The End of the JCPOA Road? by Ofira Seliktar

he July 2015 Iranian nuclear deal, formally Tknown as the Joint Comprehensive Plan of Action (JCPOA), prompted many optimists to assume that Tehran would abandon its expan- sionist, Islamist drive and join the community of nations. But the Obama administration was so desperate for this that it settled for a weak deal that President Obama (with VP Biden, left) announces the signing of the accommodated Tehran’s hard- JCPOA, July 14, 2015. The Obama administration settled for a liners, leading to its eventual weak nuclear deal with Iran that accommodated Tehran’s rejection by Donald Trump. hardliners. Five years later, the deal is on the verge of collapse. What consequences does this have for the Middle East and the world?xxxxxxx world?xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

The JCPOA’s Critics realized that nuclear weapons would provide Upon founding the Islamic Republic of a protective umbrella against attack from the Iran in 1979, Ayatollah Ruhollah Khomeini United States and its allies, who would surely vowed to export his revolutionary message oppose Iran’s moves. throughout the Muslim world via Shiite In the early 1980s, then-president Ali proxies, or the Axis of Resistance. His aides Khamenei was among a group that oversaw

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the nascent nuclear pro- from 38 percent in 2010 ject. The Mujahedeen-e Rouhani wanted nuclear to more than 76 percent Khalq (MEK) opposition negotiations so as to ease the in 2013. By prompting a group revealed the pro- sanctions, a step a rival described sense of doom in the gram’s existence in as “national treason.” population, sanctions 2002, prompting the dominated the 2013 international community presidential elections. to impose sanctions, a Hassan Rouhani, who standard measure to roll back proliferation. reprresented the reformist and moderate In 2005, however, the hard-line President secttors of the electorate, claimed that the Mahmoud Ahmadinejad revived the so- economic misery was directly linked to the called resistance economy—an economic nuclear project. He wanted to expedite self-sufficiency program first launched by nuclear negotiiations so as to ease the Khomeini—to beat the sanctions. Despite sanctions, a step that his hard-line rival Said official optimism, by 2013, the sanctions had Jalili described as “nationaal treason.”3 After dramatically depleted the economy. Oil sales, Rouhani won more than 50 percent of the which accounted for 60 percent of the popular vote to Jalili’s 11 percent, a reluctant government’s revenue, were cut in half, Khamenei gave Rouhani a go-ahead to reducing Iran’s oil exports to about one negotiate with the United States, Britain, million barrels per day, far below the 2.5 France, Russia, China, and Germany (the million exported in 2011. As a rentier state P5+1). dependent on oil income, the disruption of oil In July 2015, after arduous negotiations, exports was bound to cascade through the the P5+1 signed the JCPOA, whereby Iran economy. The currency dropped from 10,000 agrreed to cut the number of first-generation rial to the U.S. dollar in 2010 to 30,000 rial centrifuge models (IR-1) to 6,014, but only in 2015, a staggering 300 percent decline. 5,0660 of them were approoved to operate for The level of unemployment was particularly the next ten years.4 The more advanced demoralizing: At the end of the Iranian moddels were to be decommissioned and calendar year in March 2013, twelve million stored in Natanz under the International people were out of work, but some econ- Atomic Energy Agency (IAEA) safeguards. omists suggested that the real numbers were The Fordow facility was ordered to cease much higher with youth unemployment enrriiching uranium for fifteen years. Con- reaching catastrophic levels.1 verrtted into a nuclear, physics, and tech- The population’s distress was reflected nology center, Fordow could have no more in the Iranian misery index,2 which escalated thaan 1,044 IR-1 centrifuges and had to produce radioscopes for medical, agri- cultural, industrial, and scientific use.

1 The New York Times, Mar. 15, 2012; Ettela’ata (Tehran), Oct. 25, 2013. 3 Farhad Rezaei, Iran’s Nuclear Program: A Study in 2 The misery index is calculated from the rates of Proliferation and Rollback (N.Y.: Palgrave unemployment, inflation, and bank lending MacMillan), 2016, pp. 211-15. levels minus the percentage change in real gross 4 All-Monitor (Washington, D.C.), June 24, 2013; The domestic product (GDP) per capita. Washington Post, June 15, 2013.

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Iran was limited to keeping only 300 kilograms of uranium enriched to 3.67 percent; the rest of its stockpile of ten thou- sand kilograms of low enriched uranium was to be blended down to natural uranium levels or sold abroad.5 However, several congress- sional hearings revealed grave problems with the deal, from weak verification and monitoring protocols to Tehran’s refusal to disclose the possible military dimensions and locations of suspected nuclear sites. Sen. John McCain, chair of the Senate Foreign Relations Committee, The IAEA standard for Iran was not as demanding as the one said that lifting sanctions would applied to other countries. The inspection regime excluded access bolster “military and intelligence to military sites such as the base in Parchin where nuclear operatives” and their desta- experiments had allegedly been conducted. bilizing activities from Syria to Yemen. Senate Republicans tried but failed to prohibit President Obama from Outside critics, including prominent waiving sanctions or “otherwise limit[ing] the experts such as David Albright, founder of application of sanctions pursuant” to the the Institute for Science and International JCPOA.6 The deal was so unpopular that the Security, and Olli Heinonen, former IAEA president could not convince the required two- deputy director-general for safeguards, thirds of the Senate to formalize it as a treaty. pointed out that the inspection regime The agreement even fell short of a simple excluded access to military sites such as the majority to approve it, so a contrived formula huge base in Parchin where nuclear ex- was used instead: Congress voted to periments had allegedly been conducted. In disapprove, meaning that Obama could veto the their opinion, the IAEA standard for Iran was disapproval if a mere thirty-four senators not as demanding as the one applied to other supported him.7 countries. An analysis of Iran’s nuclear archives obtained by Israel in 2018 con- firmed these misgivings.8 5 Joint Comprehensive Plan of Action (JCPOA), The Other observers noted that the Obama Washington Post, July 14, 2015. team, eager to strike a deal, caved on ballistic 6 H.R. 3460, U.S. House of Representatives, Sept. 11, missiles. Under tremendous pressure from 2015. the Islamic Revolutionary Guard Corps 7 “Impacts of the Joint Comprehensive Plan of Action (JCPOA) on the United States Interests and the Military Balance in the Middle East,” hearing 8 David Albright and Olli Heinonen, “What to do with before the Committee on Armed Services, U.S. the crown jewels of Iran’s nuclear program,” The Senate, July 29, Aug. 4, 5, 2015; NPR, Sept. 2, 2015. Hill (Washington, D.C.), May 16, 2019.

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(IRGC), the Iranian ne- compliance, Trump pulled gotiating team refused to The U.N. told Iran not to the United States out. include any reference to undertake ballistic missile Secretary of State Mike missile production in the development “capable of Pompeo noted that the agreement. Instead, the delivering nuclear weapons.” 2030 expiration date issue was delegated to would allow the regime the U.N. Security Coun- to resume weapons- cil, which passed Res- grade enrichment. Tech- olution 2231 on July 20, 2015, and endorsed nically, signing the Additional Protocol of the nuclear pact. The resolution stated that the Non-Proliferation Treaty (NPT), as “Iran is called upon not to undertake any stipulated by the deal, would have prevented activity related to ballistic missiles designed Tehran from pursuing an illicit program after to be capable of delivering nuclear weap- 2030. However, the Iranian parliament never ons.”9 While there is no universal definition approved the protocol, leaving the country of what constitutes a nuclear-capable missile, withhin the much looser verification protocol experts insist that missiles with a range of of the NPT. 300 kilometers and a payload of 500 Pompeo also worried about Tehran’s kilograms could be considered nuclear- ballistic missille program. The Iranians had capable.10 developed a variety of missiles since 2015. In September of that year, they unveiled the Soumar, a solid-fueled, ground-launched The Trump Administration’s longg-range cruise missile with an estimated Decision to Quit rangge of 2,500 kilometers. On September 22, Candidates running in the Republican 2017, the Khorramshahr appeared. It is a primary election in 2016 fiercely condemned two-stage, liquid-propellant medium-range the JCPOA with Donald Trump calling it ballistic missile with an estimated range of “the worst deal ever negotiated.” Once in the 2,0000 kilometers, capable of carrying White House, President Trump refrained multiple warheads up to 1,800 kilograms. In from certifying Iran as compliant, a condition August 2018, two new missiles, the Fateh and required by the Senate. In 2018, despite the the Fakour-90, each with an estimated range of fact that the IAEA had found Tehran in 1,300 kilometers, were added to the arsenal. On February 2, 2019, the IRGC announced the successful test of the Hoveyzeh cruise missile, which can fly a distance of over 1,350 kilo- 9 UNSC Resolution 2231, U.N. Security Council, meters, and a few days later, the Dezful missile New York, July 20, 2015. was unveiled with a range of some 1,000 10 Ibid.; UNSC Resolution 1929, U. N. Security kilometers. In February 2020, the media was Council, June 9, 2010; “Appendix E: Iran’s Ballistic Missiles and the Nuclear Deal,” Arms given access to an advanced Sejill missile Control Association (ACA), Washington, D.C.; designed to caarrry a nuclear warhead with a “Addressing Iran’s Ballistic Missiles in the range of 2,000-2,500 kilometers.11 JCPOA and UNSC Resolution,” ACA, July 27, 2015; Greg Thielmann, “Leave Ballistic Missiles Out of the Iran Nuclear Deal,” Defense One, May 20, 2014; Colum Lynch, “Washington 11 FFarhad Rezaeei, “Iran’s Military Capability: The Made It Easy on Iran to Fire Its Ballistic Structure and Strength of Forces,” Insight Missiles,” Foreign Policy, Mar. 16, 2016. Turkey, 4 (2019): 183-214.

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withdrew from the deal in 2018 and imposed the so-called maximum pressure sanctions.12

Tehran’s Maximum Response As in the previous round, sanctions wreaked havoc on the Iranian economy. The unem- ployment rate rose to 15 percent but reached 30 percent among the young. Oil exports decreased by 90 Sanctions wreaked havoc on the Iranian economy amid signs percent, and the gross domestic of the breakdown of Iranian society. Drug addiction product for 2020 was on track to expanded from two million users before 2012 to six million in shrink by 80 percent. The IRGC 2019. was declared a terrorist entity and its assets were subjected to severe sanctions. All in all, the U.S. In addition, the White House took a dim Treasury added more than one thousand view of IRGC general Qassem Soleimani’s Iranian entities to the sanctions list. The expansion of his network of Shiite proxies. misery index soared once again, this time to The Obama administration had assumed that the dangerous level of almost 76 percent.13 the regime would abandon its Axis of Signs of the breakdown of Iranian society Resistance project after the agreement, a climbed, too. The rates of HIV and AIDS prospect that President Rouhani and Foreign infection are up nine-fold since 2006, an 80 Minister Mohammed Javad Zarif had percent annual increase. In 2006, nine suggested might happen but did not. Now thousand people were diagnosed with HIV, flush with cash that had become newly but eighty thousand were diagnosed in 2017. available after the lifting of sanctions, the Drug addiction expanded from two million IRGC expanded Soleimani’s expeditionary users before 2012 to six million in 2019.14 Quds Force. By 2018, he largely controlled The marriage rate decreased from 550,000 in Lebanon through the Hezbollah proxy; had 2009 to 495,000 in 2019. In 2009, there was rescued Syria’s president Bashar Assad; had taken hold of Iraq with the help of local Shiite militias; had developed the Houthis in Yemen into a formidable foe of Saudi Arabia, and had made inroads into 12 Mike Pompeo, U.S. secretary of state, interview, Afghanistan. Pompeo said that the JCPOA “After the Deal: A New Iran Strategy,” The would need to be revised to account for all Heritage Foundation, Washington, D.C., May 21, 2018. three categories of grievances: nuclear 13 Daily Beast (New York), Jan. 7, 2020. enrichment and the sunset clause; ballistic missiles, and the destabilization of the 14 Hamshahri (Tehran), May 25, 2019; Pupils Association News Agency (PANA, Tehran), Dec. Middle East. To force Tehran to address 1, 2019; Iranian Student News Agency (ISNA), these issues, the Trump administration May 26, 2019.

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one divorce for every After tense internal eight marriages while Tehran banked on persuading debates between the in 2019, the number rose the Europeans to undermine government, the IRGC, to one in three. Ahmed Trump’s sanctions through an and Khamenei, the Toysarkani, head of alternative payment system. regime devised a dual- the Registration Office, track, diplomatic-mil- blamed poverty and itary strategy. Rouhani drugs.15 and Zarif led the dip- While this behavior worried officials, lomatic track to appeal to the international protesters commanded all the attention. In community, accusing Washington of waging November 2019, the Resistance Budget “economic warfare” and urging “strategic office was forced to cut subsidies of gasoline, pattience” in response to “American increasing the price by 300 percent from proovocations.”18 10,000 to 30,000 rials (US$.24 to $.72) per The government banked on perssuading liter. Massive demonstrations erupted every- the Europeans to undermine Trump’s where, which were brutally crushed by the sanctions through an alternative payment Basij militia, the IRGC arm responsible for systtem known as the special purpose vehicle domestic security. According to human rights (SPV). Avoiding the American-dominated groups, 1,500 Iranians were killed and many banking system, the SPV was a de facto thousands arrested.16 clearinghouse ffor Iranian proceeds from oil As much as the new legitimacy crisis and gas sales that could be bartered for was bound to cast the regime in a poor light, Tehran’s purchases. On January 31, 2019, Ayatollah Khamenei hardened his position. Brittain, Francee, and Germany announced the He had become convinced that the JCPOA creation of the special vehicle named the was born out of the Rouhani-Zarif “illusion” Instrument for Supporting Trade Exchanges that giving up the nuclear project would (INSTEX). Thhree months later, Iran set up bring Iran long-awaited prosperity. He hinted the counterpart on its end, the Special Trade at this when confessing that he had “made a and Finance Instrument (STFI). However, in mistake [in allowing negotiations] due to the fear of Washington’s secondary sanctions, insistence of these gentlemen [Rouhani and companies have been reluctant to participate Zarif].” The Paydari Front, an ultra-radical in the scheme. Iranian officials described parliamentary faction linked to Ahmadinejad, INSTEX as inefficient and accused the went so far as to demand withdrawal from Europeans of caaving to U.S. threats.19 the NPT.17 Tehran showed its displeasure by announcing a gradual disengagement from the JCPOA. On May 8, 2019, the Atomic 15 Kayhan International (Tehran), Oct. 28, 2018; Energy Organization of Iran (AEOI) said it Tasnim News Agency (Tehran), June 15, 2019; Mashregh News Agency (Tehran), Jan. 25, 2020. 16 Reuters, “Special Report: Iran’s leader ordered crackdown on unrest: ‘Do whatever it takes to end iti ,’” Dec. 23, 2019; NetBlocks, Nov. 15, 18 Author interview with Farhad Rezaei, Center for 2019. Iranian Studies, Ankara, Mar. 10, 2020. 17 Shahir Shahidsaless, “Has the US-Iran Conflict 19 Mashregh Neews Agency, June 29, 2019; “Iran Reached a Point of No Return,” Middle East Eye Sanctions,” Congressional Research Service, (London), Apr. 23, 2019. Washington, D.C., RS20871, Jan. 24, 2020.

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would reduce compliance, breaching the stockpile cap on heavy water and enriched uranium (300 kilograms of up to 3.67 percent low enriched ura- nium, the basic ingredient for nuclear fuel). On July 7, 2019, the AEOI re- vealed that uranium enrichment had exceeded the 3.67 percent limit. On September 5, 2019, Tehran declared that it would abandon all restrictions on advanced centrifuges and go ahead with research and development, and two months later, AEOI technicians began injecting uranium hexafluoride When the IRGC shot down a $240 million U.S. drone, gas into some centrifuges in the Trump refused to retaliate, which emboldened IRGC’s Fordow facility, a step that would Qassem Soleimani (above). Several months later, an bring Iran closer to fabricating weapon Iranian attack knocked out half of the Saudi oil grade uranium. On January 5, 2020, production. Tehran declared that it would no longer accept any restrictions on the number of centrifuges, that the nuclear as punishment for mining the Strait of program would not be subject to “any Hormuz and damaging a U.S. ship. operational restrictions,” and that all Soleimani, however, was convinced that activities would be based on Iran’s “technical Trump, unlike Reagan, would stand down. needs.” These carefully calibrated and very On July 26, 2018, while speaking at a public measures were yet another attempt commemoration for the Iran-Iraq war, he said to pressure the Europeans to relieve the that starting a war with “a nation of martyrs” sanctions.20 would “destroy all [U.S.] capabilities.” He For those in the leadership who had little also mocked Trump as a “gambler” with the faith in diplomacy, the military track led by style of a “casino” or “bar owner” and Soleimani was far more attractive. Earlier, warned that “we are near you, in places that during Ahmadinejad’s tenure, several of- you cannot even imagine,” an allusion to the ficials threatened to close the Strait of infamous terror capabilities of the Quds 21 Hormuz, a vital, narrow trade route needed to Force. transport roughly one-fifth of the world’s oil Soleimani took note of Trump’s oft- on two-fifths of the world’s oil tankers. But repeated promise to wind down the “endless even the habitually belligerent Ahmadinejad wars” in the region. For the IRGC, the 2017 22 did not make good on those threats. Tehran strategy defense review confirmed that still remembered Operation Praying Mantis Washington planned to focus more on China in April 1988 when U.S. president Ronald Reagan shelled Iran’s offshore oil facilities 21 “Iran IRGC Quds Hajj Qasem Soleimani,” YouTube, Aug 1, 2018. 22 “National Defense Strategy of the United States of America,” White House, Washington, D.C., Dec. 20 Tabnak News Agency (Tehran), Nov. 9, 2019. 2017.

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and Russia and less a $240 million U.S. on counterterrorism. When Trump withdrew troops drone.24 When Trump ordered from the Syrian Kurdish territory, Trump’s well-publi- the military out of Syria the Iranian media dubbed it cized refusal to retaliate in December 2018, “Soleimani’s Christmas gift.” further emboldened Soleimani concluded Soleimani. On September that the move was part 14, a combined drone and of a military reposi- missile attack hit the Saudi tioning process. With his assumption Aramco oil facility at Abqaiq, knocking out seemingly confirmed, the Quds Force half of the Sauaudi oil production. When the commander proposed an audacious White House failed to respond, the Quds Force asymmetrical plan to disrupt the oil trade and commander was declared a military genius, to punish U.S. allies. “If we cannot sell oil,” and both Khamenei and Soleimani ridiculed Soleimani said, “then we would not let you Trump as a “loudmouth coward.” The press, do it either.” When veteran IRGC chief Ali echoing the leadership, portrayed the U.S. Jafari warned that this strategy was too risky, president as “chicken heart.” On October 13, he was peremptorily sacked by Khamenei in 2019, when Trump sudddenly decided to April 2019 and replaced with Hossein withdraw troops from the Syrian Kurdish Salami, Soleimani’s close ally and a man territory Rojava, the Iranian media dubbed it given to violent rhetoric against the United “Soleimani’s Christmas gift..”25 States and Israel. One observer described Buoyed by accolades and under the per- the new IRGC commander as “an eccentric ception that he was “attack proof,” Soleimani warmonger who does not miss an op- became even more reckless. Despite the portunity to elevate the U.S. to new viollent upheavals at home and the ongoing heights.”23 prooblems in Lebanon and Iraq where pro- Immediate action followed the change of Iranian militias had killed hundreds of command. On May 12, the IRGC’s naval demonstrators, he decided to take his max- unit attacked four tankers off the United Arab imum response a step further. Starting in Emirates’ coast, and the following month, October 2019, Kataib Hezbollah (KH), an explosions crippled the Japanese Kokukaa Iranian-backed Iraqi Shiite militia, initiated Courageous and the Norwegian Front Altairi what Secretary of Defense Mark Esper near the Strait of Hormuz. On July 11, Iranian vessels attempted to block a British tanker from traveling through the strait, and a week later, the IRGC’s navy seized two 24 Eliot Higgins, “Was Iran behind the Oman Tanker British oil tankers and directed them to the Attacks? A Look at the Evidence,” The New York Times, June 14, 2019; Islamic Republic port in Bandar Abbas. On June 20, the News Agency (IRNA, Tehran), July 28, 2019; IRGC’s Aerospace Force under Amir Ali The Washinggton Post, July 11, 2019; “RQ-4 Hajizadeh shot down an RQ-4 Global Hawk, Global Hawk,” Military.com (New York). 25 Tasnim News Agency, Feb. 6, 2020; Mark Cancain, “How the U.S. Could Responnd after Iran Shoots down a $240 Million U.S. Drone,” 23 Shahidsaless, “Has the US-Iran Conflict Reached a Forbes, June 20, 2019; The Jerusalem Post, Oct. Point of No Return”; Enghelab-e Eslami 2, 2019; Islamic Republic of Iran Broadcasting Technical College (Tehran), news release, May (IRIB, Tehran), May 12, 2019; The New York 24, 2019; Tabnak News Agency, Apr. 22, 2019. Times, Oct. 13, 2019.

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described as a “sustained leading expert on missile campaign” against U.S. The Pentagon revealed it technology noted that bases in Iraq. On had advance warning of the the claim of intentionally December 27, a U.S. con- Iranian attack on Iraqi bases avoiding casualties was tractor on a base near housing 1,500 U.S. troops. baseless.30 Kirkuk was killed, and With the military the White House ordered track an apparent failure, the bombing of KH bases the Iranian regime had across Iraq and Syria, killing twenty-five to face the nuclear issue head-on again. As fighters. Soleimani responded by ordering the if on cue, on January 14, 2020, the three militia to attack the U.S. embassy in Baghdad, European JCPOA signatories—Britain, causing considerable damage to the outer France, and Germany (the E3)—triggerred the perimeter. Dispute Resolution Mechanism (DRM) in Evoking memories of the storming of the response to Tehran’s violation of the treaty. U.S. embassy in Tehran in 1979 that doomed The agree-ment stipulated that if no solution President Jimmy Carter’s chances for re- were found within sixty days, the issue could election, the assault was a warning that the be referred to the Security Council, which Iranians were ready to “Carterize” Trump.26 could re-impose the comprehensive “snap- Finally, on January 3, 2020, a U.S. drone strike back” sanctions. However, the E3 said the killed Soleimani and Mahdi al-Muhandis, the deadline was flexible, hinting that indefinite head of KH.27 nego-tiations were possible. Soleimani’s death unleashed calls for revenge, and Khamenei set the tone by declaring that Iran would react “directly” and Rational Choices, Iranian Style “in force.”28 On January 8, the IRGC’s Conducted during Iran’s February 2020 Aerospace Force launched sixteen missiles at parrlliamentary elections, the new round of a facility near the Irbil airport and the Assad debates rehashed the decades-long arguments base in Iraq that housed some 1,500 U.S. about the economic rationality of the state troops. Hajizadeh said that the so-called verrsus the regime’s missionary vision. Operation Shahid Soleimani “chose” not to Pragmatic politicians and officials kill five thousand soldiers, but that more than arguued that the Resistance Economy was eighty were killed and hundreds more were running on fumes, pointing to three serious wounded.29 The Pentagon denied that there structural challenges that required inter- were any dead and revealed that it had national cooperation and massive capital advance warning about the strike, pre- investment. The obsolete state of the oil and sumably from the Iraqi government. A gass industry was by far the most urgent. As early as 2015, Oil Minister Bijan Zangeneh announced that the industry’s infrastructure 26 Mark T. Esper, secretary of defense, and Gen. requuired millions of dollars in modernization Mark A. Milley, chairman of the Joint Chiefs of investments. In February 2020, he said, Staff, briefing, U.S. Dept. of Defense, Washington, D.C., Jan. 2, 2020.

27 The New York Times, Jan. 2, 2020. 30 UUzi Rubin, “OOperation Shahid Solemani: Iran’s 28 Khabar Foori website (Tehran), Jan. 3, 2020. Revenge,” Begin-Sadat Center for Strategic 29 Ibid., Jan. 8, 2020. Studies, Ramat Gan, no. 170, Feb. 13, 2020.

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In the oil industry, we need to access [foreign] technology and $25 billion foreign investment annually, and if this is not achieved, the problem will spread to other sectors. Because of the sanctions, we do not access [both money and technology].31

He added that the private sector provided minimal investment, and that the National Development Fund of Iran, which had been created to augment the Oil Stabilization Fund, did not have enough resources.32 The banking system was also in trouble. Thanks to decades of mismanagement, cor- ruption, and inefficiency compounded by nonperforming loans, banks had developed a chronic liquidity problem. The Central Bank of Iran had periodically mitigated the crisis Central Bank of Iran, Tehran. Due to mismanagement, corruption, and with a massive injection of capital, an option inefficiency, Iranian banks have a cut short by the shrunken resistance budget. chronic liquidity problem. The Experts, including Adnan Mazarei, former Central Bank periodically mitigates International Monetary Fund deputy head, the crisis with massive injections of warned that insolvency might trigger a run capital. on the banks and destroy the economy.33 Iranian banks also ran into trouble with 2020, FAFT put Iran back on the blacklist. It the Terrorist Financing Convention and its left a small opening, though, by stating that watchdog, the Financial Action Task Force “countries could apply counter-measures (FATF), which were created to suppress independent of FATF.” With thirty-six mem- terrorist financing and money laundering. bers and two regional groups participating, the In 2016, on the Obama administration’s rec- blacklist would severely restrict Iran’s access ommendation, FATF agreed to remove Iran to loans and financial aid.34 from its blacklisted states—whose banking In addition, water management, ex- systems finance terrorism—if it promised to acerbated by climate change, created another enact several finance reforms. Still, Rouhani systemic challenge. In recent years, the an- failed to persuade the parliament, which was nual precipitation level has declined sharply; under pressure from the IRGC, to pass the in 2018 alone, rainfall decreased by 20 percent. necessary legislation. So on February 20, The amount of water in reservoirs diminished by a third, from 32 billion cubic meters of 31 Ettela’at, Feb. 16, 2020. surface water in 2017 to 25 billion in 2018. 32 Ibid. 33 Adnan Mazarei, “Iran Has a Slow Moving Banking 34 “High-Risk Jurisdictions Subject to a Call for Crisis,” Peterson Institute for International Action,” The Financial Action Task Force, Paris, Economics, Washington, D.C., June 2019. Feb. 21, 2020.

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Farmers have compen- covering up the real scope sated by digging illegal The supreme leader came of the pandemic and wells, a process that has to believe that the crisis of its mismanagement of the further depleted the legitimacy could be managed crisis.39 The already frag- aquifers.35 A 2017 U.N. through coercion. ile economy is expected report on Iran noted, to suffer since most neigh- boring countries cut off Water shortages are commercial contact. The acute; agricultural livelihoods [are] drop in the price of oil in spring 2020 to no longer sufficient. With few negative dollars a barrel at a time when Iran other options, many people have sells only some 200,000 barrels per day adds to left, choosing uncertain futures as 40 migrants in search of work.36 the regime’s distress. Economic rationality, however, does not Issa Kalantari, a former minister of concern the hardliners. IRGC commander agriculture, said that the “water crisis is the Salami vehemenntly objected to any discussion main problem that threatens” Iran, adding that with the Europeans while the IRGC-linked it is more dangerous than “Israel, America or media emphasized that the force was fully political infighting.”37 committed to Soleimani’s strategy of military More recently, the spread of the COVID- disruption, including missile attacks on U.S. 19 virus in Iran has posed additional for- troops in Iraq and the transfer of weapons to midable challenges. Caught totally unprepared, the Houthis in Yemen. The supreme leader, the the regime’s instinctive blaming of the United IRGC, and the Basij militia were buoyed by States (and Israel) for creating and spreading the successful suppression of protests, and they the virus38 was met with widespread skepticism came to believe that the crisis of legitimacy and public criticism of the government foro could be permanently managed through co- ercion. In a move toward this so-called “forced stability,” the hard-line Guardian Council decimated the list of progressive candidates, 35 Abouzar Roosta and Mostafa Keshavarzi, “Bohran-I creating the most radical legislative body since Ab va Tagheerate Ab va Havaee,” Water Crisis 1980. Conservatives garnered 191 seats National Symposium, Isfahan, 2014; ISNA, Sept. compared with 14 seats for the reformers with 15, 2018; Reuters, Mar. 29, 2018; Khabar Online News Agency (Tehran), Sept. 2, 2019; Suzanne the remaining 34 allocated mostly to inde- 41 Maloney, “Iranian protesters strike at the heart of pendents and unnaffiliated conservatives. the regime’s revolutionary legitimacy,” Brookings Institute, Washington, D.C., Nov. 19, 2019. 36 “Iran: Communities Conquer Dust And Drought, Helping Themselves And The Environment,” 39 Radio Zamaneh (Amsterdam), Mar. 6, 2020. U.N. Development Programme, June 6, 2017. 40 Mashregh News Agency, Feb. 23, 2020; The New 37 Voice of America, Apr. 6, 2014. York Times, Apr. 20, 2020; The Washington 38 See, for example, “Iranian Supreme Leader Ayatollah Post, Apr. 21, 2020. Ali Khamenei: U.S. Is Accused of Creating the 41 Yaakov Lappiin, “Iran’s Regional Terrorism and Coronavirus,” MEMRI TV, Washington, D.C., Nuclear Acttivities Grow with Its Distress,” Mar. 20, 2020; RGC Gen. Gholamrm eza Jalali, “The Investigative Project on Terrorism, Jan. 23, 2020; U.S. Has Many Biological Labs in the Area That Tasnim News Agency, Jan. 4, Jan. 7, 2020; May Be Responsible for Spreading the Virus,” Reuters, Marar. 29, 2018; Khabar Online News MEMRI TV, Mar. 10, 2020. Agency, Sept. 2, 2019.

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The Trump admin- aborted by his own se- istration had its own Khamenei blamed the Jews for curity officials and Pres- doubts about further dominating U.S. politics and for ident Obama. Reflecting negotiations. Some of- waging war on the JCCPOA. the heightened danger, ficials implied that, the Israel Defense Forces given the scope of the created a special Iran riots, the underlying command to detect and discontent would eventually lead to the analyze threats from Tehran.44 collapse of the Islamic Republic. Although In the immediate future, the regime is the president denied seeking regime change, expected to drag negotiations with the his administration has been slow to respond Europeans whiile hoping that Trump loses to to European entreaties to salvage the a Democrat in the 2020 elections. Khamenei agreement. To the contrary, Pompeo revealed himself said that he is encouraged by the a “multipronged plan” to deliver a final Senate’s Iran Power Resolution Act that “death blow” to the JCPOA. He noted that limits the president’s ability to wage war there were legal grounds to petition the with Tehran. He also blamed the Jewws for United Nations to restore the snap-back dominating U.S. politics and for waging war sanctions and that more sophisticated on tthe JCPOA. The regime has not said what sanctions were in store. Pompeo’s plans it will do if Trump wins a second term, but received a boost when, in March 2020, several officials, including Foreign Minister Rafael Grossi, the head of the IAEA, accused Zarif, threatened to leave the NPT if snap- Iran of blocking inspection of three suspect back sanctions are imposed.45 nuclear sites.42 Without more visibility into the current decision-making process, the future of the Conclusion JCPOA is hard to predict. The maximum The struggle between the appeal of a response could compel the regime to restart conventional state and its founding the project with a view of producing enough revolutionary ethos has styymied the Islamic fissile material for a nuclear weapon. Israeli Republic. The elite want nuclear weapons to intelligence estimated that Iran would have prootect them as they destabilize the Middle enough highly enriched uranium to produce a East and purssue their imperialist, Islamist weapon by the end of 2020, but fabricating a agenda while their less ideological peers missile fitted with a nuclear warhead may bemoan the steep costs of defiance. With the take at least two more years. Jerusalem has debate unresolved, the Iranian regime would already announced that it would not allow likely find it hard to sign a new agreement Tehran to develop nuclear weapons and might resort to military action with or without U.S. support.43 In the early 2010s, 44 Ali Vaez and Naysan Rafati, “U.S. Maximum Prime Minister Benjamin Netanyahu pushed Pressure Meets Iranian Maximum Pressure,” for bombing Iran’s nuclear facilities but was Crisis Group, Washington, D.C., Nov. 5, 2019; Haaretz (Tel Aviv), Jan. 14, 2020; Ofira Seliktar and Farhad Rezaei, Iran, Israel, and the United States: The Politics of Counter-Proliferation 42 Al-Monitor, Feb. 6, 2020; The Washington Free Intelligence (Lanham, Md.: Lexington Books, Beacon, Feb. 23, 2020. 2018), p. 157. 43 Reuters, Oct. 26, 2017. 45 IRNA, Jan. 20,, 2020.

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requiring a reduction of ballistic missile de- velopment and the disbanding of its proxy militias. Indefinitely prolonging the nego- tiations may be its only option.

Ofira Seliktar is professor emerita at Gratz College in Pennsylvania. She specializes in intelligence, including nuclear proliferation intelligence. She is the author of ten books and scores of articles and chapters in refereed publications. Her last two books are Iran, Israel, and the United States: The Politics of Counter- proliferation Intelligence and Iran, Revolution and Proxies (with Farhad Rezaei).

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