United States Institute of Peace

The Iran Primer

Paper: Change or More of the Same for Iran?

      On March 26, the Woodrow Wilson Center for International Scholars convened a panel of four experts to discuss prospects for change in Iran during the next five years. The Middle East Program then published a compilation of short papers based on their presentations. The following are excerpts.

Shaul Bakhash (moderator)
Clarence J. Robin Professor of History, George Mason University
           Rouhani faces formidable obstacles in his cautious, measured attempt to reorient Iran’s foreign policy, to reintroduce sensible management of the economy, and to restore to Iranians some measure of political freedom. Critics on the right are already sniping at his attempt to reach an agreement over Iran’s nuclear program with the P5+1countries. The judiciary and the security services deliberately seek to undercut his political liberalization measures and have blocked the release of a larger number of political prisoners. Any attempt to curtail the role of parastatal organizations in the economy, to reduce subsidies, and to attract foreign investment to Iran will be firmly resisted. It remains to be seen whether this time, a mildly reformist president will manage to carry his agenda to completion, or whether the pattern of the past will be repeated and a reformist president’s initial successes will be undercut or reversed by a conservative reaction.
Bernard Hourcade
Global Fellow, Wilson Center; and Senior Research Fellow Emeritus, Centre National de la Recherche Scientifique, Paris, France
            The role of political factions changed after Rouhani developed political consensus among different factions. The cabinet is de facto a coalition of several factions supporting the new government and the policy of dialogue under the leadership of the Supreme Leader. Within the current context of this complex national unity government, further complicated by issues of sanctions and the potential nuclear deal, the minority of Islamist hardliners (mainly the Resistance Front/Paydari) have become the new real opposition.
            These Islamic “Tea Parties” are very active but comprise no more than one-third of the current Majles. They are supported by some preeminent policymakers, clerics, and members of the Pasdaran and Basij, and they have strong networks, efficient newspapers, and media connections. Their criticism of the negotiations between Iran and the P5+1, specifically on human rights and Syria, remains within the framework of legitimate opposition in any republic. They are a traditional “democratic” opposition and currently do not have the clear support of the Supreme Leader, who trusts President Rouhani.
            The core—or the weak center—of the current parliament is made up of “independents.” They are local MPs but also policymakers who do not want to support any radical faction (reformist or radical Islamist). In the political context of 2012, choosing this political path was a way to oppose the Islamist hardliners (Resistance Front/Paydari) and even the United Front of Conservatives (Motahed) majority, a group close to the Supreme Leader. Most of them strongly support the new policies of “moderation” and dialogue.” Both groups are open to globalization but also linked to the Islamic cultural values—and political networks—of the Islamic regime. They are good representative of the new middle bourgeoisie.
            The main question at stake in the next parliamentary elections will be the emergence—or not—of a political group able to sustain the current imposed consensus supporting the international opening of Iran. A positive strong majority supporting the new policy is necessary for the new economic and political emergence of Iran and to give the international community confidence to lift economic sanctions following political agreement on the nuclear issue.
Bijan Khajehpour
Managing Partner, Atieh International
            Iran is at an important juncture in its economic development. The positive outlook of sanctions relief and a number of reasonable economic and monetary policies have the potential to return the country to a positive economic outlook. However, one should not expect a fast-paced economic recovery, not only because the current economic crisis is very deep, but also because the social and political consequences of fast-paced economic growth would not be manageable in a political constellation like Iran’s. In other words, economic recovery should be managed in a way that does not lead to a new wave of populism that can feed itself from disappointed social classes. 
            All indications show that the new government understands how to draft and implement sustainable policies; however, the success of these policies will also depend on continued sanctions relief and a gradual normalization of Iran’s relations with Western powers.
Roberto Toscano
Former Public Policy Scholar, Wilson Center; President, Intercultura Foundation; Former Italian Ambassador to India, 2008-2010; Former Italian Ambassador to Iran, 2003-2008
The Optimist Perspective
            Among Iranian citizens, there is a very high margin of convergence on the goal of attaining the status of “normal country”—meaning a country that is not isolated, is not considered a pariah and a threat, is modern economically, and is respected politically. At the same time, there is also the awareness that such a goal cannot be attained without normalizing relations with the United States. In Iran, there are many reasons for grievance against Washington (from the 1953 coup against Mohammad Mossadeq to the present sanctions), yet what strikes any visitor to Iran, and especially American visitors, is that there is no widespread anti-Americanism, but, rather, a generalized attitude of positive interest and even friendliness.
            The nuclear issue, which was the main stumbling block to the normalization of relations with the United States and with the world, is turning out to be a fundamental step toward that goal. The main obstacle is now the most promising occasion.
The Pessimist Perspective
            The president of Iran is actually more of a prime minister (in a presidential type of system) than a president, since the real head of state and government is the Supreme Leader. If it is true that Supreme Leader Ayatollah Khamenei is allowing and supporting Rouhani’s actions, there are also signals that he did not sign a blank check but reserves the right not only to oversee but also to curtail and even stop, if needed, the whole process. There is nothing new in this: Khamenei both allowed and limited, and in some cases stopped, very different political formulas that he thought were necessary at a given stage in Iran’s politics—from Rafsanjani’s normalization of the state and economy to Khatami’s reformism to Ahmadinejad’s populism.
            Khamenei is allowing movement but remains ready to hit the brakes. In the meantime, he is sending out warning signals not to go too far and also not to abandon some fundamental “identity markers” for the Islamic Republic. Such markers include opposing the release of Mir Hossein Mousavi and Mehdi Karroubi and artificially reviving the Holocaust issue (highly damaging for Iran and highly unpopular within Iranian public opinion) in order to mark the limits of normalization with the United States and also to shift to a more moderate line on the Israeli-Palestinian issue.
Robin Wright
Wilson Center-USIP Distinguished Scholar
            Iran has made a strategic recalculation of its foreign policy because the nuclear deal is in many ways about a lot more than just the nuclear deal. It’s really about securing the Islamic Republic’s future.
            First, the strategic recalculation reflects changes in the regional balance as well as the U.S. role in the Middle East and South Asia. The Iranians now believe a Salafi circle is surrounding them, which has changed their thinking in very fundamental ways. They no longer see the United States as the threat or the challenge to their interest. They now see the United States as, in some ways, a country with which they have common national security concerns.
            The second reason that Iran is in the midst of a strategic recalculation relates to its economy. Tehran’s mismanagement, corruption, and the growing economic gap motivate Iran even more than economic sanctions do.
            The third reason that Iran will continue to reach out to the foreign community—and to a lesser degree to the United States—is because Iran believes it is strategically lonely. Iranians think they are a minority ethnically on every single border.
            The fourth reason for this opening to the outside world is demography. The majority of Iranians have now been born since the revolution; the majority of voters have been born since the revolution.
            The fifth factor is that their goals are fairly realistic. Iran now thinks in terms of breaking sanctions, not ending them.
            Finally, the biggest question is whether the Supreme Leader, who has ultimate power in Iran’s bifurcated political system, is really on board. He has so far allowed the process to continue. The negotiating team gives him very detailed descriptions of discussions with the world’s six major powers. There are reportedly some issues he cares about, while on others he is not as deeply involved.
            The bottom line is that there is a genuine prospect for a nuclear deal, but probably with real limits. Iran’s goal is not to improve relations with the United States. Its goal is to better its place in the world, improve the economy, and create an enduring following. Iran’s next agenda, after a nuclear deal, may be bettering relations in the Arab world. Tehran is deeply worried about the growing Shi’ite-Sunni divide, which is arguably deeper than at any point since the original schism in the 7th century, in part because it ripples globally. In the past, tensions have been local or regional, but now the divide spreads right across the Islamic world. And the Iranians want to prevent what they think will isolate them even further than they are now.
Click here for the full text.


Report: Low Confidence in Justice System

            Iranians have low confidence in their justice system, according to a new World Justice Project study. The Islamic Republic ranked 82 among 99 countries on The Rule of Law Index 2014, which drew on more than 100,000 household and expert surveys worldwide. Iranian citizens in Tehran, Mashhad and Isfahan participated in the study.

            The index is based on eight different factors: constraints on government powers, absence of corruption, open government, fundamental rights, order and security, regulatory enforcement, civil justice and criminal justice. Out of seven countries surveyed in the Middle East, Iran ranked last in four categories. The following are excerpts from the report.

Constraints on Government Powers
Assume that a high-ranking government officer is taking government money for personal benefit. Also assume that one of his employees witnesses this conduct, reports it to the relevant authority, and provides sufficient evidence to prove it. Assume that the press obtains the information and publishes the story. Which one of the following outcomes is most likely?
The accusation is completely ignored by the authorities         18%    
An investigation is opened, but it never reaches any conclusions      48%    
The high-ranking government officer is prosecuted and punished (through fines, or time in prison)     35%
Absence of Corruption
Corruption exists in all countries and societies in some form or the other. How many of the following people in Iran do you think are involved in corrupt practices?
Officers working in the national government     40%    
Officers working in the local government           39%    
Members of Parliament/Congress           31%    
Judges and Magistrates      40%    
The police     33%
Open Government
When talking to people about their local government, we often find important differences in how well local authorities perform their duties. Could you please tell us how well or badly you think your local government (Metropolitan, Municipal, or District administration) is performing in the following procedures?
Providing citizens information about the government expenditures           45%
Consulting traditional, civil, and community leaders before making decisions      34%
Providing information in plain language about people’s legal rights, so that everybody can understand them   39%
Providing effective ways to make complaints about public services41%
Providing effective ways to handle complaints against local government officials34%
Order and Security
How safe do you feel walking in your neighborhood at night?
Very safe and safe    65%
Unsafe and very unsafe      35%
Regulatory Enforcement
Please assume that the government decides to build a major public works project in your neighborhood (such as a railway station or a highway), and assume the construction of this public works project requires the demolition of private homes in your community/neighborhood. How likely are these homeowners to be fairly compensated by the government?
Very likely and likely         65%
Unlikely and very unlikely            35%
Civil Justice
Please tell us how serious the following problems are in civil and commercial courts in the city where you live? (10 means a very serious problem):
Duration of cases (they take too much time)       6.2
Inefficient enforcement mechanisms (judgments are difficult to enforce in practice)          3.9
Lack of enough judges or court personnel          4.4
Lack of adequate resources to do the job           2.9
Lack of adequate selection or training of judges and clerks   6
Lack of deterrents to prevent frivolous litigation          3.3
Inefficient alternative dispute mechanisms to resolve disputes outside the courts           4.8
Corruption of judges and judicial officers (they don’t move the cases unless the parties bribe them)     3.6
Insufficient monetary compensation (pay) for judges and court officers       4.1
Lack of mechanisms to track the efficiency of the courts          5.3
Lack of independence of the judiciary from the government’s power           4.8
Criminal Justice
The following question aims at identifying the main problems faced by the criminal investigation system in your country. On a scale from 1 to 10 (with 10 meaning a very serious problem, and 1 meaning not a serious problem), please tell us how significant are the following problems for the criminal investigative services (prosecutors, investigators, judicial police officers, etc.) in the city where you live:
Lack of effective intelligence systems to support criminal investigators       4.4
Lack of proactive investigation methods, such as undercover operations    3.9
Deficient mechanisms to gather information and analyze evidence   5.1
Deficient systems to protect witnesses and whistle-blowers   5
Deficient systems to exchange information between criminal investigative service agencies       4.2
Lack of enough criminal investigators     3.2
Incompetence of criminal investigators   5.4
Lack of technology and adequate resources       5.1
Lack of independence of prosecutors (unable to act against powerful government officials or private parties)           8.9
Corruption of investigators or judicial police    6.4
Corruption of prosecutors 5.1
Excessive length and use of pre-trial detention 6.5
Click here for the full report.

US and Saudi Arabia: Differences on Iran

Interview with David Ottaway by Faris Al Sulayman

What came out of President Obama’s trip to Saudi Arabia and discussions on pressing issues of mutual concern, especially on Iran nuclear talks?
           Obama and King Abdullah agreed that their shared goal is to prevent Iran from gaining a nuclear weapons capability. But Saudi Arabia is perhaps more concerned about the implications of improved U.S.-Iran relations if a nuclear agreement is reached. The Sunni kingdom is worried about a tilt in U.S. foreign policy toward Shiite Iran at the expense of Saudi Arabia and the other Sunni sheikhdoms. Obama has said that he is willing to repair the U.S.-Iran relationship. But he has not spelled out what this might mean in practice and what other issues the two countries could cooperate on.
     Washington and Tehran were holding secret talks for a year starting with President Mahmoud Ahmadinejad then under President Hassan Rouhani. The Obama administration had not shared the content of those discussions with its Arab allies, which has raised enormous suspicions in the Gulf about U.S. intentions for Iran.
     President Obama probably found it difficult to provide the kind of assurances that the Saudi leadership is seeking on Iran and nuclear negotiations.
What are the basic differences between the United States and Saudi Arabia on Iran?
            The United States and Saudi Arabia appear to have different visions for solving the Iranian nuclear dispute. Saudi Arabia, much like Israel, wants Iran to relinquish its uranium enrichment capabilities or at least cap enrichment at 5 percent – far below weapons grade, or 90 percent. Riyadh also wants Iran’s existing stockpile of 20 percent enriched uranium to be shipped out of the country or turned into a form that cannot be used to fuel a weapon. But the United States and the other five major world powers negotiating with Iran – Britain, China, France, Germany and China – may be open to allowing Tehran to keep limited enrichment capabilities.
     Riyadh also wants Washington to take a much more aggressive role in ending President Bashar Assad’s rule in Syria. Damascus is Tehran’s closest ally in the Middle East, so the main battle ground between Saudi Arabia and Iran is Syria. Riyadh is keen on the United States providing more sophisticated arms — anti-aircraft missiles in particular—to opposition forces.
            Washington and Riyadh also differ in their strategic approach to the Syrian conflict. Tehran has reportedly invested millions of dollars in Syria’s economy and provided training and arms to its army. So Saudi Arabia’s involvement in Syria is part of a wider effort to curb Iranian influence in the Sunni Arab world. The Sunni kingdom seems dedicated to rooting out the Alawite regime as a way to cut off Iran.
If the world’s six major powers and Iran reach an agreement that allows Tehran to continue enriching uranium, might Riyadh pursue its own nuclear program?
            Saudi Arabia is further developing its relationship with Pakistan, which became the world’s first Muslim nuclear power in the early 1970s. Riyadh has already built a new center for medium range missiles, and it has a new generation of Chinese missiles. Saudi officials have also been speaking with Chinese military and political leaders.
           If Tehran sprinted towards a nuclear weapons capability, Riyadh would likely call on Islamabad to provide warheads for those missiles – shortening the process of becoming a nuclear power. But Saudi Arabia is highly unlikely to enlist Pakistani help unless Iran pushes its program forward.

 Military Balance

How are Saudi Arabia’s policies influenced by its relationship with the wider Islamic world? 
           First, Saudi Arabia sees itself as the religious leader of the Sunni Arab world. But it is increasingly trying to be the political leader because it has wherewithal to spend money on helping its allies. Saudi leaders feel vindicated by the failures of the Arab spring, and they would like to assert their political and financial weight in the Arab world. The problem is that they have little military throw weight. Saudi Arabia still depends on the United States for its military and security apparatuses and it has a limited ability to project force outside its borders.
Oil Balance

David Ottaway is a senior scholar at the Woodrow Wilson International Center for Scholars.
Faris Al Sulayman was a research assistant at the Woodrow Wilson International Center for Scholars from 2013-2014.
*Estimated spending, includes US Foreign Military Assistance via IISS
** Based on “The Gulf Military Balance” report by Anthony Cordesman and Bryan Gold. Click here for Cordesman’s chapter on Iran’s conventional military. Also see The International Institute for Strategic Studies’ annual assessment of worldwide military capabilities.


EU for Iran Role in Syria Diplomacy, Greater Engagement

            On April 3, the European Union Parliament passed a resolution calling for an Iranian role in Syria diplomacy and greater E.U.-Iran engagement. Parliament also called on Tehran to address its human rights record and comply with international obligations. The following are excerpts from the resolution.

On the nuclear issue
1.   Welcomes the Geneva interim agreement between the E3/EU+3 and Iran on Iran’s nuclear programme; considers it vital that all parties continue to engage constructively in the negotiating process so that the final comprehensive agreement can be concluded within the agreed timeframe;
2.   Stresses that there can be no alternative to a peaceful negotiated solution that addresses the international community’s concerns regarding the exclusively peaceful nature of Iran’s nuclear programme and regional sensitivities as well as Iran’s security sensitivities;
3.   Welcomes the decisions taken by the Council at its meeting of 20 January 2014 with a view to implementing the Joint Plan of Action, in particular the provisions on partial sanction relief; stresses the crucial importance of reliably monitoring Iran’s implementation of its commitments under the Joint Plan of Action; believes that, once a comprehensive agreement ensuring the exclusively peaceful nature of Iran’s nuclear programme is reached, nuclear-related sanctions against Iran should be gradually removed;
On prospects for EU–Iran relations
4.   Stresses that more constructive relations with Iran are contingent on progress in the full implementation of Iran’s commitments under the Joint Plan of Action; hopes that the progress in the implementation of the Joint Plan of Action and in the negotiations for the Geneva agreement will pave the way for more constructive relations between the EU and Iran, including as regards issues of regional concern such as the civil war in Syria and the fight against all forms of terrorism and its causes, but also in areas such as economic
development, trade agreements, the rule of law and the promotion of human rights;
5.   Calls on the European External Action Service (EEAS) to carry out all the preparatory work for the opening of a Union delegation in Tehran by the end of 2014; strongly believes that this would be an efficient tool for influencing Iranian policies and would also support the dialogue on issues such as human and minority rights;
10. Calls for the EU to pursue a more independent policy towards Iran, while coordinating with allies and partners;
On regional issues
11. Considers that Iran should use its considerable influence in Syria to stop the bloody civil war and calls on Iran’s leadership to adopt a constructive role in the international efforts to find a solution to the Syrian crisis; considers that Iran should be involved in all discussions to that end, provided that it shows commitment to finding a diplomatic solution to the crises in Syria and in the region;
12. Considers that greater engagement between the EU and Iran on the basis of credible implementation of the Joint Plan of Action and, in the future, of the comprehensive agreement, could be beneficial in terms of stabilising the situation in the Middle East; encourages the EU, in particular, to facilitate dialogue between Iran and members of the Gulf Cooperation Council;
On human rights
14. Welcomes the release of several prisoners of conscience in Iran, including the human rights lawyer and Sakharov Prize winner Nasrin Sotoudeh, and calls on the Iranian authorities to release all imprisoned human rights defenders, political prisoners, trade unionists and labour activists, and those detained after the 2009 presidential elections; notes with interest President Hassan Rouhani’s initiative of formulating a Charter of Citizens’ Rights; expresses continued grave concern, however, regarding the human rights situation in Iran, in particular the widespread allegations of torture, unfair trials –– including of lawyers and human rights defenders – and impunity for human rights violations; expresses alarm with regard to the high number of executions in 2013 and 2014, including of minors; notes that most of the 2013 executions were carried out during the last five months of the year; condemns the restrictions on freedom of information, freedom of association, freedom of expression, freedom of assembly, freedom of religion, academic freedom, freedom of education and freedom of movement, as well as the repression and discrimination on the basis of religion, belief, ethnicity, gender or sexual orientation that persist, inter alia against the Baha’i community, Christians, apostates and converts;
15. Takes the view that the Charter of Citizens’ Rights should comply fully with Iran’s international obligations, particularly as regards non-discrimination and the right to life, strengthening the prohibition of torture, ensuring full freedom of religion and belief, and guaranteeing freedom of expression, which is currently restricted by the vaguely formulated provision on the ‘national-security-related offence’;
16. Calls, therefore, for the EU to mainstream human rights in all aspects of its relations with Iran; believes that a high-level and inclusive human rights dialogue with Iran should be part of the future policy framework for bilateral EU–Iran relations; calls for the EU to start a human rights dialogue with Iran that includes the judiciary and security forces and establishes clearly defined benchmarks against which progress can be measured; calls for the EU to support fully the work of the UN Special Rapporteur on the situation of human rights in the Islamic Republic of Iran, and calls on Iran to grant him an immediate and unconditional entry visa; encourages UN High Commissioner Navi Pillay to take up the Iranian authorities’ invitation to visit Iran; calls on Iran to declare a moratorium on the death penalty;
Click here for the full resolution.

Treasury’s Cohen: Sanctions Update

            On April 2, Treasury Under Secretary David Cohen briefed the Senate Subcommittee on Financial Services and General Government on Iran sanctions. "Today, Iran stands isolated from the global financial system with slashed oil revenues, an eroded currency, and a severely weakened economy," reported Cohen. The following are excerpts from his testimony.

Iran Sanctions Program
Our unprecedented sanctions on Iran have led the way in demonstrating the power and efficacy of our financial measures.  
From the outset of the Obama Administration, we have pursued a dual-track strategy that paired an offer to Iran to rejoin the community of nations if it addresses the international community’s concerns over its nuclear program with increasingly powerful and sophisticated sanctions if it continued to ignore those concerns.
When Iran initially chose another path, we responded by crafting and implementing the most comprehensive, powerful, and effective set of sanctions in history.
Today, Iran stands isolated from the global financial system with slashed oil revenues, an eroded currency, and a severely weakened economy. 
Our oil, financial, and trade-based sanctions helped drive Iran into deep recession. Since 2011, oil sanctions imposed by the EU and the U.S. have cost Iran over $100 billion in lost sales.  Last year, Iran’s economy contracted by six percent and is expected to perform badly this year as well.  Its currency, the rial, has lost about 60 percent of its value against the dollar since 2011.  And its inflation rate is about 30 percent, one of the highest in the world.
This enormous pressure on the Iranian economy did not come about overnight.  We have worked side-by-side with Congress to craft sanctions that target Iran’s key sources of economic strength.  We maximized the impact of these sanctions through TFFC’s robust and persistent engagement with foreign governments and the private sector.  Working alongside our interagency partners, we leveraged our in-house intelligence component, OIA, to identify Iranian pressure points.  And then OFAC took action against illicit actors and their financial networks by targeting them with powerful sanctions. 
This has not been a simple task.  In all, TFI enforces a sophisticated and complex regime of sanctions on Iran that encompasses 10 statutes, 26 E.O.s, and 4 United Nations Security Council Resolutions.  We supplement these tools by issuing public guidance, licenses that advance U.S. objectives, and advisories warning of concerning trends and practices.
Although our sanctions have proved to be incredibly potent, we have not imposed sanctions for sanctions’ sake.  All along, the goal of our sanctions has been to induce a shift in the decision making calculus of the Iranian government and to build the necessary leverage for serious negotiations about its nuclear program. 
We are now in the midst of those negotiations.  In the Joint Plan of Action (JPOA) that went into effect in late January, Iran agreed to take important steps to halt the advance of its nuclear program in exchange for limited, targeted, and temporary relief for six months.  And as Iran has implemented its commitments to date, we have worked to fulfill our own.     
Even as we now seek to negotiate a comprehensive solution over Iran’s nuclear program, the core architecture of U.S. sanctions—especially our potent oil, financial and banking sanctions—remains firmly in place.  And over the remaining four months of the JPOA period, we will continue to vigorously enforce these sanctions as well as the broad array of sanctions targeting Iran’s human rights abuses and its support for terrorism. 
Global Counter-Terrorism Program
Over the past 12 years, OFAC has designated more than 800 individuals and entities under our counterterrorism sanctions program.  In 2013, we designated 87 individuals and entities with the aim of disrupting and degrading some of the most dangerous terrorist threats to our country, including al-Qa`ida in the Arabian Peninsula (AQAP), Lashkar-e Tayyiba, the Haqqani Network, and the Iranian Revolutionary Guards Corps Qods Force.
Beyond the blocking of assets, a Treasury designation exposes terrorists’ activities publicly, drawing them out of the shadows and alerting financial institutions and foreign governments to their nefarious activity.  It also encourages corresponding actions from counterterrorism partners and the United Nations.  But most importantly, the designations disrupt and degrade the finances of terrorist groups as those designated will never again be able to openly access the international financial system.
Click here for his full testimony.

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