge, U.S. and partner 
intelligence services have yet to detect such a site and of course 
remain vigilant in their watching for any such indications to emerge. 
But, intelligence failures have happened and could happen again.
    Intelligence can also be successful. Reports from Germany indicate 
that Iran sought nuclear-related goods via covert means throughout the 
negotiations of the JCPOA and may be continuing to do so now. It would 
not be surprising that Iran hedged its bets during the negotiations; 
after all, we did not end our sanctions on the nuclear program during 
that time. Germany has not reported any procurement efforts after 
January 16 (and, for that matter, neither has the United States, 
according to the State Department). But, if Iran were to engage in 
covert procurement now--in direct contravention of the terms of the 
JCPOA--then this would be a major threat to the integrity of the deal, 
even if intelligence reporting ultimately precludes illicit transfers. 
The United States should respond directly to any such violations, 
including by using its authority in the Procurement Working Group to 
deny any legitimate procurements while there are positive indications 
of Iranian cheating. The United States should use all of its 
authorities to ensure that, even if it causes difficulties, the JCPOA 
serves its fundamental purpose.
    This takes me to the issue of inspector access to Iranian military 
sites. The JCPOA explicitly made this possible, in the event of 
questions raised about Iranian compliance with the terms of the deal 
and Iran's other obligations under its agreements with the IAEA. This 
right exists for a reason and it should be utilized if there is 
reliable, credible information pointing to Iranian violations of their 
obligations.
    But, in this, there are three important clarifications. First, 
there has to be some indication that Iran is in breach of its 
obligations now. Information acquired that points to Iran's past 
nuclear weapons work is less relevant, if for no other reason than we 
know they pursued nuclear weapons in the past. True, it would be useful 
to know as much about that past effort as possible, if for no other 
reason than to help discriminate against ongoing work. But, even had 
the Iranians given us a full confession of their past work, the United 
States and its partners would still have held back some suspicion that 
Iran was not telling us the complete story. Consequently, there would 
always be a residual question in the minds of intelligence analysts 
whether information received points to historical work or present work. 
This is why intelligence analysts would also require far more 
information about what Iran is up to than just the identification of 
one or two particles of man-made uranium.
    Second, the focus on military facilities is understandable, but 
misguided. Prior to 2002, Iran's uranium enrichment project took place 
in part at a warehouse in Tehran. If Iran were to restart its nuclear 
weapons program, it may decide to do so at a military facility. But, it 
may just as easily decide to do so at a civilian facility or one that, 
to all outward appearances, is civilian. Our focus ought to be less on 
gaining access to military sites for the purpose of gaining access to 
military sites and more on ensuring that if there are any credible 
indications of Iranian cheating, access is granted wherever those 
indications point. And our focus ought to be on ensuring that we have 
as much information as possible, from intelligence sources, IAEA 
reporting, open source data-streams, to accurately judge Iran's 
intentions as well as its capabilities.
    Third, there is now and there always will be some element of risk 
that Iran's cheating will go unnoticed. To that end, there is now and 
there always will be some element of risk that Argentina, Brazil, South 
Africa, South Korea, Sweden, or Ukraine have started to pursue nuclear 
weapons. We all judge that risk to be much lower than with Iran because 
of the unique history and relationships that surround those countries. 
This is sensible. But, the risk is not zero.
    For Iran, our perceived risk is high. So, we have engineered a deal 
to constrain their capabilities and improve transparency to help 
address that risk. But, no deal could reduce that risk to zero. There 
would always be some risk, even in an Iraq-in-the-1990s style 
inspections regime, that we were being cheated. It is worth noting that 
the pursuit of ``zero risk'' led to us to jump at shadows in Iraq. Even 
if every nuclear facility in Iran were to have been obliterated in the 
JCPOA, even if every gram of enriched uranium were to be shipped out, 
and even if every Iranian scientist involved in the former nuclear 
program were to be employed charting the movements of stars, the risk 
of further nuclear proliferation in Iran would not be zero and while 
its present government exists, there would be people who believe Iran's 
nuclear weapons program was not only operational but closing on its 
goal.
    Positive discrimination between actual attempts at noncompliance 
with the JCPOA and incidental implementation issues will be vital going 
forward on the nuclear side. It is important because an inability to 
determine whether Iran is cheating or just made a mistake could mean 
the difference between an incautious move to conflict and an overly 
cautious decision to treat every Iranian slip-up as just an accident. 
Time, care, and prudent assessment of the circumstances and facts of 
any implementation problem on Iran's side will be essential. And, in 
fact, the creation of time and space for such an assessment is an 
unsung benefit of the JCPOA. Rather than face a pre-JCPOA 2-3 month 
timetable for assessing Iranian intentions during a prospective 
breakout attempt, the JCPOA now will afford us much more time to make a 
reasoned and thoughtful assessment of what Iran is up to and how we 
should respond.
Sanctions
    Taking a measured approach to determining Iranian compliance (or 
lack thereof) with the nuclear commitments of the JCPOA is also 
important because the United States and its partners made their own 
commitments in the deal. Iranian leaders are even now considering 
carefully whether to regard what they view the delayed benefit of the 
sanctions relief provisions of the JCPOA as merely a reality of the 
global economy and Iran's place in it, or a calculated effort on the 
part of their intractable enemies in the United States to deny them the 
very relief they purchased with nuclear concessions.
    First and foremost, we should consider carefully Iran's overall 
economic health. The economy has improved since 2013. President Rouhani 
brought with him into government a cadre of technocrats who arrested 
Iran's economic freefall, aided in part by the halt in U.S. sanctions 
under the Joint Plan of Action (JPOA) but largely because having found 
themselves at the bottom of a hole, they stopped digging. These 
officials implemented a combination of reforms that, in the IMF's words 
last December, ``set the stage for improved macroeconomic performance, 
provided comprehensive reforms are implemented.''\9\ In essence, these 
steps created some stability in Iran's economy but they did not repair 
any of the major, structural problems identified by the IMF nor did 
they change the basic facts of Iran: that its state-based, oil-focused 
economy will always have a ceiling.
---------------------------------------------------------------------------
    \9\ International Monetary Fund (IMF), Article IV Staff Report on 
Iran. December 2015.
---------------------------------------------------------------------------
    The sanctions relief contained in the JCPOA was never going to 
replace the need for Iran to make further reforms. I do not think that 
most of the experts in Iran's government believed that they would. 
Rather, I believe the hope was that JCPOA relief would provide enough 
of a spark for the economy to permit Iran's political leaders to take 
the politically sensitive step of economic reform, particularly given 
there are entrenched groups in the country with a clear interest in 
maintaining the status quo.
    It is difficult to say whether the economic relief created by JCPOA 
has provided room for such reforms. As of today, Iran has been able to 
regain some of the market share it lost when U.S. sanctions clamped 
down on oil exports in 2012-2013. Iran's automotive industry is showing 
signs of life, facilitated by the fact that sanctions on the auto 
sector were fairly nascent when the JPOA froze them in November 2013. 
And, Iran has been able to sign fairly large contracts for the import 
of aircraft from Airbus and Boeing. Internally, inflation has been 
reduced from around 45% to around 10%.\10\ Iran's currency has 
stabilized. And, there are indications that the Iranian banking system 
is finally recovering from the insolvency brought on by years of bad 
loans and damage from sanctions.
---------------------------------------------------------------------------
    \10\ Slavin, Barbara. June 2016. ``Senior American Official at IMF 
Says Iran faces `fundamental' economicchoices.'' Al Monitor.
---------------------------------------------------------------------------
    On the other hand, Iran's economy is nowhere near what it might 
have been had sanctions not been imposed, or at the levels promised by 
Iran's leaders. Unemployment is down, but it remains in the double-
digits.\11\ GDP growth has returned after years of contraction, but 
Iran is building on a far weaker, smaller base than prior to the 
Ahmadinejad years and sanctions.\12\ This is particularly frustrating 
for Iran, given that the Ahmadinejad years were also marked with record 
oil prices and revenues, most of which now appears to have been 
squandered. And, Iran has yet to see the kind of major external 
investment pour in that, to some extent, its leaders were banking on 
after the JCPOA came into force. In my view, this leaves Iran with an 
economic position best described as ``stable and improving slightly.'' 
(I outline the main successes and impediments that Iran has experienced 
thus far in a paper being published today by the Center on Global 
Energy Policy at Columbia University, which accompanies my testimony as 
an appendix.)
---------------------------------------------------------------------------
    \11\ International Monetary Fund (IMF), Article IV Staff Report on 
Iran. December 2015.
    \12\ Ibid.
---------------------------------------------------------------------------
    Iran's difficulties primarily stem from three factors:


  1. Iran remains an incredibly difficult country in which to do 
        business, with a complicated regulatory environment, onerous 
        security issues, and lacking financial infrastructure;

  2. Residual sanctions and the threat of snap-back of those sanctions 
        suspended or terminated by the JCPOA has chilled enthusiasm for 
        going back into Iran; and,

  3. Low oil prices have contributed to an overall imbalanced 
        perception of the risk vs.reward calculus for the outside world 
        with respect to Iran.


    The problems that these three factors create are interrelated. For 
example, I have heard directly from numerous third country banking and 
business officials that they are deeply concerned about the risk of 
U.S. secondary and snap-back sanctions. They understand clearly that, 
with the 2010 Comprehensive Iran Sanctions, Accountability, and 
Divestment Act (CISADA) fully in place, they remain at risk for doing 
business with the Iranian Revolutionary Guard Corps (IRGC) and 
approximately 200 other U.S. designated entities and individuals in 
Iran. In fact, as I testified during last summer's hearings on the 
deal, the JCPOA not only did not constitute ``unilateral sanctions 
disarmament,'' but--in the eyes of many in the international business 
community--it did not even represent a real change in U.S. sanctions 
posture or approach.
    At the same time, when I have asked these same executives whether 
they would go back into business with Iran if all U.S. sanctions were 
to be lifted, many voiced a different concern: that Iran itself remains 
a tough place to do business, with uncertain profits to those who dare 
enter. Many have recounted stories of contracts that were faithfully 
fulfilled by the foreign participant, but then changed by their Iranian 
counterparty (e.g., building facilities in Iran that were supposed to 
be ``builder operated'' for some length of time in order for the 
construction contractors to recoup their investment, only to have this 
part of their contracts voided in deference to local operators). Others 
have described the negotiating process in Iran as needlessly and 
endlessly complex, stymying agreement and ensuring that--once 
negotiated--deals are next to impossible to implement due to second 
guessing and renegotiations. Still others have expressed their concerns 
about actually operating in Iran, noting the arrests of dual nationals.
    Yet, for all of these problems, had Iran re-entered a global oil 
market with high prices instead of one in which oversupply was keeping 
prices low, the country might have experienced an economic boom. The 
practical result of low oil prices has been to drive down interest in 
investing in Iran's oil and gas fields, and to reduce still further the 
``reward'' element of any risk/reward calculus of doing business in 
Iran. Iran's leaders are conscious of this reality--it is one reason 
why Tehran pushed for production cut-backs from other OPEC member 
states so as to create room for their own return to the market. But 
this awareness does not address the more fundamental problem that 
Iran's oil simply isn't what it was worth when negotiations on a JCPOA 
commenced.
    Absent a market-creating force like a major oil company or similar 
announcing a significant investment and setting up shop in Iran, there 
is little incentive for banks or smaller service companies to go back 
into the country. Instead, we have seen short-term trade deals, 
continuation of existing relationships (such as in the auto industry), 
and discussions of new Iran Petroleum Contracts that have yet to emerge 
in final form. Here too we have evidence of Iran's domestic political 
and regulatory processes getting in the way--as the main hindrance 
appears to be debate internally over how to interpret the Iranian 
constitution's prohibition on foreigners opening Iranian oil and gas 
resources--as well as fears over sanctions contagion from the presence 
of IRGC and related entities throughout Iranian industry.
    Remedying this combination of problems is going to be difficult for 
Iran, notwithstanding what the United States chooses to do. However, 
unlike in other countries in which our stake is relatively minimal, the 
United States does have an interest in Iran being able to reap the 
benefits of its emergence from economic isolation. Put simply, though I 
believe the United States has executed its responsibilities under the 
JCPOA to the letter and need not--as a legal matter--do anything 
further, the United States does have an interest in ensuring that 
Iranian leaders believe and can credibly argue that they saw some 
economic benefit from the JCPOA. Our audiences are two-fold: Iran's 
leaders and population; and, those countries that we may need to appeal 
to in the future should Iran breach its obligations and set us again 
down the path of confrontation.
    We should look for ways to offer clarity on our remaining sanctions 
measures and how they operate. Though they are seen sometimes in 
Washington as merely words, frequently asked questions (FAQ) and 
licensing policy guidance have real value in the real world. They 
explain U.S. enforcement positions and they articulate the standards 
that we expect businesses and banks to uphold. They provide confidence 
to compliance officers that they understand what the U.S. government 
means. And, they avoid creating unnecessary ambiguities that undermine 
the integrity of our sanctions regime and perceptions of our 
competence. This material should be updated to clarify further the U.S. 
approach to sanctions now, using plain language where possible, 
particularly as relates to questions of how much due diligence is 
required for foreign entities to avoid sanctions for inadvertent 
business with illicit actors and how to handle any U.S. persons' 
involvement in foreign companies' dealings with Iran.
    This guidance should be supplemented by the judicious use of 
executive licensing authority. The United States should constantly look 
for ways to streamline the processes necessary for companies to fulfill 
their obligations under U.S. law and reduce the workload on U.S. 
compliance officers. Licensing can do this where guidance fails. For 
example, General License I--little noticed, I am sure--offered real 
assistance to aviation service companies who were free, as a result, to 
enter into discussions with their potential Iranian counterparts 
without receiving specific licenses in advance. Discussions have little 
material value to Iran, but--for U.S. companies and those foreign 
companies who watch (and shadow) U.S. companies to ensure they are 
fulfilling U.S. law to the extent possible--providing a general license 
for these discussions ensured that companies seeking to use the relief 
in the deal had an easier time in doing so. This reduced the paperwork 
burden on Treasury while still offering Iran no real advantage over the 
specific licensing approach outlined in the JCPOA and subsequent U.S. 
policy.
    There may be other areas in which new general licenses would be 
useful. For example, providing licenses for U.S. compliance and legal 
services to those companies who seek to do business in Iran (solely for 
the purpose of avoiding breaking U.S. law) expands the practical reach 
of U.S. law in a constructive and sober way. Iran will generate some 
value from this, as business may once again flow that otherwise could 
be denied by confusion. But, is the U.S. interest in stymying business 
in Iran really best served by making compliance with U.S. law and 
regulation as cumbersome and awkward as possible? Taking this approach 
reduces the overall attractiveness of business with Iran and could 
contribute to de-risking that will--in the long term--disadvantage the 
United States both economically and in terms of the use of sanctions to 
deal with future problems.
    Working to address the ambiguities of U.S. sanctions and to smooth 
JCPOA implementation will not solve Iran's problems. But, they will 
make international business activity with Iran easier to pursue, 
demonstrate that the United States takes seriously its responsibilities 
and the common interpretation of them as being intended to facilitate 
Iranian economic progress, and reduce Iran's ability to claim--in the 
event of future cheating--that it is reciprocating for Iranian 
malfeasance.
    At the same time, we also have an interest in demonstrating that we 
will continue to confront Iran for its support for terrorism, 
destabilizing activities in the region, and violations of Iranian human 
rights.
    We should continue to apply those sanctions not terminated under 
the JCPOA. We have an interest in Iran not receiving the benefit of 
sanctions relief under those provisions until it has satisfied our 
other concerns. Iran must understand that it will not be treated as a 
``normal'' country internationally--and especially in the United 
States--until it does. And, this will
    create interest in Iran to address these problems. So, designations 
associated with Iran's ballistic missile and conventional arms 
proliferation, as well as human rights violations, are reasonable and 
should continue to be issued. And the provisions of CISADA should 
continue to be leveraged to reduce Iran's ability to engage in 
``normal'' commerce, consistent with U.S. law. In this way, and as 
demonstrated in Iran's inability to reconnect with the global economy 
thus far, Iran can and will pay a price for its policy choices even if 
the overall legislative framework does not expand to touch on more of 
Iran's economic sectors.
    To this end, though I do not believe its renewal is essential for 
the stability or efficacy of U.S. sanctions against Iran, it is 
reasonable to renew the Iran Sanctions Act (ISA) and to consider new 
legislation that would impose penalties on those who support Iran's 
development of and trade in missiles and conventional arms, as well as 
violations of Iranian human rights. These sanctions should be crafted 
in such a way as to avoid violating the JCPOA, which denies Iran a 
credible nuclear weapons option and thus deny Iran the ability to 
threaten the our partners in the region, particularly Israel, with 
existential force. Indeed, we must ensure that in our zeal to confront 
Iran's other illicit conduct we do not inadvertently create grounds for 
Iran to walk away from the nuclear deal, not for the sake of the deal 
itself but rather for what it denies Iran. This is not acquiescing to 
nuclear blackmail from Iran. This is acknowledging that we have an 
interest in the nuclear deal and so do our partners.
    All told, going forward, the situation demands a thoughtful, 
nuanced approach toward dealing with Iran, the JCPOA, and sanctions.
    But, ultimately, only Iran can solve Iran's problems, and this can 
only start by addressing one fundamental issue: stopping support for 
terrorism and destabilizing regional activities, as well as violating 
the human rights of its population. An Iran that was more tolerant at 
home and constructive abroad would find business easier to attract and 
keep. It might also find a United States prepared to reciprocate with 
changes to U.S. sanctions laws, which would also facilitate business. 
For its own sake, Iran also should pursue more straightforward, 
economic reform. Iran should adopt changes to its financial system to 
sustain banking operations that conform to international standards for 
anti-money laundering, tax compliance, financial disclosure, and 
capital adequacy. Iran should reform its bureaucratic process to make 
it easier for foreign companies and domestic entrepreneurs to operate 
in the country.
    Taking such steps, however, may be a bridge too far for Iran's 
leaders. Many of them, particularly in the security services, have a 
vested interest in the status quo. It affords them political power, in 
that they can control the economy and its spoils. And, it affords them 
direct financial benefits personally as well as for their institutions. 
Some in the system have embraced the idea of change in order to advance 
the cause of the Iranian population and, doubtless, to further their 
own political fortunes. And, my assessment is that we are now seeing 
the continuation of this struggle in the former of scandals, 
allegations of bribery and tax avoidance and, crucially, corruption 
investigations. Charges have been lobbed from all sides in this fracas, 
despite the Supreme Leader's frequent appeals for civility and focus on 
the outside threats (particularly the United States).
    Last July, I suggested that the security forces in Iran were facing 
an existential threat of their own: reform and openness for their 
captive population. I see little now to challenge this assessment. 
Security forces in Iran have sought to repress the economic changes 
that Rouhani and his technocrats have pursued, including through the 
most basic and unconscionable of maneuvers: the arrest of dual 
nationals, including Siamak Namazi and his father, on charges of 
espionage. They have also sought to discredit some in Rouhani's 
administration. These are the activities of strong men in positions of 
power. But, they are not the actions of confident, strong men in 
positions of power. Rather, they obscure a deep sense of trepidation 
and fear that the system they have built and furthered may be 
unraveling. It is here that the United States has a unique, if 
difficult to harness, opportunity in Iran: to avoid contributing to the 
power base of Iran's security services by playing once more the 
villain. This will require care and nuance in our response to Iranian 
provocations, but it is not beyond us.
    Thank you for this opportunity.


    [The document referred to in Mr. Nephew's prepared 
statement is located in the ``Additional Material Submitted for 
the Record'' section at the end of this hearing transcript.]


    The Chairman.  Thank you both. It is great to have two 
highly intelligent and knowledgeable witnesses who have 
slightly differing points of view.
    With that, I am going to defer to the ranking member and 
reserve my time for interjections. Thank you.
    Senator Cardin. Thank you, Mr. Chairman.
    I think what we are really focusing on is what is the 
appropriate role for Congress in accomplishing our objective to 
change Iranian behavior, whether its nuclear proliferation or 
whether its support of terrorism or whether its ballistic 
missile program.
    We act through passing legislation, and we act by 
oversight. Both are critically important, and both led up to 
the types of negotiations that were possible in regards to the 
Iran nuclear agreement, so I think we can learn from our 
behavior and what we were able to do in the past.
    So when I look at what would be now useful, because there 
are still significant problems with Iran--I think everybody 
acknowledges that. I do not think anyone disagrees that Iran's 
behavior is not where it needs to be. And I think we 
acknowledge now that we are not going to take action that would 
violate the JCPOA. At least the chairman and I have agreed on 
that.
    The question is, what can Congress now do. So I look and I 
say one thing we can clearly do is improve our oversight, get 
reports on the sanction relief, how much funds have been made 
available to Iran, get clear information as to how that has 
been used. We would like to see it used for its people, but is 
it used just to increase terrorist activities or support for 
the nefarious actions that we are trying to avoid?
    The record does not reflect head nods, but I saw both 
witnesses nodding affirmatively on that.
    Another thing we can do, and this became very clear to me 
in my visits to the gulf states, is that we have an articulated 
regional strategy to protect our allies in the region. They are 
very concerned that there may be a new chapter in what is 
happening in the Middle East, as far as the power change, and 
that Iran might be a more significant player, which jeopardizes 
the security of gulf states.
    So I think having an articulated, supported congressional 
involvement on a regional strategy would make sense.
    Third, of course, is that we know Iran, one of its major 
targets is Israel, so making clear our commitment to Israeli 
security seems to me another matter that becomes a very 
important fact of congressional policy.
    But that brings me to sanctions, which is where we seem to 
put a lot of our attention. One thing to me is clear, and I 
think would be something that we can all agree on and try to 
get done immediately, is the extension of the Iran Sanctions 
Act, because if snapback is really to be effective, you have to 
have a law beyond December of this year.
    So why don't we just get that over with, get that done, 
because we are running out the clock on legislative days here? 
And I would hope through the leadership of this committee and 
through others, we could get that done. I do not think that 
would be difficult. I think we could probably get that 
completed.
    I would hope we would also be willing to look at expedited 
considerations of sanctions legislation if Iran participates in 
actions that violate our policies. I would think that is 
something we could get done.
    The reason I mention these issues, they are all 
incorporated in legislation I filed on behalf of other members, 
but I have had conversations with our P5 partners. I met with 
some of the direct negotiators that were negotiating on behalf 
of the partner countries. I wanted to understand, because I 
hear they were not happy about Congress taking action, and I 
wanted to find out why, because wouldn't they want us to be 
strong against Iranian nonnuclear violations? And the answer is 
they do want us to be strong, but they are concerned as to 
whether this is just a piling on or a backward way of violating 
the nuclear agreement, which is not what I want to see happen.
    That is why I think we have to be very strategic as to how 
we deal with new sanctions legislation.
    And if we deal with sanctions legislation that provides a 
statutory basis for the executive sanction regime that is 
currently in existence, to me, that is a very sound basis for 
us to be on. And then we do not run the risk of whether 
Congress is supporting a very strong position in that regard.
    So I just really want to get, starting with Mr. Nephew, if 
I could, as to whether we can get this surgically done in a way 
that does not interfere with the support we need from our P5 
partners.
    Mr. Nephew. Senator, I very much agree with your comments I 
think in total, in terms of the challenges that we face and the 
kinds of things that we need to do to respond to them.
    I also agree that there is a way, as Chairman Corker 
pointed out in my written statement, of crafting sanctions 
legislation that is complementary to the JCPOA and keeps within 
the boundaries of the JCPOA.
    But it does, it comes down in the end to the specifics and 
what is involved and the degree to which it affords executive 
flexibility, again, for any President who might come into 
office to be able to respond to circumstances that may evolve 
over time.
    Senator Cardin. Thank you. Did you want to respond quickly?
    Mr. Dubowitz. Senator Cardin, I agree, absolutely. But I 
think the most important thing that Congress can do is 
reestablish American deterrence. I think over the past year, 
American deterrence has been severely degraded, because the 
Iranians do not believe that we are willing to use nonnuclear 
sanctions to respond to their malign activities.
    I think if we do not reestablish deterrence, we are tying 
the hands of the next administration and effectively paralyzing 
U.S.-Iran policy.
    Senator Cardin. Thank you.
    Thank you, Mr. Chairman.
    The Chairman.  Thank you.
    Just for what it is worth, I agree with the comments that 
were made. In crafting our legislation, we tried to do exactly 
what Mr. Nephew and Mr. Dubowitz just said.
    I will say I do not think the administration wants to see 
anything happen this year, including extension of ISA. I do 
think they are tiptoeing around issues and allowing Iran to 
continue to press the outer limits. I do think it is our role 
to push back. I think we have struck the appropriate balance 
with the legislation introduced this morning.
    Senator Risch?
    Senator Risch. Thank you, Mr. Chairman. Thank you for 
holding the hearing.
    The hearing underscores what a lot of us have been saying 
for a long time, and that is that this was a really, really bad 
deal when it was made. It is a much worse deal today.
    This business of taking a bad boy who is doing 100 things 
bad and saying we are going to negotiate with you on one of 
those, and gosh, you are doing better now on that one thing, 
the other 99 things have gotten worse instead of better, is not 
a victory by any stretch of the imagination.
    Mr. Nephew, your suggestion that we should help Iran by 
clarifying this and doing that, count me out. I do not want to 
help these people. Until they change their ways, I have no 
interest whatsoever in helping these people.
    Indeed, I think we need to double down on the sanctions and 
get after this, and convince the world that these people are 
going to have to change their ways or they are going to pay the 
price for it. As far as counting on our so-called partners in 
the P plus five group, these people aren't going to help us.
    As frequently happens when we do the right thing in the 
world, we are going to wind up going it alone. Sometimes we put 
a facade over the top of it with other people giving the nod 
that it is okay. But we are going to have to go it alone on 
this.
    We need to continue to do the right thing, and this regime 
in Iran is going to continue to do the wrong thing. They 
signaled that immediately following the agreement being put in 
place, when it started to launch ICBMs and flaunted the world, 
really, and said, look, this thing does not mean a thing as far 
as our movement toward a nuclear power.
    So this thing, it is time to turn the page with this 
administration. Get a new administration in and hopefully we 
will toughen up and do the right thing.
    Thank you, Mr. Chairman.
    The Chairman.  Thank you.
    Senator Coons?
    Senator Coons. My apologies to the chairman.
    The Chairman.  You are not used to being called in front of 
Senator Menendez, so I will filibuster, if you would like me to 
do so.
    Senator Coons. I am not used to being called quite so 
briskly.
    Let me thank you, Chairman Corker and Ranking Member 
Cardin, for convening this hearing.
    And to the remarkable witnesses we have had, your mastery 
of the details of the JCPOA and of its shortcomings and its 
successes I find important and refreshing. I am grateful that 
this committee continues to do its job of real oversight.
    As someone who narrowly agreed to support the agreement, 
characterizing it as the least bad option before us at the 
time, I also made a commitment to continue to acknowledge its 
successes and its shortcomings and to work wherever possible 
with my colleagues to address those shortcomings.
    A year later, my rough assessment is that the deal is 
working as intended, and I agree with the witnesses that some 
of the flaws of the deal have also been exposed. So I will 
continue to call for Congress to do three things.
    First, as other crises around the world emerge and take the 
attention of the current and future administration, the current 
and future Congress, we have to continue to push the executive 
branch--Treasury, State, Energy, Defense, and the intelligence 
community--to monitor, enforce, and implement this agreement so 
that violations, small, marginal violations, are known and are 
promptly addressed. And that means holding Iran accountable in 
every way possible.
    Second, we have to work together to find ways to strengthen 
the administration's ability to push back against Iran's 
continuing bad behavior outside the four corners of the JCPOA.
    And then last, we have to maintain a credible conventional 
military deterrent to protect U.S. interests and our allies in 
the region, including, of course, Israel. And in each of these 
areas, rigorous, fair, and responsible oversight by Congress is 
crucial.
    So if I might, Mr. Dubowitz, you said not tear up the deal 
but you recommended I think it was 16 ways that we can 
legislatively strengthen nonnuclear sanctions in ways that you 
believe are fully compliant with the JCPOA.
    And if there is a core disagreement I think between the 
administration and members of this committee, and within 
members of this committee, it is what is our degree of freedom 
to legislate new sanctions provisions without violating the 
JCPOA.
    Help me, if you would, hear your view. What happens if the 
JCPOA begins to unravel and breakdown? Will the rest of the 
P5+1 continue to enforce it without us? Will Iran exploit the 
difference between the United States and its European partners? 
Will Iran ramp up centrifuge production and enrichment? And 
will that isolate us from our partners?
    And what do you view as most critical ways that we could 
legislate that you also believe complies in full with the 
JCPOA?
    Mr. Dubowitz. Thank you, Senator Coons.
    First of all, I think it is absolutely critical that we 
send a clear message to the Iranians now and certainly in time 
for the next administration that we do not interpret the JCPOA 
as precluding nonnuclear sanctions. The Iranians have made it 
very clear they do.
    I think the administration's activity to date confirms the 
Iranian interpretation. We have had really a handful of new 
sanctions. They have been small designations that have been 
highly ineffectual.
    So we need to send a clear message to Iran that we are 
willing to enforce the deal vigorously, and we are willing to 
use nonnuclear sanctions to push back against their malign 
activities.
    The legislation that was introduced today by Senators 
Corker and Menendez and Rubio and others I think is critical 
because it does not violate the JCPOA. It is fully consistent 
with the JCPOA. Not only does it give some interesting new 
authorities, but, most importantly, the President is not using 
his existing authorities in the way that he committed to last 
summer.
    So of the 16 recommendations I have, I think, in principle, 
what I would like to see are the kinds of nonnuclear sanctions 
that punish the Revolutionary Guard for their continued malign 
activities and vigorously enforce the JCPOA against Iran's 
continued illicit procurement activities, including most 
recently in Germany.
    Senator Coons. Thank you.
    If I might, since I am about to run out of time, one more 
question for Mr. Nephew, something that I think concerns both 
of you and you both referenced, which is that, in 10 to 15 
years, there are legitimate concerns about Iran's industrial 
scale nuclear enrichment program.
    What steps should we be taking now to ensure that Iran does 
not ramp up fissile material production when key restrictions 
expire 10 to 15 years from now? And how do we build a new set 
of restrictions that Iran will face as those in the JCPOA 
expire?
    Mr. Nephew. Thank you, Senator. I think there is a lot that 
we can do. In fact, in a report that I issued with Bob Einhorn 
via the Brookings Institution about a month ago, I laid out a 
number of ideas. I will mention two here.
    First off, I do not think it is absolutely true that the 
Iranians will immediately break to expand their fissile 
material capabilities once the deal's main restrictions expire. 
They are going to have some decisions to make, including 
whether or not they want to be threatening other countries in 
the region with their own potential nuclear options.
    So I think the Iranians will already have some sense of 
need to at least balance the potential security dilemma they 
could create for themselves.
    Beyond that, I think there is an opportunity here to look 
to expand the application of the restrictions and transparency 
steps in the deal to make them part of a broader international 
framework and potentially even a regional multinational nuclear 
concept that helps to govern the whole spread of nuclear 
technology throughout the region.
    It takes the nuclear deal we have with Iran and it attempts 
to build on it as a foundation for nuclear restraint in the 
region.
    Senator Coons. Thank you both, and I look forward to 
another round of questions.
    The Chairman.  Senator Isakson?
    Senator Isakson. Thank you, Mr. Chairman.
    Mr. Nephew, I did not vote for the deal either, and I share 
some of the eloquently expressed concerns of Senator Risch.
    But my biggest concern during the whole thing was whether 
or not we would have any real access to inspect onsite in Iran. 
To what extent in this last year are you familiar with 
inspections that have taken place, the ease with which they 
have gained access, and the thoroughness of those inspections 
by the IAEA?
    Mr. Nephew. Senator, I think the IAEA has reported that it 
has been able to verify Iran's commitments under the terms of 
the nuclear deal.
    In their report just issued last May, they noted that they 
had gained access to sites and to other locations in Iran under 
the additional protocol's complementary access provisions. Now, 
the IAEA report does not identify the specific facilities to 
which the IAEA went, so I am not in a position here, especially 
since I am no longer in government, to provide you with a list 
of where they went and how they experienced their access.
    But the IAEA in February reported that it had a problem 
with heavy water in Iran. The IAEA reported in May that it had 
difficulties with Iran working on centrifuge rotors that it 
should not have been working on.
    So the IAEA's absence of reporting on difficulties of 
access and cooperation from the Iranians to some extent is a 
helpful indicator that they are getting the kind of access and 
support that they feel that they need. I think we would need 
the IAEA to be able to tell us whether or not they are having 
any kind of difficulty. They did not say that in their latest 
two reports.
    Mr. Dubowitz. Senator, if I could just jump in on that, one 
of the things that we do know is that the IAEA cannot get 
physical access to the Parchin military base. They relied on 
self-inspection regime that the Iranians set up. That revealed 
that there were actually uranium particles in Parchin.
    The IAEA was then in a position to insist on the 
comprehensive safeguards agreement that Iran has signed with 
the IAEA, that they get follow-on inspections.
    That is setting a dangerous precedent because what we are 
effectively saying through the Parchin precedent is that, for 
future military sites, we are not going to insist on physical 
inspections. And even when we use self-inspections, and we find 
nuclear materials there, we are not going to insist on follow-
on inspections.
    I think that is setting a terribly bad precedent for the 
future and a great situation for the Iranians who can all 
always invoke the Parchin precedent to keep the IAEA out of 
military sites.
    Senator Isakson. Mr. Nephew?
    Mr. Nephew. Senator, if I can just respond to that?
    I think Mark usefully points out an area in which the IAEA 
was able to get access that it deemed sufficient to be able to 
address lingering questions associated with Parchin. Under the 
terms of the deal, the United States has given the IAEA the 
discretion to implement the commitments it took on as part of 
the deal.
    I think that the IAEA has demonstrated in numerous other 
cases its willingness to take access requests forward, if they 
believe they have real problems they need to address.
    I think that the fact that the IAEA did not go back into 
Parchin because of two particular particles, at least not yet, 
should not be indicative of a broader problem with IAEA 
inspector access or IAEA inspector efforts. In fact, if you go 
back in history from 2003 to 2005, the IAEA was inspecting 
military facilities throughout Iran, including Parchin.
    I think this demonstrates that the IAEA, when it believes 
there is value and merit in going into a facility, it can 
structure inspection protocols and inspector access to get what 
it needs to get.
    Mr. Dubowitz. And yet we do not know, for example, as Mr. 
Albright and Dr. Heinonen have pointed out repeatedly, we do 
not know what happened to the uranium stockpiles from which 
those particles were brought.
    So exactly what is going on? Where are the uranium 
stockpiles? What has happened since? Why is the IAEA not 
insisting on follow-on inspections?
    And the notion that somehow that IAEA is always going to be 
this apolitical, technical body I think also flies in the face 
of the history of the IAEA where there have been times under 
different IAEA leaders where the body has been highly 
politicized.
    So I think it is Congress' role to insist that the 
administration hold the IAEA's feet to the fire and that we do 
not establish bad precedents that the Iranians are going to 
exploit in the future.
    Senator Isakson. Mr. Nephew?
    Mr. Nephew. Sorry, with respect, Senator, you may have 
other questions, but I did want to just put one point out 
there.
    We go back to look at the history of the IAEA, let's look 
at one of the most political directors general that we have 
ever had, Mohamed ElBaradei. It was under Mohamed ElBaradei 
that the IAEA demanded access to military facilities inside of 
Iran, including to the Parchin facility.
    So the idea that the IAEA is going to somehow automatically 
be a problem because in one instance they are not demanding 
access again I think lacks foundation. We have had experiences 
before where the U.S. and the IAEA differed strongly about the 
case in Iran and what to do with it. At the same time, the IAEA 
demanded access and conducted inspection authorities, as it set 
out to do in its charter.
    Mr. Dubowitz. This is not the time to be establishing bad 
precedents that the Iranians can invoke in the future.
    Senator Isakson. I agree with that. I am glad you all took 
the time you did to expand on it, because my big concern is the 
Iranians will cheat. We know that. In your opening statement, 
Mr. Nephew, you state in there that the risk of them cheating 
is not zero. They probably will, and we have to be able to 
catch them.
    I just worry that the inspection provisions the Iranians 
insisted on in the JCPOA left them enough wiggle room where it 
is the fox guarding the henhouse, in some cases. And I want to 
make sure we are getting as much oversight out of Congress as 
possible, so if there is cheating going on, we can detect it as 
soon as possible.
    Mr. Dubowitz. Senator Isakson, it is not theoretical 
cheating. The Iranians were cheating last year. They were 
illicitly procuring nuclear, chemical, bio, and missile 
technology from Germany. They were procuring carbon fiber in 
great quantities that have no other utility than to actually 
use for advanced centrifuges.
    If that only happen in 2015, as Mr. Nephew said, despite 
the fact the Wall Street Journal is reporting that German 
intelligence officials say that it continues into 2016, I think 
it is deeply troubling that they were conducting these illicit 
activities during the negotiations up to the JCPOA and between 
July of last year when the JCPOA was reached and December.
    I also point out some interesting facts in that German 
intelligence report that says explicitly that they are 
concerned that those activities are continuing. I do not know 
why a report coming out in 2016 would say that those activities 
may be continuing if those activities had actually stopped on 
December 31st, 2015.
    So I think it is a great example of how the Iranians 
continue to test the JCPOA and that, in the face of non-
enforcement, the Iranians will know that they have a green 
light to continue to push at the international community and 
see what they can get away with.
    Senator Isakson. My time has expired. Thank you, Mr. 
Chairman.
    The Chairman.  Thank you.
    Senator Menendez?
    Senator Menendez. Thank you, Mr. Chairman.
    Mr. Chairman, I would like to submit for the record a 
report issued by the U.S. Government Accountability Office, at 
my request, along with Senator Kirk.
    The Chairman.  Without objection.


    [The information referred to is located in the ``Additional 
Material Submitted for the Record'' section at the end of the 
hearing transcript.]


    The Chairman.  I assume it has something to do with the 
subject at hand.
    Senator Menendez. I am sorry, Mr. Chairman. It talks about 
how great you are as a chairman.
    The Chairman.  That we have no objection to.
    Senator Menendez. It is the ``Iran Nuclear Agreement: The 
International Atomic Energy Agency's Authorities, Resources, 
and Challenges.'' And it is a full accounting of the GAO's 
findings with respect to the IAEA's capacity for meeting the 
tremendous obligations that we have thrust upon it by the 
JCPOA.
    First and foremost, the GAO report highlights the IAEA's 
challenge in detecting undeclared nuclear materials and 
activities. It raises the issue of whether the IAEA will ever 
be able to verify that Iran has no undeclared nuclear materials 
and activities as international inspectors are supposed to 
verify this before reaching the so-called broader conclusion on 
Iran's nuclear program.
    If the IAEA reaches a broader conclusion on Iran's nuclear 
program before October 18th of 2023, that then triggers the 
nuclear deal's transition day, which is supposed to eliminate 
even more international sanctions against Iran.
    Yet in what critics of the deal have described as a major 
flaw, including myself, transition day still happens on October 
18th, 2023, no matter what, and even if Iran does not get a 
clean bill of nuclear health from the IAEA.
    That is pretty amazing. That is pretty amazing. The report 
goes on to list a whole other series of challenges that the 
IAEA has moving forward.
    Now, this is an entity which I have a great deal of respect 
for and have supported and have sought to improve its budget, 
but that we have placed a good part of the national security of 
the United States in, in terms of the Iranian nuclear program.
    So I would commend the report to my colleagues, and I hope 
that it raises some serious concerns from my colleagues about 
what we need to do.
    I would like to turn to Mr. Dubowitz for a moment. First of 
all, congratulations on joining us as a United States citizen. 
We appreciate that.
    Mr. Dubowitz. Thank you, sir.
    Senator Menendez. Secondly, I want to ask you a series of 
questions.
    Has Iran ultimately not continued to pursue acts of 
terrorism in pursuit of entities that pursue terrorism?
    Mr. Dubowitz. They continue to support terrorism.
    Senator Menendez. Has Iran not continued to pursue missile 
development and the firing of missiles, at least against what 
used to be the U.N. Security Council's resolution, but as most 
recently Ban Ki-moon said against the spirit of the U.N. 
Security Council?
    Mr. Dubowitz. They continue their missile activities.
    Senator Menendez. Has Iran not continued to engage in 
destabilizing the region?
    Mr. Dubowitz. They have actually probably accelerated their 
efforts to destabilize the region.
    Senator Menendez. Has Iran not continued to commit human 
rights violations against its people?
    Mr. Dubowitz. According to the U.N. special rapporteur, 
things are getting worse, not better.
    Senator Menendez. Has Iran not engaged in cyberattack 
abilities?
    Mr. Dubowitz. Again, according to authorities, their cyber 
capabilities are getting more aggressive.
    Senator Menendez. So, Mr. Chairman, regardless of whether 
you supported or opposed the JCPOA, the reality is that there 
is a wide universe of nefarious acts by Iran that are against 
the national interests and, I would argue, the national 
security of the United States. And I cannot understand this 
view that we cannot act on those nefarious activities 
independent of the JCPOA.
    And the failure to do so, I think, runs the risk of our 
national interests and our national security and of our allies 
in the region.
    I think I may have caught the tail end of it, but I think 
you may have been asked about the German intelligence report 
that says that Iran is still pursuing, even in the midst of the 
JCPOA, still pursuing the purchases of dual-use technology, 
which can also pursue their interests in missile and other 
technology. Is that a fair statement?
    Mr. Dubowitz. That is correct.
    Senator Menendez. So it is in that context, Mr. Chairman, 
that I am pleased to join with you, and I hope others will as 
well, in a legislative effort that seeks to pursue these 
different nefarious activities of Iran, to pursue their 
terrorist actions, to pursue their destabilization of the 
region in Yemen and Syria, to pursue their missile technology.
    I pressed very hard when the administration here was 
testifying. I said there is a difference between ``Iran shall 
not deploy missile technology'' and ``Iran is called upon.'' 
Now we see that, and the results of that are consequential.
    I pressed very hard about the question of shouldn't we have 
the ability and shouldn't we pursue the reauthorization of the 
Iran Sanctions Act that I authored along with others on this 
committee that I think was a critical element of bringing Iran 
to the table. And every time, all we heard was, well, we do not 
need to deal with that now.
    Had we dealt with it then, then maybe it would have sent a 
very clear message that, no matter what, we are going to have a 
continuing set of sanctions to be called upon to snap back to.
    I know the suggestion is that if you, in fact, go ahead and 
see Iran violating anything, that we can always pass sanctions. 
The problem is that those sanctions take time to implement. We 
have to give the world morning again that, in fact, these 
sanctions are in effect.
    We did that in the first round. We had to give countries 
and companies across the globe notice that, in fact, there were 
going to be sanctionable activities. That took 6 to 8 months. 
Then your enforcement mechanism after that took time.
    So the time frame that would be necessary to get a 
sanctions regime back in place ultimately drives the time in 
which you have bought for being notified of the potential to 
cross the nuclear threshold toward a weapon.
    So that is why, as part of our legislation, the Iran 
Sanctions Act is reauthorized as well.
    So I hope that, regardless of the views of colleagues on 
the question of the JCPOA, that there is a universe of real 
consequential actions by Iran that are largely going to 
unresponded. For so long as they go unresponded, I think we 
have a consequence.
    It is in that spirit that I joined you, Mr. Chairman, in 
the legislation. It is in that spirit I hope we can join 
others.
    For me, this is not about politics. This is about policy. 
It is about the national interests and security of the United 
States. It is something I have been following for 20 years 
since I was in the House of Representatives, and I think it is 
very important. And I commend it to the rest of our colleagues.
    The Chairman.  Thank you.
    I am going to make my first interjection, if I could.
    I think the concern that we have, and it is bipartisan, is 
that the JCPOA is by default becoming our Middle East policy, 
and we are not pushing back against nefarious activities that 
Iran has underway, and I think that is the purpose of the 
legislation that has been introduced. It is to continue to push 
back against those activities that are counter to the benefit 
of our friends and allies in the region.
    I do think that our friends in Europe and other places are 
so concerned about the JCPOA, they are unwilling to do those 
things that need to be done to push back.
    That is why, by the way, the snapback sanctions are 
worthless. They are worthless. They are worthless because we 
know that Russia and China are going to prevent any action from 
taking place at the U.N. Security Council, meaning that, yes, 
there may in place be snapback, but they are not going to 
cooperate with that. So that means that they are, in essence, 
no longer universal like they were in the past.
    So I appreciate what you just mentioned. I thank our 
witnesses for being here.
    And with that, Senator Perdue?
    Senator Perdue. Thank you, Mr. Chairman.
    Thank you, Mr. Nephew and Mr. Dubowitz. It is good to see 
you both again. Thank you for your testimony and your hard work 
in this endeavor.
    A year later, here we are.
    I just want to highlight a couple things. I have a question 
on the German intelligence report. We will start with you, Mr. 
Dubowitz.
    But I want to highlight my concern about where we are with 
Iran. I thought we were naive last year. I was criticized for 
using that word, and yet the attempt here, it seemed to me, was 
to accommodate Iran in this nuclear deal, thereby encouraging 
them to join the spirit of the community of nations. That 
seemed to be the overall strategy.
    Yet here we are. In the first 12 months, we know about the 
ballistic missile launches, seven illicit launches. Harassment 
of U.S. forces, not only the Navy sailors who were illegally 
detained, but also some 10 percent of U.S. crossings of the 
Strait of Hormuz are characterized as unsafe by the Navy 
because involvement of Iranian interactions.
    We know that there are still U.S. hostages, some with dual 
nationalities, but several U.S. hostages still being detained. 
Four confirmed reports of interdicted arms shipments from Iran 
to Yemen to the Houthis.
    We see violations of travel sanctions. The general in 
control of the IRGC has made four illicit trips to the Soviet 
Union.
    We know the procurement attempts in Germany now coming out 
from their intelligence report but also from the Institute of 
Science and International Security.
    I could go on but these are really concerning. It does not 
seem to me that the evidence is that Iran is trying to join the 
spirit of the community of nations at all.
    So they have an agenda. In fact, what we know right now 
from the $1.7 billion that was released to them under this 
agreement, that their own budget this year says that all that 
money goes to the military.
    As a matter of fact, I think it is true that they have 
increased spending on their military by 90 percent, I think. 
That is not the sign of a country that has been in economic 
woes for 10 years or more and are now trying to help build 
their economy and moving away from this nuclear effort and 
their attempts at supporting terrorism in the region and Bashar 
Assad.
    So my question, and I want to go to the German specifics, 
Mr. Dubowitz. Can you talk to me about the intelligence 
reports, the report from Institute of Science and International 
Security, about the carbon acquisition attempts?
    It seems like it is not just one report. It is something 
like seven of the nine states or whatever that have looked at 
it have come back with evidence that these, indeed, have been 
endeavors that Iran has been undertaking.
    Can you address that for us?
    Mr. Dubowitz. Correct, Senator Perdue. There is a federal 
report. There are 16 German states that issue their own 
intelligence reports, of which eight have been made public.
    My colleague in Berlin, Benny Weinthal, has been pouring 
through them in German, looking for the details. The details 
are quite striking: Iran was engaged in significant illicit 
procurement of nuclear, ballistic, chemical, and biological 
weapons-related technology.
    What I find most troubling about the reports is the 
response to the reports. The administration, instead of 
blasting the Iranians and saying that we absolutely oppose this 
kind of malign activity, we will aggressively enforce U.S. 
sanctions on this kind of behavior up to the negotiations of 
the JCPOA and after the negotiations of the JCPOA, this is 
completely unacceptable and is a violation of the JCPOA, which 
has a specific procurement channel through which the Iranians 
are supposed to be going. Instead, from the administration we 
got excuses.
    From the German Foreign Ministry, a remarkable response. 
The German Foreign Ministry said, well, we are not concerned 
because these are clearly Iranian hardliners trying to 
undermine the moderates. Of course, they are Iranian 
hardliners. There are Iranian hardliners in charge of the 
nuclear program, the missile program. They are in charge of 
Iran's terrorist activities. They are in charge of Iran's vast 
system of human rights abuses. They are in charge of all the 
destabilizing activities that Iran is engaged in.
    So the fact that the hardliners are engaged in illicit 
procurement is not a reason to be reassured. It is a reason to 
be even more concerned.
    So what I would hope and expect from this administration is 
aggressive enforcement. As David Albright, has said, there are 
significant concerns that the Obama administration is actually 
blocking prosecutions and investigations of Iranian illicit 
procurement.
    It is not a posture that we want to take. I agree with 
Senator Corker. I mean, I think our economic sanctions snapback 
is delusional, but I think their nuclear snapback is actually 
incredibly powerful. And we have seen a year of this. It has 
deterred this administration and the Europeans from vigorously 
enforcing nonnuclear sanctions, at a minimum.
    So the Iranians are constantly going to invoke this threat 
to walk away from the deal anytime we try to push back, even in 
ways that are allowed by the JCPOA. The longer we allow that 
dynamic to continue, the worse it is for American national 
security.
    Senator Perdue. Thank you, Mr. Chairman.
    The Chairman.  Thank you.
    Senator Markey?
    Senator Markey. Thank you, Mr. Chairman.
    One of the arguments that Iranian opponents of the nuclear 
deal have raised is that the United States has failed to 
provide Iran with the sanctions relief we promised under the 
agreement.
    For example, in an April speech, Ayatollah Khomeini said 
the reason big banks are not ready to work with Iran is Iran 
phobia, which the Americans created and continue.
    However, this statement failed to acknowledge Iranian 
policies that reduce the willingness of foreign firms and banks 
to do business with Iran. Although the IAEA has reported that 
Iran is in compliance with the nuclear deal, Iran continues to 
engage in other provocative actions, including providing 
funding and weapons to Hezbollah and conducting ballistic 
missile tests.
    One of those ballistic missiles reportedly had the words 
``Israel must be wiped out'' written on it in Hebrew.
    These activities produce investment risks that companies 
cannot ignore.
    Furthermore, Iran's economy continues to lack transparency. 
Who actually owns many of its businesses is difficult to 
determine, and foreign firms cannot be sure that they are not 
doing deals with front companies for individuals and entities 
that are designed and designated under sanctions aimed at 
Iran's support for terrorism or its human rights violations.
    Mr. Nephew, do you agree that at least some of Iran's 
difficulties in reaping the economic rewards of sanctions 
relief has been a result of its own domestic and foreign 
policies? And what can we do to ensure that the U.S. is not 
inaccurately blamed if Iran does not experience the economic 
growth that many Iranians hoped for when they supported the 
nuclear agreement?
    Mr. Nephew. Senator, thank you very much for the question.
    I 100 percent agree that the Iranians are dealing with the 
consequences of their own internal issues, in addition to 
issues associated with low oil prices and the presence of 
residual U.S. sanctions. In fact, I think in this point I would 
like to disagree very strongly with Mr. Dubowitz about the 
likelihood and effect of potential U.S. sanctions snapback.
    Frankly, I have spent a lot of time talking to 
international businesses and banks throughout Europe and Asia. 
They believe in snapback so strongly, and they believe residual 
sanctions are so impactful, especially CISADA, that that is 
part of the reason why we have not seen them start to 
facilitate the big sorts of deals that the Iranians were 
expecting.
    So I think, quite to the contrary, the idea that snapback 
and residual sanctions have no impact, I think the Iranians are 
experiencing some of that building on top of the economic 
mismanagement that they have been engaged in for so many years.
    I think, frankly speaking, our sanctions were effective in 
the first place because we took advantage of Iranian economic 
mismanagement. We took advantage of the fact that they 
squandered $650 billion of oil revenue over the course of 10 
years.
    But they were effective then just as they are now by taking 
advantage of the fact that Iranians still do not have their 
heads on straight.
    Senator Markey. So let me ask you this then. One of the 
questions about the long-term impact of the nuclear deal is how 
it will affect Iranian domestic politics.
    On the one hand, following the agreement, reformist and 
moderate forces allied with President Rouhani were elected to a 
majority in parliament. On the other hand, the deal has also 
produced the backlash by hardline forces allied with the 
Islamic Revolutionary Guard Corps and the supreme leader.
    That backlash included the election of Ahmad Jannati, a 
hardliner to head the assembly of experts, which is the group 
that will decide Iran's next supreme leader. It also has 
consisted of a crackdown against opposition groups resistant to 
economic reforms and vocal opposition to a broader involvement 
of relations with the U.S.
    A poll released last week showed that Rouhani's lead is 
narrowing over his possible challenger in next year's 
presidential election, former President Mahmoud Ahmadinejad.
    Mr. Nephew, how do you assess the overall impact of the 
agreement on Iran's domestic politics? What are the prospects 
for peaceful reform in Iran over the next few years? And how 
will U.S. policies influence this process? And are there 
suggestions that you have for congressional action?
    Mr. Nephew. Senator, thank you. I would say a couple 
things.
    First off, I think that the nuclear deal, to some degree, 
undermines the argument that all of Iran's woes are to be held 
at the feet of the United States and our international 
partners. In fact, Iran's leaders now have to contend with the 
fact that they have done a pretty bad job delivering for their 
citizens. In fact, they have done quite worse with the 
treatment of their citizens.
    I think ultimately what is happening in Iran now is a 
manifestation of these tensions that have been under the 
surface in Iran for a number of years, ever since the 
revolution. I think we are seeing the contest now becoming very 
public over issues of economic reform, political placement of 
who is going to be in charge of what bodies.
    In terms of what kinds of policies we can engage in, I 
think, first and foremost, we need to be able to demonstrate to 
the Iranian people as well as to the international community 
that we have upheld our end of the bargain on the nuclear deal. 
I think this goes to the issue of not undermining it with 
actions we might take, but also ensuring that our sanctions are 
very clear, they are very transparent, people understand what 
they can and cannot do. This goes to some of the ideas that I 
put forward in my testimony earlier.
    Senator Markey. Just in the last couple weeks, and you can 
see the politics worsening, like in the United States, in Iran 
right now where 2 weeks ago, the deputy head of the 
Revolutionary Guard threatened that 100,000 missiles were ready 
to fly at Israel. So we can already see the sides dividing up 
here, in terms of the politics of Iran.
    Unfortunately, sometimes the most radical voices get the 
most attention, notwithstanding the underlying reality that a 
country does not want to have a war, does not want have 
economic instability and would rather find a peaceful route.
    Thank you, Mr. Chairman.
    The Chairman.  Thank you.
    Senator Gardner?
    Senator Gardner. Thank you, Mr. Chairman.
    Thank you to both of you for being here today.
    Mr. Dubowitz, I would like to start with you. You have 
heard some talk about procurement in Iran under the JCPOA, the 
agreement that was taking effect January 16, 2016, initially, 
and procurement under that date.
    If you look at the recent study by the Institute for 
Science and International Security, and I will quote from that 
report, ``The Institute for Science and International Security 
has learned that many previously sanctioned Iranian entities 
are now very active in procuring goods in China. These entities 
experienced sanctions relief on Implementation Day, or January 
16, 2016, of the Joint Comprehensive Plan of Action. Those now 
active in China include Iranian entities that conducted at 
least some procurements for Iran's nuclear programs. They 
include, for example, companies involved in making or procuring 
aluminum, steel, or other raw materials. It is unknown which 
goods these entities are procuring or buying in China. 
Nonetheless, many of these formerly sanctioned entities are 
well-versed in making illicit procurements and their resurgence 
in China warrants special scrutiny and concern.''
    That is the report from ISIS.
    Can you describe the extent of the Iranian proliferation 
activities in China, and how the Obama administration is 
responding and reacting to these developments that you are 
aware of? We can go from there.
    Mr. Dubowitz. Senator, I have seen no indication that the 
administration is doing anything to push back against Iran's 
illicit procurement activities.
    I would also think this brings out a very important point. 
These are entities that were listed, have now been delisted, 
and they are back to their old malign activities.
    So if we are going to take the posture that we are not 
going to relist entities or relist sectors that are engaged in 
Iran in malign activities because somehow that is a violation 
of the JCPOA, what are we doing? We are granting a blanket 
immunity to any individual, any entity, or any sector to 
actually get back to business. When I say business, I mean 
malign business.
    So this is all the more reason why, when we find these 
entities and individuals and sectors that are engaged in these 
malign activities, particularly nonnuclear malign activities, 
but also violating the JCPOA through illicit procurement, the 
administration has to enforce the law. And the administration 
has not done so.
    Again, there have been only 20 designations in the past 
year against missile procurement networks and Mahan Air 
supporters, all of which have been highly ineffectual and 
highly weak.
    Senator Gardner. Now the United States is not the only 
party to this agreement. Obviously, China is as well.
    What steps, if any, has China undertaken to stop these 
illicit activities? I am assuming they have not exactly done--
perhaps they have taken the same role or course as United 
States.
    Mr. Dubowitz. Certainly according to Mr. Albright's 
reports, they have done nothing. If anything, middlemen in 
China are helping facilitate and enable that illicit 
procurement.
    Senator Gardner. What do you believe Congress ought to be 
doing about these allegations?
    Mr. Dubowitz. I think Congress needs to pass--I think 
Congress first needs to get the administration up here and ask 
the administration what they are doing about it. Second, 
Congress needs to, through its statutory authority, pass new 
sanctions that, again, the sole purpose of which I believe is 
to reestablish American deterrence.
    I mean, if somebody spends their life looking at sanctions, 
I think these days it is actually less important very 
specifically from a technical point of view what those 
sanctions say, and that Congress reestablish American 
deterrence with respect to Iranian illicit behavior.
    The Iranians believe they can literally get away with 
murder. And the past 12 months since the JCPOA, I think, 
confirms that impression.
    Senator Gardner. Keeping with the theme of listed then 
delisted, during last year's deliberations of the nuclear deal, 
you actually testified before this committee and you talked 
about the investigations that you have done and your 
organization has undertaken on Treasury's delisting of EIKO, 
which was the conglomerate controlled by the Ayatollah Khomeini 
worth about $100 billion, EIKO, in the reports.
    Could you talk a little bit about an update about what 
impact relaxation of U.S. sanctions have had on an organization 
like EIKO, what they are doing? Are earnings being diverted to 
international terrorism, other finances?
    Mr. Dubowitz. Subsidiaries owned and controlled by the 
supreme leader are doing business with European companies. It 
is quite a remarkable phenomenon that these European companies, 
Italian companies and others, are doing business with the 
supreme leader's holding company and, in doing so, enriching 
the supreme leader.
    Again, if you think the supreme leader is going to use all 
of that money for the betterment of the Iranian people, so be 
it. But I think there is evidence, a decades-long rap sheet of 
financial crimes, that would suggest the supreme leader will be 
using that money, or at least some of that money, for illicit 
activities.
    Senator Gardner. EIKO itself, as far as they are concerned, 
are they again participating in activities that ought to be 
worthy of sanctioning again?
    Mr. Dubowitz. They certainly are. I think this actually 
brings up a great example, to divert this briefly, but Iran 
Air.
    Boeing is about to do a $26 billion deal with Iran Air. 
Just last month, Iran Air flew three resupply routes from 
Abadan, Iran, which is the IRGC resupply base, to Damascus. It 
is a great example, like EIKO, like Iran Air.
    They get delisted and they are back conducting malign 
activities. And yet we are going to be permitting Boeing to do 
major deals with Iran Air, which is essentially supporting the 
IRGC. And we are going to be allowing Italian companies and 
others to do business with the supreme leader's holding 
company.
    I mean, these are the consequences that I warned about last 
year, and I am afraid that this is only going to continue. And 
the snap back itself becomes increasingly ineffectual to the 
point that it becomes delusional as these businesses go back, 
as the money goes back. And as the Europeans are in a position 
where they have their business interests to protect, they are 
not going to join us in a major snapback of U.S. sanctions if 
and when we all decide that there actually has been a 
violation.
    Senator Gardner. Thank you, Mr. Chairman. I know we are in 
a vote, so thank you very much.
    The Chairman.  I know Mr. Nephew wants to respond. We do 
have four votes that have gone off, but go ahead.
    Mr. Nephew. It will not take but a second, Senator.
    So the only point I would like to make, sir, is that Mr. 
Dubowitz, in his comments, he made a very important, logical 
leap that may be true but may not be true. And that is that all 
the activities that you were citing, procurement activities in 
China, air flights between Iran and Syria, are malign, that 
there are Iranian companies in China now who are buying things 
that they should not be buying, that there are, in fact, IRGC 
resupply routes being run by Iran Air right now.
    To my knowledge, there is no public evidence about this. In 
fact, sir, the quote that you read from ISIS even says we do 
not know, in fact, what these companies are procuring.
    So the question of whether or not the administration is 
responding goes to an issue of evidence. As Mr. Dubowitz knows 
well, our European friends are having a lot of trouble 
enforcing their sanctions because they made a lot of decisions 
absent evidence.
    In my view, we should absolutely enforce remaining U.S. 
sanctions, including snapback of sanctions on companies that 
engage in activities inconsistent with the JCPOA. But we have 
to know what they are doing before we can take those actions, 
sir.
    Mr. Dubowitz. The German intelligence report I think was 
pretty clear in blasting the Iranians about procuring equipment 
and technology that can be used for nuclear, missile, chemical, 
and biological purposes. That was confirmed by eight other 
German state intelligence agencies. Mr. Albright actually goes 
into a lot of detail talking about the procurement of carbon 
fiber and why that is such a concern with respect to Iran's 
advanced centrifuge program.
    And if Mr. Nephew would like to convince his State 
Department former colleagues to come up here and present the 
evidence that Iran Air flight patterns that have taken place 
all through 2016 from Abadan, Iran, where there is an IRGC 
resupply base, to Damascus are actually Iranian civilians going 
on vacation to Damascus and are not Iran's malign activities, I 
am sure Congress would be very interested in hearing that 
explanation.
    But as far as I can see, and we follow these flight 
patterns on a daily basis, they are flying false transponders. 
I mean, their information is sending out false transponder 
information showing that the flight is actually from Najaf to 
Iran, and not from Abadan, Iran, to Damascus.
    Why are you using false transponder information, if you are 
actually doing something that is not malign? It is highly 
suggestive of some illicit activity, I would think.
    The Chairman.  Senator Cardin I think may have a closing 
statement. We have about 5.5 minutes, by the way, left on the 
vote.
    Senator Cardin. I just really want to draw a distinction.
    I do not think there is any disagreement here about 
enforcing our sanctions for non-JCPOA activities. I do not 
think there is any disagreement about strengthening our 
sanctions regime in regards to non-JCPOA activities.
    The question is where do we draw the line, and what are our 
priorities?
    What I have raised is that there are executive authorities 
that are not backed by legislation. Would it be helpful to have 
legislative backup for those executive authorities?
    There are new sanctionable activities that there is no 
authority today. Do we want to give additional authorities we 
do not have today? That is something we should consider.
    Then we have to consider the mandatory nature of the 
sanctions by Congress, the ability of the President to waive 
those for different reasons, what standards should be used 
there. These are all issues that we are going to have to deal 
with.
    But I think the real challenge is, how do we have a new 
sanctions regime that is not in violation of the JCPOA, because 
you will be subject to the concern that we are reimposing 
sanctions that have been released? And we can do that through 
new activities that are non-JCPOA related, but that line is not 
always easy to draw.
    So there have been a lot of statements made today about 
having stronger sanctions. I am for that. It is in my 
legislation. It is in the Corker-Menendez legislation. We are 
for that. But the question is, where do we set the priorities, 
and how do we draw those lines, and under what conditions?
    We did not really get into much of the discussion today on 
that, but I would welcome your help and expertise as we to try 
to draw those lines.
    We have a 7-week period, starting this afternoon, and I 
hope we use that time to really drill down on a lot of the 
specifics here because the details are going to become 
important.
    Some of this is disagreement between the legislative and 
executive branches of government. We know that. We know how to 
deal with those problems. Believe me, we do. But the 
substantive issues are the areas where we are going to need 
help.
    The Chairman.  I want to thank you for coming. We have 
tremendous access to you, so I am not going to take any more 
time, especially with what is happening on the floor right now.
    I do want to say that, let's be honest, we would have 
already passed legislation here, but the fact is the 
administration is pushing back against any legislation, even if 
it meets the description that Senator Cardin just so aptly laid 
out. That is what is happening.
    The reason the bill was introduced today as it is, which 
does not in any way touch the JCPOA--does not; it aptly fits 
the description that our ranking member just laid out--is to 
move that along.
    I do agree that, over the next 7 weeks, I hope that we will 
be able to come together and pass something prior to this 
administration leaving and certainly us leaving office this 
year, because there is no question that Iran is pushing the 
limits, no question that our European friends are pushing back 
against us doing anything.
    And let's face it, a lot of that are their business 
interests. There is no question that Russia and China are 
tamping that down. And the fact is, it is time for us to take 
action.
    So I thank you both for being here. And the fact that both 
of you agree that we should be taking those actions that, 
again, do not cross the line of the JCPOA, but push back 
against the nefarious activities that are underway, to me is 
uplifting.
    So thank you both for being here.
    Senator Cardin. Mr. Chairman, just 30 seconds.
    There is no administration, whether the Obama 
administration or the Bush administration, that wouldn't like 
to see Congress go away, so I agree with you on that. There is 
unity there.
    So I can assure you that when I introduced my bill on 
behalf of my colleagues, it did not get a Rose Garden reception 
at the White House.
    So I think we do have that challenge. We have to do what is 
right and the independent Congress can be very helpful in 
dealing with these issues.
    I look forward to working with you on this.
    The Chairman.  The record will remain open until the close 
of business Monday. If you could fairly promptly respond, we 
would appreciate it again.
    I want to thank the folks who are here in support of Camp 
Liberty. You have been here day in and day out. We passed 
something out of our business meeting today that supports your 
efforts. We thank you for your continued patience but also 
strong, strong support of family members, allies, friends, that 
you know have been persecuted in the way that they have. Thank 
you for being here.
    With that, the meeting is adjourned.
    [Whereupon, at 11:47 a.m., the hearing was adjourned.]

                              ----------                              


              Additional Material Submitted for the Record

[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
           
           Prepared Statement of Mark Dubowitz--Unabridged



                      DEFEATING THE IRANIAN THREAT
                         NETWORK: OPTIONS FOR 
                       COUNTERING IRANIAN PROXIES

                              ----------                              


                       TUESDAY, DECEMBER 6, 2016

                                       U.S. Senate,
                            Committee on Foreign Relations,
                                                    Washington, DC.
    The committee met, pursuant to notice, at 3:13 p.m., in 
Room SD-419, Dirksen Senate Office Building, Hon. Bob Corker, 
chairman of the committee, presiding.
    Present: Senators Corker [presiding], Rubio, Perdue, 
Cardin, Menendez, Shaheen, Coons, Murphy, Kaine, and Markey.

             OPENING STATEMENT OF HON. BOB CORKER, 
                  U.S. SENATOR FROM TENNESSEE

    The Chairman.  The hearing of the Foreign Relations 
Committee will come to order.
    I want to thank our witnesses for being here today and for 
sitting through all of that. Both of you have outlined tangible 
policy options in your written testimony to help us address the 
threat of Iranian proxies. Apart from the efforts to prevent 
Iran from obtaining a nuclear weapon, Iranian proxies remain a 
direct threat to the United States and our allies.
    Currently, Lebanese Hezbollah has at least 100,000 missiles 
and rockets threatening Israel. Militias in Iraq continue to 
pose a threat not only to our long-term interests in Iraq but 
also a threat to American forces currently deployed in the 
country.
    Just this past October, Iranian-backed Houthi militia fired 
cruise missiles at U.S. Navy ships. Saudi Arabia continues to 
feel the effect of Iran proxies and partners as Houthis attack 
Saudi cities and launch extended range ballistic missiles 
across the border that can be only be deployed with outside 
help.
    A recent report by an organization called Conflict Armament 
Research clearly outlines the destabilizing role Iran is 
playing, by highlighting three separate at-sea interdictions of 
Iranian-supplied weapons bound for Yemen and Somalia. At the 
same time, Lebanese Hezbollah continues to play a decisive role 
in Syria, while Iran has demonstrated an amazing capability to 
deploy Shia militias around the world.
    There is no doubt that the next administration will face a 
range of threats from the more traditional areas like the 
Strait of Hormuz to newfound spheres of Iranian influence like 
Yemen.
    One reason that I opposed the nuclear deal with Iran was 
that I feared it would end up being our de facto Middle East 
policy and that countering Iran's regional efforts would play 
second fiddle, if you will. The current administration has not 
pushed back, in a meaningful way, against the Islamic 
Republic's destabilizing actions in the region.
    I hope that both of you can help us consider new ways to 
stem the spread of Iranian weapons, terrorism, and dangerous 
ideology.
    I want to thank you both for being here, for sitting 
through our business meeting, and for sharing your intellect.
    With that, I would like to turn to our distinguished 
member, and my friend, Ranking Member Ben Cardin.

             STATEMENT OF HON. BENJAMIN L. CARDIN, 
                   U.S. SENATOR FROM MARYLAND

    Senator Cardin. Mr. Chairman, thank you for calling this 
meeting on defeating Iran's threat network options for 
countering Iranian proxies.
    As you know, Mr. Chairman, I did not support the JCPOA as 
it was negotiated. One of my greatest concerns was the universe 
of issues that the JCPOA did not address: Iran's sponsorship of 
terrorism, its continued ballistic missile testing, its work 
with Russia to shield Bashar Assad, and its deplorable human 
rights record. These are issues that I have long believed need 
to be given equal weight and consideration as we contemplate 
U.S. policy in the Middle East.
    Iran's state sponsorship of terrorism and its cultivation 
of violent proxies across the Middle East is as important for 
our security and that of our allies and partners as the Iran 
nuclear program. Indeed, American citizens, uniformed and 
civilian, have been victims of Iranian terror.
    Iran-sponsored, -directed, -trained, and -equipped proxy 
groups are a threat to U.S. forces and American citizens today. 
This is a problem that directly threatens U.S. security.
    In my consultations with leaders in the region, it is 
crystal clear that Iranian terrorism is on equal ground with 
the nuclear threat in governments' prioritizations of threats 
to their security.
    In Iraq, where we are partnering with the Iraqi Government 
to defeat ISIL, Iran is directing militias that have engaged in 
sectarian violence and cleansing, putting at risk the stability 
of Iraq.
    In Syria, Iran is sending Shia militia to defend a dictator 
guilty of crimes against humanity in his violent suppression of 
millions of innocent Syrians.
    In Yemen, Iran and Lebanese Hezbollah are working with the 
Houthi rebels to threaten Saudi Arabia and jeopardize broader 
gulf security.
    In Lebanon, Hezbollah's intransience held hostage the 
process of forming a government for over 2 years.
    And Iran continues to transfer sophisticated weapons that 
threaten Israel's security.
    I will stop listing the examples, but it is clear that you 
do not have to work hard to identify the fingerprints of 
Iranian terror across the region. For Iran's leaders and the 
IRGC, investment in this type of unconventional warfare is just 
enough to keep the region off balance and more than enough to 
ensure a constant state of instability and unpredictability.
    Iran's threat network is a shared challenge. In reviewing 
our options for countering Iran's proxies, I believe we must 
look at the shared solutions. The United States cannot go it 
alone and eliminate Iran's proxies. There is no unilateral 
solution.
    So our approach must take into account the requirement of 
international cooperation and coordination. In the region, that 
means intelligence-sharing and security cooperation with our 
partners. Outside the region, that means ensuring the sanctions 
on Iran for its use of terrorism have meaningful impact.
    To accomplish a coordinated, multilateral approach to 
countering Iran's proxies and dismantling the Iran threat 
network, our partners must trust us and want to work with us. 
There must be a baseline confidence and a fundamental 
commitment to their security. They cannot question that 
American leaders may one day get frustrated and walk away from 
bilateral security assurances on multilateral agreements.
    This brings me back to the JCPOA. As I stated earlier, I 
did not support the JCPOA as it was negotiated. But now that we 
are in 2 years of the agreement's implementation, we cannot 
just walk away without risking the credibility of U.S. 
commitments, the U.S. leadership role in enforcing sanctions, 
and the security of our partners. I fear that walking away from 
the JCPOA now amplifies the prospects of war in Iran while 
leaving the United States isolated.
    Iran could rush for the nuclear finish line. There would be 
no more intrusive inspections by the IAEA. And if the United 
States lapses in its JCPOA obligations, the rest of the world 
is not going to follow us with more sanctions.
    So I hope to work with my colleagues on both sides of the 
aisle next year on comprehensive Iranian legislation that sets 
the foundation for the next chapter of the Iran policy. The 
signal we must send with this legislation is that we are 
committed to the JCPOA and Congress will rigorously conduct 
oversight on its enforcement while maintaining credible, 
deterrent snapback legislation.
    Mr. Chairman, I was pleased to see the unanimous support in 
the United States Senate for the passage of the Iran Sanctions 
Act extension. That was an important step that we took.
    On the nonnuclear issues, Congress must continue sanctions 
on Iranian entities and individuals engaged in ballistic or 
cruise missile proliferation, and terrorism or human rights 
violations, and ensure expedited considerations of new 
sanctions if Iran directs or conducts an act of terrorism 
against the United States, or substantially increases its 
operational or financial support for terrorist organizations 
that threaten U.S. interests or allies.
    I have introduced legislation that I think would help move 
that along with many of our colleagues. I look forward to 
working with the chairman on how we can increase our 
responsibilities in Congress on oversight of Iran's compliance 
with the Iran nuclear agreement but also to deal with their 
other activities. I think this discussion today will help us in 
that work.
    The Chairman.  Thank you very much for those comments.
    Since you brought up the extension of ISA, I think we all 
owe a huge debt of gratitude to Senator Menendez for his 
leadership on that issue. I am glad they are extended. Thank 
you for that, very much.
    Our first witness is Mr. Matthew McInnis, a resident fellow 
at the American Enterprise Institute. Mr. McInnis previously 
served as senior analyst for the U.S. Department of Defense.
    Thank you so much for being here.
    Our second witness is Ms. Melissa Dalton, senior fellow and 
chief of staff of the International Security Program at the 
Center for Strategic and International Studies. Previously, Ms. 
Dalton served at the Department of Defense.
    Thank you both. I think you understand that we would 
appreciate it if you would summarize in about 5 minutes. 
Without objection, your written testimony will be entered into 
the record. If you would just begin in the order of your 
introduction, I would appreciate it. Thank you.

  STATEMENT OF J. MATTHEW McINNIS, RESIDENT FELLOW, AMERICAN 
              ENTERPRISE INSTITUTE, WASHINGTON, DC

    Mr. McInnis. Thank you, Chairman Corker, Ranking Member 
Cardin, and the distinguished committee members.
    Thank you for inviting me to testify at today's hearing on 
Iran's support for terrorism and proxies. I will focus my 
comments on how that support fits into Iran's strategic 
priorities and how U.S. policy can best counter it.
    Please note that while this testimony constitutes my own 
research and analysis, it draws as well on discussions 
conducted as part of a working group at the Center for 
Strategic and International Studies with Ms. Dalton, which aims 
to identify potential opportunities to deter Iran after the 
nuclear deal.
    I want to stress that, at the end of 2016, we are at an 
inflection point in Iran's strategy in the Middle East. The 
nuclear deal has given the Islamic Republic new resources and 
has freed Tehran to focus on building its conventional military 
capacity to compete with its regional rivals more directly.
    Iran is also sensing, finally, some form of victory in the 
wars in Syria and Iraq. In the aftermath of these conflicts, 
the Iranian leadership will be left with an enormous degree of 
influence stretching from Beirut to Basra and beyond.
    Led by its Islamic Revolutionary Guard Corps, or the IRGC, 
Tehran will also now have at its disposal a transnational proxy 
army of Shia militia units with at least a couple hundred 
thousand personnel, many with new hybrid warfare capabilities 
developed on the battlefields of Syria and Iraq. This will pose 
significant challenges to us and our friends in the region.
    Our traditional approaches to combating Iran's proxies 
through financial sanctions, weapon shipment interdictions, and 
occasional counterterrorism operations are well-intended and 
still needed. These types of actions can mitigate, perhaps 
contain, or even rollback their capabilities. But they will not 
likely defeat or eliminate the threat posed by these types of 
Iranian-backed groups, especially well-established ones like 
Lebanese Hezbollah.
    How should we better tailor our approach to countering 
Iranian proxies, especially if defeating them is our ultimate 
goal? There are two keys.
    The first is understanding how proxies fit into Iran's 
overall political and military strategy. Though Iran 
established its proxies first to execute unconventional warfare 
and then spread its ideological and political influence, these 
groups often become central parts of Iran's frontline 
deterrence strategy once established.
    This deterrence exists via two layers. The first is 
retaliatory deterrence, the ability to instill fear of 
significant casualties, destruction of critical infrastructure, 
or economic destruction to dissuade Tehran's more powerful 
enemies, such as Israel and the U.S. This draws from what 
Supreme Leader Khamenei and others have described as ``threat 
in response to threat'' doctrines.
    Proxies also give plausible deniability to help Iran manage 
escalation in retaliation. Since Iran, for example, cannot 
strike the U.S. homeland conventionally, it tries to threaten 
through terrorism to balance the deterrence equation.
    The second layer is through passive deterrence, which is 
more latent, which involves its ability to build proxies in 
Iraq, Syria, and Lebanon that are already within Iran's sphere 
of influence. These are groups such as the Popular Mobilization 
Forces in Iraq and the National Defense Forces in Syria that we 
have seen in recent years.
    These are built to basically solidify Iran's influence in 
these states and dissuade any future militaries such as ours or 
others or perhaps even Russia's from potentially trying to pull 
these states out of Iran's influence or sphere of influence. 
These are something that could potentially threaten the future 
U.S. military presence in the country.
    The second key is being able to distinguish Iran's true 
proxies from those groups that are only partners or in process 
of becoming a proxy, such as Yemen's al Houthis. Disruption of 
this process should be a central component of our regional 
policy.
    The main distinguisher is whether an organization adheres 
to Iran's revolutionary ideology of vileyat e faqih, or 
guardianship of the jurisprudence that recognizes Iran's 
supreme leader as its ultimate religious and political 
authority. Groups that do not acknowledge that authority, such 
as the followers of Iraqi Shia cleric Muqtada al Sadr, the al 
Houthis in Yemen, or even Sunni militant groups such as Hamas, 
still enjoy significant support from Iran and cooperate with 
Iran's foreign policies. However, Iran cannot reliably depend 
on these organizations to form the frontlines of its 
retaliatory deterrence against adversaries or even to 
consistently execute Iran's leadership directives.
    So looking to U.S. policy recommendations, as long as Iran 
continues to ideologically oppose the United States and sees 
Washington as a threat to its existence, it will seek 
deterrence through its proxies, unconventional weapons, or 
whatever feasible means it can support. However, the United 
States can take steps to mitigate and disrupt the deterrent 
effect of its proxies.
    Four or five principles in such an approach include, first, 
exposing and demystifying the psychological foundations of the 
proxies' deterrent strength. Greater efforts by the U.S. to 
name and shame Iranian-backed groups, front companies, and 
financial activities can erode the psychological foundation of 
Tehran's deterrent strength. Second, contain and pushback IRGC 
operations to support U.S. proxies. Third, divide and undermine 
local support to proxies. Iran's heavy-handed approach 
frequently stokes nationalist resentment that we can take 
advantage of. Fourth, stem proxy formation and help shape the 
governing environment where we can. This is particularly 
important in places like Yemen where the proxies are not yet 
quite there in fully supportive and fully adhered to Iranian 
ideology. We can prevent the Houthis from becoming fully part 
of Iran's operations. Fifth and finally, we should support full 
whole-of-government approaches such as is supported in 
Countering Iranian Threats Act of 2016. Legislation such as 
that recognizes that need.
    The bottom line: The U.S. cannot alter the fundamental 
logic of Iran's creation of proxies to counter and deter the 
conventional power advantage of the U.S. and its allies without 
fundamental changes in Tehran's threat perceptions or real and 
ideological changes in leadership.
    In the interim, we can, however, mitigate the growth of 
Iran's proxies, and undermine the real and effective 
psychological power that they have.
    With that, I conclude my statement. Thank you.
    [The prepared statement of Mr. McInnis follows:]


                Prepared Statement of J. Matthew McInnis

    Chairman Corker, Ranking Member Cardin, and the distinguished 
committee members: Thank you for inviting me to testify at today's 
hearing on Iran's support for terrorism and proxies. I will focus my 
comments on how that support fits into Iran's strategic priorities and 
how U.S. policy can best counter it.
    Please note that while this testimony constitutes my own research 
and analysis, it draws as well on discussions conducted as part of a 
working group at the Center for Strategic and International Studies. 
The working group aims to analyze potential opportunities to deter Iran 
in the post-JCPOA environment. The final results of its deliberations 
will be published in February 2017.
           the role of proxies in iranian deterrence strategy
    Few states in the modern era, if any, have placed the development 
and sustainment of proxy forces more central in their defensive 
strategies as has the Islamic Republic of Iran (IRI). Assessing the 
role these groups play in Iran's deterrence strategy--and the direction 
IRI strategies will take in the future--requires understanding the 
reasons why Tehran placed such emphasis on building foreign forces to 
defend its security and project its influence in the years after 1979.
    The executor of Iranian proxy policies, the Islamic Revolutionary 
Guard Corps (IRGC), was created by Supreme Leader Ayatollah Ruhollah 
Khomeini first to secure the revolution at home and then export the 
revolution abroad. As an amalgam of existing paramilitary groups and 
neophyte recruits consciously separate from Iran's traditional imperial 
armed forces (the Artesh), the IRGC had no distinct military 
traditions, doctrines, or strategic frameworks beyond ensuring 
Khomeini's new political order must survive and flourish. The 
organization's motto from the Quran ``prepare against them what you 
can'' captures both the pragmatic ethos that drove the IRGC's structure 
and missions and the fundamentally reactive nature of the force to the 
threats and opportunities faced in the early 1980s, namely the risk to 
the new regime from the United States and Iraq and the chance to 
confront Israel in Lebanon.
    Proxies quickly became central in each of these confrontations.\1\ 
The limitations of the IRGC and the Artesh's ability to project 
military power drove the IRGC's need for proxies to conduct 
unconventional warfare abroad. The IRGC worked with Iraqi Kurdish 
militants and formed the Badr Corps from opposition Shia Iraqi groups 
to help fight Saddam Hussein during the Iran-Iraq War. When Khomeini 
decided against a direct Iranian intervention in Lebanon to combat the 
invading Israelis and their Western allies, the IRGC crafted Lebanese 
Hezbollah (LH) from existing local Shia militias.\2\ The corps' Quds 
Force (QF) branch oversaw the expanding foreign network, the so-called 
axis of resistance.
    Tehran also found these groups to be well-suited as vehicles for 
the promulgation of IRI ideological and political influence. Direct 
coercion or forced revolutionary conversion of its neighbors, Soviet-
style, is neither feasible nor politically palatable for the anti-
imperialist-minded Iranian leadership. Instead, proxies in places such 
as Lebanon, Syria, and Iraq could slowly subvert and co-opt state 
institutions while attempting to create a more authentic appearing 
movement toward Iranian ideology and influence from below. In places 
like the Arab Gulf states, this process has been less successful, and 
true Iranian proxies do not yet exist. However, the fear Gulf 
Cooperation Council (GCC) states have of infiltration by IRGC agents or 
cells, and the prospect of IRGC-led terrorism campaigns, 
assassinations, or general unrest, does provide a significant 
psychological or even deterrent effect.
    Iran does not initially create proxies with the intention of using 
them as a deterrent force. Rather, this mission is adopted as proxy 
capabilities strengthen and become existentially important to Iran. 
This deterrence via proxy exists in two layers. The first is 
retaliatory deterrence, the ability to instill fear of significant 
casualties, destruction of critical infrastructure, or economic 
disruption to dissuade Tehran's conventionally more powerful enemies 
from taking direct military action against Iran or its interests. This 
draws from what Khamenei and Iranian military leaders describe as the 
IRI's ``threat in response to threat'' doctrine.\3\ Proxies also give 
the IRGC a degree of plausible deniability, which can help Iran manage 
potential escalation after any retaliatory actions. Since Iran cannot 
strike the U.S. homeland conventionally the way the United States can 
strike the Iranian homeland with near impunity, Tehran seeks ways to 
balance the deterrence equation by threatening U.S. interests worldwide 
through proxy terrorism and asymmetric operations.\4\ The IRI similarly 
hopes to keep Israel at bay through the threat of terrorism and 
asymmetric war from Lebanese Hezbollah. While the IRGC is employing its 
existing proxies and building new ones to fight ISIS and Jabhat al 
Nusra on the front lines, the militias are also already playing a role 
in deterring these Sunni extremist groups from assaulting deeper into 
Shia or Alawite territories in Iraq or Syria.
    The second layer of passive deterrence is more latent and designed 
to deter foreign involvement in states such as Iraq, Syria, and Lebanon 
that are already in Iran's sphere of influence. The IRGC has helped 
mobilize large paramilitary groups such as the National Defense Forces 
(NDF) in Syria and Popular Mobilization Forces (PMF) in Iraq, not only 
to conduct unconventional war against Damascus' and Baghdad's enemies 
but also to solidify its influence in each states' security apparatus 
and dissuade any military or political efforts by outside powers to 
pull these states out of Tehran's orbit. Iran's direction of Asa'ib Ahl 
al-Haq (AAH) and Kata'ib Hezbollah (KH) similarly threaten the counter-
Islamic State coalition currently operating in Iraq and dissuade 
reestablishment of a long-term U.S. military presence in the country.
               current capabilities and future trajectory
    The IRI has significantly expanded the size and complexity of its 
proxy force in the past five years, due primarily to the wars in Syria 
and Iraq. This includes not only the growth of the primary groups that 
form the axis of resistance such as Lebanese Hezbollah, Badr Corps, KH, 
and AAH, but also the establishment of new Shia militias from Iraq, 
Afghanistan, and Pakistan and the mobilization of Iraqi and Syrian 
civilians into the PMF and NDF respectively. The proliferation and 
permutation of smaller Iranian-backed proxies in Iraq and Syria can be 
extremely challenging to discern, although almost all can trace their 
formation and ultimate command back to one of those four principle 
groups, with the QF one echelon above.
    The IRI continues to invest in training and arming its proxies and 
partners with increasingly advanced equipment, with its most trusted 
groups receiving the best weaponry. Lebanese Hezbollah has acquired 
unmanned aerial vehicles and an estimated 100,000 to 150,000 rockets 
and missiles through Iranian assistance, including advanced air-to-
ground and ground-to-sea missiles.\5\ The IRI's Iraqi proxies employed 
the QFs' signature improvised explosive device, the explosively formed 
projectiles against coalition forces in the last decade.\6\ Yemen's al 
Houthis, in contrast, have received mostly small arms from Hezbollah or 
the IRGC, although there are indications the movement has gained some 
Iranian rocket technology.\7\
    Perhaps more important than weapons are the tremendous strides the 
IRGC has made in the past five years advancing their proxies' 
deployability, interoperability, and capacity to conduct unconventional 
warfare. The corps has effectively moved its Iraqi, Afghan, and 
Pakistani proxies into and out of the Syrian theater as requirements 
demand. In addition to building the NDF and coordinating with Lebanese 
Hezbollah, Russian, and Syrian government operations, the IRGC, along 
with some Artesh special forces units, has also begun rotating cadre of 
its brigade-level officers to Syria to train and lead the Shia militias 
in their counterinsurgency campaign.\8\
    The IRI is in effect turning the axis of resistance into a region-
wide resistance army.\9\ Recent estimates indicate more than a quarter 
million personnel are potentially responsive to IRGC direction,\10\ 
including:


   Lebanese Hezbollah: 45,000 fighters, of which 21,000 are full time, 
        and 6,000 to 8,000 are currently deployed to Syria\11\
   Palestinian Islamic Jihad: at most 1,000 personnel focused on 
        targeting Israel \12\
   Badr Corps Brigades: between 10,000 and 20,000 fighters\13\
   Kata'ib Hezbollah: likely a core group of around 1,000 fighters, 
        with 10,000 or more mobilized through its main subsidiary 
        Saraya al-Difaa al-Shaabi and 1,000 to 3,000 likely deployed to 
        Syria\14\
   Asa'ib Ahl al-Haq: approximately 10,000 fighters, and 1,000 to 
        3,000 likely deployed to Syria\15\
   Afghan Fatemiyoun Brigade: 2,000 to 3,000 thousand fighters 
        deployed to Syria, but total numbers for the group are 
        unknown\16\
   Pakistani Zainabiyoun Brigade: up to 1,000 fighters deployed to 
        Syria, but total numbers for the group are unknown\17\
   Syrian National Defense Force: approximately 100,000 mobilized 
        Syrian fighters\18\
   Iraqi Popular Mobilization Forces: approximately 100,000 fighters, 
        of which 80,000 are considered to be part of Iranian supported 
        groups\19\


    The challenges Iran faces from the Islamic State, other Sunni 
extremist groups, and allied state instability have driven the shift to 
larger scale mobilization of proxy and partner groups in the past three 
years, although notably there appears to be little parallel impetus to 
create cyber proxy groups.\20\ A degree of success in the current wars 
in Syria and Iraq will likely lead the governments in Damascus and 
Baghdad to officially demobilize some of these militia forces, 
especially those deemed less proficient or which possess more tentative 
relationships with the IRGC. However, these forces will still represent 
a latent deterrent capability for Tehran. Those groups that profess 
vilayet e faqih, and are thus considered part of the Islamic 
Resistance, will largely remain a standing force under Iranian 
guidance. These groups will likely deepen their integration into their 
respective states' political and security infrastructure. The IRGC 
proxy ``army'' in Iraq and Syria will be in a strong position to 
threaten or deter Iran's adversaries if some form of victory is 
achieved in their civil and counterterrorism wars.
    IRI proxy groups are considered part of the axis of resistance, 
which the Iranian leadership views as an ideological and security 
extension of the Islamic Republic. These organizations proclaim their 
ultimate religious and political allegiance to the supreme leader and 
owe most of their financial and material support to the QF. However, 
unlike other tools used for deterrence, Iran does not fully control 
this weapon. Working with partially autonomous actors can pose a 
liability at times for Iranian leaders, especially in times of crisis 
when rapid decisions are needed. Despite these operational weaknesses, 
there is political value for proxies to demonstrate their relative 
independence and make their support to IRI policy appear more 
grassroots and voluntary.
    These dynamics are also reflected in the IRI's command and control 
over its proxies, which tend to be tailored based on the relative 
levels of trust and experience. The IRGC, through the QF, gives 
strategic guidance to most other proxies, under the supreme leader's 
broad orders. Lebanese Hezbollah is fairly self-directed. QF delegates 
much of the day-to-day operational command of its Iraqi proxies to the 
Badr Organization. In Syria, the relative infancy of most of the 
proxies requires direct control by the rotating cadre units of the 
IRGC. The campaigns in Iraq and Syria are now creating deep ties among 
QF, IRGC, and even some elements of Artesh.
    As a revolutionary state facing stronger military opponents that 
threaten the very nature of the state, the IRI sees warfare in 360 
degrees, where domestic and foreign battlefronts frequently blend. Many 
of the roles and missions proxies perform abroad to expand IRI ideology 
and influence while opposing Iran's enemies are also executed by the 
IRGC and Basij paramilitary forces to secure the IRI's internal 
stability. Training and doctrine development among the IRGC, Basij, LH, 
and other proxies, such as for counterinsurgency operations, are 
increasingly integrated, the latest example being the role the Basij is 
taking in shaping the Syrian NDF.
    The ideological and religious mission of Iranian proxies brings 
them in close contact with Iran's clerical establishment, as the IRI 
proselytizes its version of Shia Islamic thought. Proxies also provide 
a means for Iran to seeks and funnel money for religious or political 
donations throughout the Shiite diaspora. Lebanese Hezbollah, in 
particular, has developed its own financial system through Lebanese 
banking institutions and the black market, which the IRGC uses to 
bypass international sanctions and facilitate its worldwide operations. 
However, Iranian civilian political leaders have little to no influence 
over these groups.Implications for the Region and U.S. Interests
    As long as the IRI lacks the conventional military power to match 
the United States or Israel, the IRGC will continue building and 
sustaining proxies to pressure Tel Aviv, threaten the U.S. homeland, 
and level the deterrence equation. The QF usually works in partnership 
with Lebanese Hezbollah to create new operational capacities in Africa, 
Asia, Europe, and Latin America. The wars in Syria and Iraq, though, 
have apparently dampened some of the IRI's ability to create new 
networks. However, if the current Middle East conflicts subside, 
anticipate a renewed emphasis on growing the IRI's global proxy reach.
    Once a proxy's role in Iranian deterrence strategy is solidified, 
preserving that group becomes an existential matter for the state. 
Ensuring LH, the crown jewel in the axis of resistance, can still deter 
Israel is the most vital reason Tehran must protect the group, even 
more so than the role LH plays in shaping the Lebanese state and 
expanding Iranian influence. This is why the Iranian military has gone 
to, and will continue to go to, enormous lengths to maintain its access 
to Hezbollah through Syria.
    It is crucial to differentiate between the IRI's true proxies and 
groups that are best described as Iranian partners. The key 
distinguisher is whether an organization adheres to the Iranian 
revolutionary governance ideology of vileyat e faqih, or guardianship 
of the jurisprudent, and recognizes the Iranian supreme leader as its 
ultimate religious and political authority. Groups that do not 
acknowledge that authority--such as the Promise Day Brigade and other 
forces that follow the nationalist Iraqi Shia cleric Muqtada al Sadr, 
the al Houthi rebels in Yemen, and even Sunni militant organizations 
such as Hamas--can still enjoy significant support from Iran and 
cooperate with Tehran's foreign policies. However, the IRI cannot 
depend on these organizations to form the front lines of retaliatory 
deterrence against its adversaries, or even to consistently execute the 
Iranian leadership's directives. Moreover, even the true proxies at 
times act more like partners, as local or national considerations may 
temporally trump Tehran's needs.
    The IRGC's new resistance army poses a huge threat to internal 
stability in Iraq, Syria, Lebanon and potentially an external challenge 
to Israel, Jordan, and the GCC states. Additionally, the IRI will still 
use the threat of terrorism or domestic instability inside the GCC as a 
useful tool to restrain Riyadh and to hold U.S. regional military bases 
at some risk. The QF will continue to support organizations such as 
Yemen's al Houthis and some Bahraini Shia opposition groups to the 
degree that it can. However, it is doubtful that Iran can create true 
proxy forces in Yemen or Bahrain on the scale of those created in Iraq, 
Syria, or Lebanon. Keeping the Gulf Arab states off balance is likely 
the IRGC's primary objective on the Arabian Peninsula in the near term.
                         policy recommendations
    As long as the IRI sees the United States as a threat to its 
existence, it will seek deterrence through proxies, unconventional 
weapons, or whatever feasible means it can support. However, the United 
States can take steps to mitigate the deterrent effect of Iran's 
proxies. Four principles in such an approach include:


    Expose and Demystify. Much of the deterrent effect of Iranian 
proxies stems from the impact of their fear-instilling and clandestine 
nature. The IRI bemoans the ``Iranophobia'' among the Gulf Arabs, but 
Iran benefits from the belief there is an Iranian element behind every 
internal and external threat the GCC states face. Greater efforts by 
the U.S. Treasury and State Department to name and shame Iranian backed 
groups, front companies, and their financial activities could erode the 
psychological foundation of Tehran's deterrence strength.
    Contain and Push back. The United States can conduct relatively 
effective counterterrorism operations to trim QF and its proxies. 
Despite their sophistication, Iran's proxy organizations have a much 
more detectable signature than true non-state actors such as the 
Islamic State or al Qaeda. The U.S. capacity to contain and push back 
on these organizations is limited not by a lack of operational and 
tactical options, but rather by a lack of political will to confront 
Iran.
    Divide and Undermine. The IRGC and its proxies' heavy-handed 
behavior frequently stoke nationalist resentment in areas where they 
operate. These sentiments can be exploited through information 
operations and diplomatic activities to create a greater degree of 
separation between Tehran and its proxies. Reenergizing efforts to 
strengthen national military and police forces can prevent Iranian 
proxies and militias from becoming a permanent third army in places 
such as Iraq.
    Stem and Shape. Preventing the IRGC from turning groups it supports 
into full proxies, and therefore eventual tools of Iranian deterrence, 
is crucial. For example, U.S. and Saudi interdiction activities, in 
addition to difficult geography, hamper closer cooperation between the 
IRGC and the al Houthis. Reinforcing these efforts can prevent the 
opposition group from becoming an actual Iranian proxy. The United 
States should also focus where it can, such as in Yemen and Iraq, on 
supporting the development of national and local forces that can 
provide both legitimacy and security to minimize the space the IRGC can 
exploit within the state for building proxies under its control.


    Efforts to counter proxies' deterrent effects need to account for 
the other reasons Iran supports these organizations: to conduct the 
IRI's unconventional warfare campaigns and to spread its political, 
ideological, and security influence. However, the United States will 
not be able to alter the IRI's logic for supporting such groups in 
general and the logic for using proxies for deterrence specifically, 
without fundamental changes in Tehran's threat perception from its more 
conventionally powerful foes, the United States and Israel, or real 
ideological change in the leadership.


------------
Notes

  \1\ This approach is notable in that there is little historical 
        precedence for the Iranian state's use of proxies. Paramilitary 
        groups have existed historically in Iran, but they were 
        typically formed in opposition to the state rather than as 
        principle agents of Iran's foreign and security policies.

  \2\ Khomeini decision was largely driven by Syrian President Hafez al 
        Assad's rejection of the offer for direct Iranian intervention. 
        See Jubin M. Goodarzi, Syria and Iran: Diplomatic Alliance and 
        Power Politics in the Middle East (London: I.B. Tauris, 2006), 
        63-67.

  \3\ Asghar Eftekhari, Fatallah Kalantari, ``Evaluating and Defining 
        the `Threat in Response to Threat' Strategy in Iran's Defense 
        Policy,'' Journal of Defense Policy 22, no. 88 (Fall 2014).

  \4\ The IRGC used Badr Corps and its descendent groups such as 
        Kata'ib Hezbollah (KH) and Asa'ib Ahl al-Haq (AAH) to bleed 
        coalition forces in Iraq after 2003 and deter any military 
        actions against Iran.

  \5\ Avi Issacharoff, ``Israel Raises Hezbollah Rocket Estimate to 
        150,000,'' Times of Israel, November 12, 2015.

  \6\ Marcus Weisgerber, ``How Many U.S. Troops Were Killed By Iranian 
        IEDs in Iraq?'' DefenseOne, September 8, 2015.

  \7\ Katherine Zimmerman, ``Signaling Saudi Arabia: Iranian Support to 
        Yemen's al Houthis,'' AEI Critical Threats Project, April 15, 
        2016.

  \8\ Paul Bucala and Frederick W. Kagan, ``Iran's Evolving Way of War: 
        How the IRGC Fights in Syria,'' AEI Critical Threats Project, 
        March 24, 2016.

  \9\ Retired IRGC Commander Mohammad Ali Al Falaki has coined the term 
        ``Shia liberation army'' for the collection of partners and 
        militias currently operating under IRGC command in Syria, Iraq, 
        and Yemen. This term has received coverage in both the Persian-
        language and English-language press, although it does not 
        appear to be in widespread use among Iran's political 
        leadership at this time. See ``Reports: Iran Forms `Liberation 
        Army' to Deploy Abroad,'' Al Jazeera, August 20, 2016, and Amir 
        Toumaj, ``IRGC Commander Discusses Afghan Militia, `Shia 
        Liberation Army,' and Syria,'' The Long War Journal, August 24, 
        2016,

  \10\ In total, the IRI has 13,000 to 15,000 of its proxy forces 
        fighting in Syria in addition to the NDF. In Iraq, perhaps 
        30,000 or more of those 80,000 personnel can be considered 
        direct Iranian proxies consisting of KH, AAH, and Badr Corps. 
        The remaining 50,000 mostly include those who follow Muqtada al 
        Sadr. Across all these groups, Iran could employ approximately 
        75,000 to 80,000 fighters for direct retaliatory deterrence 
        purposes. The rest conduct secondary deterrence as a bulwark 
        against foreign interference in Iran's sphere of influence.

  \11\ Nadav Pollak, ``The Transformation of Hezbollah by Its 
        Involvement in Syria,'' The Washington Institute for Near East 
        Policy, August 2016.

  \12\ Bureau of Counterterrorism and Countering Violent Extremism, 
        ``Country Reports on Terrorism 2015,'' U.S. Department of 
        State.

  \13\ Michael Knights, ``Iraq's Popular Demobilisation,'' Al Jazeera, 
        February 26, 2016, and Susannah George, ``Breaking Badr,'' 
        Foreign Policy, November 6, 2014.

  \14\ Loveday Morris and Mustafa Salim ``Iran Backs Assad in Battle 
        for Aleppo with Proxies, Ground Troops'' Washington Post, 
        October 19, 2015,

  \15\ Matthew Hilburn, ``One-Time U.S. Prisoner Now Key in Battling 
        IS,'' Voice of America, March 15, 2015,

  \16\ Farzin Nadimi, ``Iran's Afghan and Pakistani Proxies: In Syria 
        and Beyond?,'' The Washington Institute for Near East Policy, 
        August 22, 2016, and Human Rights Watch, ``Iran Sending 
        Thousands of Afghans to Fight in Syria: Refugees, Migrants 
        Report Deportation Threats,'' January 29, 2016.

  \17\ Babak Dehghanpisheh, ``Iran Recruits Pakistani Shi'ites for 
        Combat in Syria,'' Reuters, December 10, 2015,

  \18\ Christopher Kozak, ``An Army In All Corners: Assad's Campaign 
        Strategy in Syria,'' Institute for the Study of War, April 
        2015,

  \19\ Bret Baier, ``U.S. Officials: Up to 100,000 Iran-Backed Fighters 
        Now in Iraq,'' Fox News, August 16, 2016,

  \20\ The IRI uses its growing cyber capabilities in the same ways it 
        uses proxies for retaliatory deterrence. The unique 
        characteristics of the cyber realm allow Iran to execute its 
        missions more directly. The IRI tends to use front 
        organizations under direct IRGC control, although it will 
        cooperate with non-Iranian cyber groups if that suits its 
        needs. See J. Matthew McInnis, ``How Much Should We Fear 
        Iranian Cyber Proxies?,'' The Cipher Brief, July 21, 2016,


    The Chairman.  Thank you.
    Ms. Dalton?

  STATEMENT OF MELISSA G. DALTON, SENIOR FELLOW AND CHIEF OF 
STAFF, INTERNATIONAL SECURITY PROGRAM, CENTER FOR STRATEGIC AND 
             INTERNATIONAL STUDIES, WASHINGTON, DC

    Ms. Dalton. Chairman Corker, Ranking Member Cardin, and 
distinguished members of the committee, it is an honor to 
testify before you today with my excellent colleague, Matthew 
McInnis, on options for countering Iranian proxies. This 
testimony draws from our forthcoming CSIS report on deterring 
Iran.
    I will focus my remarks on three topics today: Iran's 
strategic approach, building a U.S. deterrence strategy, and 
recommendations for the new Congress and next administration.
    Iran is a revisionist power that seeks to fulfill a number 
of goals to change the status quo. These objectives include 
ensuring survival of the Islamic Republic, deterring 
adversaries, enhancing its regional power and influence, and 
securing a place of political and economic importance within 
the international community.
    Iran is aware of its conventional military inferiority 
versus its adversaries. It leverages a range of unconventional 
and conventional capabilities and concepts of operation, 
including proxy forces, to achieve its objectives. This 
approach also encompasses other activities, including missile 
development, engaging in provocative maritime operations, 
exploiting cyber vulnerabilities, and employing information 
operations. It ensures that any escalations against the United 
States and its regional partners fall short of large-scale 
warfare.
    Through this approach, Iran can pursue its goals while 
avoiding kinetic consequences, enjoy plausible deniability by 
using proxies, subvert regional rivals and deter them from 
taking actions that could trigger a potential backlash from the 
proxy groups, and infiltrate and influence state institutions 
incrementally in countries with weak governance. Moreover, the 
wars in Syria and Iraq have provided fertile ground for the 
growth of Iranian proxies and supported groups.
    This approach also disadvantages Iran. Through its 
destabilizing regional activities, Iran's image as an 
international pariah remains in many ways the same, impairing 
its economic development. Iran is also hindered by a principal-
agent problem versus its proxies, which do not always act in 
accordance with Iranian interests.
    The U.S. approach to Iran has deterred significant leaps 
forward Iranian activities in capability development, yet the 
United States has largely been unable to deter Iran's 
incremental extension of regional power and threshold testing 
across a range of military and paramilitary activities.
    Indeed, in the last 5 years, Iran's threat network has 
grown. Regional partners doubt U.S. sincerity in pressing back 
against Iran's destabilizing activities.
    The next Congress and administration have an opportunity to 
chart a pathway forward vis-a-vis Iran that protects U.S. 
interests, strengthens deterrence, and sets the conditions for 
changing Iran's behavior. The United States may choose to 
elevate its counterterrorism objectives in its approach to 
Iran, given the unique challenges that Iran's threat network 
presents.
    This strategy will have its limits. Absent ideological 
changes in the Iranian Government, the United States will not 
be able to change Iran's reasoning for supporting proxy groups. 
It may prompt Iran to reassess its commitment to its JCPOA, 
especially if the United States imposes new terrorism-related 
sanctions that mimic prior nuclear ones. If U.S. action is not 
calibrated, Iran is likely to respond with kinetic attacks, 
information operations, and cyberattacks.
    Working in close coordination with allies and partners, the 
United States can take a number of steps to limit the reach of 
Iranian proxy activities and stem further growth of proxies in 
the region.
    These measures include: ratchet up direct and indirect 
operations to disrupt IRGC activity and interdict support for 
proxies, calibrated for U.S. and Iranian red lines; conduct 
cyber-disruption of Iranian proxy activities; avoid inflating 
Iranian capabilities and intentions; expose Iranian-backed 
groups' front companies and financial activities outside of its 
borders to discourage Iranian coercive interference; exploit 
nationalist sentiment in the region that bristles at Iranian 
interference through amplified information operations; sustain 
financial pressure on the IRGC and proxies; and minimize the 
space that the IRGC can exploit in the region by building the 
capabilities of regional partner security forces, and 
supporting governance and resiliency initiatives in countries 
vulnerable to Iranian penetration.
    Even a U.S. strategy that seeks to amplify pressure on Iran 
cannot be purely punitive or it will prove escalatory and have 
its limits in changing Iran's behavior. The United States 
should link possible incentives to changes that Iran makes such 
that they are synchronized as one move.
    Congress and the new U.S. administration have an 
opportunity to chart a pathway forward on Iran policy. I hope 
that today's hearing can inform that process.
    Thank you, and I look forward to your questions.
    [The prepared statement of Ms. Dalton follows:]


                Prepared Statement of Melissa G. Dalton

    Chairman Corker, Ranking Member Cardin, and distinguished Members 
of the Committee: it is an honor to testify before you today with my 
excellent colleague Matthew McInnis on options for countering Iranian 
proxies. This testimony draws from research and analysis informing a 
forthcoming report, ``Deterring Iran After the Nuclear Deal,'' which 
will be published by the Center for Strategic and International Studies 
in February 2017.
                       9iran's strategic approach
    Iran is a revisionist power that seeks to fulfill a number of goals 
to change the status quo. These objectives include: ensuring the 
domestic survival and primacy of the Islamic Republic; enhancing its 
regional power and influence in the Middle East; securing a place of 
political and economic importance within the international community; 
and preserving its ability to deter adversaries from posing an 
existential threat to Iran.
    Iran is aware of its conventional military inferiority versus its 
adversaries, particularly the United States and Israel, and also to a 
lesser extent the Gulf Cooperation Council (GCC) states. Thus, Iran 
employs a hybrid strategic approach towards achieving its interests, 
leveraging a range of unconventional and conventional capabilities and 
concepts of operation, including proxy forces. It ensures that any 
escalations against the United States and its regional partners fall 
short of large-scale warfare. This approach encompasses a range of 
coercive activities, from developing missiles and engaging in 
provocative maritime activities, to supporting proxies and terrorist 
groups, and exploiting cyber vulnerabilities while employing 
psychological and information operations.
    Operating in the ``gray zone'' between war and peace, Iran 
exercises threshold avoidance by incrementally antagonizing the United 
States and its regional partners in the maritime sphere and through the 
gradual progression of its missile development program. The use of non-
military coercive tools - cyber, psychological, and information 
operations - also allows Iran operating space to target its adversaries 
without provoking significant retaliation. Additionally, Iran's 
exploitation of ambiguity, particularly through its use of proxy groups 
in the Middle East, enables the country to indirectly attack its 
adversaries and counter Sunni influence in the region. These 
activities, employed in the pursuit of Iran's interests, accrue gains 
as well as costs to Tehran, all the while exacerbating tensions with 
its adversaries.
    The GCC countries have largely resisted Iranian penetration of 
their Shi'a populations through intelligence and security measures, but 
they remain highly concerned about the potential for Iran to deepen its 
influence in their territory. Iran's use of proxies is of particular 
concern to GCC countries in this regard. The Islamic Revolutionary 
Guard Corps (IRGC) oversees and directs proxy activities as an 
extension of Iran's power and influence. It has been particularly 
successful in Lebanon, Syria, and Iraq, cultivating and sponsoring 
groups such as Lebanese Hezbollah, the Badr Corps, Kata'ib Hezbollah, 
and Asa'ib ahl al-Haq. Not all of Iran's proxies are created equal or 
are even true proxies. Some groups possess more sophisticated 
paramilitary and intelligence capabilities and receive more training, 
funding, and equipment from Iran than others; these groups also tend to 
be more ideologically and politically connected to Iran and its agenda, 
such as Lebanese Hezbollah. Others, such as the followers of Iraqi 
Shi'a cleric Moqtada al-Sadr, have links to but receive less support 
from Iran.
Advantages of Iran's Strategic Approach
    By operating below the threshold of large-scale warfare, Iran is 
able to act boldly and make significant gains towards its goals without 
provoking a conventional war against the United States or its regional 
partners. Supporting sub-state proxy groups such as Hezbollah in the 
Levant and the Houthis in Yemen in a variety of ways allows Iran to 
pursue its goals of increased influence in the Middle East, while 
avoiding kinetic consequences. Iran enjoys a significant measure of 
plausible deniability with this particular pillar in its strategic 
approach. As it is not directly implicated in any acts carried out by 
these proxy groups, Tehran benefits from its ability to subvert its 
regional rivals, and deter them from taking anti-Iranian actions that 
could trigger a potential backlash from the proxy groups.\1\ While the 
United States and its allies and partners must operate within 
international norms, Iran is able to leverage its capabilities and 
asymmetric activities without playing by international rules. 
Additionally, Iran's use of proxies constrains its adversaries' 
options, as the United States, Israel, and the GCC countries must 
calculate their responses to Iranian actions based on the potential for 
conflict escalation and the risks of causing civilian casualties, 
disrupting economic activity, and disabling critical infrastructure. 
For example, Lebanese Hezbollah's penetration of southern Lebanon 
serves as a deterrent against Israel, as it has embedded effectively in 
Lebanese localities and civilian structures.
---------------------------------------------------------------------------
    \1\ J. Matthew McInnis, Iran's Strategic Thinking: Origins and 
Evolution, American Enterprise Institute, May 2015, p. 20.
---------------------------------------------------------------------------
    Besides deterring adversaries' actions, Iran also leverages its 
proxy relationships to incrementally infiltrate and influence state 
institutions in countries with weak governance, such as Lebanon and 
Iraq, while promoting Iranian ideology among local recruits. Through 
its proxies, Iran provides services that would normally be dispensed by 
the state, taking advantage of local grievances, particularly among 
Shi'a populations. Over time, these groups gain popular support and 
legitimacy, providing a hedge against the state government, or, as seen 
in Lebanon, forming part of a governing coalition.
    Moreover, the wars in Syria and Iraq have provided fertile ground 
for the growth of Iranian proxies and supported groups. Iran likely has 
made investments in these groups in part out of true concern for the 
instability and fragmentation of both countries, which does not serve 
its interests. Iran wants a pliable government but a functioning state 
in both Syria and Iraq. Yet, in this chaos, Iran may see opportunities 
for tactical advantages versus the United States and the GCC countries 
by shaping and supporting local actors and proxies. Iran has mobilized 
up to 115,000 fighters in Syria to bolster President Bashar alAssad's 
regime, comprised of Lebanese Hezbollah, Syrian, Iraqi, Afghan, and 
Pakistani recruits, and overseen by IRGC-Qods Force personnel. It is 
unclear whether some contingent of this expeditionary force will remain 
in Syria over the long-term to preserve Assad's hold on the strategic 
territory necessary for Iran to sustain its supply and command and 
control lines to Lebanese Hezbollah.
Disadvantages of Iran's Strategic Approach
    Iranian activities in the pursuit of its strategic goals have, in 
some instances, backfired and imposed unintended costs on the regime. 
By testing the limits of the Joint Comprehensive Plan of Action (JCPOA) 
through its missile tests, continuing its naval provocations in the 
Gulf and the Strait of Hormuz, and its support for terrorist groups in 
the region, Iran's image as an international pariah remains in many 
ways the same. This is best exemplified by the unwillingness of 
international banks and businesses to invest in Iran despite the 
lifting of significant international sanctions against the country 
under the JCPOA. \2\ Unilateral U.S. sanctions on Iran for its 
ballistic missile program remain intact, as do sanctions for Iranian 
human rights violations and its support for proxy terrorist groups.\3\
---------------------------------------------------------------------------
    \2\ Laurence Norman, ``U.S., EU Urge European Banks, Businesses to 
Invest in Iran,'' The Wall Street Journal, May 19, 2016.
    \3\ Carol Morello and Karen DeYoung, ``International sanctions 
against Iran lifted,'' The Washington Post, January 16, 2016,
---------------------------------------------------------------------------
    Iran is also disadvantaged by a principal-agent problem versus its 
proxies, which do not always act in accordance with Iranian interests. 
This dynamic is currently most visible in Iraq among some armed Shi'a 
groups that receive Iranian support and can secure territory but can 
also survive without an Iraqi government. This poses a challenge for 
Iran, as it does not desire the complete fragmentation of Iraqi state 
governance; it wants an Iraqi government in control that can be pliable 
to Iranian interests, while continuing to support Iraqi Shi'a militias 
that can keep the Iraqi government in check.
    Additionally, Iran's strategic approach results in continued 
economic pressure on the country, limiting its ability to invest in its 
military and paramilitary capabilities. A weaker economy, further 
eroded by the persistence of low oil prices, undermines Iran's ability 
to modernize and improve its military at the rate that it ideally would 
like to; despite Russian and Chinese military assistance, sanctions 
continue to limit Iran on the conventional front.\4\ From 2006 to 2016, 
Iranian military expenditure decreased by approximately $4.01 billion, 
and that number is unlikely to change significantly in the near term 
given continued unilateral sanctions and international hesitance to 
invest in Iran.\5\ Limited cash flow also inhibits Iranian ability to 
fund proxies in the Middle East. Acting Treasury Undersecretary for 
Terrorism and Financial Intelligence Adam Szubin asserted in a May 2016 
Congressional testimony that as a result of U.S. sanctions on Iran for 
its support of Hezbollah, ``the group is in its worst financial shape 
in decades.'' Although the IRGC largely is isolated from international 
pressure, it operates at the will of Iran's Supreme Leader, who does 
react to domestic demands. Constraints on Iran's economy and resulting 
pressures on the Iranian people can affect the Supreme Leader's 
calculus. The GCC states' backlash to Iran's coercive activities also 
hampers the latter's security interests. Reacting to Iranian proxy 
subversion and empowerment of Shi'a groups in the region, the GCC has 
empowered anti-Iranian Sunni proxies of its own, particularly in Syria, 
thus escalating the civil war. Reports of Saudi and Qatari funding that 
assists Jabhat Fateh al-Sham (formerly Jabhat al-Nusra) and other 
Salafist groups in Syria directly counter Iranian efforts to increase 
its influence in the region, and pose a security threat to Iranian 
interests.\6\ The GCC is also bolstering its conventional capabilities, 
with Saudi Arabia looking to become the fifth largest buyer of arms in 
the next five years, with a budget upwards of $60 billion.\7\ Despite 
its best efforts, Iran will be unable to keep up with that level of 
military spending.
---------------------------------------------------------------------------
    \4\  Anthony H. Cordesman, ``The Conventional Military,'' The Iran 
Primer, United States Institute of Peace, August 2015, Data for all 
countries from 1988-2015 in constant USD, SIPRI Military Expenditure 
Database,
    \5\ Ron Kampeas, ``Hezbollah in `worst financial shape in decades,' 
says top sanctions official,'' The Jerusalem Post, May 27, 2016.
    \6\  Kimberly Kagan, ``The Smart and Right Thing in Syria,'' 
Strategika, Issue 01, Hoover Institution, April 1, 2013.
    \7\ Alia Chughtai, ``GCC military spending spree,'' Al Jazeera, 
June 4, 2016,
---------------------------------------------------------------------------
    Iranian behavior can have unintended consequences, backfiring on 
efforts to improve its standing within the international community and 
negatively impacting its economy and its security calculus. The 
regional reactions to Iranian coercive behavior has created unlikely 
avenues for dialogue and possible cooperation among traditional 
adversaries, notably between Israel and Saudi Arabia and Israel and the 
UAE. These countries share deep concerns about Iranian destabilizing 
activities and have discussed political and economic ways to curb them. 
On balance, Iran's strategic approach provides short-term deterrence 
benefits, but is to the detriment of the country's longer term 
objectives.
                assessment of the current u.s. approach
    The U.S. approach to Iran has deterred significant leaps forward in 
Iranian activities and capability development. Sustained U.S. 
leadership in mobilizing an international push for a dual-track policy 
of diplomacy and economic sanctions resulted in the achievement of the 
JCPOA. Despite some ambiguities in JCPOA implementation,\8\ this 
approach has cut off all of Iran's overt routes to a nuclear weapon, 
put in place vigorous and intrusive transparency measures to verify 
Iran's compliance, and ensured sanctions can be snapped back into place 
if Iran violates the deal. The United States and its regional partners 
have also made sound investments and enhanced training and exercises to 
improve the regional military balance, particularly in their 
counterterrorism, intelligence, missile defense, air strike, and 
maritime operations. Yet, enduring military relationships and sustained 
investments have failed to instill the needed confidence among partners 
to assure them that the United States is committed to pressing back 
against Iranian destabilizing behavior and capability development. 
Israel and the GCC countries in particular do not believe that the 
United States has taken the Iran challenge seriously enough. They have 
also expressed concerns about whether U.S. leadership and commitment in 
the region will endure, following U.S. troop drawdowns in Afghanistan 
and Iraq, the announcement of the Asia-Pacific Rebalance, and the 
narrow U.S. approach to addressing the Syrian civil war.
---------------------------------------------------------------------------
    \8\ A number of ambiguities have troubled JCPOA implementation, 
including what happens to Iranian nuclear development as the JCPOA 
enters its latter years and whether a cap should be placed on Iranian 
missile development. In addition, it is unclear whether certain 
commercial transactions may take place and foreign banks can conduct 
dollar-denominated transactions with Iranian entities with tangential 
contact with the U.S. number of ambiguities have troubled JCPOA 
implementation, including what happens to Iranian nuclear development 
as the JCPOA enters its latter years and whether a cap should be placed 
on Iranian missile development. In addition, it is unclear whether 
certain commercial transactions may take place and foreign banks can 
conduct dollar-denominated transactions with Iranian entities with 
tangential contact with the U.S. financial system, restoring the ``U-
turn'' transactions by which dollar transactions between Iran and 
foreign banks can be cleared by the New York Federal Reserve bank.
---------------------------------------------------------------------------
    The United States has largely been unable or unwilling to deter 
Iran's incremental extension of regional power and threshold testing 
across a range of military and paramilitary activities. Despite some 
key successes against and pressure on the Iranian threat network, 
including enhanced financial pressures applied earlier this year, the 
United States has most notably failed to effectively curb the deepening 
reach of Iran's network of proxy actors and activities in Syria, Iraq, 
and Yemen. Indeed, in the last five years, the network has grown.
    Beyond these proxy activities, regional cyber infrastructure is 
vulnerable to Iranian penetration, challenging economic, energy, and 
operational activities of key U.S. partners in the region. U.S. 
military presence in the Gulf deters large-scale Iranian incursions at 
sea but has failed to stem IRGC-Navy provocations. Regional missile 
defense capabilities have grown in the last five to ten years but 
remain vulnerable to accelerating Iranian missile capabilities. 
Finally, Iran's ability to wage ``soft'' or political warfare through 
information operations, projecting its regional activities and 
capability development to magnify and glorify its power and influence, 
remains largely unchecked by the United States and its allies and 
partners.
                     towards a deterrence approach
    The next Congress and the new U.S. administration have an 
opportunity to chart a pathway forward vis-a-vis Iran that protects 
U.S. interests, strengthens deterrence, and sets the conditions for 
changing Iran's behavior. The United States should evaluate a range of 
policy choices to determine the most important security objectives in 
its Iran strategy and prioritize them accordingly. Inevitably, there 
will be tensions among these objectives that the United States will 
need to assess and address.
    The United States may choose to elevate its counterterrorism 
objectives in its approach to Iran, given the unique challenges that 
Iran's expansive threat network poses to U.S., allied, and partner 
interests. Despite short-term U.S.-Iranian alignment of interests 
versus ISIS, Iran's support for terrorist proxy groups and growing IRGC 
activities and influence run counter to U.S. interests and objectives. 
Left unchecked, these conditions set a dangerous dynamic whereby Iran's 
deterrent value to direct action by the United States and regional 
partners is enhanced, but Sunni powers perceive that they must also 
support their own proxies to counter Iran's activities. IRGC-supported 
groups in Iraq and Syria will be in a strong position to threaten and/
or deter states and actors that would seek to contain and press back 
against Iranian influence, once ISIS is degraded and attention turns 
toward stabilization efforts in Iraq and Syria. After Mosul is cleared, 
it is possible that some Shi'a militias could revert to ``first 
principles'' of resisting U.S. influence and presence, possibly even 
through kinetic means, against remaining U.S. personnel in Iraq. 
Although Iran has less incentive and influence to create true proxy 
forces in Yemen and Bahrain, it will continue to seek to keep GCC 
countries off-balance with its support to groups (e.g., arms flows and 
propaganda) in those countries.
    To curb this trend, the United States should uphold its end of the 
JCPOA with Iran while simultaneously enhancing efforts to reduce or 
counter Iranian support of terrorist proxy groups, particularly as it 
threatens allies and partners' interests in the region. The United 
States should ratchet up direct and indirect targeted and calibrated 
operations to disrupt IRGC activity, interdict support for proxies, and 
undermine Iran's regional cyber activities. Through amplified 
information operations, the United States should publicly expose groups 
that receive Iranian support, and exploit national sentiment in the 
region that bristles at Iranian interference through information 
operations. The United States should build the capabilities of and 
regularly train and advise regional partner security forces, employing 
scenario-based exercises focused on Iran and its proxy groups. It also 
should patch known cyber vulnerabilities in the region's critical 
infrastructure to complicate Iranian efforts to compromise the 
confidentiality, integrity, and availability of critical systems and 
structures, through cooperative efforts with regional partners.
    This strategy will have its limits. Absent ideological changes in 
the Iranian government, the United States will not be able to change 
Iran's reasoning for supporting proxy groups in general or its use of 
proxy groups to deter U.S. and regional actions specifically. A 
counterterrorism-heavy approach may prompt Iran to reassess its 
commitment to the JCPOA, due to backlash among Iranian hardliners 
toward policies of President Hassan Rouhani and Foreign Minister 
Mohammad Javad Zarif, especially if the United States imposes new 
terrorism-related sanctions that mimic prior nuclear ones. U.S. or 
allied action against Iranian proxies could be seen as a serious act of 
aggression if not calibrated to maximize effect while mitigating 
blowback. Iran is likely to respond with kinetic attacks, information 
operations, and cyberattacks on U.S., allied, and partner personnel and 
economic interests in the region via its proxies. In such cases, the 
United States should employ asymmetric responses and application of 
pressure.
    To manage these limitations, the United States should calibrate its 
actions to prompt behavior changing results and send a message that 
certain groups, interests, and assets are off limits. The United States 
government will have to determine internally what its redlines are with 
respect to Iranian proxy activity, perhaps by tiering threats to U.S., 
allied and partner interests, and broadly destabilizing activities, and 
to take concrete action when the threshold is tested. It must determine 
when to make its counterterrorism actions known and when the action and 
message should be telegraphed privately (or to let it speak for 
itself).
                            recommendations
    Absent changes in Iran's strategic calculus and orientation, it 
will likely continue to rely on its network of proxies to shape the 
region, increase its influence, and constrain actions by the United 
States and its regional partners. However, there are steps that the 
United States, working in coordination with allies and partners, can 
take to limit the reach of Iranian proxy activities and stem further 
growth of proxies in the region. These measures include:


   Ratchet up direct and indirect targeted and calibrated operations 
        to disrupt IRGC activity and interdict support for proxies, 
        based on an intelligence and operational assessment of U.S. and 
        Iranian red lines for action;
   Conduct cyber disruption of proxy activities;
   Avoid inflating Iranian capabilities and intentions, but at the 
        same time, be prepared to respond strongly to Iranian 
        provocations across the spectrum of its coercive activities;
   Expose Iranian-backed groups, front companies, and financial 
        activities outside its borders to delegitimize and discourage 
        Iranian coercive interference;
   Exploit national sentiment in the region that bristles at Iranian 
        interference through amplified information operations. Leverage 
        information operations to highlight inconsistencies and 
        ulterior motives of the Iranian approach to reduce local 
        support; debunk exaggerated Iranian claims to assure partners 
        and deter further Iranian action by insinuating U.S. and 
        regional partner activities;
   Sustain U.S. and international financial pressure on IRGC and proxy 
        activities; and
   Minimize the space that the IRGC can exploit in the region by:

     Building the capabilities of and regularly exercising 
            with regional partner security forces, including through 
            the employment of scenario-based exercises focused on Iran 
            and its proxy groups to plan for risk mitigation strategies 
            and determine how far to escalate with Iran; and
     Providing training, advising, and funding for governance 
            and resiliency initiatives in countries vulnerable to 
            Iranian penetration.


    Even a U.S. strategic approach that seeks to significantly amplify 
pressure on Iran cannot be purely punitive, or it will prove escalatory 
and feed the Iranian narrative that the United States' sole objective 
is to undermine Iran's stability. Iran has an ideological aversion to 
engagement with the United States. Thus, the United States should 
consider a range and combination of incentives to test for areas of 
constructive Iranian behavior linked to changes that Iran makes, such 
that they are synchronized as one move. These incentives could include:


   Exploring membership in multinational organizations to enhance 
        Iran's voice in international political and economic issues, 
        making Iran potentially more responsible for its actions by 
        ``buying into'' the international system (e.g., moving forward 
        with World Trade Organization accession);
   Continuing to include Iran in political negotiations on Syria, 
        Iraq, and Yemen, in the context of a broader strategy created 
        by the United States, Israel, and its Arab regional partners;
   Pursuing economic incentives through third party countries, 
        particularly in Asia, while retaining pressure through U.S. and 
        European sanctions;
   Attempting more commercial sales from the United States and Europe, 
        if Iranian behavior improves and sanctions relief is possible 
        (e.g., the Boeing/Airbus licenses);
   Negotiating payload caps on Iran's missile development; and
   Allowing conventional arms sales to Iran to resume when the JCPOA-
        ban on conventional weapons trading with Iran expires in 2020.

     Conventional capability development could diversify 
            Iran's military investments, perhaps with less emphasis on 
            its unconventional capabilities that have proven among the 
            most destabilizing to U.S. and regional interests in the 
            past 37 years.
     Such conventional capability development must remain in 
            the bounds of the regional military balance of power so as 
            not undermine U.S. allies and partner's security.
     The United States should assure Israel and Gulf partners 
            that this development is linked to additional capability 
            development, arms sales, and financial incentives for them, 
            in order to preserve their primacy.


    The Chairman.  Thank you. I am just going to ask one 
question and then defer to Senator Menendez, keeping my 
remaining time for interjections.
    When the agreement was being negotiated, I know some of us 
were in Jordan, which was the Switzerland of this deal, where 
many of the meetings took place. One of the things that they 
would say is that the revolution is over. The revolution is 
over. Iran is a different place.
    Obviously, the descriptions that you have just laid out run 
counter to that, since the reason Iran has proxies is to 
further the revolution.
    But I wonder if the two of you, as distinguished witnesses 
could just very briefly answer the question, yes or no, do you 
believe the revolution is over?
    Mr. McInnis. Certainly, for the current leadership, it is 
not. What I usually argue is that, for this particular 
leadership, the revolution is the political infrastructure that 
allows them to retain power. And they can change the ideology 
if they want to, but they have not figured out what that change 
would look like in order for them to maintain power.
    I think everyone that follows the region in this town, in 
academia, and around the world, asked that question of, are 
they going to have the China in the 1970s movement, the Deng 
Xiaoping movement? Are they going to have a Gorbachev moment 
where they are going to change the ideology?
    The Iranians actually worry a lot about that. They debate 
that internally. I think they are scared that it is going to 
happen. Some of them are scared that it is going to happen and 
they are all going to go through an early 1970s Gang of Four 
purges, everyone dies, kind of moment when that happens.
    For right now, the revolution still matters, and it is what 
keeps them in power.
    The Chairman.  Ms. Dalton?
    Ms. Dalton. I heartily agree with Mr. McInnis's 
characterization. I would only add that there has been 
historically tensions in Iranian policy, the pull of ideology, 
which is still quite strong today but also a dose of pragmatism 
in terms of economic development and a desire to have credible 
standing in the international community.
    You see Iran over time trying to balance those two elements 
of their policy. There is a push and pull that occurs in the 
leadership in trying to strike that balance.
    So I think the sweet spot that the United States and its 
international partners have to find is a way to constrain the 
behavior that is a manifestation of Iran's ideology and 
harnesses the potential of the pragmatism.
    The Chairman.  Thank you.
    Senator Menendez?
    Senator Menendez. Thank you, Mr. Chairman.
    Thank you to our witnesses.
    Mr. Chairman, for a couple decades now, Iran has sought to 
extend its brand of governing through terror and intimidation 
throughout the region. I know that champions of the JCPOA 
insisted that with a hold on Iran's nuclear program, that we 
would be able to expend our resources to combat these more 
conventional threats from Iran, and I was looking forward to 
doing that.
    However, in the past 2 years since the agreement, we have 
seen Iran test us in a variety of ways. Even the production of 
heavy water in violation of the agreement is in itself--the 
ability to produce that much heavy water is a precedent for a 
set of circumstances which gives them access to other 
developments of their program.
    Yes, once we bought it and now they transfer it, in the 
second case. But the reality is that it is a violation of the 
agreement. Beyond that, in a more conventional way, their 
engagement in ballistic missile technology in violation of what 
was U.N. Security Council resolutions, their engagement on 
terrorism has not stopped, their engagement in Iraq and Syria 
and Yemen are tremendously challenging in terms of our national 
interests as well as partners in the region.
    So it just seems to me that I hope that in the next 
Congress, colleagues who have been reticent to deal with the 
nonnuclear issues of Iran will be willing to be engaged in them 
in a way that I think can be incredibly important to our 
national security.
    I think that the extension of the Iran Sanctions Act shows 
that despite all the ballyhooing that Iran might walk away from 
the agreement if the sanctions were extended, that is not quite 
the--to the contrary. I see them appealing to President-elect 
Trump to not walk away.
    So it is very interesting that, notwithstanding all the 
blustering, the reality is that sanctions have, in fact, not 
had them move away, which then brings me to what is it that we 
do as it relates to all of these actions.
    So I would like to get a sense of you, Mr. McInnis, you 
mentioned the Countering Iranian Threats Act that Senator 
Corker and I introduced in this Congress. What elements of that 
most particularly do you see as helpful toward this goal? And 
what can we do with our international partners to effectively 
enforce U.N. sanctions on conventional weapons and ballistic 
missiles?
    I would like to hear from both of you on that.
    Mr. McInnis. Thank you, Senator Menendez.
    In particular, I always supported taking a very 
comprehensive look at what Iran is doing from their 
conventional efforts, the support for terrorism, of course the 
nuclear program itself, human rights, the entire field.
    I think, in particular, in the 2016 updates to the bill, 
including something that I personally advocated for, including 
a comprehensive strategy for the U.S. Government to pursue the 
Defense, State, Treasury, DNI, producing a real coordinated 
strategy, which when I was in the government, it was very 
difficult, frankly, to have. We did not really have a sense of 
all the different elements of U.S. national power. Even if you 
could not necessarily have a fully coordinated effort, at least 
all sides were talking to each other, recognizing what we are 
doing on terrorism, what we are doing on counterfinance, and 
what we are doing on our military posture in the region is 
working well with our diplomatic efforts.
    We weren't necessarily always talking well to each other. 
So I think that, in particular, I thought would be a huge help.
    And I think when it comes to recognizing the balance of 
what we did on the nuclear program, if I can be a little 
provocative here, what it took to effect the nuclear program, 
our efforts on sanctions and our pressure that we also brought 
to bear on the diplomatic front and, frankly, on the military 
front, to bring Iran to the table--and let's be honest, there 
were also incentives involved. We conceded on uranium 
enrichment.
    All of that, when you look at that, to bring Iran to 
negotiate, that was on something that was fundamentally a 
program that was not existential to Iran. It was very important 
to Iran, extremely important to them. But they did not have a 
nuclear weapon yet. So therefore, the nuclear weapon was not 
part of their deterrence strategy yet. Therefore, it is 
something that could theoretically be traded away at the table. 
It was something that could be negotiated, the reason why I 
focus, try to condense in my testimony, about the importance of 
existential issues, whereas something like proxies have become 
existential to Iran.
    Lebanese Hezbollah is absolutely existential to Iran to 
deter Israel, for example. Their ballistic missiles are 
something they already have, and, therefore, in order for us to 
pressure Iran to restrain themselves on their conventional 
missile program or on something like Lebanese Hezbollah is 
going to require an effort with us and our allies, frankly a 
much greater effort than it ever took for us to get them to the 
table to get to the JCPOA as much as we may not like that 
agreement.
    Again, not to be such a pessimist about it, but it is 
something to remind--it is an enormous challenge for us.
    That does not mean we do not need to do it. It is just that 
it is so important to remember that when you are faced with 
something like the missiles, like the proxies, it is essential 
for us to understand how important it is to Iran and that if we 
are going to do it, we have to bring a whole lot of force to 
bear or we have to bring incentives to bear, which is another 
question.
    Senator Menendez. I will just say, as my time has expired, 
I appreciate your naming and shaming, but I have to be honest 
with you, I do not get the sense that Iranians are going to 
stop if it is such an existential desire that they need, that 
naming and shaming is going to stop the flow.
    When we talk about incentives, I read in Ms. Dalton's 
testimony that you suggest the possibility of including Iran in 
international organizations. I am just not sure that a country 
that violates just about every international norm should be 
invited into an international organization because that doesn't 
necessarily change attitudes. If you look at Russia, they 
violated international norms, invaded Ukraine and next Crimea, 
are in Syria supporting a dictatorship that chemical bombs its 
own people.
    I am not sure that invitation to such entities, into 
international organizations, is the greatest inducement in the 
world. But I do think that pursuing the course of money to 
proxies and other entities is incredibly important.
    Thank you, Mr. Chairman.
    The Chairman.  Thank you.
    Senator Rubio?
    Senator Rubio. Thank you.
    I think we were all happy earlier this year to see American 
citizens that had been unjustly held by Iran returned, 
irrespective of the circumstances under which that happened, 
which were less than ideal. But one of them was not Robert 
Levinson, an American who has been missing now for a very long 
time.
    Since that time, we have seen in February that Iran 
arrested Baquer Namazi, whose son was arrested in October 2015. 
They were both convicted in October and sentenced to 10 years 
in prison.
    So my question is, and I would like to hear from both of 
you on this, is, in fact, Iran using unjust arrest and 
detention of American citizens as a tool of statecraft to 
ensure that it receives additional benefits from the United 
States in the future? And if so, was that incentivized by 
perhaps the circumstances surrounding the releases we saw 
earlier in the year?
    Ms. Dalton. I think that Iran sees the persistent detention 
of U.S. citizens and its own citizens at times as a source of 
leverage to achieve a broad set of objectives. At the same 
time, there is, as I mentioned earlier, a dose of pragmatism in 
the regime such that there is the possibility to broker 
negotiations to secure the release of our citizens, but 
ensuring that those negotiations happen systematically and are 
synchronized in such a way that we are not rewarding the bad 
behavior but are justly seeking the release of our citizens in 
accordance with international law and rules of the road.
    Mr. McInnis. I would certainly agree that Iran has a very, 
very long history of taking our citizens as well as citizens 
from a number of other countries as leverage points. And 
frankly, it has been part of their statecraft since the early 
1980s.
    And certainly, we have actually seen that increase since 
the nuclear deal, in my opinion. Dual nationals, in particular, 
have been the target.
    That is actually something that I had written about and 
anticipated, that Iran after the nuclear deal is particularly 
worried that the opening up--because they are afraid of 
President Obama's, from their perspective, implicit strategy 
with the deal that including Iran into the international 
community is going to start a slow change inside the regime, 
and the supreme leader is very concerned that that may actually 
happen, and so, therefore, is clamping down even harder on 
human rights as well as threatening international Iranian dual-
national businessmen, holding more Americans that visit as 
hostages as leverage chips.
    They are trying to ensure that they have as much leverage 
as possible. It is something they want to ensure that the deal 
does not create positive change inside their society.
    Senator Rubio. Let me ask about one more thing. We all saw 
recently the Boeing sale of aircraft to Iran. I find that to be 
extremely troubling. It is important to remember that earlier 
this year, Iran Air was designated for providing material 
support and services to the IRGC and its Ministry of Defense.
    When they were designated in 2011, the Treasury Department 
noted that rockets or missiles had been transported via Iran 
Air passenger aircraft and the Islamic Revolutionary Guard 
officers occasionally take control of Iran Air flights carrying 
special Islamic Revolutionary Guard Corps-related cargo.
    In addition to that, we have seen other related airlines 
like Mahan Air, they are the same or worse.
    So we have no indications that these airlines have changed 
their activities. We have no assurances that Iran is not going 
to use these Boeing planes in the same way that they have used 
other aircraft.
    I understand that some will argue it would be a violation 
of the contract. Well, I do not know where they intend to 
enforce that. What court are they going to take that to?
    But I guess given your background on Iran, when they 
receive this aircraft from Boeing, is it your view, and again, 
I would ask both of you, that we should expect to see the 
likelihood that this aircraft will be used in the exact same 
way aircraft have been used in the past by Iran Air and by 
others to assist the IRGC and other designated entities?
    Mr. McInnis. I would expect, given Iran's history with such 
aircraft, there will be some that will be used in that manner, 
and there will be some that will be used for their commercial 
purposes.
    Iran has very long use of dual use of all capabilities and 
technology that it requires. So I would be surprised if they do 
not. That would be my answer.
    Ms. Dalton. I think that this is very illustrative of the 
need going forward in the new Congress and new administration 
to chart a holistic approach to Iran such that we can sequence 
the moves that we would like to make in shoring up our 
deterrence while at the same time incentivizing behavior 
changes.
    In constructing a framework that way, you can evaluate the 
risks that you are highlighting if we are to consider certain 
incentives. Can certain commercial transactions lead to Iran 
using those products for dual use purposes in ways that are 
contrary to U.S. interests? Then perhaps in the greater context 
of our strategy, that does not make sense.
    So I would encourage the next administration, and the next 
Congress, to evaluate programming that we already have 
underway, initiatives that we have already started, but in the 
context of a grander strategy that seeks to strengthen our 
deterrence, secure our interests, and protect our allies and 
partners.
    The Chairman.  Thank you.
    Senator Cardin?
    Senator Cardin. Thank you both for your testimony.
    One of the areas that concerned me in regard to the 
oversight by Congress of the nuclear agreement was expressed in 
legislation that I referred to earlier that was cosponsored by 
many of my colleagues, and that is for Congress to understand 
where the sanction relief resources are being used by the 
Iranians.
    If they are used to enhance their economic fairness to its 
citizens, I think all of us would say that we should well 
support that type of effort. But if it is used to enhance their 
support for terrorism or to use it to advance a ballistic 
missile program, then obviously, that is a different story.
    So can you share with us how you believe the sanction 
relief resources have been used by the Iranians and whether you 
have seen any uptick or not in their other activities?
    Mr. McInnis. I think still most analysts would agree that 
the majority of the sanctions relief in a broader sense, 
especially the incoming, say, for example, oil sales and FDI, 
foreign direct investment, that has gone in, in a broad sense, 
probably the majority of that is still going into more 
nonterrorism, nonproxy, non-IRGC-related activities.
    But what we are seeing, for example, is that the IRGC is 
trying to ensure close to 10 percent of all the incoming 
foreign direct investment is going to be dedicated to their 
activities. That is something they are trying to get ensured as 
a regular percentage.
    We have seen some of these direct transfers----
    Senator Cardin. What type of investments would these be?
    Mr. McInnis. Just, for example, any type of incoming deals 
that Iran is striking with foreign companies to do investment, 
from any type of industry, auto, air, energy sector. Basically, 
IRGC is looking for its cut. It is going to get a certain cut 
of that.
    Senator Cardin. Would that come from the Iranians or would 
that come from the investor?
    Mr. McInnis. That would come from, whatever the deal is 
signed, 10 percent of it would go into IRGC funding somewhere 
within the budgetary system. The IRGC has all sorts of gray 
budget capacity to funnel money within the system.
    That is still being argued within--there is a lot of back-
and-forth happening right now in the Iranian budget about who 
is going to get what from the largess coming out of the deal.
    Senator Cardin. But, in fact, have they gotten their cut on 
these projects?
    Mr. McInnis. I do not know if they have actually finalized 
that. That is what they have been arguing for in the recent 
budget fights.
    But we also know that some of the actual transfers of money 
that have been coming in since the deal was implemented have 
actually kind of doubled the military's budget for like a 1-
year term because of the transfers that have come in from the 
one-time deals. Whether that is going to continue into 
subsequent years is undetermined.
    So basically, the IRGC is getting like a 1-year bump this 
year that is quite significant. Whether that is going to 
continue into the out-years is uncertain.
    So we are seeing a very significant influx. A lot of that, 
of course, is going into sustaining--what you would consider 
OCO funding that is going into sustaining operations in Syria 
and Iraq. How that is going to flow into building--for example, 
are they going to build a new air force, try to recapitalize 
their navy, try to build new proxies in the Arabian Peninsula 
or Africa or in South Asia? Those are questions that I am not 
quite sure yet.
    Senator Cardin. I think we all would acknowledge that prior 
to the nuclear agreement, Iran's economy was in pretty bad 
shape.
    Mr. McInnis. Yes. A serious recession, yes.
    Senator Cardin. Sanctions were really having a major 
impact.
    Mr. McInnis. Yes.
    Senator Cardin. We can certainly also acknowledge that Iran 
has been actively engaged in its proxy activities, and whether 
they could have done that with or without these resources, we 
do not know. But they are actively engaged in proxy campaigns.
    How can we learn the lesson for how we impose sanctions for 
their nuclear activities and figure out a way that we can make 
our sanctions regime on ballistic missiles and on sponsoring 
terrorism and human rights violations more effective to be 
consequential to change behavior in Iran?
    Ms. Dalton, do you want to try that one?
    Ms. Dalton. Yes, thank you, Senator. Great question.
    I think that we can certainly extract lessons learned from 
how Iran is leveraging the funding from the sanctions relief 
and apply it to future cases of sanctions, We could, perhaps 
build in off-ramps or learn from the snapback effects that were 
used in the nuclear negotiations and resulting sanctions to 
better understand, first, how money flows and operates in the 
Iranian system and then create trigger mechanisms, indicators 
that we can look for such that if sanctions relief or sanctions 
are put in place for future missile development, future proxy 
activities, that action can be taken to revoke any sort of 
relief if Iran goes down a certain pathway.
    So I think building that into the system upfront as we 
design a holistic approach would be wise.
    Senator Cardin. Thank you.
    The Chairman.  Senator Perdue?
    Senator Perdue. Thank you, Mr. Chairman.
    I want to follow the money. We had a hearing last week and 
we talked about that, but I also want to talk about the 
connection between IRGC and the money trail.
    I am very concerned--by the way, we had a question earlier, 
is the revolution dead? Well, by definition, the IRGC, it is in 
their name. Their existence depends on this being a continued, 
exportable revolution, in my opinion.
    But the IRGC, just like the PLA years ago used to have a 
significant portion of China's economy, the IRGC has up to 20 
percent to 30 percent of Iran's economy, which means they have 
an ongoing source of revenue to export and support terrorism 
around the world. And we know from the Treasury Department's 
own report, weapons of mass destruction support, support for 
terrorism, Hezbollah, Bashar Assad, militia, the Shiite militia 
just in Iraq that we know since 2005 have actually killed more 
than 500 U.S. soldiers. The Houthi rebels, the list goes on and 
on across the entire region. We know the IRGC plays an 
important role.
    The question is how can we, in a post-deal environment, use 
our economic sanction ability and our financial ability to get 
at the flow of money through the IRGC to these terrorists? The 
reason I am asking that is because the money flow, Mr. McInnis, 
I do not disagree with you, but there is still money to come. 
We are opening up economic sanctions, releasing sanctions. We 
know they have assets in other countries.
    So this money flow is not just a one-time deal. With $33 
billion in cash and gold, yes, they will get a bump this year, 
but they are going to continue to get increased availability of 
cash or spendable money for their nefarious activities.
    So my question to both of you is, how would you advise the 
next administration? With the IRGC and money flows and the 
releasing of sanctions and the opening up of business over 
there, what is our role? How can we hinder their ability to 
further support terrorism around the world?
    Mr. McInnis. Well, I think what you get to--and you are 
absolutely right that this one-time bump is a one-time event 
but they will certainly continue on.
    In thinking about the last question, I think what we are 
looking for is how you create an Iran that is certainly going 
to go through a degree of economic expansion over the next few 
years, at least according to most estimates. But how do you 
create a recession in the IRGC's economy? How do you separate 
that out?
    Senator Perdue. I am sorry to interrupt, but even before 
they have an economic renaissance, just releasing their assets 
with other countries means that there is a flow of cash coming 
to them immediately, independent of whether their economy 
grows. Is that correct?
    Mr. McInnis. Yes. And you are right to also bring up the 
PLA because actually, prior to doing the Middle East for number 
of years, I actually worked on China's security issues and I am 
familiar with the whole PLA business model concerns and that 
process of getting the PLA out of business.
    Iran at some point in time may go through the same process, 
because they are running into some of the same problems that 
China did in that.
    But I think the Iranians, there is a recognition that over 
time it is going to become a problem for the IRGC, if it is 
going to actually have this type of dynamic economy that 
integrates with the rest of the world, the IRGC eventually is 
going to have to take probably a lesser role. But I think the 
key for that--the problem with the nuclear deal that many of us 
talk about--there are many problems with it--but one of the 
biggest problems is that it is frontloaded to Iran's favor in 
that they get most of the benefits upfront. We get the benefit 
that they actually do not build a bomb throughout the entire 
period.
    But part of the reason--what you can change in that 
equation is if the frontloading doesn't actually happen in all 
the front where the business climate is not completely 
favorable at the beginning. That is where you change this 
dynamic that happened in the last 12 months or so where we go 
out there and we are encouraging the international community to 
invest in Iran, and we relax the issues of using dollars for 
business transactions for foreign companies.
    We do all these things to make it easier to invest in Iran. 
We make it so it is not so problematic if a U.S. company with a 
foreign subsidiary does business with guys--that that company 
has IRGC guys in the back room or somewhere on their corporate 
board.
    We have relaxed a lot of those rules recently. All those 
rules with the incoming administration or with rules coming 
from this body, some of that stuff can be reversed. You can 
change the frontloading. You can make it more conditional that 
that business climate and that money flow--and place the burden 
back on Iranian business that the IRGC's role and the money--
and businesses related to the IRGC, that they become a business 
burden.
    That is something that you can change, that equation, I 
believe and focus on that and make those businesses 
recessionary.
    So I think that that is something that could be looked at 
and focused on.
    Senator Perdue. I am sorry, Mr. Chairman. I am out of time, 
but could I ask your forbearance and ask Ms. Dalton to respond 
really quick?
    The Chairman.  Absolutely.
    Senator Perdue. I am sorry.
    Ms. Dalton?
    Ms. Dalton. Thank you very much.
    I think that in addition to what Mr. McInnis laid out, 
harnessing the coalition that was used to broker the JCPOA on 
approach to Iran going forward is going to be of paramount 
importance.
    The reality is that there are limits to what the United 
States can do directly vis-a-vis the IRGC. But leveraging the 
broader coalition of P5+1, perhaps even some Asian allies and 
partners, would be a broader and more holistic approach to 
addressing this problem set.
    I think that another dimension of this, thinking of 
creative ways to offset the IRGC over the long term and put 
something a little bit provocative of the table that was in my 
written testimony and would welcome further discussion on it, 
but something my colleagues and I have been discussing is, over 
the long term, at the end of the JCPOA period in 2020, the 
sanctions on an international ban on conventional arms sales to 
Iran will be lifted. Is there a future scenario in which----
    Senator Perdue. That is 5 years, right?
    Ms. Dalton. Yes, in 2020. Is there a future scenario in 
which Iran is able to divert funds to its conventional arms 
capability and away from the IRGC? As Matt has pointed out, the 
IRGC is front and center to the ideological ambitions of the 
regime. But in terms of Iran's pragmatic interest in the 
region, its power projection, its desire to have a political 
and strategic role in the region, that often can come from a 
conventional capability.
    So it is an issue in which the United States perhaps 
doesn't want to be forward-leaning on. But is it possible for 
the United States to tacitly allow for, over time, the 
development of Iran's conventional capability to offset Iranian 
investments in the IRGC, which have historically run up against 
and threatened the interests of the United States and its 
allies and partners?
    Senator Perdue. Thank you, Mr. Chairman.
    The Chairman.  Thank you.
    Senator Shaheen?
    Senator Shaheen. Thank you, Mr. Chairman.
    And thank you both for being here this afternoon.
    You both talked about Iran's operations in Syria, but I do 
not think I heard you talk about how they view the Islamic 
State. I wonder if each of you could characterize how you 
believe Iran views the Islamic State?
    Mr. McInnis. Overall, Iran views the Islamic State as 
certainly a very significant, dire, and theoretically, at 
least, existential threat.
    I think they certainly do not view it right now as an 
imminent threat, given its current state of military weakness. 
But they certainly view it as an extension of efforts from 
Saudi Arabia and, frankly, from us. I mean, they blame both us 
and Saudi Arabia for creating ISIS, and they see ISIS as behind 
terrorist cells and activities inside their own country. They 
have a growing fear of ISIS growing inside Afghanistan. And 
they are trying to build up their own security forces and new 
proxy forces and capabilities inside Afghanistan to deal with 
ISIS there, which is an interesting kind of side theater that 
is developing.
    In Syria, of course, it has been a slightly different story 
because similar to President Assad, they have cynically used 
ISIS as a good excuse to fight the rebel opposition and lumping 
all of those as terrorists. And ISIS was a convenient--and they 
frankly did not go up against ISIS much during the civil war 
over the last few years.
    But they certainly look at ISIS as a real--in 2014, it was 
a very clear threat and they are the ones that, frankly, if it 
was not for the Iranian intervention on the ground in June 
2014, it is likely that ISIS could have made it into the 
outskirts of Baghdad and the Iranian Government knows that.
    Senator Shaheen. Excuse me for interrupting, but my time is 
running.
    Ms. Dalton, do you agree with that?
    And then can I ask you both, given that, how should the 
U.S. view our relationship with Iran with respect ISIS?
    Ms. Dalton. I think that Iran definitely views ISIS as a 
significant threat to its interests in the region, a 
manifestation of Sunni extremism that is highly destabilizing.
    I think Iran, ideally, enjoys a degree of instability in 
the region. It is through that level of instability and chaos 
that it is able to use its asymmetric influence and 
capabilities most effectively. But it is not in the long-term 
Iranian interests to have the level of instability and disorder 
that ISIS has been sowing.
    I think the endgame for Iran in both Syria and Iraq is a 
pliable government that is sympathetic to Iranian interests 
that is going to push back against ISIS and like-minded groups. 
But its hedge in that is, of course, the development of Shia 
militias in both countries.
    So while there is short-term convergence with the United 
States in countering ISIS, I think Iran and the United States 
are going to be at loggerheads over the long-term trajectory 
for both countries.
    Senator Shaheen. So we should not view their efforts in 
Iraq, for example, to fight ISIS as beneficial to our efforts 
as well?
    Ms. Dalton. I think that there may be short-term 
convergence of interests, but I do not think that it should be 
part of the long-term strategic planning for either Iraq or 
Syria.
    Senator Shaheen. I think, Ms. Dalton, it was you who 
mentioned that we should have amplified information operations 
against Iran. I wonder if you could elaborate on what that 
means.
    Ms. Dalton. There are a number of ways to take this. There 
is kind of the posture that seeks to unveil Iran's at times 
inflated capabilities and influence in the region, and really 
expose it for what it is. The Iranians are quite influential 
and powerful in some ways, but they also use their own IO to 
project their power and influence and kind of knit together all 
of their capabilities, whether it is proxies, whether it is 
missile capabilities, to really project their influence.
    So there is a counter-IO strategy that the United States 
could take to unmask what Iranian intentions and capabilities 
truly are, acknowledge where they are significant and push back 
against them, but at the same time diminish any sort of 
inflation that is occurring.
    I think also there is more of a proactive approach that the 
United States could take to harness some of the nationalist 
Sunni Arab sentiment that are both at the government level and 
the popular level that are very concerned about the increasing 
reach of Iran in the region and to try to mobilize some of the 
support from the population, from the government, in support of 
a strategy that presses back against Iran.
    So the IO is kind of connective tissue, if you will, for a 
deterrence approach that the United States might take going 
forward.
    Senator Shaheen. Can I ask just a follow-up question on 
that?
    The Chairman.  Yes. Sure.
    Senator Shaheen. So do you envision, and Mr. McInnis, I 
would ask you to jump in on this as well, do you envision a 
Radio Free Europe kind of operation or are you thinking more a 
social media campaign?
    Clearly, getting information out to the people who you 
would want to influence is challenging.
    Ms. Dalton. I think there are certainly overt and covert 
elements to this. There is, inevitably, the question of how 
credible some of the overt mechanisms can be if it is coming 
directly from the United States. So I think third parties in 
the region that share similar mindsets are probably the best 
overt forms.
    Then, of course, there are the convert mechanisms as well, 
which I think we could bolster.
    Mr. McInnis. I would agree with almost all of what Ms. 
Dalton is saying. I think the Iranians are voracious consumers 
of all sorts of media, and they have extremely creative ways to 
get around pretty much anything that the government throws up 
at them. So I think that there certainly are ways that we can 
get through to the Iranians. At the same time, the Iranians are 
becoming increasingly clever in ways of getting around that. It 
is a fascinating environment to work with.
    But I do think the Iranians are very keen to hear from us. 
I think the Iranian people are. So I think it is still fertile, 
is my opinion.
    Senator Shaheen. Thank you both very much.
    Thank you, Mr. Chairman.
    The Chairman.  Thank you.
    Senator Kaine?
    Senator Kaine. Thank you, Mr. Chair. Great, great hearing 
and a lot of great questions have been asked that I will not 
repeat. I am going to get into two that I am interested in.
    Ms. Dalton, you said a minute ago that you think we really 
need to think of a holistic approach to Tehran, the areas we 
challenge, areas we work together, how do you push and not push 
too far. I am really grappling with the holistic approach to 
the region. I am struck that whether it is in this committee or 
the Armed Services Committee, we will often have a hearing on 
Iran, and we will have separate hearings on Sunni extremism or 
ISIS. I am trying to put these together a little bit.
    When I am in the region and I talk to Lebanese or Syrians 
in southern Turkey or others, they often talk about their own 
feeling that they are being crushed in a proxy war. So the 
title of this is Iranian proxies, but they talk about being 
crushed in a proxy war between Iran and Saudi Arabia, and they 
feel that that war is playing out all over the place.
    They view it somewhat as a war of two nations, and they 
view it somewhat as Sunni and Shia, and they view it somewhat 
as Arab and Persian, and they view it somewhat as economic 
competition, and they view it somewhat as monarchy versus 
Revolutionary Guard. But they kind of get personified in a 
proxy war between these two countries, neither of which are 
going anywhere, both of which are going to be there for a very 
long time.
    You used the phrase a second ago, is there a way that we 
could use Sunni nationalist sentiment against Iran, but I would 
worry that that just might continue to escalate the possibility 
of this proxy war. We did not start the proxy war. We cannot 
solve the proxy war. There is a proxy war.
    And the region is going to be very unstable as long as 
there is a proxy war between the Saudis and Iran.
    What are the prospects of, if any, for using American 
influence to try to, if not make it warm and fuzzy, at least to 
ratchet down the proxy war as a way of promoting more stability 
in the region?
    Ms. Dalton. I think that is the million-dollar question. I 
think that starting with the basics, and a new administration 
and new Congress have that political leverage and opportunity 
to do that, to engage allies and partners not just in the 
region but also in Europe and Asia in terms of what really 
matters and what it is that we want to accomplish, what are the 
outcomes that we want to achieve, and how best we can get 
there. Then working through, perhaps through some scenario-
based planning and exercises, how we can all leverage our 
comparative advantages to achieve those outcomes.
    The United States historically has been a great convener, a 
great mobilizer for those kinds of conversations, even if it is 
not at the end of the day primarily U.S. resources that are 
committed.
    So I do think there is an opportunity there to have a fresh 
conversation despite all the multilayered challenges that you 
have laid out, and an opportunity for the U.S. to exert some 
leadership.
    But I do think the stakes are stacked pretty high against 
us in terms of this cycle of escalation amongst partners in the 
region, the Sunni-Shia dimension, the Saudi- Iran regional 
balance. And I think it is trying to bring them to the table to 
look at primarily Iraq, Syria and Yemen, and how we can get to 
a sustainable, enduring outcome for those conflicts at the 
political level but also at the military level.
    And it is going to involve tradeoffs, but I think that 
having that sort holistic approach, leveraging U.S. leadership 
to bring everyone to the table at the political and military 
level, is really important.
    Senator Kaine. Let me ask a second question, and I will 
have Mr. McInnis tackle that first, but if you want to add 
something in about the proxy war between Iran and Saudi Arabia, 
I would appreciate it.
    Iran let Russia use Iranian bases to help conduct bombing 
operations in support of the Syrian Government. Traditionally, 
there has been some wariness to suspicion to hostility between 
Iran and Russia.
    Are you worried at all about Iran and Russia relationship 
growing into a more cooperative military partnership? Or do you 
think that would be an unlikely thing to have to worry about 
much?
    Mr. McInnis. I will tackle that one first.
    I think the Iranians and Russians obviously have an 
enormously difficult history, deeply suspicious of each other. 
At the same time, there is a certain marriage of convenience 
that is useful for them strategically right now. I think they 
are both very worried about the other selling each other out at 
the end, and Syria being the obvious case for that. I think the 
idea that the Russians may cut a deal with us or with some 
other power, that puts them at a disadvantage.
    At the same time, as I was mentioning in my testimony, this 
latent deterrent capacity that--Iran has spent a lot of time 
inside Syria in the last few years Iranianizing the state, 
building this kind of Iran version of Syria with the national 
defense forces, re-creating parts of the intelligence 
structures in Syria. It used to have only one guy in Syria and 
that was Assad. It did not have anything else.
    Now it has a lot of the state, not all of it, but it has a 
large portion of the state that is really kind of under Iranian 
influence on the ground, which Russia really doesn't have. 
Russia has a lot of conventional power on top but Iran has 
built kind of a deep state, like it has been doing in Iraq for 
all these years.
    I think Iran has its own version of a veto over whatever 
Russia wants to do inside Syria. So you have this very weird 
Russia-Iran veto over each other in Syria that is really kind 
of interesting.
    So I think, at the same time, Russia doesn't necessarily 
want to manage all the Middle East. Iran has bigger plans for 
the Middle East than Russia does. So I think this is where you 
end up in a situation where I am very concerned about where 
Russia wants to go in the region. I do not know how Russia is 
now going to factor into Iran's deterrence strategy--i.e., does 
any type of confrontation we or the Saudis or the Israelis have 
with Iran in the future, does that implicitly mean that Russia 
is going to come in and back up Iran? Does that trigger a 
Russian intervention or Russian threat of force if we or the 
Saudis or the Israelis get into it with the Iranians? I do not 
know. That is a very big question.
    Senator Kaine. My time has expired, so I think I should 
defer to Senator Markey at this point. But thank you.
    The Chairman.  Thank you.
    Senator Markey?
    Senator Markey. Thank you. I want to follow up on Senator 
Kaine.
    The great fear, obviously, that Israel has is that there is 
going to be from Tehran through Baghdad, through Damascus into 
Lebanon and Hezbollah, this greater threat to Israel, which is 
going to be created. The Sunni, Saudi Arabia, they have a fear 
that through Baghdad, through Tehran, through Damascus, it is 
going to be a greater threat to them.
    So we have this thing that is developing. It can be dealt 
with realistically or we can just step back and wait for the 
whole dynamic to unfold. So we have a choice here as Americans 
to kind of anticipate the inevitable and try to get into this 
underlying pathology with an intervention in a timely fashion.
    So we know that going back to the early 1980s that the 
Iranians and the Russians were the partners of Assad's father 
because the naval base was up in their hometown, the Assad 
hometown. So we know that is going to be a driving force for 
the Russians and for the Syrians.
    And we can see that until that is completed, the Russians 
and Iranians are going to partner with Hezbollah to help Assad 
finish the job, not just in Aleppo but in the other cities 
where the Sunni moderates remain, and that it is more likely 
than not that they will be successful in accomplishing that.
    So I guess my question to you is, knowing that, or 
anticipating that, and knowing that it is highly unlikely that 
Assad is going to go to the International Criminal Court, and 
that we have to just deal with this realistically, what would 
you now say to American policymakers about what the United 
States should be specifically saying to the Russians at this 
point before the mission is completed for the Shia inside 
Syria? What would you say are the words that should be spoken 
to Russia the looks like an understanding that we can reach 
that kind of de-escalates before there is a rapid escalation 
that allows the Sunni-Shia rivalry to just spiral out of 
control?
    Ms. Dalton. To first narrowly address the problem of the 
Iranian proxy influence in Syria and more broadly in the 
threats it presents to Israel and the United States and more 
broadly looking at the Syria problem set, when it comes to what 
specific steps the United States and its allies and partners 
can do, I think, at a military operational level, doing more to 
interdict and constrict supply lines to IRGC-backed groups in 
the region, the Israelis are obviously closely tracking this, 
but the more that we can do to work together with other 
partners in the region as well----
    Senator Markey. To interdict?
    Ms. Dalton. The supply lines to IRGC-backed groups that are 
operating in Syria and more broadly in the region. I think we 
can step up our efforts to do that such that it undermines the 
potential for there to be a long-standing IRGC----
    Senator Markey. Do you think that can be successful?
    Ms. Dalton. I think that there is----
    Senator Markey. What do you think the probability of that 
being successful in the future is?
    Ms. Dalton. I think that there is likely more that can be 
done.
    Senator Markey. No, I am asking what do you think the 
likelihood is of it being successful at the end of the day?
    Ms. Dalton. I think that there is likely to be some 
continuing presence as a hedge and protective force for Assad 
in the form of IRGC-backed groups in Syria but that we could 
mitigate the reach and power of those groups by interdicting 
and cutting off some of the supply lines.
    Senator Markey. Right. But do you see a negotiation that 
begins? When does that begin, in your mind?
    Ms. Dalton. Yes. I mean----
    Senator Markey. Or does it begin?
    Ms. Dalton. So there is the military dimension operational 
things that we can do. I think at the political and diplomatic 
level that there are markers that the United States should set 
down very clearly in terms of the outcome and end state for 
Syria that limits the influence and long-term presence of IRGC-
backed groups in Syria.
    Senator Markey. Okay.
    Mr. McInnis, how would you deal with this in a way that 
anticipates what looks like it is unfolding to be? And when do 
you start the process of trying to negotiate protections for 
the Sunnis politically inside of that country as the Shia 
continue their inextricable march? When do you begin the 
process of protection for the Sunni?
    Mr. McInnis. I think, in some ways, there are a lot of 
parallels at this stage in a more condensed time frame to what 
has been happening in Iraq over the last 10 to 15 years where I 
think you are going to be dealing with a situation where 
protecting areas--where what has happened with the IRGC and 
building up these capabilities like the NDF and in some ways 
there is a certain degree--I would not say quite sectarian 
cleansing that has been going on in Syria, but creating what 
people expect to be these zones of control or zones of 
influence that will probably be some form of whatever 
settlement, if we ever get to that point.
    But I think the Iranians have really staked a lot of their 
hope or what they are going to fight for in any type of 
settlement is that they are able to maintain these new forces 
that they have built as part of the Syrian Government's 
apparatus, and I am not really sure how you unhinge that, how 
you leverage that out. I think really----
    Senator Markey. Is it better done sooner than later in the 
process?
    Mr. McInnis. It is certainly better done sooner than later. 
I think the irony is that you end up in a situation similar to 
what we deal with in the Iraqi dynamic where you find yourself, 
as horrible as it sounds, you find yourself that the Syrian 
Government would rather not have to depend on all these Iranian 
capacities, and I think any efforts that can be done as you 
start forming some type of new reconciliation government, if 
you can call it that, that does not depend so much on these new 
capabilities that Iran has built----
    Senator Markey. Do you think that is likely?
    Mr. McInnis. I think it is going to be very tough.
    Senator Markey. Okay. Then let's talk about it in that 
context, if you could.
    Mr. McInnis. Could you say that again?
    Senator Markey. I said let's deal with it in the context of 
what is likely to happen. It is always better in life to try to 
start out where you are going to be forced to wind up anyway 
because it gets prettier that way. You can try to work it 
through and just try to be realistic about what is going to 
happen rather than----
    Mr. McInnis. I think as much as you can build whatever 
international support for whatever settlement is there that is 
dependent as much as possible on local groups, local forces 
that are Syrian-based, and minimize as much as possible what is 
coming in that are internationally sponsored, basically 
nonforeign sponsored groups and militias that are operating 
there, as much as you can do that, that would be the best I 
could hope for.
    Senator Markey. I guess my hope would be that the sooner we 
can start to be realistic about what is going to be needed to 
help the Sunni population in that country, so that they are 
given places where they can return from Lebanon, return from 
Jordan, where they can be given some guarantees of being able 
to coexist under some tension-packed relationships, but what is 
going on in some of the cities in Iraq right now, so that we 
are beginning to think in those terms rather than allowing for 
a bloodletting to just continue on indefinitely where we are 
contributing to the refugee and the internally displaced 
persons problem without having really anticipated what looks 
like is unfolding.
    If you agree with that--my time has expired, but I thank 
you both for your expert advice.
    Thank you, Mr. Chairman.
    The Chairman.  Thank you.
    And, Senator Cardin, thank you for a very productive 2 
hours. I think we have closed out the year in a good way.
    Our witnesses have been outstanding. We thank you both for 
your testimony today.
    We are going to continue to have written questions through 
the close of business Friday. If you could, fairly promptly, 
respond to those questions, we would appreciate it.
    The Chairman.  Thank you for your service to the country 
and for being here today and helping us with this.
    Again, with that, the meeting is adjourned.
    [Whereupon, at 4:30 p.m., the hearing was adjourned.]

                              ----------                              


             APPENDIX 1.--Text of the Agreement and Annexes

Joint Comprehensive Plan of Action
    http://www.state.gov/documents/organization/245317.pdf

                                Annexes

Annex I.--Nuclear Related Committments
    http://www.state.gov/documents/organization/245318.pdf
Annex II.--Sanctions Related Committments
    http://www.state.gov/documents/organization/245320.pdf
Attachment 1 to Annex II
    http://www.state.gov/documents/organization/245319.pdf
Annex III.--Civil Nuclear Cooperation
    http://www.state.gov/documents/organization/245322.pdf
Annex IV.--Joint Commission
    http://www.state.gov/documents/organization/245323.pdf
Annex V.--Implementation Plan
    http://www.state.gov/documents/organization/245324.pdf

                        JCPOA Contingent Waivers

    http://www.state.gov/e/eb/rls/othr/2015/248320.htm

                                  [all]