Contrary to the many naysayers, US
sanctions against Iran are being felt at every level of Iranian society. More
importantly they are slicing directly into the Mullah Regime.
Those who doubt the efficacy of the sanction
need to look at the bald statistics. Iran’s ability to export gas and oil is at
its lowest pitch since 2009. President Trump’s latest decision to curtail
exemption waivers will further ratchet up the pressure on Iran’s stricken
economy, which is already showing signs of serious contraction. This is
confirmed by an annual statement by the World Bank, which stated that Iran’s
‘economy is expected to contract by 1.4% on
average between 2017/18-2020/21, experiencing a fall in exports and consumption
on the demand side and a contraction of the industry sector on the supply
side.’
The World Bank’s
overview also predicted that inflation will rise ‘above 30% in the coming years,
as inflationary expectations spiral and consumer sentiment falls leading to
once again a period of stagflation for Iran.’ The IMF also supports the bleak outlook. Its latest World Economic
Outlook states that ‘Prospects for 2018–19 were marked down sharply for Iran,
reflecting the impact of the reinstatement of US sanctions.’ This comes on the
heels of assessments that 34% of Iranians are now living in absolute poverty.
The truth is that Iran is
buckling under the iron ring fence of 21st century sanctions that
are both all-encompassing and ‘smart.’ President Rouhani has repeated his
assertion that Iran ‘will evade’ the sanctions, but increasingly he cuts a
deluded figure, in denial at the scale of US methods and their scope.
Of course, the US could
have placed blanket bans merely on oil and gas but the ‘Trump Doctrine’ - as
articulated in Secretary of State Mike Pompeo’s remarks in October 2018 -
called for a far more complex array of sanctions. Pompeo argued that ‘corruption goes all the
way to the top. Iran’s supreme leader, Ayatollah Ali Khamenei, has his own
personal, off-the-books hedge fund called the Setad, which is worth $95
billion. That untaxed and ill-gotten wealth, often earned by expropriating the
assets of political and religious minorities, is used as a slush fund for the
IRGC. In other words, Iran’s leading holy man captains the kind of plundering
characteristic of Third World strongmen.’
Therefore, the decision
was made to go after the wealth of individuals, as well as exports. Moreover
Pompeo’s comments of last October showed that the Trump administration had a
plan to increase the pressure on Iran with a rolling agenda of sanctions.
Pompeo’s thinking demonstrated this when he said ‘Iran’s leaders—especially those at the top
of the IRGC, such as Qasem Soleimani, the head of the Quds Force—must be made
to feel the painful consequences of their violence and corruption. Given that
the regime is controlled by a desire for self-enrichment and a revolutionary
ideology from which it will not easily depart, sanctions must be severe if they
are to change entrenched habits.’
This plan came to
fruition last week, when the US designated the IRGC as a terrorist
organisation. It is worth remembering that the IRGC has its tentacles deep
in Iran’s business sector and is reputed to control approximately 20% of Iran’s
economy. Behnam Ben Talebu, a senior
fellow at the US Foundation for Defense of Democracies said that the new
proscription ‘enhances Washington’s ability to punish those who provide
material support to the IRGC...banks, businesses, and other financial
institutions will have to tread even more carefully if they continue to
transact with Iran.’
With the regime and its
apparatus firmly in its sights, the US appears to be intent on neutering Iran’s
ability to wage terror and pursue its WMD programme. This week Pompeo said
‘We’ve made clear our seriousness of purpose.’ He went on to add that ‘If
they're prepared to come to the table and negotiate those things to get to that
outcome, fantastic. If not, the campaign with which we've been engaged ... will
continue.’ Thus Pompeo’s remarks show that the rolling out of sanctions has not
ended and new pressure will continue to be applied. The resolution of the US in
this respect is obvious.
The Mullah Regime could
choose to turn away from its reckless and bloody path, but the rhetoric that
utters forth from Tehran indicates otherwise. For the moment the Mullahs seem
stuck in their medieval mind-set. Their perverse worldview only serves to
continue the misery inflicted across the region by Iran’s terror chiefs and proxies.
Misery is likewise visited on millions of Iranians who suffer under the rule of
the Mullahs. Yet sanctions will certainly continue to tighten the noose around
big players in Tehran. Moreover, in a sign that the US wishes to also remind
Iran’s leaders of its hard power assets, a two carrier group has this week
sailed into striking distance of the country.