Prospects for Iran

Legatum Institute

Prospects for Iran

Jonathan Paris Prospects for Iran Jonathan Paris

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ISBN 978-1-907409-15-8 January 2011 January

9 781907 409158 January 2011 Prospects for Iran

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Legatum Institute 11 Charles Street, Mayfair London, W1J 5DW United Kingdom T +44 (0)20 7148 5400 F +44 (0)20 7148 5401 www.li.com [email protected] CONTENTS

About the Author 5

Acknowledgements 6

Executive Summary 7

Introduction 12

Chapter 1 Domestic Considerations 13

Chapter 2 The Nuclear File 34

Chapter 3 Regional Snapshots 64

Conclusion 70

About the author

Jonathan S. Paris is a London-based security specialist and Non-resident Senior Fellow with the Atlantic Council of the United States South Asia Center. He is also an Adjunct Fellow at the Legatum Institute and an Associate Fellow with the International Centre for the Study of Radicalisation (ICSR) at King’s College London. In 2010, he authored the Legatum Institute’s Prospects for Pakistan Report. Before moving to London in 2001, he was a Middle East Fellow at the Council on Foreign Relations in New York from 1995-2000, where he worked on the four MENA Economic Summits and the Middle East peace process, and was deputy to Paul A. Volcker, former Federal Reserve Bank Chairman, at the Council’s Middle East Economic Strategy Group. Jonathan also co-edited the first book on Indonesia’s democratic transition, The Politics of Post-Suharto Indonesia (Brookings/CFR 1999). A Senior Associate Member at St. Antony’s College, Oxford from 2004-2005, he is a graduate of Yale University and Stanford Law School.

5 Acknowledgements

I thank Nazenin Ansari, Hemal Shah, Iona Debarge and Yasmine Moezinia for their generous assistance. Karim Sadjadpour was kind to introduce me to Omid Memarian, who contributed extensively to the sections dealing with domestic Iranian considerations. I would like to extend my gratitude to Legatum Institute, to Will Inboden and, especially, to Claudia Mendoza, Research Associate at Legatum Institute, for her wise counsel from the inception of this project. Finally, I am very fortunate to have the support of my wife Carrie, and Tanya and Joey. I dedicate this Report to Sam, who urged me a decade ago to spend more time writing about critical foreign policy issues. For Sam, may you continue to serve faithfully, and come back safely.

Jonathan Paris

6 Executive Summary

Iran is opaque and difficult for outsiders to understand. One of the more thoughtful insights to emerge from the WikiLeaks release of confidential US diplomatic cables in November 2010 comes from Abu Dhabi’s Crown Prince Mohammed bin Zayed, whose greatest worry “is not how much we know about Iran, but how much we don’t.”1 What we do know is that the Iran crisis is very important to the international community and that it is in fact two crises: the emergence of civil resistance inside Iran as a result of the disputed election of 12 June 2009, and the pursuit of nuclear weapons by the Islamic Republic of Iran (IRI).

Domestic Considerations

Iran’s domestic crisis was born from a confluence of badly managed state affairs, generating widely shared grievances and culminating in mass protests in the June 2009 presidential election. The protests reflect a political chasm between the regime and its two sources of legitimacy: the Iranian people, who saw their votes dismissed, and the religious establishment, many of whom lost confidence in the supreme leader after he lent his partisan support for President Ahmadinejad in the dispute over the election results and the violent crackdown on demonstrators, mostly young, and dissidents. There have been several protests before, but the political schism in 2009 was different for a number of reasons: First, previously protesting sectors were joined by the educated, professional, urban elite. Second, whereas these earlier instances involved only one sector of society at any given time, in June 2009 various sectors of society came together to denounce the election outcome. Third, the previous protests set civil society against the state. This time, the inner core of the state turned against figures who are or who have been part of the state, including Ali Akbar Hashemi Rafsanjani (a former president), Mir Hossein Mousavi (a former prime minister), and Mehdi Karroubi (a former speaker of the majlis, or parliament). These men have support inside the regime, including ministries, parallel organisations and the security apparatus.

1 David Sanger, “Around the World, Distress Over Iran” The New York Times, 28 November 2010 at http://www.nytimes. com/2010/11/29/world/middleeast/29iran.html

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Fourth, the presence of international broadcasters in the country and the access of many Iranians to modern telecommunication devices and new media, including the internet, Skype, Paltalk, YouTube and Twitter, altered the information flow to the detriment of the government. The Farsi-language broadcasts of the BBC Persian service, Persian News Network, Radio Farda, Voice of America, in addition to the ubiquitous internet, deprived the state of its monopoly over the means of communication. Two years later and the regime appears to have reconsolidated power and contained the Green Movement, which has been unable to mobilise large demonstrations in Teheran and other Iranian cities since early 2010. The Green Movement itself is fractured and its leadership has turned inward. Meanwhile, quarrels among the regime elite, though serious, are deceptive; whenever regime survival is threatened, the elites seem to unite. The centrist- reformist, Ali Akbar Hashemi Rafsanjani, has far more to lose if Iran ceases to be an Islamic Republic than if he continues to languish outside the corridors of power wielded by his rivals, Supreme Leader Ayatollah Ali Khamenei and President Mahmoud Ahmadinejad. Nonetheless, the growing divisions within the elite have led to the current decision- making paralysis in the IRI. The deepening fissures are multiple: between reformists and conservatives, conservatives and ultra-conservatives, President Ahmadinejad and the parliament, Ahmadinejad and the judiciary, Ahmadinejad and the clerics in Qom, Ahmadinejad and the supreme leader, the supreme leader and the Qom clerics, reformists and the guardian council, the parliament and the guardian council, and more. The Revolutionary Guard, also known as the IRGC, has grown more powerful politically and economically throughout President Ahmadinejad’s tenure since 2005. The IRGC controls the instruments of power, secures the streets and has become the edifice on which the survival of the clerics depends. It is hard to imagine the clerics ruling without the IRGC, but it is possible for the IRGC to survive without the clerics. The one benefit the ayatollahs provide the IRGC is the legitimacy of Iran as an Islamic Republic among other Muslim countries. Otherwise, Iran would simply be another authoritarian regime ruled by a praetorian guard.2 Domestically, the Achilles heels of the regime are its economic mismanagement and human rights violations. Economic stewardship under President Ahmadinejad has been a disaster for all but a few privileged groups, including the IRGC. The anger of the people over the state of affairs wrought by the sanctions and government policies is rising. More and more people question the government’s skewed priorities in which hospitals are left inadequate and jobs non-existent as limited Iranian state revenues go abroad to rebuild southern Lebanon and at home to improve upon North Korean ballistic missiles and assemble a space programme. The other vulnerability of the regime is its human rights violations, particularly since the crackdown following the June 2009 election.3 Stories of rapes of young male and female

2 The author of the concept of the praetorian guard is Samuel P. Huntington, which he explains in his book, Political Order in Changing Societies (1968). 3 human Rights Activists News Agency documented 38879 cases between in one month alone, between 21 March and 21 April 2010. 37,519 labourers, 537 students, 255 civil society activists re freedom of expression, 34 sentenced to hanging, 259 suffered torture and abuse of prisoners’ rights, 7 were killed in provinces at the borders, and 124 were ethnic minorities, and 68 religious minorities, each suffering arrests and human rights abuse. See full report at http://www.hra-news.org/1389-01-27- 05-27-51/792-000.html

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reformers by their torturers in Teheran prisons have surfaced repeatedly through the efforts of Mir Hussein Mousavi and others in the Green Movement. Other human rights violations take place against minorities, both ethnic and religious, and against women. Many in the Green Movement have been arrested and are languishing in prison. It is hard to predict the next couple of years in Iran since the Green Movement is split between those who want reform and those who want regime change. Disenchanted demonstrators appear unwilling to return to the streets to help Mousavi recreate the earlier pristine Islamic Revolutionary days of 1979. Many of them no longer wish to live under any Islamic regime with the increasingly discredited jurisprudential system of Velayat Faghih (rule of the Jurists) that gives ultimate power to the supreme leader. They want free and fair elections where the people are sovereign. The traditional Shi’a clerics are becoming more vocal in their support for separation of religion and politics and the repeal of the Velayat Faghih. This doctrinal dissent represents, in the eyes of the regime, another serious vulnerability and may explain moves by the supreme leader and his allies to further insulate themselves from the need to obtain consent from the traditional clerical establishment. Notwithstanding resistance from an increasing number of people and clerics, as long as the instruments of control remain mainly with the IRGC, which continues to support the supreme leader, who continues to support the president, the regime will not only commit more human rights violations and mismanage the economy, but also will likely inch forward towards a nuclear weapons capability.

The Nuclear File

The premise of this Report is that based on continuing uranium enrichment, weaponisation and missile programmes, and a pattern of behaviour going back several years, Iran is aiming for a nuclear weapon capability, but has not yet made the political decision to cross the nuclear weapon threshold. Will the sanctions break the regime’s march toward nuclear potency? Although the supreme leader may prefer the more self-sufficient Iran that sanctions encourage, the sanctions of 2010 appear to be seriously hurting the economy. One example is anecdotal evidence that work at Iranian banks and stores in Dubai have come to a halt because the United Arab Emirates decided to enforce the UN sanctions voted in June 2010.4 The reality is that even if the economy is hurting, it has a very small place in the calculus of Khamenei and Ahmadinejad. Unless the severity of the sanctions dramatically escalate, it is unlikely that Iranian leaders will see the sanctions as a domestic threat to their survival in power. Enormous pressure is required to lead them to compromise on the nuclear programme. There is a chance, albeit small, that if the regime anticipates that sanctions today will get worse tomorrow, then they might be more willing to compromise. However, if the regime can cope with the current sanctions and believes it is unlikely the international community will maintain its unity against Iran in the future, then they will likely not feel enough pressure

4 Martina Fuchs, “Sanctions squeeze Dubai’s trade with Iran”, Reuters, 24 November 2010 at http://news.yahoo.com/s/ nm/20101124/wl_nm/us_emirates_iran_trade

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to compromise, unless they are convinced that the US will attack. If sanctions fail to induce a compromise, then it seems that the only remaining measure is to convince Iran’s leadership that there is a credible threat of a US attack. The Obama Administration hesitates to elucidate on its military option for fear that such talk might then create a dynamic under which it must follow through on its threat. There are sound reasons against a US or Israeli attack. Iran might activate its sleeper terrorist cells worldwide and unleash deadly attacks on both American soldiers in Afghanistan and Iraq, and Israeli civilians on the receiving end of Hezbollah and Hamas rockets and missiles. If attacked, Iran would likely leave the Nuclear Proliferation Treaty (NPT) and become even more determined to reconstitute a nuclear weapons programme that will be largely covert and no longer monitored by the IAEA. The revenge factor might increase the chance of a nuclear war in the future. The ‘don’t attack’ view, however, underestimates the strategic changes in the region that may follow from a nuclear Iran. One nuclear proliferation scholar warns against two negative trends: ‘creeping fatalism’ - that is, accepting the inevitability of a nuclear Iran, and ‘deterrence optimism’ – that is, believing that a nuclear Iran can be contained. These two outlooks reinforce each other. As the perception grows that a nuclear Iran is inevitable, deterrence optimism reduces the incentive to stop Iran.5 There has been much speculation about Israeli responses to Iran’s march toward nuclear potency. The Israelis hold some hope that the sanctions, together with skilful diplomacy, might bring the Iranian leadership to a meaningful compromise. They are more sanguine that a clear US threat of a military strike would bring about such a compromise. Failing that, Israeli leaders do not think that they are the most capable party for executing a military strike on Iran’s nuclear facilities.

Regional Realignments

At the same time, the Obama Administration and current Israeli Government look at what the Middle East might look like five to 10 years after Iran has gone nuclear and the picture is not pretty for the US, its moderate Arab allies or Israel. It is not the fear of a nuclear attack from Iran that disturbs US and Israeli decision-makers. After all, both the US and Israel have robust missile defence capabilities that make a second strike virtually assured should Iran be foolish enough to strike at Israel, US ships or US allies. Iran will be deterred from launching a nuclear attack out of the blue. The problems are two-fold, nuclear proliferation and strategic realignments. The first set of problems is that other countries in the region may try to match Iran’s nuclear potency and non-state actors may even try to obtain a bomb. This situation leaves an unmanageable state of affairs in which any minor crisis has a chance of pushing otherwise rational decision- makers into nuclear escalation if clear red lines between the decision-makers of the adversaries involved are insufficiently understood or recognised.

5 Scott Sagan, co-director of the Center for International Security and Cooperation (CISAC) at Stanford, made this point at a panel on nuclear proliferation at the Herzliya Conference, 4 February 2009.

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The second set of problems is the emergence of political realignments adverse to the US as Iran uses coercive diplomacy to threaten or emasculate the Gulf and other moderate Arab states, Turkey, and even Europe into accommodating Iran. Israel could be vulnerable on a strategic level if the existing orders in Saudi Arabia and the two Arab countries that have peace treaties with Israel, Egypt and Jordan, either collapsed or, in order to maintain popular support, turn towards Iran and away from the West. The US would no longer be able to ensure the stability of the Persian Gulf, the main source of the world’s energy. If the US or Israel is going to have to go to war with Iran, they may prefer to strike before the balance of power in the Middle East has swung decisively in Iran’s favour. For Israel, the cost-benefit analysis may come down in favour of striking now to buy time. If the Israelis believe that an attack will delay Iran’s nuclear programme, they may be counting on Khamenei to die or Ahmadinejad to fall or step down from power in the interim. The Osirak reactor in Iraq was bombed in 1981 and Saddam Hussein immediately began another nuclear programme that was nearly complete before Desert Storm of 1991. In the end, he did not obtain a nuclear weapon. Israel may hope that a similar strike will keep the current Iranian leadership from being able to cross the nuclear threshold. A strike on Iran’s nuclear programme would undoubtedly boost Ahmadinejad and his supporters in the IRGC, and might even provide him with an excuse to clamp down on the Green Movement. However, the grievances that created the Green Movement in 2009, including human rights violations, economic mismanagement, stolen elections, and the questionable legitimacy of the Velayat Faghih, will endure long past any momentary rally around the Iranian flag. Khamenei and Ahmadinejad are pursuing aggressive and destabilising foreign policies that make a nuclear Iran particularly dangerous to the US, the moderate Arab world and Israel. Although many experts believe that it makes little difference if former President Khatami became the supreme leader and former Prime Minister Mousavi the president, it is likely that, notwithstanding their commitment to the 1979 Iranian Revolution, these reformers would engage with the outside world and be more attentive to the Iranian economy than to pursuing revolutionary agendas abroad. They just might be willing to compromise on the nuclear file in order to rejoin the world and fix the economy. The current leadership appears to be taking Iran into a cul de sac, refusing to compromise for fear of looking weak, and moving in the direction of political isolation and economic hopelessness. The leadership harbours ambitions to rival the US as a superpower in the Gulf and beyond. Iran risks, instead, becoming a pariah state like North Korea as its current leadership pursues an outsized and dangerous supra-conventional nuclear and ballistic missile programme.

11 Introduction

The first part of this Report examines domestic considerations inside Iran starting with the aftermath of the 2009 elections and the rise of the Green Movement. Part Two examines Iran’s foreign policy objectives and its global and regional dimensions. The Report considers an array of international responses to Iran’s nuclear programme from diplomatic engagement and economic sanctions to arguments for and against a US or Israeli military strike on Iran’s nuclear installations. Part Three describes the coming realignments in the region in response to a rising Iran. This final section considers regional responses to a scenario in which Iran becomes a nuclear power.

12 chapter 1 Domestic Considerations

The Aftermath of the June 2009 Elections

The Green Movement emerged during the 2009 presidential election as an organic domestic civil rights movement within the existing political framework of the Islamic Republic of Iran. Despite some radical moments that appear to challenge the very legitimacy of Iran’s supreme leader, Mir Hussein Mousavi’s vision of the Green Movement emphasises non-violent reform within the system rather than regime change that carries an existential threat to the regime. In the aftermath of the election, as the political machine fought to legitimise a second term for President Ahmadinejad against the opposition, Supreme Leader Ali Khamenei repeatedly sided with the president. In the minds of the people, his unequivocal manner of standing by Ahmadinejad brought into question his competency as supreme leader, whose institutional role is supposed to be the mediation and balance of power within the country’s fragmented political system. During the protests in 2009 chants of “Down with the Dictator, Down with Khamenei” could be heard for the first time.6

1.1 Rise of the Green Movement

Mir Hussein Mousavi is the best recognised spokesman of the Green Movement, but in fact, he represents only one faction of it. After the elections, disparate groups coalesced into an inclusive Green Movement, representing the aspirations of a range of Iranians for social freedom, democracy and human rights. Secular liberals and social democrats are factions of the Green Movement that include women and youths, ethnic and religious minorities, workers in labour unions, and soldiers in the regular military. They view the system through the prism of universal and indivisible human rights, and are adamant in their view that the constitution and political structure of the Islamic Republic abridges fundamental civil rights. They would describe the Green Movement as many different groups connected by the desire for free elections and

6 See YouTube, “JUNE 22 IRAN Down with Khamenei Dictator” at http://www.youtube.com/watch?v=8Ok1qC3WTa0

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the ousting of the government. Trying to reform the current system, they believe, is like rearranging chairs on the Titanic, adding that if the regime were flexible, reformists would not be incarcerated, or outside the country.7 The religious faction of the Green Movement comprises elements within the bureaucracy, university professors, teachers in religious seminaries and enlightened younger veterans of the IRGC who fought in the Iran-Iraq War and remain loyal to the legacy of the 1979 Islamic Revolution. They are led by two well-known political figures in Iran, Mir Hussein Mousavi and Mehdi Karrubi. The former president, Mohammad Khatami, has also spoken out on behalf of this group. Each of these individuals has at one time received a stamp of approval from the regime as a prime minister, president or speaker of parliament. These religious democrats consider the Green Movement a civil rights movement rather than a revolutionary one. They want to work within the system, reforming laws through deals with the existing clusters of power in the Islamic Republic. The religious faction under Mousavi and Karrubi has emerged as the dominant face of the Green Movement. Its strategy has been to avoid pushing for regime change and, instead, focus on its poor economic performance, abuse of power, corruption, human rights violations, political repression and circumventing of the rule of law. In a speech at a UK university, Mousavi’s senior advisor described the Green Movement “as a pluralistic movement with no centralised leadership command centre and a modus operandi of non-violent struggle based on tolerance of other views and adherence to basic human rights principles.”8 By avoiding accusations from the regime of being ‘barandaz’ (translated roughly as ‘those who seek the collapse of the regime’), Mousavi and Karrubi hope their voices will resonate among average Iranians. At a minimum, their restrained approach appears to have provided them with the political space to sustain the Green Movement without being arrested. Curiously, the security establishment has arrested hundreds of prominent reformist figures, human rights lawyers, student leaders and civil society activists after the election, but they have not yet arrested Mousavi or Karrubi, despite repeated threats and physical assaults on these two leaders and their relatives. The regime may not want to turn the Green Movement leaders into martyrs who would bring demonstrators into the streets again. An additional reason for not arresting Mousavi is that he served for eight years as prime minister under the founding supreme leader, Ayatollah Khomeini in the 1980s. Mousavi’s competency during the stressful Iran-Iraq War garnered significant support within the conservative establishment. At that time, then President Ali Khamenei clashed with Prime Minister Mousavi but failed to receive Ayatollah Khomeini’s support in challenging Mousavi’s position. Mousavi is seen by many clerics as one of the original Khomeini loyalists in Iran.9 Also, many poor Iranians remember Mousavi, who comes from a humble background,

7 See Nazenin Ansari and Jonathan Paris, “The Future of Iran”, Wall Street Journal, 13 January 2010 at http://online.wsj.com/ article/SB10001424052748704362004575000663644083200.html 8 See Azarmehr, “Ardeshir Amir Arjomand, Moussavi’s Advisor at UCL”, Azarmehr.Blogspot, 3 December 2010 at http:// azarmehr.blogspot.com/2010/12/ardeshir-amir-arjomand-moussavis.html 9 In the summer of 2010, Mousavi repeatedly said that he was not going to criticize the Khomeini era. At the same time, he has clarified that he does not approve all that happened during that era. Mousavi’s 1988 resignation letter to then President Khamenei was only recently published. Its release is an indication that Mousavi was not in favour of some of the policies and actions that were performed by the other branches and revolutionary institutions in the first ten years of the IRI under the founding supreme leader, Ayatollah Khomeini. Memo from O. Memarian to author, August 2010.

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as somebody who managed the economy during the Iran-Iraq War in a way in which disadvantaged people could survive. For example, he devised a coupon system and other subsidies to help the poor subsist during the war. A third reason for Mousavi’s popularity is that he has remained among the cleanest politicians in Iran at a time when many officials have been tainted with corruption. Since the 2009 elections, his views have changed dramatically on where he thinks the Islamic Republic is headed. Mousavi has been able to embrace a sizable portion of the political elite and civil society including intellectuals, students and even the military. Two former presidents, Akbar Hashemi Rafsanjani and Mohamed Khatami, support him,10 as does Karrubi, who has emerged as another prominent political figure in Iran. For many in Iran, Mousavi is the face of the Islamic Republic.11 For now, the regime’s strategy is to separate the Green Movement leaders from their supporters and marginalise the leaders in the media. The regime has had some success in limiting the manoeuvres of the Green Movement leaders on the internet. Although Mousavi and Karrubi’s interviews and political statements are posted online, many Iranians do not have internet access and are unable to hear what the Green Movement leaders actually have to say. Also, many of their advisors, friends and supporters are either in jail or have been released on bail and face years in prison. The regime has dismantled the operation of the major political party, Mosharekat, or the Participation Front, shut down reformist newspapers such as Etemad Melli, and cut the opposition’s access to airtime on national TV or radio. Finally, many activist students have been suspended from their universities and most journalists are unable to gain access to the Green Movement leaders for interviews.

Social Trends One of the backdrops for the rise of the Green Movement in 2009 was a broader social trend toward greater sexual liberalism from below and harsh Islamic rule from the top. Young women in particular are experiencing an ever-widening chasm with the regime’s expectations for their appearances and behaviour. According to Islamic teaching, men and women cannot engage in any pre-marital relations. The Islamic Republic’s vast propaganda machine that is responsible for promoting Islamic thoughts and ideology includes a number of powerful national organisations such as the Islamic Republic of Iran Broadcasting (IRIB), Islamic Propaganda Organisation, the Council of Friday Prayers, Iran’s Education System, and the Basij. Islamic training, from kindergarten to university, teaches Iranian women that the use of makeup is only for inside the house to please their husbands and not others. Still, Iranian women aggressively spend about two billion dollars a year on cosmetics, almost 29% of the Middle East market.12 Many women challenge Islamic dress codes by

10 Rafsanjani was president from 1989-1997 and Khatami from1997-2005, both for two four-year terms, which is the maximum allowed under the IRI constitution. 11 As between the two leaders, Ayatollah Mehdi Karrubi is a giant but there are rumours about financial corruption in his past, which Ahmadinejad raised during the presidential debates in the days leading up to the June elections. Mousavi has the luxury of being clean, personally and financially and also conveys a consistency in character which many Iranians find reassuring. He has reacted to major political issues after the election faster than Karrubi. He is educated and not a cleric. Even though Ayatollah Karrubi is a popular reformist politician, for many Iranians, particularly the youth, supporting a cleric for leadership would not be their first choice. 12 S. Ghazi, “Iranian women splash money on makeup,” Middle East Online, 2010 at http://www.middle-east-online.com/ english/?id=39304

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wearing tight tunics and a small hijab. Furthermore, in a country where women are covered fully from head to toe and are only allowed to show their face in public, rhinoplasty (plastic nose surgery) is popular. In 2003, the head of the National Youth Organisation, Morteza Mirbagheri, said that more than 50% of Iranian youth have relations with the opposite sex, from platonic to sexual relationships.13 Although authorities have not announced any new statistics in this area, it would be surprising if the number of sexual relationships has not gone up, considering the increase in internet use, satellite programs, and travel to neighbouring countries such as Dubai and Turkey. One author writes: “In the absence of any option for overt political dissent, young people have become part of a self-proclaimed revolution in which they are using their bodies to make social and political statements. Sex has become both a source of freedom and an act of political rebellion.”14 The rigidity of the regime on sexual relations has paradoxically generated enthusiasm for more social freedom among Iranian youth.

1.2 Role of the Iranian Diaspora

For the first time since the 1979 Revolution, the Iranian Diaspora played a major role in shedding light on widespread post-election human rights violations. Some political activists amplified the voices of Iranians inside to the outside world. Ultimately, however, the Green Movement outside Iran is limited in its ability to initiate political actions within the country. The regime portrays the Green Movement outside Iran as “barandaz”. As a consequence, any kind of association with the external opposition seems to be a liability for activists inside the country. The Green Movement outside of Iran also has more sweeping demands than the Green Movement’s political figures within the country who fear that any kind of radicalisation on their part might cost all of their political capital and lead to more severe crackdowns.

Discord within the opposition Many in the Green Movement outside Iran identify with and support the secular liberal and social democrat factions of the Green Movement inside Iran. Loosely referred to as the “Diaspora Opposition,” they offer three criticisms of the strategy of Mousavi’s religious faction. First, they disagree with Mousavi’s decision to limit his goals to reform within the IRI. The manifesto published by five major figures of the Green Movement residing outside of the country, Abdolkarim Soroush, Mohesen Kadivar, Abdolali Bazargan, Ataollah Mohajerani, and Akbar Ganji, underscores the disconnect between those outside and inside Iran.15 This manifesto listed several demands of the people and criticised the supreme leader. Mousavi, by contrast, has chosen not to target the supreme leader to avoid being stamped with the deadly label of “barandaz”. A second criticism from the Diaspora Opposition is that Mousavi and Karrubi turned inward as the excitement in the streets subsided toward the end of 2009. They ceased to

13 Interview of Morteza Mirbagheri by Omid Memarian, Teheran, 2003. 14 Pardis Mahdavi, Sexual Revolution (Stanford University Press 2009). See http://www.sup.org/book.cgi?id=15943 15 Robin Wright, “An Opposition Manifesto in Iran”, Los Angeles Times, 6 January 2010 at http://articles.latimes.com/2010/jan/06/ opinion/la-oe-wright6-2010jan06

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cooperate with non-religious secular liberals and social democrats who were instrumental in bringing out so many young demonstrators into the streets in the summer of 2009. By turning the Green Movement into an aloof and elitist group, Mousavi failed to build on the wider sources of disenchantment among young, more secular Iranians. 16 The third criticism of Mousavi from the Diaspora Opposition is that he clung to non- violence long after it became clear that the demonstrators were being routed by the clubs, chains and guns of the Basij, who became more numerous as the regime organised its counterattack. In the end, the Green Movement has been unable to forge a unified front out of a variety of groups with different interests and ideologies.17 Even among the five intellectuals in the Diaspora who wrote the manifesto, there was little unity as they criticised each other shortly after the its release. Although the Green Movement inside and outside Iran agree that the current leadership under Khamenei and Ahmadinejad is disastrous, they differ over tactics and ultimate goals. The divisions within the Green Movement both inside Iran and between the insiders and the Diaspora Opposition have created a leadership and organisation vacuum that is being filled by new groups. One new entity, called the Green Wave, has emerged in 2010.

The Green Wave One vibrant exception to the low-key tactics of the Mousavi-led religious faction of the Green Movement was the launch of a new Green Wave movement in Paris and London by a self-made Iranian millionaire, Amir Hossein Jahanchahi. The mission statement of the Green Wave calls for regime change through pragmatic and covert work within Iran. In particular, the Green Wave has financed and organised recruitment of key officials within the regime who have become disenchanted with the current situation. Formally called “Green Wave: Supporters of Freedom in Iran,” it is the first Iranian opposition structure since 1979 to provide financial and logistical backing to all Iranian opposition groups committed to democracy and regime change, irrespective of their political ideologies. The Green Wave announced the defections of Iranian diplomats from their missions in Europe and was responsible for assisting a military officer who defected from the Iranian army and then declared publicly in Paris that there were thousands of people in the Iranian military who want to join him in overthrowing the regime.18 In launching the Green Wave in April 2010, Jahanchahi laid out several ambitious goals beginning with a clear call for changing the regime by force:

“We will overthrow this illegitimate regime which is nothing more than a force of occupation since the 12 June 2009 coup d’état it instigated against the Iranian people.

16 Critics of the religious faction of the Green Movement call the faction “Sabzollahis”, which means green fanatics. 17 The Green Movement is an umbrella term for a variety of political groups and interests inside and outside Iran. 18 ben Hartman,“Iranian military officers won’t support Ahmadinejad,” Jerusalem Post, 17 November 2010 at http://www.jpost. com/IranianThreat/News/Article.aspx?id=195740

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We will overthrow this regime to free the Iranian people, and establish freedom: freedom of thought, freedom of movement, freedom of religion, freedom and equality for women, for minorities, for trade unions, for the press, and so on….”19

He adds in an interview that “the people who go to the streets in order to change the regime need the backing of people from inside the system. That’s why I am contacting and seeking the support of people who say ‘we will go with you’ when the time of protests comes.” Jahanchahi’s urgency comes from his realisation that should the regime remain intact and continue with its nuclear programme, a military strike is a near certainty, which he fears will give the regime a resounding boost.20 He wants to bring down the regime before it sparks a “destructive regional war with unimaginable consequences for international peace and security.” Unless the regime falls, he foresees a lose-lose situation where “if Israel does not attack, there will be war, but if Israel does attack, it would be the biggest gift the Ahmadinejad regime could ever receive and would send the entire region into war.” He disagrees with the non-violent strategy and asserts that “[t]he Iranian people are ready to accept the truth that this regime will not be changed by a velvet revolution. It has to be changed by force.” His plan includes helping defectors escape the country, building a radio station to beam news into Iran, setting up an exile government, and funding strikes in the transportation sector. The objective is to “transform the cells of discontent into cells of resistance.” He sees active opposition as a third option to sanctions/engagement and military action.21

1.3 War of the Ayatollahs

Since Ahmadinejad’s presidency in 2005, the number of grand ayatollahs publicly distancing themselves from the government has markedly increased, creating a sense of mistrust around the leaders and eroding their ability to lead effectively.22 The unsatisfactory handling of the 2009 protests weakened the government’s position and accelerated polarisation within the religious community. Grand ayatollahs such as the late Ayatollah Montazeri, and Ayatollah Amini, Ayatollah Ostadi, Ayatollah Dastgheib, Ayatollah Taheri, and Ayatollah Javadi

19 Statement of A. H. Jahanchahi, “Time to overthrow despotism in Iran” , Foreign Press Association, London, 19 April 2010. See also Ian Black, “Iranian exile calls for overthrow of Ahmadinejad”, The Guardian, 19 March 2010 at http://www.guardian.co.uk/ world/2010/mar/19/iran-green-wave-opposition-jananchahi/print 20 Conversation with author, March 2010 21 Ryan Mauro, “Iranian Air Force Officer Defects”, FrontPage Magazine, 2 December 2010 at http://frontpagemag. com/2010/12/02/iranian-air-force-officer-defects/print/ 22 The hierarchy among Shi’a clerics is, from the top, Marja, Grand Ayatollah, Ayatollah and Hojatoleslam. Many traditional clerics look down on Ayatollah Khamenei as a ‘sultan’, or political leader, not a marja or religious leader. “The opposition (to Khamenei) is not new. It goes back to the 1990s, just a few years after Khamenei’s 1989 appointment as supreme leader. At that time, the right-wing clergy tried to promote Khamenei as a Marja. Vahid Khorasani is said to have told him, “You be the sultan, but leave marjaeiyat [Marja status] to others.” Muhamad Suhimi, “A Historic Letter by Judiciary Chief Sadegh Larijani?” FrontlineMagazine, 14 October 2010 at http://www.pbs.org/wgbh/pages/frontline/tehranbureau/2010/10/a-historic-letter-by- judiciary-chief-sadegh-larijani.html

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Amoli are among those who have moved away from the government. More and more ayatollahs are abandoning support for the Velayat Faghih, which underpins the legitimacy of the office of the supreme leader. The 400 ayatollahs in prison for denouncingVelayat Faghih are part of a widespread expression of disenchantment with the system among traditional Shi’a Islam in Iran.23 Out of the three main vulnerabilities of the regime, the disenchantment of traditional Islam is regarded by the regime as the most threatening, even more so than economic mismanagement and human rights violations. Ali Khamenei was not a grand ayatollah when he was chosen supreme leader after Ayatollah Khomeini’s death. Partly because of the inadequacy of his credentials among the clergy, he has created a network of clerics who support him. They are assigned by him to different positions, from ‘Friday prayer Imams’ and university posts to the IRGC, Army, the Islamic Republic of Iran Broadcasting, and other institutions. Notwithstanding the supreme leader’s extensive patronage and purse strings, there remain a number of independent clerics at seminaries in Qom, Isfahan and Shiraz. Since the June 2009 election, these independent clerics have been vocal about the government’s handling of the crisis. The late Grand Ayatollah Montazeri, once Ayatollah Khomeini’s favourite to succeed him, made an extraordinary assessment after the crackdown following the June election that the Islamic Republic was neither Islamic nor a Republic anymore. The revered ayatollah drew thousands at his funeral in Qom from across Iran. The procession had an unmistakeable anti-regime feeling. Another gap that has widened since the election is the distance between Ayatollah Khomeini’s family and the Khamenei – Ahmadinejad leadership. Hasan Khomeini, the grandson of the leader of the Revolution, neither congratulated Ahmadinejad for his second term in office nor attended his inauguration. Hasan also met with ranking political figures sent to prison after the election.24 The fact that Khomeini’s family has taken sides with the Green Movement opposition has been damaging for Khamenei, polarising the clerical establishment.25 The refusal of three eminent ayatollahs – Ayatollah Amini, Ayatollah Ostadi and Ayatollah Javadi Amoli, to appear at a key Friday Prayer in Qom in 2009 was another public setback for Khamenei, leaving him more vulnerable to his critics and opponents. WikiLeaks confirmed a long-standing rumour that Khamenei has terminal cancer.26 The information emanates indirectly from Akbar Hashemi Rafsanjani, who has a motive to spread such a rumour given his own ambitions to succeed Khamenei. However, the veracity of the supreme leader’s illness could be genuine, given his prolonged absences from the public. Well-informed Iranians also say that Mojtaba, the second son of Khamenei, President Ahmadinejad and senior IRGC officials have isolated Khamenei from ordinary people.27

23 Traditional Shi’a clerics believe that the twelfth (or “hidden”) imam, known as the Mahdi, lives in “occultation” but will one day return and resume the leadership of the faithful. Until that moment arrives, traditional Shi’as....believe that political and religious authority should remain separated. As such many high-ranking ayatollahs, religious leaders and their followers have opposed the fundamental tenets of the present Iranian political system, established following the 1979 revolution. Conversation with Nazenin Ansari, 2 December 2010. 24 hasan Khomeini also attended the wedding of the son of Mohsen Mirdamadi, a prominent opposition figure who spent months in prison after the election, and appeared in pictures with other reformist figures including former President Khatami. 25 Robert Baer and Omid Memarian. “Iran’s Leaders Battle Over Khomeini’s Legacy,” Time Magazine, 2009 at http://www.time. com/time/world/article/0,8599,1912970,00.html 26 See “WikiLeaks cables say Iran’s Khamenei has cancer” Reuters.com, 29 November 2010 at http://uk.reuters.com/article/email/ idUKTRE6AS1LP20101129 27 Conversation with Nazenin Ansari, who heard this from a prominent source, 2 December 2010.

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Khamenei appears to be making an effort to persuade clerics in Qom to approve his son Mojtaba as a possible successor as supreme leader. One prominent cleric, Grand Ayatollah Vahid Khorasani, who previously taught Mojtaba Khamenei in Qom, avoided meeting Khamenei during a visit to Qom in late 2010, according to some observers, so as not to be seen as endorsing Khamenei’s son to succeed the supreme leader. 28 For many people the legacy of the 1979 Revolution belongs to memories of the founder, Ayatollah Khomeini and his close allies, including Akbar Hashemi Rafsanjani, Abdolah Bouri (former Minister of Interior), Mehdi Karrubi (former Khomeini representative in the Martyrs Foundation, former speaker of the parliament and presidential candidate), former President Khatami and many more in the clerical establishment. Ali Khamenei is excluded from this legacy.

1.4 The Supreme Leader as Divine Ruler

Religion has been invoked since the founding of the Islamic Republic of Iran to create a spiritual link between the people and the clerics’ new political system. Now, the ultra- conservative ‘radical’ ayatollahs led by Ayatollah Mesbah Yazdi are evoking religious sentiment in a novel way by saying that the legitimacy of the government is independent from the vote of the people. The regime itself has assumed an air of divine authority.29 A long-time mentor of President Mahmoud Ahmadinejad, Mesbah Yazdi wants to replace the “Islamic Republic” with an “Islamic Government”. Under an Islamic Government, a vote by the people for the presidency and the parliament is no longer essential for the legitimacy of Khamenei or any future supreme leader. This represents a major ideological shift in Iran that the reformists are trying to challenge. Mousavi and other reformists believe that if they had not stood up for sanctity of the people’s vote during the election, Mesbah Yazdi’s radical ideology would have been even closer to implementation. The more people have asked for free elections and political freedoms, the more the radicals have pushed to connect the supreme leader’s rule to the will of God.30 In July 2010 Ayatollah Jannati, head of the pro-Khamenei guardian council, went as far as saying that “God delivered the leadership to Khamenei.” The reaction by the Iranian intellectuals and youth on the internet was one of mockery. 31 The radicals are attempting to put the supreme leader in a safe position independent of the checks and balances created to hold the supreme leader accountable to bodies such as the assembly of experts, where Rafsanjani is influential. Ultimately, the supreme leader and his radical allies hope they will no longer need the

28 Recently, Hassan Nasrallah, Hezbollah’s leader in Lebanon, and other acolytes of Khamenei have been calling the supreme leader “Imam”, which is another sign that the supreme leader is looking to the future because in Shi’ism, only Imams are able to pass on the title to their sons. Meir Javedanfar, “The Missing Ayatollah”, The Diplomat, 26 November 2010, at http:// the-diplomat.com/2010/11/26/the-missing-ayatollah/. For more on the tensions between Khamenei and the Qom clerics, see Najmeh Bozorgmehr, “Khamenei pleads for support in Qom”, Financial Times, 28 October 2010, at http://www.ft.com/cms/ s/0/0f4837aa-e2b2-11df-8a58-00144feabdc0,dwp_uuid=be75219e-940a-11da-82ea-0000779e2340.html#axzz17EpSVSug 29 E. Follath, “Is War Between Iran and Israel Inevitable?,” Spiegel Online, 2009, at http://www.spiegel.de/international/ world/0,1518,631799,00.html 30 Khamenei’s 2010 fatwa stating that he is an extension of the rule of the Prophet Mohammad is another attempt to justify absolute rule on divine sovereignty. L. Scott, “Iran Special: Khamenei’s ‘I Am the Rule of the Prophet’ Fatwa- Strength or Weakness?” Enduring America, 21 July 2010, at http://enduringamerica.com/2010/07/21/iran-special-assessing-khameneis-i- am-the-rule-of-the-prophet-fatwa-verde/ 31 S. Lucas, “Iran Analysis: Twisting and Turning to Prove the Leader is Supreme”, Enduring America, 2009 at http://enduringamerica. com/2010/07/29/iran-analysis-twisting-turning-to-prove-the-leader-is-supreme-verde/

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approval and support of the traditional clerical establishment. However, the increasing tendency to link the legitimacy of the supreme leader to God, the Prophet Mohamed or any other religious foundations, could backfire and render the entire institution of the supreme leader and Velayat Faghih anathema in the eyes of the public. Many Iranian activists and politicians fear that the radicals led by Mesbah Yazdi will weaken the parliament as a way to ignore the people’s vote in a systematic way. Elections will be increasingly micro-managed by the guardian council, who hand-pick the candidates, preventing even centrist conservatives from running in the next parliamentary elections in 2012. Potential candidates who have been critical towards Ahmadinejad might not be approved. The parliament is resisting such emasculation by targeting Ahmadinejad’s reckless and careless policies and his attempts to ignore the role of the parliament. A vocal minority of parliamentarians has gone as far as to bring a petition of impeachment against the president.32 The architect of the IRI, Ayatollah Khomeini once said that the “parliament is on the top of all affairs.”33 The radical faction inside the Islamic Republic is pushing for a major shift from the will of the founder. The downside of claiming a divine connection to God is that the regime distances itself from two sources of legitimacy in Iran; first, the Iranian people, which is supposed to be represented by a vibrant parliament, and, second, the spiritual and religious source of legitimacy from the clerical establishment.

1.5 Ahmadinejad and the Imam Mahdi

Mahmoud Ahmadinejad has been an advocate of the 12th Imam or Imam Mahdi, believed to be a messiah-like figure in Shi’a Islam. He is said to have disappeared for a thousand years and will reappear one day to save the world. There are rumours that Ahmadinejad, when he was Teheran’s mayor, was trying to build a highway to Teheran to be called Imam Mahdi Highway. President Ahmadinejad believes that when the Imam appears, he will enter the city from that highway. After much criticism of the idea, the highway construction never came to fruition. 34 Ahmadinejad has spent much public money on the development of the Jamkaran Mosque; a place that some believe the Imam Mahdi once appeared. The president asked people to pray there in an effort to heighten the religious legitimacy of his government. Amir Taheri describes how “several times a year, Ahmadinejad takes his entire cabinet to Jamkaran, a suburb of the ‘holy’ city of Qom south of Teheran, to report to the Hidden Imam… [T]here is a well that is supposed to lead to the place where the Hidden Imam is in hiding. In a solemn ceremony, Ahmadinejad throws copies of his government’s budget and other edicts into the well for consideration by the Hidden Imam. The message is clear: A government that is preparing for the end of times, under the command of the Hidden Imam, does not need the mullahs.” 35

32 Farnaz Fassihi, “Assembly Pushes to Oust Iran President” Wall Street Journal, 22 November 2010, http://online.wsj.com/article/ SB10001424052748703904804575631093531990342.html?KEYWORDS=impeach+iran 33 http://www.khabaronline.ir/news-50441.aspx (in Arabic) 34 Michael Slackman, “For Iran’s Shiites, a Celebration of Faith and Waiting,” The New York Times, August 30, 2007 at http://www.nytimes.com/2007/08/30/world/middleeast/30imam.html 35 See Amir Taheri, “Impeaching Ahmadinejad”, Wall Street Journal Opinion, 30 November 2010 at http://online.wsj.com/article_ email/SB10001424052748704693104575638210916460270-lMyQjAxMTAwMDIwOTEyNDkyWj.html

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Ahmadinejad appears to have hedged his bets on both his patron, Ayatollah Khamenei, and his mentor, Mesbah Yazdi, who is pushing the notion that the supreme leader has a divine connection. If Ahmadinejad himself has a direct line to the Hidden Imam, he can bypass not only the clerical establishment but also the supreme leader. Taheri concludes that a “man who talks to God wouldn’t bother with mere saints.”36

1.6 Decision-Making Paralysis

There was a brief period after the 2005 election when the conservatives had a monopoly on government. Before then, the in-fighting between the office of the supreme leader (the Beit) and President Khatami was intense. They even had two rival intelligence agencies, with Khamenei’s head of security setting up an intelligence agency inside the IRGC.37 The dual intelligence operations mirrored the leadership rivalry, causing a paralysis in government decision-making. When President Khatami was replaced by Ahmadinejad, the reformists were sidelined, and the conservative government, in alignment with the dominant conservative ayatollahs, could take decisions more easily. Since the election fiasco of 2009, however, the government has become even more ridden with power struggles. The reformists have come storming back in the public eye, supported by the resources of the wily Rafsanjani. The current decision-making paralysis has resulted from deepening fissures within the elite between reformists and conservatives, conservatives and ultra-conservatives, President Ahmadinejad and the parliament, Ahmadinejad and the judiciary, Ahmadinejad and the clerics in Qom, Ahmadinejad and the supreme leader, the supreme leader and the Qom clerics, reformists and the guardian council, the parliament and the guardian council, and more. Consumed with jockeying for power, the regime has been unable to take decisions since mid-2009. One international example of this paralysis was in October 2009, when President Ahmadinejad accepted a US-authored deal to swap nuclear fuels only to be rebuffed by

36 Further evidence of Ahmadinejad’s populist inclinations is his recent highlighting of King Cyrus, a pre-Islamic giant in Persian history, as a means of galvanising support among Iranian nationalists, particularly among the nationalists who lead the IRGC. In a speech, Ahmadinejad paid tribute to Cyrus while one of his associates with a Persian nationalist ideology claimed that the Persian King of Kings should be regarded as ‘equal to prophets.’ “This was too much for the mullahs, who remember that Cyrus freed the Jews from bondage in Babylon. Since Islam claims that everything and everyone before and outside Islam is nothing but ‘darkness and sin,’ the public tribute to Cyrus even sparked criticism from one of Ahmadinejad’s closest clerical allies, Ayatollah Mesbah Yazdi.” See Amir Taheri, infra. 37 The IRGC’s renamed Intelligence Organisation now stands in parallel to Iran’s Ministry of Intelligence. An insider’s account of the decision to create a rival intelligence operation in the IRGC is provided by Omid Memarian, an Iranian journalist who left Iran in 2005. The key figure who challenged Khatami’s efforts to clean up the intelligence services was Asghar Hejazi, chief of security at Khamenei’s office. Hejazi was close to the controversial Saeed Emami, former deputy to the ministry of intelligence at the time of Hashemi Rafsanjani’s presidency and the main suspect in the case of several murders of Iranian intellectuals in 1988. Former President Khatami accepted internal government reports that the murders were carried out under the Ministry of Intelligence, resulting in the arrest of high ranking officials including Saeed Imami. Emami reportedly was very close to Ayatollah Khamenei’s office, which had unsuccessfully pressured Khatami not to reveal the names of those with blood on their hands from within the Ministry of Intelligence. This created a major intelligence rift between Hejazi and Khatami’s intelligence establishment. Khatami fired many in the intelligence to clean up the system and shut down the murder machine within the government. Those who left the Ministry of Intelligence formed a parallel intelligence force within the IRGC and joined the intelligence department at Khamenei’s office. Hejazi, who is seen as one of the most influential men on Ayatollah Khamenei’s staff, together with Mojtaba Khamenei, have been the major figures to bring Ahmadinejad closer to Ayatollah Khamenei following the 2005 election. The supreme leader’s support for Ahmadinejad, in turn, influenced others to support Ahmadinejad, including the IRGC, the police and Iran’s state TV. Omid Memarian memorandum to author, August 2010.

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others when he presented the deal in Teheran. The deal was opposed because Ahmadinejad’s rivals saw an opportunity to portray the president as weak. In late 2010, Ahmadinejad’s rivals in the parliament led by Ali Larijani and his brother and brother-in-law, were busy drawing up preliminary petitions for impeachment of the president. An intensifying struggle over the short to medium-term seems to be inevitable between reformists, moderate conservatives, and Ahmadinejad and his radical allies. Drawing attention to outside threats to Iran and the possibility of an attack against its nuclear and military bases benefits Ahmadinejad and his allies in Teheran.38

1.7 Role of the Revolutionary Guards (IRGC)

The IRGC is the force that is responsible for the protection of the supreme leader, the president and other top Iranian officials. The IRGC deals with foreign threats and is also responsible for Iran’s nuclear bases and, jointly with Iran’s Ministry of Defence, for Iran’s missile program. The number of IRGC forces in official political positions has increased over the past decade.39 The IRGC operates as a big corporation that has absolute military and intelligence dominance in Iran. Three ‘tendencies’ within the IRGC have formed in recent years: first, many in the IRGC have become professionals like their counterparts in the Iranian military forces, with whom they have been competing favourably for resources. Disciplined in outlook and training, these are the most conservative elements of the IRGC. They are not ideologically inclined to implement Ahmadinejad’s jingoistic rhetoric against the West, especially if it leads to a military attack on Iran, but they seethe with resentment over their ‘Versailles moment’ when the Iran-Iraq War ended without victory for Iran after so many battles which they personally fought. A second group also comprises veterans of the Iran-Iraq War, but they are more entrepreneurial and have benefited from the business deals lavished by the regime on the IRGC in recent years. They oversee ownership of hundreds of companies, private ports and airports. Some of these entrepreneurs owe their positions to the supreme leader and some do not. The third component of the Revolutionary Guards oversee the true believers, including the Al Quds brigade, which is responsible for training Hamas and liaising with the Lebanese Hezbollah, Sadrist militias in Iraq, and others abroad. They are most closely linked with the Ansari Hezbollah, the shock troops of the Basij, and other fanatical Basij inside Iran. President Ahmadinejad is not the only major political figure with a background in the IRGC. Mohsen Zarghami, head of Iran’s state TV, which is the heart of Iran’s propaganda

38 Since neither faction has anything positive to offer the people, they fight each other over the narrowing Khomeinist base, vying for its support through growing confrontation with the Western democracies. See Amir Taheri, infra. 39 D. Bednarz and E. Follath,” Revolutionary Guards Keep Stranglehold on Iran” Spiegel Online, 2010, http://www.spiegel.de/ international/world/0,1518,677995,00.html and K. Heideman, “Analysing the Political Elite of the Islamic Republic of Iran,” Wilson Center, 2010 at http://www.wilsoncenter.org/index.cfm?topic_id=1426&fuseaction=topics.event_summary&event_ id=603056 and Ali Alfoneh,”Iran’s Parliamentary Elections and the Revolutionary Guards’ Creeping Coup d’Etat,” American Enterprise Institute For Public Policy Research, February 21, 2008 at http://www.aei.org/outlook/27549 and RAND comprehensive study on the IRGC (2008) at http://www.rand.org/pubs/monographs/2008/RAND_MG821.pdf and J. Borger and R. Tait, “The Financial Power of the Revolutionary Guards,” The Guardian, 15 February 2010, at http://www.guardian.co.uk/ world/2010/feb/15/financial-power-revolutionary-guard

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machine, Teheran Mayor, Baqer Ghalibaf, and Ali Larijani, the speaker of the parliament, are all potential candidates for the next presidential election who have a background in the IRGC. Some analysts see a struggle for power between the mullahs and the rising generation of the military and their technocratic allies, as exemplified by the IRGC leaders. “An Islamist regime controlled by the military-technocratic elite rather than the clergy is not inconceivable. One example was Pakistan under General Zia ul-Haq in the 1980s.”40 It is increasingly doubtful that Ahmadinejad has the ability, gravitas and support to play the role of General Zia of Pakistan. He may rely on the IRGC for support, but the IRGC does not rely only on him, given their other alumni who are his fierce rivals. One US diplomatic cable in WikiLeaks describes an altercation in which the IRGC chief slapped Ahmadinejad in the face because the president “was deemed to be advocating freedom of the press.”41 The IRGC is likely to have strong influence in the choice of the next president, whatever the preferences of the clerics.42 The IRGC does not want to be tied to the unpopularity of the clerics. If the people were to somehow expunge rule by Velayat Faghih, the IRGC is in a position to manoeuvre behind the scenes to anoint the successor or, at a minimum, gain support from whoever comes to political power.43

The Bazaaris The traditional business community in Iran, known as the Bazaaris, has been squeezed by the increasing dominance of the IRGC in the economy. The Bazaaris are one of many groups in Iran that have been disappointed with the performance of the Iranian government since the June 2009 elections.44 The bazaar and the clerical establishment are the two major sources that led to the victory of Ayatollah Khomeini in 1979. The Bazaaris economic clout has waned with the rise of chain stores like Shahrvand and Refah that have changed the distribution systems in Iran. They have also been partially eclipsed by the increasing business dominance of individuals and companies close to the IRGC. Still, the Bazaaris in the major cities such as Teheran, Tabriz, Shiraz, Isfahan and Mashad continue to play an important role in Iran’s economy. Following a 12-day strike in July 2010 in the Teheran bazaar over a sharp increase in the value added tax (VAT), the government was forced to compromise in order to end the strike. The psychological impact of the bazaar is also important. Most of the bazaars are located in parts of the cities where Ahmadinejad seems to have strong support, and which consist largely of thousands of low income workers. The strike in Teheran’s bazaar was in the part of the city where Ahmadinejad claims to have his greatest number of supporters. The 1979 Revolution began to escalate when the Bazaaris joined together, went on strike and paralysed the Iranian economy in the months before the shah’s departure. Now, even

40 See Amir Taheri, infra. 41 David Hancock, “Embarrassing Revelations Abound in Leaked US Cables” CBS News, 28 November 2010, at http://www. cbsnews.com/8301-503543_162-20023933-503543.html 42 Informed Iranians believe that the 2009 elections was a coup d’etat by the IRGC to prevent Rafsanjani from succeeding the ailing Khamenei as supreme leader. Rafsanjani is in a strong position to succeed Khamenei through his position of Chairman of the Assembly of Experts and Chairman of the Expediency Council of Iran, an unelected administrative assembly that resolves legislative conflicts between the Parliament and the Guardian Council. 43 Conversation with Prof. Ali Fatemi, prominent Iranian dissident, Paris, 2009. 44 Omid Memarian, “Poll Finds Dwindling Support for Government”, Inter Press Service, 2010, at: http://www.ipsnews.net/news. asp?idnews=52307

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though the economy operates differently, the government cannot ignore the psychological impact of strikes in the bazaar. If the 12-day strikes had lasted much longer, they would have had a devastating impact on the regime’s legitimacy. The Bazaaris are the financial source for several independent religious schools, and are involved in many religious ceremonies. They also fund major events during the religious month of Moharram. The close relationship between the Bazaaris and the clergy, and their independence from, and frequent criticism of, the government make the Bazaaris a significant aspect of Iran’s domestic politics.45

1.8 Economy

Iran’s economic outlook is largely negative as it suffers from poor economic management under President Ahmadinejad and the impact of sanctions on trade and finance.46 Ahmadinejad came into government at a propitious moment with rising revenues from oil prices that were able to mask the economy’s structural problems. He was able to find new markets for Iranian energy in the East, especially China, which shielded Iran from the impact of the early rounds of sanctions from the US and Europe. In retrospect, his policy of cash handouts to the poor ignored the productive parts of the economy, including the Bazaaris and the industrialists, and exacerbated unemployment, brain drain and inflation when the oil price dropped.

Unemployment According to Iran’s Statistical Centre, the official unemployment rate was 11.5% in 2005 and 12.5% in 2010. According to ten prominent Iranian economists, the real unemployment numbers are 14.7% in 2005 and 15.4% in 2010.47 Today, 70% of Iran’s 2.8 million unemployed are between 15 and 29 years old and 80% of them live in cities. Each year more than 700,000 young Iranians are added to the job market. At the height of its prosperity, Iran was able to create 600,000 jobs per year in the last decade. With shrinking foreign investment in Iran, unemployment remains one of the major sources of concern to the regime as it adds to other social problems.

Brain Drain Educated Iranians try to find a way out of the country. According to the International Monetary Fund’s survey of 91 countries, Iran has the highest rate of brain drain in the world. “Every year, 180,000 (compared to 150,000 in 2004) educated Iranians leave their country to pursue a better life. The economic loss from this departure is estimated at some

45 W. Yong, “After Killing at a Bazaar, Iran Declares Two Days Off,” The New York Times, 13 July, 2010 at http://www.nytimes. com/2010/07/13/world/middleeast/13iran.html. The strike quickly spread to Tabriz. See N. Fathi, “Strike at Bazaar Spreads Beyond Teheran,” The New York Times, 16 July 2010 at http://www.nytimes.com/2010/07/16/world/middleeast/16bazaar.html 46 M.R. Behzadian, the head of Teheran’s Business Chamber, said in July 2010 that Iran’s imports had been $90 billion dollars. A year before, the actual value of goods and imported items was $60 billion, which means that the country paid $30 billion more for the sanctions. As this number increases, the sanctions may force the radicals in Teheran to recalculate their plans. Interview with M.R. Behzadian, “Iran’s Economy is Paralyzed”, Iran-Emrooz, 8 July 2010, at http://www.iran-emrooz.net/ index. php?/news1/23328/ 47 See Khabaronline News Website, July 25 2010 at http://www.khabaronline.ir/news-78528.aspx (Arabic)

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$50 billion a year or higher.”48 90 people from among 125 ‘genius’ university graduates that participated in the Scientific Olympiads have left the country.49

Inflation Despite record oil revenues during Ahmadinejad’s first term, which generated more than $230 billion revenue in four years, Iran experienced one of the highest inflation rates (25%) in a decade.50

Subsidies and Privatisation With subsidies on energy and food consuming 40% of the budget, the government has no choice but to lift the subsidies. Ahmadinejad’s plan to cushion the impact of removing sanctions through direct payments to the poor is likely to compound inflation as the rest of the economy is starved of capital.51 In 2009 Ahmadinejad undermined his bold move to privatise the bloated public sector by awarding the IRGC a majority stake in the state telecommunications firm in 2009.52

China’s Role China has built up a multi-billion investment in Iran over the last decade. Iran signs billion dollar contracts with China for two reasons, first to challenge the US-led sanctions, and second, to give China a vested interest in retaining its contracts with Iran.53 Given that Iran has the second largest gas reserves in the world with a huge liquefied natural gas potential, resource-hungry China is likely to be supportive of the regime and offer the US only token support for additional sanctions. Other countries in Asia have followed the US lead on sanctions more closely. In some cases, China has taken over investments and projects held by other countries that sold their interests because of the sanctions. Examples of such risks are illustrated below.

Japan Japan’s INPEX discovered the Azadegan oil field in Iran and held 75% ownership in it until they felt pressured by the international community to sell their interest back to the Iranians, retaining only a 10% interest. Not long afterwards, the Iranians sold the 65% repurchased from INPEX to a Chinese oil company.54

48 G. Esfandiari, “Iran: Coping With the Worlds Higest Rate of Brain Drain,” Radio Free Europe/Radio Liberty, 2004, at http://www. rferl.org/content/article/1051803.html. F. Harrison, “Huge Cost of Iranian Brain Drain,” BBC News, 2007, at http://news.bbc. co.uk/2/hi/middle_east/6240287.stm 49 As quoted from an expert at a conference entitled “Brain Drain: Challenge or Opportunity,” held by Amirkabir University, Teheran, 2009, at http://www.iran-farhang.ir/news/view.php?gid=1&id=12541081 50 On Iran’s oil industry situation see from minute 26, “Iran’s Economic Health and the Impact of Sanctions,” Carnegie Endowment, 2010 at http://www.youtube.com/watch?v=xKnlgnca3AE 51 R. Taghavi, “Why Iran’s Ahmadinejad is pushing to cut popular government subsidies,”The Christian Science Monitor, 2010 at http://www.csmonitor.com/World/Middle-East/2010/0430/Why-Iran-s-Ahmadinejad-is-pushing-to-cut-popular-government- subsidies 52 Suzanne Maloney, “The Revolutionary Economy,” The Iran Primer, USIP, November 2010 at http://iranprimer.usip.org/resource/ revolutionary-economy 53 “ Iran sanctions could be biggest challenge for Seoul: scholar” , The Korea Times, 5 August 2010 at http://www.koreatimes.co.kr/ www/news/nation/2010/08/113_70857.html 54 Meeting with Nakao Yasuhisa, Director, International Economic Affairs Division, METI, Tokyo, 25 August, 2010.

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South Korea South Korea imposed sanctions in September 2010 that were as tough as the ones imposed by the EU, notwithstanding its burgeoning trade and oil imports from Iran. “Trade between Iran and South Korea grew to $9.6 billion (in 2009), up from $2.9 billion in 2001. In the first seven months of 2010 it rose 53 percent over the same period of last year to $7.4 billion, thanks mainly to increased oil exports to South Korea and a growing Iranian appetite for Korean electronics and vehicles. Iran is the fourth-largest source of crude oil for South Korea, accounting for 10 percent of its oil imports.”55 Part of South Korea’s motivation in adopting sanctions against Iran’s nuclear programme is to generate greater international pressure on North Korea regarding its more advanced nuclear weapons programme.

Germany Germany accounts for nearly two thirds of the machinery used in Iranian factories. It has bolstered its export controls as part of the EU sanctions in 2010, but it has refused to close a major bank in Hamburg that finances German exports to Iran.56

United Arab Emirates (UAE) One of the biggest blows to Iran is the decision of the UAE, a long-time trading partner, neighbour and largest source of Iranian imports ahead of China, to enforce the UN sanctions voted in June 2010. Business activity at Iranian banks and shops in Dubai has come to a halt because traders are unable to get letters of credit and other sources of financing.57

The Economic Stewardship Deficit Would the election of Mousavi in 2009 have made a difference in the current economic performance of Iran? He ran a campaign based on the platform of fixing the Iranian economy rather than on expensive foreign adventures. He somehow managed to keep the economy going during the 1980-1988 Iran-Iraq War. In July 2010, a former IRGC minister during the Iran-Iraq War said publicly that many in Mousavi’s cabinet at that time were not in the “mood” for war, meaning that they did not support it fully. In a backhanded compliment, he accused Mousavi of caring more about people’s ‘bread and butter’ than about winning the war.58 Mousavi is not alone in focusing on economic issues. Other reformist politicians like Khatami, Rafsanjani and Karrubi, along with Hassan Roohani (Iran’s former chief nuclear negotiator and the former secretariat of Iran’s National Security Council), Gholamhossein Karbaschi (former Teheran mayor) and Mohammad Ali Abtahi (former vice president under Khatami) emphasise the negative consequences of Iran’s building tensions with the international community. They seem ready to open up the country to the world.

55 Choe Sang-Hun, “South Korea Aims Sanctions at Iran,” The New York Times, 8 September 2010, at http://www.nytimes. com/2010/09/09/world/asia/09korea.html 56 Daniel Schwammenthal, presentation to Legatum Institute, London, 2010. See also Benjamin Weinthal, “Why is Merkel Protecting Iran’s Terror Bank?” The Weekly Standard, 8 September 2010, at http://www.weeklystandard.com/blogs/why- merkel-protecting-irans-terror-bank. The EU point person for sanctions says that any transaction exceeding 40,000 Euros between any party and EIH is monitored by the EU. Meeting in Brussels at Council of Ministers, 7 December 2010 57 Martina Fuchs, “Sanctions squeeze Dubai’s trade with Iran”, Reuters, 24 November 2010 at http://news.yahoo.com/s/ nm/20101124/wl_nm/us_emirates_iran_trade 58 http://www.farsnews.net/newstext.php?nn=8904280382 (in Arabic)

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In contrast to the reformists, the economy holds a very small place in the calculus of Khamenei and Ahmadinejad. Khamenei prefers that Iran be self-sufficient, even if it requires following the North Korean model. Ahmadinejad belittles the economic impact of the sanctions, likening the June 2010 sanction resolution by the United Nations Security Council (UNSC) to “a used handkerchief.”59 This gap between the reformists and the current leadership contradicts somewhat the mantra of the Diaspora Opposition that the problem is with the IRI system, not with particular individual leaders. On economic policy, there are differences among individuals within the IRI. This raises a question as to whether there are The reformists might gain individual differences on other issues such as the nuclear popular domestic support programme. On the surface, the answer is no. Mousavi as prime for reprioritising the minister and Khatami as president both supported the nuclear programme. At the same time, Mousavi in 2010 talked about economy and de-emphasising holding a “nuclear referendum,” challenging the official narrative rebuilding Hezbollah in that people think Iran’s nuclear programme is an “absolute right.”60 Lebanon or funding a massive Depending on how the issue is framed, the reformists might gain space, missile and nuclear popular domestic support for reprioritising the economy and de-emphasising rebuilding Hezbollah in Lebanon or funding a programme when hospitals in massive space, missile and nuclear programme when hospitals in Iranian cities are inadequate, Iranian cities are inadequate, jobs are almost non-existent, and the jobs are almost non-existent, economic situation has become so hopeless that industrialists are and the economic situation leaving Iran for good. Khamenei and Ahmadinejad do not see economic has become so hopeless that mismanagement as a threat to the regime’s survival. Compared industrialists are leaving Iran to the economy today, the country made enormous economic for good sacrifices during the Iran-Iraq War. However, that was under the charismatic leadership of Ayatollah Khomeini, who could rally the people round the flag. By contrast, 60% of today’s Iranians are under 30 and 25 million are between 15 and 29. These Iranian youths are more materialistic, realistic and sceptical about the government’s policies than their Iranian cohorts in the 1980s, when the Revolution was still fresh. It may be unrealistic for the regime to count on the support of the vast majority of the population in the face of worsening economic mismanagement caused by an ideological leadership and intensifying international economic pressure. The uncertainty of the willingness of the under 30-year-olds to accept mismanagement is a potential source of social and political instability. Iran’s post-election unrest in 2009 may have been a foreshadowing of the people’s dissatisfaction. The economy truly is one of the Achilles heel of the regime.

59 Josh Duboff, “Ahmadinejad: New Sanctions Are Like ‘a Used Handkerchief’,” New York Magazine, June 2010 at http://nymag. com/daily/intel/2010/06/ahmadinejad_new_sanctions_are.html 60 http://www.bbc.co.uk/persian/iran/2010/07/100707_l07_iran89_mirhossein_musavi_international_policy.shtml

28 Prospects for Iran

1.9 Demographic Trends: Two Different Paths

In 1950, Pakistan and Iran had similarly sized populations. There are now 100 million more Pakistanis than Iranians and the gap is expanding. The two different trajectories will have a long-term impact on the two countries. Whereas Pakistan seems condemned to perpetuate its youth bulge, Iran’s population, currently at 77 million, is projected to rise slowly. Unlike Pakistan, Iran’s current youth bulge will turn into a worker bulge. The difference is attributed to several reasons, including Khomeini’s decision in the late 1980s to endorse his health minister’s liberal programme for contraceptives. Although Ahmadinejad speaks of incentives to increase Iran’s birth rate, which has declined to European levels, the vast number of educated Iranian women, many of whom are pursuing careers, will most likely be decisive in keeping birth rates low. As the current youth bulge becomes older, it is unclear where a million young ‘Green’ demonstrators will come from in 2015.

Demographic Trends in Iran

7 Fertility 0.6

6 0.5

5 Youth 0.4

bulge Youth buldge 4 0.3 3 Fertility rate 0.2 2

1 0.1

0 0.0 1970 1985 2000 2015

Estimates Projections

Note: Youth bulge is defined as the proportion of 15-to-29 year olds in the working-age population (15 to 64) Source: UN Population Division, 2007.

The chart shows a declining fertility rate that began in the late 1980s. The throngs of young people in the June 2009 demonstrations may represent Iran’s last youth bulge (age 15-29). By 2015, the chart shows that Iran’s youth bulge will mature into a worker bulge. Based on the experience of other countries, demographers assert that the chances for liberal democracy are significantly higher in worker bulges than in youth bulges. This suggests that if the Green Movement can replace the current government in the next few years, Iran has a golden opportunity to transform itself into a liberal democracy as its youth become older.61

61 Richard Cincotta, a political demographer, pointed out the different trajectories of Iran and Pakistan in several conversations and correspondence between 2007 and 2010. See also, his interview with a panel of Nigerians, entitled “Does a Young Age Structure Thwart Democratic Governments?” in Population Reference Bureau, 12 November 2009, at http://discuss.prb.org/ content/interview/detail/3951

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Alternatively, Iran’s current regime has a chance to tame the democrats, as in the case of China following the Tiananmen crackdown in 1989, by continuing to tamp down on the Green Movement. On a pessimistic note, if Iranians miss their chance to change the political system in the coming few years, they may be consigned to that status quo because of Iran’s aging population. There will not be enough young people to match the street demonstrations seen in 2009 as Iran’s age structure exits the period of peak potential political volatility.62 Demographic trends, it should be pointed out, do not always, or even nearly always, predict future trends, especially in volatile political systems. It is always possible that in Iran a worker bulge is more likely to flood the streets or strike against an oppressive regime than a youth bulge. If the economy continues to be mismanaged into the future and/or people feel deprived of their social and political freedoms, one could imagine worker-aged Iranians organising mass strikes that cripple and eventually topple the regime.

Ethnic Minorities One of the interesting demographic features of Iran is that ethnic Persians account for only half (51%) of all Iranians. The other ethnicities are Azeri 24%, Gilaki and Mazandarani 8%, Kurd 7%, Arab 3%, Lur 2%, Baloch 2%, Turkmen 2%, and assorted others 1%.63 Social and political instability is rife in the border provinces and among the minorities. There are two different approaches within the regime’s establishment on dealing with border provinces. One approach, which carried over from the dominant pattern under governments before the 1979 Revolution, believes in benign neglect for fear that development in provinces like Khuzestan, Baluchistan, Azerbaijan, and Kurdistan might lead to political demands for autonomy and even independence. There were exceptions to this pattern of benign neglect under the shah’s rule in Khuzestan and Azerbaijan, including a project comparable to the TVA (Tennessee Valley Authority, a massive US Depression-era dam and hydroelectric power project that transformed the impoverished Tennessee region) called the Khuzestan Water & Power Authority, the largest development project of Iran. It included the building of Dez dam with the capacity of 3.2 billion cubic meter of water, development of 120 thousand hectares of land, re-establishment of sugar-cane in Iran after seven centuries, and an electricity network for the whole Khuzestan Province.64 After the Revolution, a different approach for development of the provinces was discussed during the Khatami presidency. A Ministry of Interior survey at the time found that government allocation of more attention and resources would diminish national security threats in the border regions. Like many progressive ideas, the Khatami government was unable to implement the enlightened approach because the bureaucracy resisted any change to the prevailing paradigm of benign neglect.

62 The fertility decline is dramatic when contrasted with neighboring Pakistan, with a stubbornly high Total Fertility Rate (TFR) of 4.1. UN demographers project that Pakistan’s youth bulge will persist for several decades with associated political instability and the likelihood of a continuing cycle of poverty. Iran is in a much more enviable social dynamic, provided it can evolve out of its current political quagmire. For population and other data on Iran, see “The World Factbook,” CIA Publications, updated 18 November 2010, at https://www.cia.gov/library/publications/the-world-factbook/geos/ir.html 63 See “Ethnic Groups,” CIA, The World Factbook on Iran at https://www.cia.gov/library/publications/the-world-factbook/geos/ ir.html 64 See http://countrystudies.us/iran/74.htm. The Governor of Khuzestan who directed the project, Abdolreza Ansari, was one of the Shah’s most brilliant and least corrupt technocrats. Interview with Abdolreza Ansari, Paris, France, 17 April 2007.

30 Prospects for Iran

Currently, most of the movements in Kurdistan, Khuzestan, and Azerbaijan have been peaceful and civil-rights oriented. However, some armed separatist groups have clashed with the army and police and have also conducted terrorist attacks.65 Among the minorities, the Azeris are the most integrated. Ayatollah Khamenei is Azeri, as well as many ministers and members of parliament. President Khatami appointed Abdullah Ramazan Zadeh, a Kurd, as his cabinet’s spokesman. He also appointed General Shamkhani from the Arab Khuzestan region as the minister of defence, in order to show that members of ethnic minorities served in his government. The Green Movement has been careful not to support separatism among the different ethnic groups. They do not want to give the regime an excuse to suppress any kind of political or social movement in those areas under the guise of cracking down on the Green Movement. More importantly, separatism threatens the essence of the Iranian identity, and Green Movement advocacy of any separatist agenda pursued by ethnic minorities risks losing the support of millions of Iranians who view the fragmentation of Iran as a worse outcome than continuing rule under an oppressive regime. The Green Movement prefers to reach out to all the minorities without labelling them as separatist. Their message is that all Iranians, both Persian and non-Persian, support the national integrity of Iran. Westerners who oppose the regime often do not realise that any advocacy and funding of separatist groups undermine the West in the eyes of Iranian public.66 Funding Baluch separatists to attack the IRGC and other regime targets may be inexpensive but it clashes with the interests of the primarily Teheran-based, ethnically Persian Green Movement. The US was correct to condemn a Jundallah attack on a Shia mosque in Zahedan, in the Baluch Sistan area of southeastern Iran.67 Otherwise, the regime can get away with accusing the West of supporting separatism, thereby stoking Persian xenophobia. Neighbouring Pakistan is only 62-years-old and has stronger separatist tendencies, especially among the Pakistani Baluch. By contrast, Iran is a nation that is centuries old. The concept of the Iranian nation that includes Persians and non-Persians is older than the modern Iranian state, whether under the Pahlevi dynasty or the IRI. In terms of longevity of national identity, Iran is more like Egypt, another ancient nation, than like Pakistan, a much newer nation-state.

1.10 Communication Technology

The story of communication technology after the 12 June 2009 election is a story of the government losing control of the narrative to a new technology. The story begins twenty years earlier, during the 1990s when Akbar Hashemi Rafsanjani was president and Gholam-

65 The Iranian Baluch group, Jundullah is not seen as a “movement” by Iranians. Although the Sunni Baluch and Shi’a Sistanis (where Ayatollah Sistani comes from) believe that they do not have equal rights and have been discriminated by the central government, the Jundullah group is viewed as a terrorist organisation disliked by most Iranians. Still, Jundullah attacks on regime targets have been lethal, creating problems for the regime and especially the IRGC. See J. Paris, “Iranian regime under three-point attack,” New Atlanticist, 22 October 2009 at http://www.acus.org/new_atlanticist/ iranian-regime-under-three-front-attack 66 Prof. Ali Fatemi, a distinguished Paris-based Iranian dissident and business professor, told me that the separatist strategy is a recipe for a needlessly bloody war. By focusing on opposition to the IRI, and not on exploiting ethnic grievances, he sees a better chance for success with less bloodshed. Conversation, Paris, 21 October 2009. For an example of ethnic advocacy, see WikiLeaks report on a 2007 meeting with the head of the Israeli Mossad referred to in an article by Y. Katz, “Dagan urged support for Iranian minorities to oust regime”, Jerusalem Post, 29 November 2010 at http://www.jpost.com/International/ Article.aspx?id=197135&R=R4 67 “Iran Shia mosque attack leaves dozens dead,” Telegraph, 16 July 2010 at http://www.telegraph.co.uk/news/worldnews/ middleeast/iran/7893316/Iran-Shia-mosque-attack-leaves-dozens-dead.html

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Hussein Karbaschi was the mayor of Teheran. This was the period when chain stores like Shahrvand and Refah, the Wal-Marts of Iran, challenged the role and influence of the traditional bazaar by transforming the distribution system. It was also the period when new cultural centres called ‘Farhangsara’ challenged and, in some areas, eclipsed the traditional, cultural and social institutions that revolved around the mosques and Basij centres.68 One can understand how the replacement of old institutions and systems with new ones can be unsettling. A conservative member of parliament once compared “the poisonous impact of promoting civil society” to the impact of these chain stores and cultural centres.69 Perhaps he was addressing the way Iranian civil society challenged the regime’s control over how young Iranians think. Unlike other highly authoritarian systems, like North Korea, Iranian society is highly networked, particularly amongst the Iranian youth. The conservatives may have felt threatened by the 2,600 active and licensed people-based organisations supporting over 3,500 university associations drawn from more than 5.3 million university students around the country.70 One can imagine how subversive this network of organisations and associations, with young bloggers and heavy internet users, appear to the authorities, who have always been suspicious of a progressive civil society.71 The post-election unrest showed the regime a few steps behind the youth, whose mastery of modern communication technologies enabled them to challenge the narrative of the regime over the use of widespread violence after the election. But how did the regime lose its monopoly over the media? The unexpected reaction of hundreds of thousands of Iranians who believed their votes were stolen from them upset the regime’s plan to portray Ahmadinejad’s fabricated win as an epic victory. The regime then forced foreign print, radio and TV journalists to leave the country and started a brutal, organised and pre-meditated crackdown. The political establishment controlled and censored the domestic media and used their colossal and influential national TV network to frame their own version of reality. The regime thought they had the capability of creating a convincing narrative, which could support their post-election crackdown as necessary to guarantee Ahmadinejad’s second term in office. However, their narrative failed to dominate the Iranians’ or the world’s view of the events. Journalists working in Iran, foreign or Iranian nationals, cannot report freely. In normal circumstances, journalists are morally obliged to cover both sides; in this case, the side of the people and of the government. Even if the story is sometimes disproportionately skewed, they still give space and air time to both. Once the authorities forced out or silenced the professional journalists, the Iranian media was missing professional coverage of the post-election incidents. This vacuum left the government with its own one-sided narrative. The heavy-handed attempt by the regime to control the narrative backfired and resulted in disproportionate coverage via the many videos and still-shots taken by thousands of protesters. This material ended up almost instantaneously on YouTube and shortly after on dozens of TV channels outside Iran.

68 Although better known as the militias who brutally suppressed the Green Movement demonstrators, the Basij also organised public religious ceremonies, and engaged in morals policing and the suppression of dissident gatherings. 69 See Omid Memarian, “Civil Society in Iran after the Revolution,” 2005 at http://omidmemarian.com/writings/civil-society-in- iran-after-the-revolution/ 70 According to the National Youth Organisation, as of March 2008, 3,400 SAMAN (Sazman Mardom Nahad or People-Based Organisations) have received licenses and 2,600 of them are active and have renewed their licenses. See Omid Memarian, infra. 71 See Omid Memarian, infra.

32 Prospects for Iran

The new situation confronting the authorities was different from the more familiar situation with foreign journalists whom the regime could control by threatening to cancel their visas and/or confiscate their cameras. The new communication technology was outside the government’s control. These non-professional ‘people-reporters,’ unburdened with the biases of any news corporations, became brutally believable. The regime put the blame on the BBC Persian TV channel, Voice of America and other news agencies, accusing them of stimulating turbulence and directing the crowds. This was not because there was an actual systematic and planned involvement on the part of those media outlets but because those outlets overshadowed the government’s owned media, which was filled with fabricated narratives. Protesters who had been arrested told how they were brutally beaten during detention when the police officers found out that they had shot videos of the protests. If observers put themselves in the shoes of the authorities charged with disseminating the regime’s media narrative, the reaction of the authorities is almost predictable. After having spent millions of dollars to articulate and orchestrate the government’s message, it is exasperating to have a 20-year-old protester shoot a one-minute video, upload it onto YouTube and destroy their whole story. Those amateur videos, like the one that captured the death of Neda Agha Soltan, a 26-year- Despite their huge investment old vivacious, middle-class woman who came to symbolise the in devices to spy on people’s resistance against the regime, severely damaged the image of private life and to censor the Islamic Republic.72 The damage done from millions of people around the world seeing Neda shot and laying on the ground all media and filter internet dying with her eyes open is next to impossible to control or websites, the people who run undo. Symbolism and imagery had a significant impact on spurring the state media in Iran belong resistance against the authorities in Iran. to a pre-internet-era mentality How, despite all the money and planning, could the authorities lose the battle to cell phones and text messages? Quite simply, despite their huge investment in devices to spy on people’s private life and to censor all media and filter internet websites, the people who run the state media in Iran belong to a pre-internet-era mentality. Their approach is black and white while the youth are part of the rapidly changing digital era.73 It is not having or controlling such devices effectively; it is more about a way of thinking that embodies a new paradigm. In this paradigm shift, a new method of sending a message, processing it and giving feedback makes the regime’s attempt to monopolise the narrative appear almost quixotic. Although the regime has been able to reassert its dominance over the internet with some success in the months after the election, their monopoly over the media in Iran is constantly being challenged in new ways by young, internet-savvy people outside Iran.74

72 See the HBO documentary, “About Neda” (Anthony Thomas, Producer, 2010) for graphic imagery of these videos of Neda from the minutes before being shot through to her death with her eyes open, accompanied by the narration of her physician friend next to her. 73 See Mahmood Enayat, “Revisiting the ‘Twitter Revolution’ in Iran; Lessons for the Future,” Legatum Institute, 6 September 2010 74 For recommendations on how to assist Iranians with information and communication technologies (ICT) and breaking the IRI’s monopoly over media and restrictions on free access to information, see Omid Memarian, “A step-by-step guide on how to fight censorship in Iran and what the US can do”, Huffington Post, 23 March 2010 at http://www.huffingtonpost.com/omidmemarian/a-step-by-step-guide-on-h_b_510372.html

33 chapter 2 The Nuclear File

Foreign Policy Objectives of the Islamic Republic of Iran

Two questions are central to understanding the foreign policy objectives of the IRI. First, is Iran seeking to become a rival of the United States on a global level or is it seeking only regional hegemony? The IRI is in fact simultaneously pursuing both ambitions. As evidence of its global ambitions, Iran is building a ballistic missile and space programme that exceed the limited aim of regional hegemony. It does not need solid propellant multi-thrust missiles to prevent scuds from Iraq from landing in Iranian cities as in the 1980s Iraq-Iran War. The multi-stage solid propellant Sejil-2 missile is a precursor to a longer range missile that will eventually be able to reach 3,000 km or more, covering all of Europe. It is scheduled for production in 2012.75 Further into the future, Iran aims to have a nuclear-armed Inter- continental Ballistic Missile (ICBM) that can reach the United States. These outsized goals may be delusory, but they are ambitions that illuminate and shape the leadership’s actions and discourse. They are seeking to make their ambitions operational step-by-step. President Ahmadinejad’s travels not only to Syria and Lebanon but to distant Africa and South America to demonstrate Iran’s global strategy in confronting the US. Its concentration on a supra-conventional nuclear missile capability at the expense of developing a modern conventional army and air force is further evidence of its global ambitions. The IRI wants to be the leader of the billion-plus Muslim world. It can claim an advantage over an emerging global power, China, by pointing to its location in the crossroads of the world’s energy supply. Controlling the energy in the Gulf and attaining nuclear status will, its leaders believe, propel Iran to becoming a super power even stronger, at least in terms of energy resource control, than China. However, the United States will remain an obstacle to Iran’s ambitions both on a global level and on a regional level considering that the Persian Gulf has been an American lake for several decades.

75 “For now, the Islamic Republic is unable to reach targets in Eastern Europe, but that could change as early as 2012 if Teheran decides to commence production of the medium-range Sajjil-2 missile.” Michael Eisenstadt “Potential Iranian Responses to NATO’s Missile Defense Shield,” Policy Watch no. 1722, Washington Institute, 19 November 2010

34 Prospects for Iran

The second question relates to Iran’s foreign policy: is Iran a cause or a state? The answer is both. Ever since the Revolution in 1979, Iran’s foreign policy has had a significant Islamic ideology. The fact that Iranian behaviour is also driven by the requirements of regime survival does not contradict the thesis that Iran is a cause, or more precisely, several causes. Iran aspires to establish leadership of the Islamic world, despite it being a Shi’a state in a heavily Sunni Muslim world. President Ahmadinejad’s threats against Israel and the US are designed to blur the Shi’a-Sunni divide by appealing to the Sunni Arab street. Iran is the biggest supporter of Hamas, which is also Sunni. While appealing to the Arab street, the IRI also promotes a second cause, the ascendance of Shi’ism. It seeks to build a Shi’a crescent with a focus on Iraq, Lebanon and perhaps parts of Yemen and Afghanistan. The reach of Shi’a Iran is wider than the Middle East. Unsurprisingly, Iran has been accused of converting Sunnis to Shi’ism by Morocco, a long distance away from Iran. A third cause that the IRI pursues is nationalistic, namely, the revival of an Iranian empire. Scholars such as Ali Ansari emphasise the nationalist motivations of today’s Iran and its constant reference to pre-Islamic Persian roots and symbols.76 Iran may use the language of Islam but its main objective is to increase its national power in the region as Persia has done for millennia. Some experts note that Ahmadinejad has recently used Iranian nationalist slogans in an effort to boost his support within Iran after his loss of legitimacy following the 2009 elections. Ahmadinejad asserts that “there are many interpretations of Islam, but [the] basis for our practice is the Iranian interpretation. The historical experience proves that the Iranian interpretation is the closest one to the truth.”77 Iran is not a cause but a series of causes – Islamism, Shi’ism and Iranian nationalism – which are deployed by different leaders for different audiences at different times. Promoting multiple causes expands the regime’s support base and preserves its power. The elites within the IRI may quarrel among themselves but they are cohesive and pragmatic when the regime’s survival is at stake. For example, Ayatollah Khomeini felt compelled to end the eight-year war with Iraq in 1988, which felt to him like ‘drinking from the poison chalice’.78 Ali Khamenei’s decision to sign the amendment protocol with the E-3 (UK, France and Germany) on uranium enrichment takes place during the same time frame as the suspension of the Iranian weaponisation programme in 2003.79 Perhaps this unusually conciliatory behaviour had something to do with over 150,000 US-led coalition forces on both sides of Iran’s borders in Iraq and Afghanistan in April 2003. The IRI’s grandiose ambitions, whether for Islam or for Iran, are part of a survival strategy. Ayatollah Khamenei is more comfortable with a firebrand like Ahmadinejad than a reformer like Khatami because the supreme leader fears that the IRI would be weakened without ideological motivation. The Khatami/Rafsanjani reformists and the Green Movement place economics and a better life for Iranians ahead of risky and costly foreign policy adventures abroad and confronting America and Israel. If any one of these less ideological rivals ascend to power and replace Ahmadinejad, Khamenei and his ultra-conservative allies fear the IRI will go

76 See Ali Ansari, Confronting Iran: The Failure of US Foreign Policy and the Roots of Mistrust, Hurst, London, 2006. 77 Mehdi Khalaji, “A Marriage of Convenience”, The Majalla, London, November 17, 2010 at http://www.majalla.com/en/Features/ article193028.ece 78 Afshin Molavi, “Iran and the Gulf States,” Iran Primer, USIP, November 2010, at http://iranprimer.usip.org/resource/iran-and-gulf- states 79 See, Key Judgments of National Intelligence Estimate, “Iran: Nuclear Intentions and Capabilities,” National Intelligence Council, November 2007 at http://graphics8.nytimes.com/packages/ pdf/international/20071203_release.pdf

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the way of the Soviet Union under Mikhail Gorbachev, who allowed initially tentative moves toward liberalisation and perestroika to later cascade into the end of the Soviet Union.

2.1 The Nuclear Clock: Status of Iran’s Nuclear Project

The premise of this Report is that based on evidence going back several years, Iran is aiming for a nuclear weapon capacity, but has not yet made the political decision to cross the threshold. Iran will achieve nuclear weapon capacity when it moves from nuclear latency to nuclear potency. It is likely to do so following a ‘breakout’ (also called a ‘dash’), which is defined as the time it takes to convert nuclear materials into a working weapon. The breakout will begin when Iran’s leaders decide to convert its low enriched uranium (LEU) at 3.5% level into high enriched uranium (HEU) at the minimum 90% level needed to fuel a nuclear bomb. Another more gradual way Iran can reach nuclear potency is by getting a sizeable amount of LEU enriched to a medium level of 19.75% (hereinafter “20%”). According to experts on nuclear proliferation, the most challenging and time consuming part of the enrichment process is going from LEU at 3.5% to 20%. Once the Iranians get past that stage and enrich sufficient quantities at 20%, they can ‘breakout’ to 90% enrichment in a matter of weeks. Because the time period for a breakout from 20% to 90% is so short, Iran’s adversaries may regard Iran’s enrichment of sufficient quantities to 20% as the trigger for nuclear potency, even though they have not yet made the ‘breakout’ to HEU. Until recently, assessments from the United States and IAEA have focused on the traditional breakout paradigm from LEU to HEU but now they are watching carefully Iran’s progress in intermediate enrichment to 20%.80 How is Iran performing in its enrichment programme?

Uranium Enrichment Iran’s progress in enrichment is mixed. It is growing, but not rapidly. As of November 2010, the IAEA reported that Iran had 8,426 centrifuges in Natanz of which only 4,816 were being fed uranium hexafluoride (UF6) that is enriched for LEU. Although over 40% of the installed centrifuges are not being fed with UF6, the operational centrifuges at Natanz are functioning better than before, producing 33 kilos per month.81 As the chart below shows, their effectiveness is increasing each month. According to the arithmetic of enrichment, Iran needs far more LEU to produce intermediate 20% enriched uranium, and requires ten times more intermediate 20% enriched uranium to produce 90% HEU. Working backwards, the IAEA can monitor how close the Iranians are to producing enough fuel for a bomb. One nuclear bomb requires 20 kg of HEU, which requires 200 kg of 20% enriched uranium and 1,000 kg of LEU at

80 “A critical question has been the time it would take Teheran to convert existing stocks of low-enriched uranium into weapons- grade material, a process commonly known as “breakout.” Israeli intelligence officials had argued that Iran could complete such a race for the bomb in months, while American intelligence agencies have come to believe in the past year that the timeline is longer. ‘We think that they have roughly a year dash [breakout] time,’ said Gary Samore, President Obama’s top adviser on nuclear issues, referring to how long it would take the Iranians to convert nuclear material into a working weapon. ‘A year is a very long period of time.’ American officials said the United States believed international inspectors would detect an Iranian move toward breakout within weeks, leaving a considerable amount of time for the United States and Israel to consider military strikes. Mark Mazetti and David Sanger, “US Assures Israel That Iran Threat Is Not Imminent” The New York Times, August 19, 2010 at http://www.nytimes.com /2010/08/20/world/middleeast/20policy.html?_r=2&hp 81 See the November 2010 IAEA report at http://www.iaea.org/Publications/Documents/Board/ 2010/gov2010-62.pdf See also http://isis-online.org/isis-reports/detail/iaea-iran-safeguards-report-shutdown-of-enrichment-at-natanz-result-of-stux/8

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3.5%. As of November 2010, the IAEA estimates that Iran has 3,183 kg of LEU and 33 kg of 20% enriched uranium. It could go for a breakout starting from their stockpile of LEU and ending up with enough HEU for 3 bombs if enriched further.82 Western experts agree that with 6,000 centrifuges of the IR1 (P-1) variant, 1,000 kg of LEU at 3.5% enrichment could be turned into military level HEU within a matter of months.83 Separately, Iran could enrich another 167 kg to 20%, and then pursue a fast-track breakout by converting the accumulated stockpile of 200kg at 20% into 20kg HEU, which is enough to build one bomb. At this juncture, it is worthwhile analysing if the Iranians have indeed made the political decision to enrich up to an additional 167kg to 20%, which is enough for one bomb. If they have, then the threshold line for the international community may be the point when the Iranians reach 200 kg of 20% enriched uranium. Even though the IAEA monitoring system can detect any breakout move from 20% to 90% HEU, the breakout may be possible for Iran to achieve in such a short space of time that there would not be enough time to militarily stop Iran from completing the breakout and having enough highly enriched fuel to make a bomb. It took the Iranians 10 months to enrich 33kg to 20%, using one cascade and later one tail-spinning cascade.84 If the enrichment conditions remained the same, they could generate the 200kg of LEU to 20% in five years. However, if Iran were to plug in additional cascades for enrichment, the process could be significantly quicker.

Kilograms Low Enriched Uranium (LEU) per month

140

120

100

40 Leu (kilograms per month)

Feb 07 Feb 08 Feb 09 May 07 Aug 07 Nov 07 May 08 Aug 08 Nov 08 May 09 Aug 09 Nov 09 Feb 10 May 10 Aug 10 Nov 10 Month/Year

Source: ISIS report 23 November2010:http://isis-online.org/uploads/isis-reports/ documents/IAEA_Iran_ Safeguards_Report_ISIS_analysis_23Nov2010.pdf

82 The outgoing head of Israeli military intelligence, Amos Yadlin announces in a 2 November 2010 briefing to Knesset that Iran has enough enriched uranium for two bombs. Alex Fishman, “Not just another warning” Ynet News, 4 November, 2010 at http://www.ynetnews.com/articles/0,7340,L-3979444,00.html 83 The IR1 variant is the most primitive type of centrifuge used by the Iranians, which forms the bulk of their enrichment operation in Natanz. The IR1 design was purchased from the Pakistani AQ Khan network. Recent revelations of a North Korean uranium enrichment facility that uses a more advanced centrifuge design suggests that Iran has a North Korean source for advanced centrifuge design technology or the actual centrifuges. It is difficult for the West to block design technology or transfers of advanced centrifuges or other nuclear material by North Korea to Iran. 84 When 3.5% uranium is enriched to 20%, much of the input material ends up as waste. Tails-reprocessing is the process of recycling the wasted uranium in order to squeeze out a bit more 20% uranium and, hence, increase efficiency of the enrichment operation.

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The Stuxnet Mystery An intriguing question that surfaced in the autumn of 2010 is whether the computer worm known as Stuxnet is responsible for the technical problems that the Iranians have been experiencing since 2009 with their centrifuges. The Iranians shut down the centrifuges at Natanz for emergency repairs for a week in November 2010 and President Ahmadinejad acknowledged that the centrifuges encountered problems with a computer virus. Many experts believe that the Stuxnet virus or ‘worm’ caused the nuclear centrifuges at Natanz to spin out of control. The worm takes over frequency converters, which has the power to change output frequency to control the speed of a motor. It causes the rotating speed of the motors that operate the centrifuges to oscillate from a very slow spin to a very rapid spin, similar to an irregular heartbeat. “The worm eventually makes the current hit 1,410 Hertz, or cycles per second — just enough to send the centrifuges flying apart.”85 With so many centrifuges breaking down, the enrichment process has been slowed significantly, giving the international community additional time to reach a deal with the Iranians.

Weaponisation One of the most intriguing questions that is not well understood is Iran’s progress in the weaponisation of the nuclear device. It is one thing to have enough HEU for one or more bombs, but another thing to have the ability to weaponise the bombs. In 2004, the US discovered detailed diagrams of conical sphere warheads for ‘reduced’ uranium from a laptop stolen from Iran.86 The ability to compress a bomb and insert it into a conical sphere warhead according to the specs found in the stolen laptop will enable Iran to get very close to a weaponised bomb. New evidence has come out that the Iranians had jettisoned the failed design in the laptop version for a more aerodynamic baby-bottle shaped triconic warhead as early as 2002.87 The important point is not whether the design on the stolen laptop is currently used, but to highlight the significant advances that the Iranians have made in compressing a nuclear payload into the re-entry vehicle of one of their forthcoming solid fuel propellant medium-range ballistic missiles. Another challenge that Iran is close to overcoming is the formulation of a triggering device for detonating the bomb. According to reports at the end of 2009, Iran carried out experiments with neutron initiators or triggers.88 These experiments take place in a modest research equivalent of the famed US Manhattan Project during World War II. A Der Spiegel article showed that an entire research wing of an institution in

85 William J. Broad and David E. Sanger, “Worm Was Perfect for Sabotaging Centrifuges”, The New York Times, Nov. 18, 2010 at http://www.nytimes.com/2010/11/19/world/middleeast/19stuxnet.html?hp 86 “A Laptop’s Contents. American officials have said little in their briefings about the origins of the laptop, other than that they obtained it in mid-2004 from a source in Iran who they said had received it from a second person, now believed to be dead. Foreign officials who have reviewed the intelligence speculate that the laptop was used by someone who worked in the Iranian nuclear program or stole information from it. One senior arms expert said the material was so voluminous that it appeared to be the work of a team of engineers.” William Broad and David Sanger, “Relying on Computer, US Seeks to Prove Iran’s Nuclear Aims” The New York Times, November 12, 2005. See http://ncr-iran.org/en/index.php?option=com_content&vi ew=article&id=535:relying-on-computer-us-seeks-to-prove-irans-nuclear-aims&catid=160:nuclear&Itemid=134 87 Gareth Porter, “Iran Laptop Papers Showed the Wrong Missile Warhead” IPSNews, November 19, 2010 at http://ipsnews.net/ news.asp?idnews=53616. See also Iran’s Ballistic Missile Capabilities, A Net Assessment, The International Institute for Strategic Studies, May 2010. 88 Catherine Philp, “Secret document exposes Iran’s nuclear trigger,” The London Times, Dec. 14, 2009 at http://www.timesonline. co.uk/tol/news/world/middle_east/article6955351.ece

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Teheran is under command of the IRGC military team that is designing and weaponising the bomb.89 The IAEA has sought answers from the Iranian government, thus far unsuccessfully, about these suspicious items that suggest a military weapon endgame. It is possible that by 2012, Iranian engineers will have worked out the manufacture of the triconic warhead, the testing of trigger devices, and other technical issues giving them the ability to weaponise a bomb into one of its missiles.

Missile Delivery Capability to reach Paris, London and Moscow Iran has for some time tested a liquid propellant ground-to-ground missile called the Shahab. Some versions of the Shahab and more advanced Ghadr can now reach Israel and parts of Russia and southern Europe. Aside from not being satisfactorily accurate, liquid propellant missiles are slow to launch and vulnerable to pre-emptive strikes. As far back as 2002, however, Iran began research and development of solid propellant missiles known as the Sejil. With a range of 2,000 kilometers, the Sejil can reach not only Israel but also some major cities in Europe and Russia. The Iranians initially received help from other countries in its missile program, including North Korea. They have also made significant progress in the indigenous production of missiles, assembling complex materials such as solid pressured graphite, in addition to technical expertise in building accurate guidance ballistic missiles.90 The Iranians have mastered the ability to launch two-stage rockets, which is critical to achieving the goals of long-range missiles. These multi-stage missiles have thrust terminators which enable the missiles to slow down and drop onto enemy targets on the ground. Iran’s ability to produce thrust terminators is additional evidence that they are working on military ballistic missiles as opposed to peaceful space rockets which do not require thrust termination. It appears to be only a matter of time before the two-stage Sejil is enhanced to reach 3,000 km or more, which would put most of Europe, including London, Paris and Moscow, within range. Out of all three dimensions of their nuclear programme - uranium enrichment, weaponisation and ballistic missiles, the Iranians have publicly demonstrated most progress in their ballistic missile/space programme by means of test launches. They have also made a strategic decision to apply their resources to indigenous missile production rather than to building a modern air force.91 Within two to three years, Iran may have enough HEU for several weaponised bombs. In a similar time period, Iran may be able to weaponise the bombs in the cone of a warhead of a tested solid-propellant multi-stage ballistic missile capable of reaching at least 2,500 km with some degree of accuracy. Eventually, in a decade or more, they will produce ICBMs that can travel 4,000 km or more. It is clear that Iran is approaching nuclear potency in terms of the technology. It has already crossed one red line: the knowledge of how to complete the nuclear fuel cycle. The

89 Dietar Bednarz, Erich Follath and Holger Stark, “Intelligence from Teheran Elevates Concern in the West,” Der Spiegel, January 25, 2010 at http://www.spiegel.de/international/world/0,1518,673802,00.html 90 Uzi Rubin, missile defence specialist, at meeting at IISS, London, October 2010. 91 For detailed analysis of Iran’s missile programme, see “IISS Strategic Dossier on Iran’s Ballistic Missile Capabilities: A net assessment” IISS, May 2010.

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supreme leader has not yet made the decision to breakout toward highly enriched HEU. He has yet to decide to move Iran from nuclear latency to potency, which means having all three components, (i) highly enriched uranium for bombs that (ii) fit into compact warheads which (iii) can be launched via ballistic missile delivery systems, available for assembly and operation at short notice.

The Conventional Wisdom: Iran’s nuclear programme is dispersed Conventional wisdom suggests that the Iranian programme is so vast that any military attack on Natanz will simply be remedied by new uranium enrichment plants elsewhere. Conventional wisdom also holds that notwithstanding the difficulties Iran is experiences with the IR1 or P-1 centrifuges at Natanz, it is working on more advance P-2, P-3 and P-4 centrifuges that, when installed, will spin more efficiently than the P-1 currently in operation at Natanz. In fact, the Iranians have been collaborating with North Korea for several years on missiles and on the nuclear programme. The recent discovery of a modern and large uranium enrichment plant in Yongbyon, North Korea that uses advance centrifuges gives Iran recourse to an outside source of both uranium enrichment and more sophisticated centrifuges. It is unclear whether the US, France and other interested parties will be able to take steps to seal off North Korea to prevent the surreptitious transfer of this nuclear material to Iran. 92 Iran will also have the ability to produce plutonium once the planned reactor is built next to the Arak heavy water facility. Bushehr, the Russian-built nuclear reactor on the Persian Gulf Coast not far from Kuwait, uses uranium fuel imported from Russia, which means that Bushehr cannot be diverted easily into producing nuclear fuel for weapons.93 Iran’s leadership may be temporising on the decision to go forward out of fear that a decision to ‘break out’ will invite a military attack, which would disable their programme for an unknown amount of time. Historically, other nuclear powers have found the temptation to cross the line difficult to resist when they were as close to nuclear potency as Iran will likely be in the second half of 2011. If Iranian leaders perceive that a military attack, particularly from the US, is not likely, then they may be more tempted to cross the threshold to nuclear potency with a reduced fear of being attacked. While a credible US military threat may not be enough to dissuade the supreme leader from making the political decision to go for nuclear potency, without a credible US military threat, it is unlikely that the international community can prevent Iran from going nuclear.94

92 The North Koreans showed one uranium-enrichment facility to a visiting American scientist, Siegfried Hecker in November 2010, just before the unprovoked bombing by North Korea of an island in South Korea. “US and UN officials now worry Pyongyang could begin exporting its advanced centrifuge equipment to its military allies in Iran and Myanmar.” Jay Solomon, “US Sees Greater North Korea Nuclear Threat” Wall Street Journal, 3 December 2010 at http://online.wsj.com/article/SB100 01424052748704377004575650960600657360.html 93 Simon Henderson, “Back to the Table: New P5+1 Talks with Iran”, PolicyWatch #1727, Washington Institute, 2 December 2010. 94 The Israeli military threat may be more credible, but the Iranians appear to take the Little Satan less seriously than the Great Satan in part because the Iranians believe that the Little Satan only acts in accord with the wishes of the Great Satan.

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A contrarian view that suggests time is not on Iran’s side with respect to its uranium enrichment program.95 Conventional wisdom says that Iran’s nuclear programme cannot be stopped and that time is on the side of the Iranians in that they can technically achieve nuclear potency once their leaders make the political decision to do so. Some experts in Europe disagree, arguing that Iran may not be able to maintain and operate a sufficient number of centrifuges in order to produce the quantities of enriched uranium required for nuclear weapons. Many reasons are given; the inferiority of the P-1 design of the centrifuge currently installed at Natanz, sabotage from delivery of faulty parts, assassinations and defections of key nuclear scientists, and the more fantastic Stuxnet worm- related allegations of cyberwar sabotage of the centrifuges. One straightforward reason is that centrifuges are sensitive machines with a high attrition rate of centrifuges wherever they operate, including in in France and at URANCO in the Netherlands. They tend to break down at a fairly frequent rate. As a result of the increasingly effective sanctions, the Iranians are having difficulties importing certain key metals that they need to build new centrifuges.96 Based on publicly known intelligence, Natanz appears to be the only plant where uranium is being enriched. The Qom construction site discovered by the West in 2009 is not yet in production.

Decision time for Iran According to the contrarian view, Iranian leaders have been delaying the decision to make a breakout from LEU to HEU for as long as possible, but they cannot delay a decision much longer before running out of working centrifuges. Some of those centrifuges now spinning LEU will have to be reconfigured for HEU in order for Iran to have the highly enriched fuel needed for the bomb. If they wait too long to reconfigure the centrifuges, they risk further attrition of centrifuges that would leave them with an insufficient number of working centrifuges to make both HEU and LEU. This has two important consequences. First, paradoxically, time may not be on the side of Iran because the high attrition rate of the centrifuges at Natanz imposes a deadline on the supreme leader to decide whether to go for a breakout. Second, from the point of view of Iran’s adversaries, Natanz in 2011-12 begins to look more like the Iraqi nuclear plant Osirak in 1981 and the Al Kibar plutonium

95 This contrarian view was drawn in part from a discussion with a French scholar and expert on national security strategy in Paris, 20 October 2010. 96 According to former senior IAEA Deputy Director, Olli Heinonen, “the centrifuges are not operating well, and some of them are failing. They have a lot of problems, and they are not there yet....The flaws in the centrifuges derive from two interconnected reasons: lack of sufficient knowledge, and difficulty obtaining high-quality material.” Laura Rozen, “Ex-IAEA watchdog: Iran’s centrifuge problem” Politico, 22 October 2010 at http://www.politico.com/blogs/ laurarozen/1010/ExIAEA_ watchdog_Irans_centrifuge_problem.html?showall

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reactor in Syria in September 2007.97 A surgical strike focusing almost exclusively on Natanz becomes more attainable from a technical viewpoint, and therefore more credible. Also, if the Iranians fear they are running out of centrifuges, US warnings that ‘nothing is off the table’ begin to look more credible. To summarise, the contrarian view holds that time is not on the side of Iran. If the procurement of component parts of centrifuges continues to be difficult for Iran and North Korea does not provide Iran with more advanced centrifuge technology, then Iran may be forced to make the decision to ‘breakout’ and cross the red lines of its adversaries. At that point, a military attack looks more feasible to Iran’s adversaries in terms of limiting the mission to Natanz and a few other sites.98 This increases prospects for operational success in setting back Iran’s nuclear programme. It also increases the likelihood that a worried Iran may choose to agree to a compromise solution with the P5+1.

2.2 Sanctions and Diplomacy: Last chance to persuade Iran not to cross the nuclear threshold

What will persuade the Iranian leadership to demonstrate it is not aiming for nuclear potency even as Iran insists on its rights to nuclear latency? At a minimum, demonstrating the peaceful factor of the nuclear programme might require Iran to halt its weaponisation programmes and refrain from a breakout toward production of HEU. The P5 +1, or five permanent members of the UNSC plus Germany, will likely have to settle for Iran agreeing to stop its enrichment activities rather than roll back its enrichment of LEU to levels prior to the date of any agreement. Another complicating problem for the P5 + 1 is the recent discovery of a large uranium enrichment plant in North Korea in Yongbyon.99 What will keep the North Koreans from selling LEU to Iran for hard currency? Is it possible for the US and others to monitor the shipment by sea or by air of advanced centrifuges or enriched uranium from North Korea to Iran or Syria? North Korea has been sending missiles to Iran for several years. They tried to send nuclear-related materials to Libya in the past but it was intercepted by a US ship. They helped construct a secret nuclear reactor in Al Kibar, Syria that was destroyed by Israel in September, 2007. Although the US has no knowledge that they have shared nuclear material with Iran, it would not be surprising for North Korean engineers to show them the designs and engineering techniques for building advance centrifuges like the P-2. It is far more

97 The decision by Israel to attack the Al Kibar nuclear site in Syria could offer a precedent for an attack on Iran. President George W. Bush disclosed in the pre-release of his new book ‘Decision Points’, that he had turned down then Prime Minister Ehud Olmert’s plea that the US bomb the alleged plutonium nuclear reactor in northeast Syria. “Prime Minister Olmert hadn’t asked for a green light, and I hadn’t given one. He had done what he believed was necessary to protect Israel.” Steve Holland, “Bush: Olmert asked me to bomb suspected Syria nuclear plant,” Reuters News, 5 November 2010 http://uk.reuters.com/article/ idUKTRE6A44O520101105 98 Conversation with David Ivry, who was the Chief of the Israeli Air Force and the ‘Conductor’ of ‘Opera,’ the code name for the strike of the nuclear reactor at Osirak, 16 September 2010. 99 See David Sanger, “North Koreans Unveil Vast New Plant for Nuclear Use” The New York Times, 20 November 2010, at http:// www.nytimes.com/2010/11/21/world/asia/21intel.html?_r=1&hp

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difficult to deter North Korea from exchanging knowledge about centrifuges than from sending to Iran the actual P-2 centrifuges or enriched uranium. The US wants to prevent North Korea from crossing red lines on proliferation but it also wants to prevent it from continuing to build bombs. If the US were to officially declare to North Korea that shipping advanced centrifuges or enriched uranium to Iran crosses a red line, North Korea might conclude that continuing to build bombs does not cross a red line, which is not the US intent. Although there are no explicit sanctions on Iran’s trade with North Korea, the 2009 UN sanctions on North Korea permit individual countries to inspect North Korean cargo on ships if they both suspect there are illegal materials aboard and act in compliance with the international law of the sea. A logical next step is for the UNSC to address ways it can effectively sanction and prevent proliferation by North Korea to countries like Burma, Iran and Syria. 100

Bigger Carrots, Bigger Sticks The Obama Administration’s approach has been to offer Iran bigger carrots through direct diplomatic engagement and, at the same time, bigger sticks through tougher international sanctions. Diplomatic engagement with Iran was a priority for President Obama within weeks of his arrival to the White House. He reached out to Iran’s leaders with several verbal messages including a video statement to the Iranian people in a ‘Nowruz’ Iranian New Year greeting in March 2009 and again in March 2010. Diplomacy continues in the form of P5 + 1 talks with Iran without preconditions. Senior diplomats from the US and Iran occasionally show up at the same international conferences where they exchange limited but cordial greetings. At the Geneva conference in December 2010, the US delegation was the only one in the P5 + 1 which did not meet separately with the Iranian delegation. One instance of such near-agreement was the proposal of 1 October 2009, originating from senior proliferation officials in the Obama Administration, to have some LEU from Natanz further enriched abroad and fabricated into fuel for the Teheran medical Research Reactor (TRR). The first version of the TRR deal seemed promising when Iran initially accepted the offer, but it went nowhere following the reversal and rejection of the proposal by Iran. A second version of the TRR swap proposal, brokered by Brazil and Turkey in April, 2010, was rejected by the US and its allies because it left Iran with additional LEU that was enriched during those interim six months following the initial offer.101 Sanctions have also been expanded, with the most far-reaching set passed by the UN Security Council in June 2010 (UNSCR 1929), with the support of China and Russia. These UN sanctions were followed up with separate sanctions from the US, the EU, Japan, South Korea, Australia, Canada, Norway and others in the international community. Initial reports that these collective and unilateral sanctions were having an impact inside Iran emphasised the impact on multinational companies and banks, energy companies, and shipping insurance, as well as a crash in the Iranian rial. As time has gone by, the likelihood that sanctions will persuade Iranian leaders to abandon their pursuit of nuclear weapons capability is

100 Meeting with one of the point persons on EU sanctions on Iran in Brussels, 7 December 2010 101 See Tony Karon, “US and Israel: No Consensus on Pressuring Iran,” Time Magazine, 19 November 2010, at http://www.time. com/time/world/ article/0,8599,2032292,00.html#ixzz15vP0VyAG

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receding, notwithstanding the economic pain that the sanctions are causing Iran. Some say there is a lack of metrics for measuring the impact of the sanctions, making it “impossible to provide a quantitative assessment” beyond anecdotal evidence.102 The real problem is that the supreme leader believes that compromise is a sign of weakness, and showing weakness invites aggression against the regime. It would take enormous pressure to break that mindset even if the quantitative assessment of the impact of sanctions is impressive. The next iteration of sanctions would likely require an escalation from targeted sanctions to crippling sanctions, such as a US-led boycott of the entire Iranian banking system or an international agreement to prevent Iran from importing refined oil. The EU approach is to avoid crippling sanctions that punish ordinary Iranians. They prefer adding names of Iranian entities periodically as a way to increase the pressure on the regime. New designations are effective and can be done as part of the implementation of existing UN sanctions rather than through the enactment of new UN sanctions.103 If the regime anticipates that sanctions today will be followed by even tougher sanctions tomorrow, then they might be more willing to compromise. However, if the Iranians believe that it is unlikely that the international community will maintain its unity regarding Iranian sanctions in the future, then they may decide they can cope with the current sanctions and not compromise. Given China’s interest in Iranian energy and Russia’s interest in commercial ties with Iran, it is probably less likely that the P5 + 1 will be able to increase significantly the severity of the sanctions through the collective mechanism of the UN Security Council. The Europeans are reluctant to go further with new sanctions that, in their view, transfer business from European to Chinese companies.104 On the other hand, unless the severity of the sanctions dramatically escalate, it is unlikely that Iranian leaders will see the sanctions as creating a domestic threat to their survival in power. Any punitive measure that does not threaten regime survival is unlikely to lead them to compromise on the nuclear programme. Crippling sanctions are unlikely to be imposed on Iran because it is impossible to achieve international consensus with the inclusion of China, Russia, and probably the EU, in proposing such an imposition. Moreover, many in the international community fear that crippling sanctions will lead the Iranian people to blame the West and to support the besieged regime.105 Since crippling sanctions are unlikely to be enacted, Iran’s leadership may conclude that it can endure the current sanctions with little prospect of tougher sanctions to follow.

2.3 The Case for Engaging Iran without Coercive Diplomacy

Some observers think that the bigger carrots, bigger sticks approach of the Obama Administration is only half right, arguing that pressure does not work with the Iranian leadership.

102 Meeting with EU sanctions official in Brussels, infra. 103 Meeting with EU sanctions official in Brussels, infra. 104 Meeting with EU sanctions official in Brussels, infra. 105 Another possibility is that crippling sanctions, if coordinated with the opposition movement inside Iran, could bring demonstrators into the streets and strikes by workers who blame their economic hardships on Ahmadinejad and Khamenei, rather than the outside world, and who want different leadership. For instance, “oil workers might complement sanctions by striking at those domestic refineries that Mr. Ahmadinejad is depending on to compensate for embargoed gasoline from abroad.” Nazenin Ansari and Jonathan Paris, “The Message From the Streets of Teheran” International Herald Tribune, November 6, 2010, at http://www.nytimes.com/2009/11/06/ opinion/06iht-edparis.html

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The way to persuade them to abandon the nuclear weapons programme is to engage with them unconditionally without threatening new sanctions or a military attack. The latter serves only to “reinforce those in Teheran who believe Iran requires nuclear weapons for its security and undermines those who argue for compromise with the international community.” According to this view, the Obama Administration should move beyond symbolic gestures of engagement and offer Teheran “strategic engagement (which includes) a set of robust economic, political and strategic incentives that give Iran’s leaders reason to cooperate.” Just as President Obama’s initial outreach to Iran undermined the hardliners within the IRI, a major and sustained diplomatic engagement “might shift the balance in Teheran, persuading more pragmatic members of the ruling elites that it is in Iran’s own interest to end its estrangement from the international community by reaching a compromise on the nuclear, and other security, issues.”106 A more nuanced approach calls for US “strategic patience”, arguing that even though short- term prospects for resolving the nuclear dispute are poor, over the long term, Iran’s “history, demography, and education favour liberalisation and international integration…The focus of US policy should be to buy time for this evolution to take place.”107 Unlike ‘strategic engagement’, a patient policy does not preclude tougher sanctions but focuses on encouraging shifts within Iran’s ruling elites to a leadership that might be more receptive to Western incentives. It is probably true that the vast majority of Iranians might be persuaded to compromise if Iran were treated with the respect and given tangible economic, political and strategic incentives to make such a compromise. Strategic engagement would probably sway leaders of the Green Movement and reformists like Khatami and Rafsanjani. However, the hard-line group in power since 2005 is unlikely to respond positively to strategic engagement, in part, out of fear that compromise with the West would undermine their power within Iran. A new regional architecture that includes Iran may make sense for a future constellation of Iranian decision-makers but is unpersuasive for the group now wielding power. ‘Strategic patience’ appears to reflect the Obama Administration’s current policy, but it leaves one question that the Administration cannot postpone forever: What does the US do if they, along with the international community, are unable to persuade the Iranian leadership to halt its nuclear weapons programme?108

2.4 After Sanctions? Coercion or Containment

If the US concludes at some point that sanctions and diplomacy will not be sufficient to alter Iran’s steady movement along the path towards nuclear weapons capability, then the remaining options are i) accepting an Iranian nuclear weapons capability as inevitable and working to devise a regional containment policy, or ii) resorting to further coercive

106 See Daniel Brumberg, “New Report by US Institute of Peace and Stimson Center: Recommendations to Rebalance US Policy Toward Iran,” Iran Primer, 15 November 2010 at http://iranprimer.usip.org/blog/2010/nov/15/new-report-us-institute-peace- and-stimson-center-recommendations-rebalance-us-polic 107 barbara Slavin, “The Iran Stalemate and the Need for Strategic Patience,” Iran Task Force Briefing Note, Atlantic Council of the US, November 2010 at http://www.acus.org/files/ publication_pdfs/403/ACUS_IranIBNov10.pdf 108 See David Sanger, “Cables Depict Range of Obama Diplomacy,” The New York Times, 4 December 2010. “But what next? The administration is vague, because few officials expect the Iranians to give up their nuclear ambitions or know what risks Mr. Obama is willing to take to stop the program. ‘If you haven’t accomplished your goal you are left with the unpalatable choice of extending the timeline, diminishing your objective, or being forced to take the kind of military action you were attempting to avoid,” said David Rothkopf, who wrote a history of the National Security Council.’” (emphasis added) http://www.nytimes. com/2010/12/05/weekinreview/05WikiLeaks-sanger.html?_r=1&hp

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measures, including but not limited to naval blockades, to convince Iranian leaders that the prospect of serious military action is an inevitable outcome of Iran’s refusal to compromise.

Coercion The US might prefer to try coercive measures before switching to containment, first, because containment may not work with the current leadership in Iran,109 and second, because US global leadership risks suffering irreparable damage should the Iranians defy the US and go nuclear. For starters, the Obama Administration’s counter-proliferation goals and, more generally, the NPT regime would be in jeopardy. Iran’s defiance, if successful, would feed into a wider narrative of declining US and Western power. The continuing ramifications of the 2008 economic collapse of the US has left an indelible image of a country in economic decline relative to rising economies in Asia and other emerging markets. The perception of a declining US is reinforced by Europe’s own economic crisis in 2010 stemming from erosion of confidence in the Euro-zone following recent bail-outs of member states. The continuing economic crises in the West add to the Iranian leadership’s perception that the West is in decline. Iranian defiance of the US on the nuclear programme would likely reinforce an Iranian perception of American military decline, with unsettling repercussions in the Middle East and South Asia. It was the Baghdad Pact in the 1950s that first underscored America’s guarantee of military security to its moderate Arab and Muslim allies. A nuclear Iran could mean the end of the security architecture that the Baghdad Pact and its successors made possible for the US and the West. Nowhere will the decline of US power relative to Iran be greater than in the Persian Gulf, which may cease being a US lake with implications on the ability of the US to guarantee the world’s free access to Middle East energy at reasonable prices.110 Some analysts note that discussions advocating containment underestimate the strategic repercussions of an Iranian nuclear arsenal. “A nuclear Iran would strengthen its hegemony in the strategic energy sector by its mere location along the oil-rich Arabian Gulf and the Caspian Basin. These adjacent regions form the ‘energy ellipse,’ which holds more than 70 percent of the world’s proven oil and more than 40 percent of natural gas reserves. Improving revolutionary Iran’s ability to intimidate the governments controlling parts of this huge energy reservoir would further strengthen Iran’s position in the region and world affairs.”111 Iran’s nuclear ambitions have repercussions far beyond the region. Iran’s relations with other oil producing states such as Venezuela and Russia, both anti-Western, “will increase their leverage in the energy market and weaken the power of the Western buyers. A nuclear Iran may also result in the loss of the Central Asian states for the West. After the collapse

109 See Prof. Dustin Dehez, “Iran: The Flaws of Containment” BESA Perspectives, No. 123, 24 November 2010 at http://www.biu. ac.il/SOC/besa/perspectives123.html 110 Analysts are split as to whether a nuclear Iran spells the end of US control over the Persian Gulf. Martin Kramer, a non-resident fellow with the Washington Institute for Near East Policy, argues that the Persian Gulf will cease to be an American lake, with dire consequences for the security and economies of the US and its allies in the region and the world. Conversation, 15 September 2010. Dana Allin and Steve Simon disagree, writing that the Gulf will remain an American lake in terms of the “strategic currency of naval power and bases access.” Dana Allin and Steven Simon, The Sixth Crisis: Iran, Israel, America and the Rumours of War USA: Oxford University Press 2010, p. 96. They may be right in terms of hard power but “dwindling confidence in US leadership on the part of America’s traditional Arab allies may eventually lead to the emergence of new constellations of power in the region.” Uzi Rabi, “The WikiLeaks documents and the Middle East,” Dayan Center, Tel Aviv Notes, 9 December 2010 111 Efraim Inbar, “Halt Nuclear Iran,” BESA Center Perspectives Paper No. 124, 2 December 2010 at http://www.biu.ac.il/SOC/ besa/perspectives124.html

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of the Soviet Union, these new states adopted a pro-Western foreign policy orientation. Following the emergence of a nuclear Iran, they will either gravitate toward Iran or try to secure a nuclear umbrella with Russia or China, countries much closer to the region, and end their alignment with the West.”112

Containment The alternative to attacking Iran is containing a nuclear Iran. There is some historic justification in arguing that Iran has previously acted cautiously, for instance, following the Vincennes attack by the US of an Iranian civilian airliner.113 Iran may find that having a nuclear weapon requires that it act cautiously to prevent an attack by its adversaries. Historically, Iran has not been a country that invades its neighbours on a regular basis. Iran’s border with Turkey has changed little over hundreds of years, suggesting that the rhetoric of the IRI is different from its actual behaviour.114 This is all true and comforting for proponents of containment, provided that one is confident that the current leadership’s ideology does not take Iran on a different and far more belligerent and confrontational trajectory than Iran’s historical patterns of interstate behaviour. One of the ironies of the prospects for a fresh US containment policy towards a nuclear Iran is that before the US-led invasion of Iraq in 2003, Saddam Hussein was containing Iran fairly well. In December 2005, Saudi King Abdullah expressed his anger at the Bush Administration for ignoring his advice against going to war. According to a cable from the American Embassy in Riyadh, King Abdullah argued “that whereas in the past the US, Saudi Arabia and Saddam Hussein had agreed on the need to contain Iran, US policy had now given Iraq to Iran as a ‘gift on a golden platter.’ ”115 The US can offer its nuclear umbrella to those Gulf states and other countries in the region who request it. Some Gulf countries will be reluctant to accept the US nuclear umbrella for fear of antagonising their nuclear neighbour. Rather than depending exclusively on US guarantees, more than a few Gulf states will probably move to accommodate Iran’s new role as regional hegemon in the Persian Gulf.116 Other Middle Eastern countries may decide to pursue their own nuclear programme, partly out of the need to deter a nuclear Iran, and partly because of the status that they want to share with Iran. Egypt, Saudi Arabia, Turkey, the UAE, Jordan, Libya and Algeria, along with non-state actors engaging in terrorism, will at least consider building a nuclear programme or buying nuclear weapons from proliferators once Iran achieves nuclear potency. Therefore, containment may not be a panacea for the US and its allies. A nuclear Iran will likely challenge the US for global and regional leadership as leader of the Muslim world located in the crossroads of the world’s main energy source. Iran’s hegemonic aspirations in

112 Efraim Inbar, infra. 113 A missile was mistakenly fired by the USS Vincennes on the Iranian civilian airliner en route from Teheran to Dubai, killing all 290 passengers and crew in July 1988 at the end of the Iran-Iraq War. Iran restricted its response largely to verbal condemnation. 114 This point was made by David Gardner, Foreign Affairs editor, Financial Times, in a meeting in London, 8 December 2010. 115 David Sanger, “Around the World, Distress Over Iran” The New York Times, 28 November 2010 at http://www.nytimes. com/2010/11/29/world/middleeast/29iran.html See also Fouad Ajami, “WikiLeaks and the Art of Diplomacy,” Wall Street Journal, 30 November 2010 at http://online.wsj.com/article/SB10001424052748704584804575644760960672700.html 116 A “nuclear Iran would become a regional superpower able to pressure Gulf states to line up behind it; it could serve as a source of inspiration and support for radical groups in the Gulf states and beyond; and a regional nuclear arms race would likely ensue” Uzi Rabi, “The WikiLeaks documents and the Middle East,” Dayan Center, Tel Aviv Notes, 9 December 2010

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the Persian Gulf will inevitably run up against US naval assets. Military skirmishes between Iran and the US can easily escalate into one or more Cuban Missile crises, especially in the early days of Iran’s nuclear era when Iran is likely to test its adversaries to see how far it can coerce its regional neighbours, Israel and Europe with its veiled nuclear threat. Another cause for concern is Iran’s command and control over its nuclear weapons will be unsettled, especially in the early years of a nuclear Iran. While the decision to go for nuclear potency might be in the hands of the supreme leader, Khamenei may not have control over the actual fissionable material and bombs. Most of the nuclear programme appears to be under the operational guidance of the IRGC. Those who take comfort in the fact that the supreme leader has, at least on paper, supreme control over the nuclear programme should note that Iranian decision-making is flatter and less hierarchical than other authoritarian regimes.117 Shortly after Iran crosses the threshold, an effective containment policy will require first, direct channels of communication between Iran and its adversaries, including the US and Israel, to forestall misunderstandings or disagreements that lead to nuclear isolation; second, an Iranian understanding as a member of the nuclear club of the rules of the game; and third, more and better-implemented international sanctions to prevent Iran from amassing key materials to produce dozens of nuclear bombs and a new generation of hydrogen and thermonuclear weapons. At the very least, the region will likely be highly unstable during the early years of a nuclear Iran.

Additional Levels of Deterrence Containing a nuclear Iran will require additional red lines that the US and its allies will want to stop Iran and others from crossing, even if the US fails to deter Iran from nuclear potency. For instance, the US and its allies would want to deter Iran from using its nuclear assets to threaten and coerce Israel, the Arab states, Turkey, Azerbaijan, Afghanistan, Europe and the US. A subset of this broad deterrence would be preventing Iran from extending a nuclear umbrella over Hamas and Hezbollah that permits them to launch rockets or engage in terrorism knowing that Israel must consider a possible nuclear strike from Iran. Iran would need to be deterred from proliferating nuclear weapons or knowhow to Iran’s allies, such as Syria or Hezbollah.118 Finally, the US would want to deter other nuclear powers such as Pakistan or North Korea from proliferating nuclear weapons or knowhow into the region. If the experience of other nuclear countries is apposite, a new member of the nuclear club is highly unlikely to transfer an actual nuclear bomb to another country or party.

117 A prominent Iranian dissident, Shary Ahi, once described Iranian decision-making as being “like a sponge with many holes.” The metaphor, though clever, does not convey much in practical terms except that one can imagine multiple groups and factions within the government bureaucracies, military and IRGC working separately on the same issues in a loosely coordinated fashion. Conversation in London, April 2004. 118 Israel might adopt a MAD policy that says that Israel will presume Iranian authorship in any attempted or successful nuclear attack on Israel, which would result in the complete destruction of Iran.

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2.5 The Great Debate: to strike or not to strike

The most important international debate in 2011 is likely to be whether the US or Israel will refrain from striking Iran’s nuclear sites if Iran is not persuaded to abandon its quest for nuclear weapons. Those who argue against military action feel that an attack would make matters worse without preventing Iran from eventually gaining nuclear weapons. Those who support military action are concerned about the regional and global repercussions of a nuclear Iran especially under its current leadership.

2.6 Red lines, Time lines and Decision triggers

The analytic focus in this Report is not the red lines for the US or Israel. As one after another red line passes without response, future red lines have become less credible. Many US and Israeli red lines and time lines have come and gone without consequence. First, it was Iranian uranium enrichment of LEU, then on going from LEU to 20% enrichment, followed by Iranian attainment of knowledge of the entire fuel cycle, building multiple facilities, weaponisation, and finally preventing intrusive inspections by the IAEA.119 One noteworthy time line is Israeli Defence Minister Ehud Barak’s warning to President Obama’s new Administration in June 2009, estimating “a window of between six and 18 months in which stopping Iran from acquiring nuclear weapons might still be viable. After that, any military solution would result in unacceptable collateral damage.”120 That deadline too has passed. Iran’s technical problems and unexpected international agreement on a tough set of UN sanctions in mid-2010 were sound reasons for not acting upon these public red lines and private time lines. Also, Israel’s time lines may have been tactically useful to the Obama Administration, for instance, in gaining China’s cooperation on the sanctions. The broader question is whether red lines are the best way to predict future behaviour of Iran’s adversaries as the Iran nuclear crisis runs its course. It may be more helpful to look at decision-making triggers or changes, appearing in the form of opportunities, requirements or new constraints, that precipitate a US or Israeli response. It is not only Iran which prefers to delay decisions with respect to crossing the nuclear threshold. The United States and Israel also want to delay taking a decision to attack Iran, a decision that is fraught with many undesirable and uncertain consequences.

Triggers Some of the circumstances that might trigger the US or Israel to make a decision are: 1. Iran ejects the IAEA from Natanz, and begins a breakout toward enriched HEU needed for a bomb 2. It becomes known that North Korea is providing Iran advanced centrifuge technology garnered from its uranium enrichment plant revealed in late 2010, thereby enabling Iran

119 Eli Levite, Conference on “What the West should do with Iran”, German Marshall Fund of the US and Centre for European Studies, Brussels, 5 May 2010. 120 David Sanger, “Around the World, Distress Over Iran” The New York Times, 28 November 2010 at http://www.nytimes. com/2010/11/29/world/middleeast/29iran.html

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to overcome its technical difficulties at Natanz121 3. Russia directly or indirectly provides Iran with the S-300 advanced air defence system, which may make an air strike in the distant future more problematic 4. A potential breakthrough in the Middle East Peace Process between the Israelis and the Palestinian Authority that triggers the necessity of Israel to confront Iran because of its spoiler role in its all-out opposition to the peace process. For the US, marshalling a ‘coalition of the willing’ against Iran might be easier following a potentially successful peace process 5. Conversely, as happened in late 2000, a breakdown in the peace process triggers another intifada. If Hezbollah were to join Hamas in launching attacks/rockets in an escalating intifada, Israel may decide to strike not only Hezbollah in Lebanon, but its patron, Iran. A variant of this scenario is a Hezbollah coup d’etat that removes the elected government in Lebanon with Iranian support, resulting in Lebanon becoming a front line pro-Iran state confronting Israel 6. A change in US policy in which it publicly rules out military force and no longer insists on Iran suspending uranium enrichment [or enrichment to higher levels], resulting in the codification of Iran’s status as a near nuclear state with de facto US blessing, or what Harvard proliferation scholar, Steven Miller, calls “managed acquiescence.”122 This would trigger at least a meeting of the inner cabinet of Netanyahu’s government to debate its options and decide whether to go along with managed acquiescence 7. Conversely, US domestic political shifts to the right following lack of progress in diplomacy and tougher sanctions coupled with bellicose language from Ahmadinejad lead to a more assertive US policy towards Iran, triggering a US decision to strike123 or to provide implicit support for an Israeli strike 8. Iran signals its intention to share its nuclear technology with Syria or Hezbollah

Once a need for a decision by the US or Israel is triggered, their decision-makers will have to weigh some of the following factors for and against a strike.

2.7 Factors that might lead the US or Israel to undertake a military strike on Iran before Iran reaches nuclear potency

The US might consider a strike under several circumstances:

Gulf Security If the US Administration concludes that a nuclear Iran will prevent the US from its ability to maintain a stable Persian Gulf. An indirect precedent for this is the US decision to reflag vessels following Iranian strikes on Kuwaiti vessels during the later stages of the Iran-Iraq war in 1987.124

121 The week before a top Iranian nuclear scientist, Prof. Majid Shahriyari , was assassinated on 29 November 2010, the nuclear scientist had returned from North Korea. Intelligence sources in Seoul have suggested that Shahriyari had gone to Pyongyang to discuss a co-production deal over nuclear centrifuges. Gordon Thomas, “Mossad: was this the chief’s last hit?”, Telegraph, 5 December 2010 at http://www.telegraph.co.uk/news/worldnews/middleeast/israel/8182126/Mossad-was-this-the-chiefs-last-hit.html 122 Allin and Simon, infra, p. 130. 123 Put differently, President Obama may see a successful military attack that thwarts the Iranian nuclear program as a way of proving his ability to be a tough Commander in Chief and to preserve his central foreign policy goal of global counter proliferation, thereby generating favourable momentum for his re-election in 2012.. 124 See “Operation Earnest Will”, GlobalSecurity.org at http://www.globalsecurity.org/military/ops/earnest_will.htm

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Proliferation Fears If the Obama Administration concludes that its ambitious counter-proliferation agenda and the broader NPT regime are in jeopardy, and a serious wave of proliferation will take place in the Middle East and Asia.

Terrorist Attacks Both the US and Israel might consider a strike if:

The Moderate Arabs disappear Aging but experienced and pro-western leaders like King Abdullah of Saudi Arabia, initiator of the Arab Peace Initiative, and President Hosni Mubarak of Egypt, a veteran interlocutor between Israelis and Palestinians, are succeeded by leaders less enamoured with the US-led peace process and more attuned to the mood of the Arab street. For Israeli decision-makers, the negative regional impact of a nuclear Iran is more important than their fear of an actual nuclear attack. Extremist Arab states and non-state actors will get stronger and moderate Arab states will get weaker, possibly leading to the eventual encirclement of Israel by rejectionist state and non-state actors. The current consensus of Israeli decision-makers is that acquiescing in a nuclear-potent Iran will produce a likely cascade of events in the region unfavourable to Israel’s security that will force Israel to clash with Iran and its proxies in the future. The question for Israel may be whether it is better to clash before or after Iran goes nuclear.

The Extremist Camp becomes more belligerent Parallel to the erosion of the moderate Arab camp, the extremist camp becomes more aggressive, including Hamas attacks on both Israel and the Palestinian Authority, Hezbollah attacks on Israel and on its opponents within Lebanon, and in joint operations with Iran’s Al Quds force in Iraq, Yemen, US ships in the eastern Mediterranean and elsewhere.125 Syria becomes convinced that with its revived Northern Alliance comprising Iran, Hezbollah, Hamas, Turkey,126 and possibly Iraq and Qatar, plus support from China and Russia, it can achieve military parity with Israel and contemplate a war, returning the region to the uncertainties of the pre-1973 era. The rhetoric rises as Ahmadinejad tells the Arab street that Israel is weak and the US is feckless.

Messianic Leaders The US or Israel may conclude that the current leadership in Iran cannot be deterred, having demonstrated, for example, a willingness to absorb enormous losses of 500,000 people killed during its war with Iraq, having suggested repeatedly that Israel will ‘disappear,’ and having alluded to messianic and apocalyptic visions of the coming of the Imam Mahdi

125 See Michael Eisenstadt, infra, who mentions a scenario whereby Hezbollah might attack US Aegis ships in the Mediterranean that support a NATO missile defence shield against Iran. 126 Aside from Syria’s perception of Turkey, a nuclear Iran may capitalise on the current identity crisis of Turkey to tip it onto in favor of an Islamist path. The government, led by the Islamist-rooted AKP or Justice and Development Party, is gravitating toward Iran and, like many fence-sitters between the US and Iran camps, a nuclear Iran may push Turkey firmly into the anti-US camp. See Efraim Inbar, infra.

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following a cataclysmic war with the Great and Little Satans. By puncturing Iran’s grandiose dreams, a successful strike has the additional advantage of undermining Iran’s teleological arguments that it was the divine will of Allah that brought about a nuclear Iran.

Command and Control The US or Israel may conclude that a nuclear Iran will be unable to set up a secure command and control system, leaving open the prospect that individual IRGC commanders with operational control, or President Ahmadinejad himself, could launch nuclear missiles without approval from the supreme leader and other designated decision-makers in command and control.

Any Ordinary Crisis could lead to Nuclear Confrontation The US or Israel may conclude that even if Iran is unlikely to launch nuclear missiles suddenly and without provocation, there is too much danger of a minor crisis escalating into a nuclear confrontation, especially given the absence of direct communication or ‘hot lines’ with Iranian decision makers.

Iran 24/7 Washington and Jerusalem will be consumed with Iran-connected security crises and unable to deal effectively with other important issues.

Buying Time A successful strike delays Iran from attaining nuclear weapons, providing additional time for the Green Movement or other constellation of leaders to replace the current radical faction. Israel or the US might gamble on the presumption that the people ruling Iran by the time Iran reconstitutes its programme will be less interested in arming Hamas and Hezbollah, and in making Israel ‘disappear’.127 US or Israeli decision-makers may prefer to take a chance on another faction within the Iranian regime, known or unknown, gaining control over the leadership and over the nuclear weapons in the future. Prospects for a different leadership may appear less risky than the current fanatical trinity of a paranoid supreme leader, a populist president, and a secretive IRGC having the nuclear weapon soon.

Existential Threat Some arguments for an Israeli strike do not apply equally to the US. The obvious difference is the closer proximity of Israel to Iran and the concentration of much of Israel’s human and industrial assets in the greater Tel Aviv region make Israel more vulnerable than the US (or, to a lesser extent, Russia or Europe) to a nuclear Iran. This Report does not share the view that Israel faces an ‘existential’ threat from a nuclear Iran, as explained in the discussion on page 55 of Israel’s deterrence based on a convincing second strike capability. Nonetheless, Israeli public opinion does view a nuclear Iran as an existential threat, arguing that Iran’s leaders are not rational, and/or that they might share nuclear weapons

127 This may not be a bad bet considering that they only expected the destruction of Osirak in 1981 to delay the Iraqi nuclear program by a year or two. But the Osirak analogy is debatable. While Saddam never attained a nuclear weapon, he restarted the nuclear programme soon after Osirak and nearly completed it, but for Iraq’s defeat in 1991 Desert Storm.

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with Hezbollah or other non-state actors. Some fear that Israel’s status as a haven for Jews would be undermined, and the best and brightest Israelis will leave for the US and elsewhere leading to a brain-drain.128 Multinational companies will cease investing in Israel leading to the evaporation of foreign direct investment on which the currently strong high- tech Israeli economy heavily depends.

Tactical Considerations A tactical reason for a US strike might be that the Administration believes Israel is about to attack Iran, and it can execute the attack better than Israel operationally and politically. Both the US and Israel might also be swayed by the availability of good intelligence on the location of all nuclear sites in Iran. In order to constrain Iran in its ability to reconstitute its programme, a strike would seek to damage the Isfahan plant that converts uranium ore into hexafluoride gas (UF6), the underground Natanz plant where the UF6 is enriched, the Arak reactor scheduled for on-line operation in 2012, the Qom site and undisclosed centrifuge fabrication sites.129 For operational and strategic reasons, Israel would probably limit its attack to a surgical strike on the key nodes of the nuclear programme. The US, in contrast to Israel, has the ability to strike more broadly at Iranian command and control facilities, IRGC headquarters and other targets if it chooses to do so. Depending on Iran’s retaliation, the US may end up choosing to hit these other targets. The tit-for-tat could escalate into a major confrontation which could stoke the Iranian people’s disenchantment with the regime, even after rallying around the flag following the initial air strike. It is highly unlikely that Israel will be tempted to reach beyond the nuclear sites. Israel had disappointing experiences with overly ambitious regime change-type plans in Lebanon in 1982-83 when it helped engineer the election of Bashar Gemayal as Lebanon’s President. After Lebanon signed a peace treaty with Israel, Gemayal was assassinated days before his inauguration, allegedly at the behest of Syria.130 The peace treaty backfired and was quickly rescinded by a Lebanon dominated by Syria. It is noteworthy how little Israeli strategists think publicly about the political aftermath in Iran following a strike, focusing instead on intensifying international pressure and keeping ‘all options on the table’ to dissuade Iran from seeking nuclear potency. They appear to be counting on Iran backing out. If Iran cannot be dissuaded, then the attitude among many Israeli strategists is to do what is necessary since Israel has no option but to delay a nuclear Iran and deal with the consequences whatever they may be.131

128 This argument is specious on a historical basis. The lead-up to the 1967 War with Egypt and Syria was accompanied by European and American Jews coming to Israel to volunteer in the military service rather than people leaving Israel. In the years preceding the 1967 crisis, Israel experienced brain drain due to its stagnant economy. Also, contemporary South Korea shows signs of economic vitality and emergence as one of the richest nations on a per capita basis in Asia, despite growing signs that its unstable neighbour, North Korea, is a nuclear power. 129 Allin and Simon, infra, at p. 46 130 See website, President Bachir Gemayal Official Forum at http://www.bachirgemayel.org/forum/showthread.php?t=793 131 These observations were primarily based on discussions with key Israeli advisors and strategists in meetings on 13-16 September 2010. See also Gordon Thomas, Telegraph, infra, which recounts an interview with the incoming head of Mossad, Tamir Pardo: “Mr Pardo had been in the office with Mr Dagan, where a photograph on the wall reflected his outgoing boss’s style over the past eight years. It showed an SS officer aiming his rifle at an old man’s head. Mr Dagan had once explained what the picture meant to him.“The old Jew was my grandfather,” he (Dagan) said. “He represents my own philosophy of Jewish self-defence and survival. We should be strong, use our brains and defend ourselves so that the Holocaust never happens again.” It is not only Dagan who believes this. “A Mossad source said .... that Mr Pardo had cited the moment captured in that photograph as sufficient justification for continuing to use all means possible to defend Israel against Iran.” See http://www. telegraph.co.uk/news/worldnews/middleeast/ israel/8182126/Mossad-was-this-the-chiefs-last-hit.html

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2.8 Factors that might lead the US or Israel not to undertake a Military Strike on Iran before Iran reaches Nuclear Potency

In late 2010, US Secretary of State Robert Gates said that “a military solution... will bring together a divided nation. It will make [Iran] absolutely committed to obtaining nuclear weapons. And they will just go deeper and more covert...”132 In a few words, Gates summarised some of the most salient reasons against a military attack. A US or Israeli attack would spark an Iranian decision to leave the NPT and make them more determined than they are now to reconstitute a covert nuclear weapons programme beyond the monitoring by the IAEA that increases the chances of a nuclear war in the future.133 Conventional wisdom agrees with Secretary Gates that a strike will rally Iranians behind Ahmadinejad. An attack might also give the regime an excuse to shut down the opposition and even arrest Mousavi, Karrubi and other Green Movement figures, possibly setting back the prospect of internal change. Gates stated later in the same interview that a strike would only delay Iran’s nuclear march. As one analyst puts it, “you can bomb an enrichment facility, but not an enrichment program (or not one as well-developed as Iran’s.) It’s not like a reactor, with billions of dollars’ worth of hard-to-replace capital piled up in one spot over the course of several years. Instead, it’s thousands of interchangeable pieces that can be brought together and operated more or less anywhere.”134 While Gates emphasised the progress being made in the sanctions against Iran in the hope that Iran will be persuaded not to go nuclear, there are several reasons for not striking Iran even if they cross the nuclear threshold. The most important reason is that Iran’s regime can be deterred. In its 32-year history, the IRI has acted cautiously in attacking others. Their leaders, while fanatical, are not irrational. As Karim Sadjadpour, the US-based Iran analyst notes, “the Iranian regime is homicidal, not suicidal.”135 Other than the example earlier cited of the circumstances under which Iran agreed to accept a cease fire to end the Iran-Iraq War, 136 a second example is in the summer of 2003, when Iran, fearing the US military next door in Iraq, halted, at least temporarily, its weaponisation programmes and agreed to an Additional Protocol with the E-3 (UK, France and Germany) to suspend uranium enrichment. The containment school argues that Iran is not that different from Stalin’s Soviet Union or Mao’s China after they became nuclear powers. The deterrence measures established during the Cold War between the Soviet Union and the United States, they believe, should work with a nuclear Iran. If Iran were to attack Israel, it would be destroyed in a second strike retaliation.

132 Phil Stewart, “Gates sees Iran rift, says strike would unite country,” Reuters, 16 November 2010 at http://ca.reuters.com/article/ topNews/idCATRE6AF3G720101116?pageNumber=2&virtualBrandChannel=0. 133 barry Rubin, “Why Israel Shouldn’t Attack Iranian Nuclear Installations- Unless It Has To Do So”, Rubin Reports, July 12, 2010 at http://rubinreports.blogspot.com/2010/07/why-israel-shouldnt-attack-iranian.html 134 Joshua Pollock, blog, “On Bombing the Bomb,” 10 July 2010 at http://pollack.armscontrolwonk.com/archive/2792/on-bombing- the-bomb 135 Karim Sadjadpour, “5 Minutes With Benjamin Netanyahu”, The Atlantic, August 24, 2010 at http://www.theatlantic.com/ international/archive/2010/08/5-minutes-with-benjamin-netanyahu/61948/ 136 The IRGC leaders today are veterans of the 8-year Iran-Iraq war. They seethe with revenge for their ‘defeat’ at the end of the war, which they regard as Iran’s ‘Versailles Treaty’ moment. It will be interesting to see how and against whom this faction of IRGC leaders channels their revenge.

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Why a nuclear Iran is not an existential threat: Israel’s Missile Defence guarantees a second strike capability that should deter Iran from making a first strike. Most Israelis believe that a nuclear Iran poses an existential threat to Israel. Israel has a robust missile defence and second strike capability that should deter any Iranian leader from attacking it, however fanatical. This argument assumes that, notwithstanding the fanaticism of Iran’s current leadership, they are not irrational. A rational actor would determine if its ‘first strike’ could destroy its adversary’s ability to retaliate. Iran would need to destroy all six Israeli airfields that contain Israeli military aircraft usable in a retaliatory strike against Iran.137 Crucially, Israel has a tested and sophisticated missile defence system deployed today that ensures the survival of at least three, probably four of the six airfields under any scenario of numbers of missiles launched by Iran. If Iran chose to attack Israeli cities rather than the airfields, all of Israel’s airfields would be operational. Any initial attack would logically target the airfields. The Arrow missile defence system developed jointly by the US and Israel had a kill ratio of 88% in its most recent array of tests against incoming missiles. Given the number of interceptors that Israel has, independent of any US interceptors, it is impossible for enough Iranian missiles to penetrate the Arrow defence system and destroy over half of the key airfields. In short, a nuclear Iran cannot deny Israel a second strike capability.138 An Iranian decision-maker would have to accept the certainty that a nuclear attack on Israel would unleash an Israeli second strike that would virtually destroy Iran. Israel should be able to ‘deter’ Iranian leaders from ever attacking Israel by convincing Iranian leaders to make a ‘cognitive decision’ that Israel can survive a first strike by Iran and retaliate with an incredibly devastating second strike capability from its air force, and from cruise missiles launched from land, sea and drone at Iran. As one of the architects of Israel’s missile defence system writes, “Israel’s missile shield, by its very existence, overturns the strategic equation in two ways. First, it transforms the IAF (Israel Air Force) with its small number of prime bases from an easy prey (from Iran’s perception) to an almost impregnable objective. Second, it raises the ante for Iran, forcing its planners to specify ever-increasing salvos of nuclear Shahabs, the collateral effect from which could seriously risk Iran’s own security and safety. Since all the information needed to make such sombre evaluations is readily available to Iran from its own sources, its stands to reason that the calculus of gains versus losses will be sobering enough to dissuade

137 Even if Iran were successful in destroying all six airfields, Israel would still retain a second strike capability from its small fleet of nuclear submarines and from drones and land-based missiles that might survive the first strike. 138 See also Boaz Ganor’s proposal for a second-strike nuclear alliance in “If we aren’t going to bomb, we have to deter” Jerusalem Post, 23 November 2010 at http://www.jpost.com/Opinion/Op-EdContributors/Article.aspx?id=196498

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Iran, even in the midst of an ongoing crisis, from making a potentially disastrous mistake. The cognitive decision, the crucial condition for effective deterrence, is thus achieved.”139 An unprovoked nuclear attack from Iran is very unlikely. Rafsanjani’s statement in 2001 saying “Israel could be destroyed by one single nuclear bomb while the Islamic world could absorb many nuclear hits” could be construed as offering a rational basis for a nuclear attack on Israel. But Rafsanjani was not in a leadership position at the time he made that statement, and the argument has never been repeated by the Iranian government. Two caveats need to be considered. First, in the heat of a crisis, Iranian decision- makers may be more prone to escalate than in an ordinary situation. Second, the decentralisation of the IRGC into regional commands and the question marks over how much control the IRGC will have over Iranian nuclear and ballistic missiles, could lead to a situation where a launch occurs without the approval of the supreme leader. The remedy for both of these caveats is to build direct mechanisms of communication between Iran and Israel that minimise escalation into a nuclear confrontation. As in the Cold War where Soviet leaders could communicate directly with Washington, establishing secure phone lines or ‘hot lines’ between Jerusalem and Teheran would be an important start. Many Israelis who see a nuclear Iran as an existential threat focus on the possibility of an indirect attack through Iran’s handing off nuclear weapons to Syria and Hezbollah. Historically, however, nuclear states do not share their weapons. A Hezbollah bomb in a truck should be treated as a ‘terrorist’ threat, not a state threat.140 If Syria were to try to obtain nuclear weapons from Iran or restart another al Kibar program similar to the one destroyed in September 2007, this time with overt Iranian assistance, Israel would likely take military action against Syria again before Syria had a bomb.141 Notwithstanding the two caveats of irrational behaviour in a crisis situation and Iran passing nuclear weapons to Syria or Hezbollah, Israel’s missile defence system provides the necessary reassurance that a nuclear Iran would be deterred from launching a nuclear attack on Israel.

139 Uzi Rubin, “Missile Defence and Israel’s Deterrence against a Nuclear Iran” in Inside a Nuclear Iran: Implications for Arms Control, Deterrence and Defense, ed. Ephraim Kam, Institute for National Security Studies, Memorandum no. 94, July 2008 at http://www.inss.org.il/ upload/ (FILE)1216203568.pdf 140 Forensic intelligence is such that any nuclear weapon that Iran passed on to Hezbollah would trace back to Iran. 141 According to Uzi Rubin, one of the triggers for the Israeli pre-emptive attack beginning the 1967 war was not the blockade of the Straits of Tiran but Egyptian President Nasser’s deployment of Egyptian soldiers in Jordan near Jerusalem. Meeting in London, 29 October 2010. By analogy, should Iran risk making Syria or the Hezbollah in Lebanon a frontline nuclear state on Israel’s borders, it would likely trigger an Israeli pre-emptive attack.

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The probability that misdirected nuclear missiles launched from Iran might land in Iraq, Jordan, Syria, Lebanon or the West Bank is another reason that Iran may be hesitant. If it were to launch several nuclear warheads at Israel, the toxic blowback from nuclear detonations intercepted by Israeli defensive missiles could reach as far as western and central Iran depending on the prevailing winds. In other words, Iran might end up attacking its own people. Strategically, a nuclear Iran would hesitate to use its weapons as that would forfeit the intimidation that goes with having them without using them. Iran stripped of its nuclear assets in a humiliating raid by a non-Muslim country would not only be motivated to reconstitute its nuclear programme quickly but might actually use such weapons in an act of revenge.142 A strike on Iran by the US or Israel would aggravate relations with the Muslim world especially in pivotal countries like Pakistan and Turkey. If Israel strikes Iran, which has become a major trading partner for Turkey, Prime Minister Erdogan would probably sever diplomatic relations with the Jewish state. In any strike, Iran would likely retaliate against US soldiers and assets in Afghanistan and Iran, and might activate sleeper cells to launch Al Qaeda-like attacks against the US homeland and in Europe. The rifts between the US on the one hand, and Europe, China, Russia and the Muslim world would accelerate the perceived decline of American power. All of these consequences are amplified should the operation result in the losses of US or Israeli air pilots through death or capture. In a failed attack, the US and Israel would lose their most important constituents, which is their own publics. The US hostage rescue attempt in 1980 was a public catastrophe for the Carter Administration that it even led to Secretary of State Cyrus Vance’s resignation. In the current situation, the stakes are much higher. Even a successful attack by the US or Israel would likely cause the price of oil to spike to calamitous highs, threatening the already fragile world economic recovery. The question will only be how long oil prices stay high. In the case of an Israeli attack, there is the additional spectre of Netanyahu falling out with the Obama Administration, leading to another strategic reassessment similar to the one that occurred with the Reagan Administration following Israel’s attack on the Osirak reactor in Iraq in 1981. Israel becomes diplomatically more expensive for the US to support at transatlantic, UN, G-20 and other international venues. It is one thing for Israel to attack Iran after a series of Iranian actions and pronouncements suggesting that Iran directly or through its proxies was about to strike Israel. It is quite another for Israel to launch a pre-emptive attack that is not in response to a clear and public threat of an imminent Iranian attack. In the aftermath of an unprovoked Israeli strike on Iran, a pre-emptive attack would make it difficult for Israel to gain the support of international public opinion, and might lead to greater sympathy for the Iranian regime among a significant part of world opinion.143 The UNSC would likely pass a resolution condemning Israel. The US and France might abstain, but would hesitate to exercise a veto for fear of being accused

142 The risk of Iran giving nukes to terrorists may increase if Iran is attacked by Israel. First, Iran is at least temporarily unable to launch missile attacks on Israel after its missile launchers have been destroyed. Second, the desire for revenge may overcome Iranian reticence at losing direct control over their nuclear bombs, and third Iran may perceive a lower risk through transfer than before. See Barry Rubin in Rubin Reports, July 12, 2010. 143 See Rubin Reports, infra.

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of colluding with Israel. A military success would be trumped, as often happens to Israel, by diplomatic and political setbacks in the ‘day after.’ An Israeli attack might place communities across the Jewish Diaspora in mortal danger, by making them targets of Iranian-sponsored terror attacks for an indefinite period of time. It would also accelerate ongoing efforts by adversaries to de-legitimise Israel. It will assist recruitment by Al Qaeda affiliates in the region and the world, and give rise to even more monstrous “mutations of the global terrorist virus.”144 On a local level, an Israeli attack on Iran would likely precipitate missile strikes on the city of Tel Aviv and other populated areas from Hezbollah and Hamas, firing from the south and the north. Syria might be tempted to join in if it saw hesitation or ineffectiveness on the part of the Israeli defence forces in dealing with Hezbollah and Hamas. The costs to the Israeli economy, in addition to civilian casualties, would be considerable.

2.9 What will Netanyahu decide?

Given all the pros and cons, the decision to attack or pursue a containment based strategy is anything but simple. The best an analyst can do is to try to choose the key assumptions that should dominate the analysis. The person who may have to take the decision at some point in the future is the Prime Minister of Israel, currently Benjamin Netanyahu. The political system of Israel looks like a parliamentarian one but actually centralises power in the hands of the Prime Minister, who approves all senior appointments including military ones. Netanyahu will consult closely with his inner or security cabinet, which includes 1. Ehud Barak, Deputy Prime Minister and Minister of Defence, 2. Moshe Ya’alon, Vice Prime Minister and Strategic Affairs Minister, a former Chief of Staff of the Israel Defence Forces, 3. Dan Meridor, Deputy Prime Minister and Minister of Intelligence and Atomic Energy, 4. Benny Begin, Minister of Science and Minister without Portfolio, and son of Menachem Begin, 5. Avigdor Lieberman, Foreign Minister, 6. Eli Yishai, Deputy Prime Minister and Minister of Internal Affairs

Analysing the political inclinations of this inner cabinet is similar to analysing the political inclinations of the United States Supreme Court, which often splits on decisions along the spectrum of conservative to liberal. In the case of the inner cabinet, the inclinations of the majority of its members are hawkish with the exception of Ehud Barak and Dan Meridor, two of the most cerebral politicians in Israeli history. Barak is a former prime minister and acknowledged to be one of Israel’s most accomplished military leaders. He will have preponderant influence on Netanyahu, as will Dan Meridor, whose judiciousness (some would say cautiousness), open-mindedness and inclination to doubt the conventional wisdom over the last two decades is well-known.145 The advice of the military and intelligence heads, and National Security Advisor Uzi Arad, are also important factors leading up to a decision.

144 Allin and Simon, infra, p. 103. 145 See Barak Ravid, “Deputy PM: Israel must cede land to remain Jewish and democratic,” Haaretz 15 November 2010 at http:// www.haaretz.com/print-edition/features/deputy-pm-israel-must-cede-land-to-remain-jewish-and-democratic-1.324723

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Since Netanyahu became prime minister in the spring of 2009, he has been careful in the way in which he publicly discusses his intentions on Iran. The one theme he has emphasised is that Iran’s nuclear programme is a problem for the wider international community, not solely or even especially Israel’s. His government has encouraged tough international sanctions but has refrained from leading the effort against Iran. Except for his disagreements with US officials about the degree to which the US should strive to project a credible military option, Netanyahu has aligned himself behind multilateral diplomacy and economic sanctions. While Netanyahu’s head suggests that he will be cautious toward Iran, his instincts are embedded in the historical legacy It is Iran’s extremism, not its that he carries on behalf of all Jews, past and present, and that is atoms that threaten Israel the failure of the world to stop Hitler before he could unleash the most. Figuring out the a world war coupled with the near elimination of European best way to insulate the Arab Jewry. His wife, Sarah, and his father, Benzion, reinforce those gut instincts. The premise of his father’s 1,500-page history world from Iran’s extremism explaining the origins of the Spanish Inquisition is that the is a difficult challenge, though expulsion of the Jews by Catholic Spain was more racially than the Obama Administration, religiously motivated. Why else were the Conversos, those Jews and many Arabs, Israelis and who had converted to Christianity, not spared?146 On top of this eternal history lesson from his 100-year-old father, Bibi lives in Europeans believe that a the shadow of his older brother, Jonathan, who was killed in the peace agreement with the successful rescue at Entebbe of Palestinian-hijacked Israelis and Palestinians would be a good 147 other Jews from Idi Amin’s Uganda. Bibi’s head may listen to place to start caution, but his heart will hear a different voice. As one veteran analyst of the Middle East notes, Bibi will not want to go down in history as the Israeli prime minister on whose watch Iran became a nuclear power.148 The key argument against Netanyahu launching an attack is the one that says an attack will likely extend the regime for a further 60 years. The combative President Ahmadinejad sometimes appears to bait Israel to attack Iran so that he can play the victim of Israeli aggression. An Israeli attack would divert attention away from Ahmadinejad’s serious political challenges from his critics in the parliament and elsewhere inside Iran.149 By not attacking, Netanyahu can hope that a less fanatical supreme leader and president will emerge.The next leadership might be like the Khatami presidency before Ahmadinejad, during which Iran was far less obsessed with Israel’s existence even if it was committed to the nuclear programme. Ahmadinejad cannot stand for a third term and would have to step down as president in mid-2013 under the Iranian constitution. Even though by the standards of other Middle Eastern rulers, Khamenei is not old, he is rumoured to have cancer. 150

146 Benzion Netanyahu, The Origins of the Inquisition in Fifteenth-Century Spain, Second Edition (New York: New York Review Books Collection 2001) 147 See Jeff Goldberg, “The Point of No Return”, The Atlantic (September 2010) at http://www.theatlantic.com/magazine/ print/2010/09/the-point-of-no-return/8186 148 Conversation with Aaron David Miller, Washington, D.C., May 2010. Despite the pressure on Bibi, Aaron’s view at the time was that an Israeli military attack would be a mistake. 149 An example is a petition to debate the impeachment of President Ahmadinejad brought forward by conservatives in Parliament. See Farnaz Fassihi, “Assembly Pushes to Oust Iran President,” Wall Street Journal, 22 November 2010, at http://online.wsj.com/ article_email/ SB10001424052748703904804575631093531990342-lMyQjAxMTAwMDIwMzEyNDMyWj.html 150 See “WikiLeaks cables say Iran’s Khamenei has cancer” Reuters.com, 29 November 2010 at http://uk.reuters.com/article/email/ idUKTRE6AS1LP20101129

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The key argument for an attack from Israel’s perspective is the negative political impact in the region of a resurgent nuclear Iran led by an ambitious Ahmadinejad, the “new Nasser.” The fear in Jerusalem is that Iran will reverse a steady process over the last thirty years in which the moderate Arab states have abandoned efforts to eliminate Israel.151 Hamas, Hezbollah and Syria are threats that can be contained. Turkey’s new anti- Israeli policy can also be managed. However, an unstable or populist-led Egypt, Jordan and Saudi Arabia could make Israel’s position in its immediate neighbourhood increasingly untenable. It is Iran’s extremism, not its atoms that threaten Israel the most. Figuring out the best way to insulate the Arab world from Iran’s extremism is a difficult challenge, though the Obama Administration, and many Arabs, Israelis and Europeans believe that a peace agreement with the Palestinians would be a good place to start.

2.10 Possible US Postures Toward an Israeli Strike: four potential signals

The US can give Israel a green light, an amber light, a soft red light, or a hard (bright) red light. 1. Green light: US gives passive support such as helping to secure over-flight rights over Iraq or other airspace and sharing targeting intelligence; 2. Amber light: The US says that it is for Israel to decide what is best for Israel’s security, but it warns Israel of the negative consequences of such an attack for US interests; 3. Soft Red Light: US opposes an Israeli strike but does not take operational steps to impede the strike; it is likely that the US is not informed of an Israeli decision to attack until the strike is practically under way; and 4. Hard Red Light: US opposes an Israeli attack and tries to overturn an Israeli government decision to strike or, possibly, prevents the operational implementation of a strike.

The middle two signals appear to be the likeliest scenarios, in the event that the US decides that it will not take military action and Israel decides otherwise.

2.11 Changing Thresholds and Possible Convergence Between Allies

Many observers point to the strained relations between the Obama and Netanyahu governments, and suggest that an attack by Israel following a red light from the US, hard or soft, would trigger a rift in US-Israel relations. This reading is flawed for several reasons. First, the trend since the middle of 2010 following the UN Sanctions has been a higher threshold for an Israeli attack (i.e., greater Israeli strategic patience as the sanctions and diplomacy progress, and increasing doubts within Israel that it is the country that should strike). In the US, by contrast, one sees a lower threshold for a US attack with a dawning

151 Jonathan Paris, “Confronting the New Nasser in Iran,” BESA Perspectives No. 18, June 19, 2006 at http://www.biu.ac.il/SOC/ besa/perspectives18.html

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realisation in Washington that US power is no longer taken for granted by its allies or enemies, and that a nuclear Iran would accelerate the serious challenges to US leadership regionally and globally with adverse short and long-term ramifications for US strategic interests. US and Israeli interests are trending toward convergence on the Iran file, especially as the American strategy of offering bigger carrots of engagement and diplomacy, and bigger sticks of sanctions, fails to persuade Iran to stop its advance toward nuclear potency. If this convergence trend continues, it is increasingly likelier that either the US will make the decision to strike Iran alone or give Israel at least an amber light for an attack. The only caveat to the convergence trend is one of differing intelligence assessments on timing. One could imagine that a sudden adverse development, for instance, the discovery that North Korea is providing Iran advanced centrifuges that enable Iran to overcome the difficulties Iran experienced in 2010 with its P-1 centrifuges at Natanz, is likely to trigger an Israeli decision to strike faster than an American one. The Israelis have not made a decision yet as none of the triggers for a decision have arisen. Their hope and expectation is that, following a decent period for further diplomacy and sanctions, the US will conclude that embellishing on a military option is the only way to stop Iran. At that point, the Obama Administration should be able to project a more credible military threat to Iran’s decision-makers than ever before.152 Israel is cautiously optimistic that when confronted with a US determination to prevent Iran from going nuclear, Iran’s leadership, realising that its survival is threatened by a US attack, will make a compromise that keeps Iran firmly in a nuclear latent stage. If the Iranians decide not to compromise, then, having placed the military option squarely on the table, the US and Israel will be forced to take some important decisions.

2.12 Regional Reaction to a Military Strike on Iran

The impact of a military strike on Iran in the Arab world would be contradictory in its public and private manifestations. Assuming that collateral damage was slight and that the operation was tactically successful, privately, the Arab states will be relieved. Not only would the region be spared a nuclear neighbour but Iran’s ambitions for hegemony over the Gulf would be dealt a harsh blow. If Israel strikes, the Arab states will condemn it, both to assuage their domestic public opinions and to vent their anger at Israel for playing the role yet again of the enforcer of non-proliferation for everyone in the region but Israel. Those countries that secretly abet Israel’s military strike will probably be most vociferous in publicly excoriating Israel. The reaction of the Arab states to a US strike will be appreciative though muted for fear of aggravating an angry Arab street. The main concern of the Gulf states will be possible retaliation by Iran for hosting US military installations. Ironically, if the US rather than Israel strikes Iran, then the risk of retaliation against the Gulf states by Iran is greater because US bases are located in those

152 Jeffrey Goldberg’s article in The Atlantic quotes Lester Crown, a Chicago-based philanthropist and fund raiser for Obama in the 2008 campaign, on what constitutes a credible bluff: “I support the president,” Crown said. “But I wish [administration officials] were a little more outgoing in the way they have talked. I would feel more comfortable if I knew that they had the will to use military force, as a last resort. You cannot threaten someone as a bluff. There has to be a will to do it.”

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Gulf states. Yet Arabs in public opinion polls prefer that a military strike be done by the US rather than Israel.153 Even though Turkey has much to gain by an attack that prevents or at least delays a nuclear Iran, Turkey will probably condemn Israel or the US. Turkey will also abstain from sanctions against Iranian efforts to reconstitute its nuclear programme, even if international resistance to Iran’s effort to reconstitute its nuclear program is stronger the second time around.154 Will Hezbollah, Hamas and Syria retaliate against an Israeli attack on Iran? Conventional wisdom is that Hezbollah, as an Iranian proxy, will strike northern Israel with many of its 40,000 plus rockets and medium-range missiles. It is possible that Hezbollah will be deterred by the prospect of a more robust Israeli response than in the 2006 War in Lebanon. Hassan Nasrallah, the leader of Hezbollah, sometimes acts independently of Teheran and may decide not to retaliate to an Israeli strike on Iran. He could reap the internal dividends for sparing Lebanon from Israel’s military response.155 Hamas may also hesitate to launch more than a nominal number of rockets at Israel. Hamas remains deterred by the prospects of an Israeli response similar to their devastating defeat only three years before. Alternatively, they may be tempted, if Hezbollah strikes Israel, to launch some of their new longer range Iranian missiles smuggled through the tunnels from Egypt into Gaza. These missiles can hit Tel Aviv, provided that the Israeli air force does not hit the missiles in Gaza before they can be launched. Israel is about to deploy its Iron Dome shield which comprises missiles that can shoot down Hamas and Hezbollah short range rockets. Israel also has David’s Sling, a defensive shield against medium range missiles that can reach Tel Aviv from Gaza or Lebanon, and the Arrow that can intercept longer range ballistic missiles from Iran with a 90% success rate. If, despite Israel’s defensive shield and experience, it appears that Israel is having difficulty responding to Hezbollah and Hamas attacks, Syria may be tempted to join in the fight in the hope of recovering the Golan Heights. This is a risky proposition given the commanding heights that Israel maintains overlooking the outskirts of Damascus. It also goes against the traditional caution of the Assads. On balance, Iran cannot count absolutely on its allies neighbouring Israel to be much more than a nuisance for Israel. If the US attacks Iran, then the likelihood of Hamas, Hezbollah or Syria attacking Israel becomes negligible. Throughout the Arab and especially non-Arab Muslim world like Pakistan, the reaction to another episode of American aggression in the Middle East would be strong and emotional. However, street demonstrations may not translate into diplomatic moves by the Arab governments themselves, who may be privately relieved over the American assertion of power against Iran. In the region, an American lake is considered preferable to a Persian Gulf.

153 David Pollock cites an opinion poll in Saudi Arabia that shows 33% of Saudis favour a US strike and 25% of Saudis favour an Israeli strike. See David Pollock, “What Arabs Really Think About Iran”, Foreign Policy, 16 September 2010 at http://www. foreignpolicy.com/articles/ 2010/09/16/ what_arabs_really_think_about_iran?page=0,1 154 In addition to international sanctions, Iran may face domestic resistance in some important quarters to reconstituting its nuclear programme. Iranian engineers and scientists who survive the first attack may be reluctant to go to their worksites for fear of being attacked again, a point made to the author by Uzi Arad in Berlin in 2008, before he became National Security Advisor to Prime Minister Netanyahu. 155 Some Israelis in the security establishment prefer a Hezbollah takeover of Lebanon because then Israel will have a ‘return address’ for responding to Hezbollah missiles and rockets.

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What will be the impact of a military attack on the Green Movement inside Iran? Would the opposition rally around the flag in a nationalistic response? The regime is a master at stoking xenophobic nationalism in order to galvanise hard core supporters inside Iran, especially in the IRGC and Basij, and distract the public from internal problems. However, a contrarian view is that dissident Iranians will blame the regime for putting Iran in a position of being attacked. Since the domestic grievances of the Iranian people that the Green Movement helped to crystallise in June 2009 are predominantly the absence of human rights, the right to vote on who their leaders will be, social freedom and economic transparency, an attack by Israel or the US does nothing to mitigate these public grievances against the regime. The nuclear issue is separate from the drivers of civil resistance within Iran. An attack that exposes the regime as a paper tiger, incurs little collateral damage and results in ineffective retaliation, might undermine the regime’s legitimacy domestically. At the very least, the duration of a rise in increased domestic support for the regime is questionable.156 There is a remote possibility that a humiliated Iranian leadership might give way to a Green Movement government eager to end Iran’s isolation.157

156 Similarly, since the reasons for domestic opposition are internal, the fact that Iran gains nuclear potency will not grant the leadership immunity from opposition. A nuclear Iran is unlikely to satisfy opposition grievances or provide the kind of power or legitimacy to the regime that they are counting on to tamp down opposition. Going nuclear is overrated in terms of how much the radical leadership will gain politically inside Iran because the regime has to worry about being attacked without an ability to respond with a second strike capability. 157 Allin and Simon, infra, p. 74. It is hard to imagine that the Green Movement, which has been extremely quiet and invisible throughout 2010, could be even less visible in its opposition to the leadership after an attack, especially one that does not cause significant collateral damage. A Geneva-based Iranian nuclear and national security specialist, Shahram Chubin, describes one scenario where an initial pinprick in the form of an Israeli or US attack on Iran’s nuclear installations escalates into an Iranian retaliation against Gulf states and US ships and personnel. Asymmetric attacks by Iranian boats on US naval assets might lead to a ‘tit for tat’ escalation between US and Iran into a serious military confrontation. Even if the Iranian people initially rally around the flag after the initial bombing of their nuclear assets, Chubin believes the people may eventually switch their blame to the regime for escalating a surgical air strike into a war with the US and its Gulf allies, leading to a humiliating defeat for Iran. Conversation, Geneva, 14 May 2010

63 chapter 3 Regional Snapshots

3.1 Introduction

This section asks two overlapping questions: First, what does the rise of Iran mean for the region? Second, how will the region respond to a nuclear-armed Iran? The regional component of Iran’s foreign policy seeks hegemony in the Gulf, which requires it to overcome US naval dominance in the area, and to prevail over two of Iran’s regional adversaries, namely Saudi Arabia and Israel. By weakening Israel so that it eventually ‘disappears,’ Iran will then gain the acquiescence of the al Saud ruling family or, failing that, seek to spark a revolt in Saudi Arabia against the ruling family, which will leave an unstable and weakened Saudi Arabia dependent on Iran. Like Nouri al Maliki’s Iraq, Saudi Arabia will cease to be a regional rival. Ahmadinejad and Khamenei’s ideological fanaticism propels an aggressive foreign policy that serves Iran’s regional ambitions while securing the regime’s survival by galvanising its core supporters within Iran and mobilising the Islamic world under a radical anti-Western banner.

3.2 Regional Responses to a Rising Iran

Given Iran’s regional ambitions, how will the Muslim neighbourhood respond?

Syria President Assad of Syria is the biggest Arab beneficiary of a rising Iran. Syria will try to leverage its three-decade-old alliance with Iran into a ‘Northern Alliance’ comprising Hezbollah and Hamas, Syria, Iran, Turkey, and possibly Qatar and Iraq. Assad may become convinced that the Northern Alliance will provide Syria with strategic parity with Israel for the first time since 1983. That was the year when Assad’s father, Hafez, was told by the Soviet Union’s Premier Brezhnev that Syria would no longer receive military credits for armaments. Syria today is confident it can get credits from Iran to buy advanced Chinese and Russian arms and rely on Turkey for key regional and international diplomatic support. Whether procurement of such arms and diplomatic support is enough for Syria to achieve strategic parity with Israel is another question.

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Turkey Turkey wants to be a bridge between the West and Iran under the ‘zero problems towards neighbours’ policy conceived by Foreign Minister Ahmet Davutoglu.158 Even though it tries not to take sides in local disputes outside its borders, Turkey’s interaction with Israel since adopting an activist foreign policy has led some to question Turkey’s neutrality. Turkey’s AK Party has a new outlook on the world in which Islamic countries, according to Prime Minister Erdogan’s thinking, are on ‘our side’ and non-Islamic countries like Israel are on the ‘other side.’159 Nonetheless, Turkey would like to see a peaceful region in which its economy can flourish through trade with Iran and the Arab world.160 It prefers not to have a nuclear Iran as a neighbour but is not prepared to join with the international community in preventing a nuclear Iran. Prime Minister Erdogan’s policy of looking to the Middle East increasingly resembles the Ottoman Empire. As happened to the real Ottoman Empire, Turkey will eventually run up against the modern version of the Persian Empire. Historical antagonists, Turkey and Iran are likely again to clash at some point, given their geographic rivalries. A rising Turkey may balance Iran’s hegemonistic ambitions. In the meantime, the determined Prime Minister Erdogan and visionary Foreign Minister Davutoglu may move away from Europe and NATO, and seek to lighten the US footprint in the Middle East and abet international efforts to de-legitimise Israel.

Egypt, Jordan and the Palestinian Authority For Egypt, Jordan and the Palestinian Authority, the rise of Iran brings instability and extremism. From their viewpoint, any chance of moderation on the part of Hamas and Hezbollah through the political process, both internally within Lebanese and Palestinian polities, and through the peace process with Israel, is undermined by Iranian meddling in the Levant. With a major succession about to take place, Egypt is particularly vulnerable to any Iranian support for populist anti-Israel and anti-US movements inside Egypt like the Muslim Brotherhood of Egypt. The prospect for Iranian mischief in Jordan and Egypt through fundamentalist Islamic opposition forces may be forthcoming in the future if Iran’s rise is not checked and if the Israelis and the Palestinians do not resolve, or at least better manage, their conflict. Iranian meddling within Palestinian affairs, by contrast, is taking place now with Iranian financial, political and military support for Hamas in Gaza and the West Bank that is undermining the Palestinian Authority as well as blocking efforts for Palestinian reconciliation that is needed to implement a peace agreement with Israel.

158 For an analysis of the internal dynamics propelling Turkey’s foreign policy, see Ziya Meral and Jonathan Paris, “Decoding Turkish Foreign Policy,” The Washington Quarterly, October 2010, p. 80-81, at http://twq.com/10october/docs/10oct_Meral_Paris.pdf 159 “The [AK] party’s tendency to analyze the Middle East through an “us versus them” foreign policy lens—which casts the region as a set of politically defined religious blocs rather than nations—has facilitated this process [of closer relations with Syria and Iran, and a simultaneous distancing from Turkey’s former ally, Israel].” J. Scott Carpenter and Soner Cagaptay “Regenerating the US-Turkey partnership,” Policy Notes No. 2, Washington Institute, November 2010, p. 5 at http://www.washingtoninstitute.org/ pubPDFs/PolicyNote02.pdf 160 See Ziya Meral and Jonathan Paris, infra.

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Saudi Arabia and the Gulf States For Saudi Arabia and the Gulf states, the rise of Iran means a challenge to the stability of their family-dominated paternalistic monarchies and the increasing restiveness of their sizeable Shi’a minorities. Saudi Arabia in particular faces a challenge for its leadership of the Muslim world, which it has traditionally asserted as custodian of the Holy Places in Mecca and Medina. With an aging leadership comprising King Abdullah and his brothers Sultan, Nayef and Salman, Saudi Arabia will be consumed by competition for power within the ruling family to see who from the second generation, that is, which grandson of Abdulaziz, the founding ruler, will eventually become king.161 The Gulf states, comprising Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the UAE are, on paper, a rich and powerful regional alliance. However, when it comes to facing Iran, Qatar and Oman tend to avoid any united Gulf stance. Kuwait worries about damage to its environment from nuclear fall-out in any confrontation with Iran. UAE is embroiled with a long-standing dispute with Iran over small islands between the two countries, although as a financial entrepot for the region it favours good relations with all its neighbours. The most vulnerable Gulf state to the rise of Iran is Bahrain, which is over 70% Shi’a and has a sizeable ethnic Persian population under the rule of the Sunni Khalifa family. Adding to the threat to this tiny pro-American sheikhdom is the widely held view among many irredentist Iranians that Bahrain is one of its provinces. Given the threat to the Gulf Arab states that the rise of Iran poses, it should not be surprising that the most strident calls for military strikes on Iran, as reported by WikiLeaks, came from King Abdullah of Saudi Arabia (“cut off the head of the snake”) King Hamad of Bahrain (“That program must be stopped....The danger of letting it go on is greater than the danger of stopping it”) and Abu Dhabi (UAE) Crown Prince Mohammed bin Zayed (“Ahmadinejad is Hitler”).162 The leaders clearly prefer that the Iranian nuclear weapon problem be dealt with, and soon. If Iran is not prevented from going nuclear, one should not assume that the former consensus means that the Gulf states will be galvanised into containing Iran. Other WikiLeaks suggest a fear among Israeli officials that some of the advanced military hardware being sold by the US to the Gulf states could jeopardise Israel if someday those same Gulf states were to reverse their pro-US policies and accommodate their nuclear neighbour.163

Lebanon Lebanon and Iraq face the spectre of lapsing under pro-Iranian governments. Many see Ahmadinejad’s visit to Lebanon in October 2010 as a precursor to a Hezbollah takeover of Lebanon. Armed by Iran and Syria, Hezbollah is probably stronger, and certainly more united, than the Lebanese Army. Hezbollah’s obstacle to power in Beirut is the government

161 King Abdullah has had two operations on his back relating to blood clots in the US in late 2010. Crown Prince Sultan has been sick with stomach cancer for several years. 162 David Sanger, “Around the World, Distress Over Iran” The New York Times, 28 November 2010 at http://www.nytimes.com/ interactive/2010/11/28/world/20101128-iran-leaders.html?ref=middleeast 163 Senior Israeli diplomat Alon Bar adds: “A perceived closure in the capability gap between Israel and Arab states, coupled with a nuclear-armed Iran, could compel moderate Arab states to reassess the notion that Israel was a fixture in the region.” “WikiLeaks: Israel cautioned US not to arm Arabs against Iran” Reuters, 1 December 2010 at http://www.haaretz.com/news/ diplomacy-defense/WikiLeaks-israel-cautioned-u-s-not-to-arm-arabs-against-iran-1.328257

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of Prime Minister Saad Hariri, the son of the assassinated Rafik Hariri. Saad, who is Sunni, at times seems more interested in maintaining his family’s lucrative contracting business in Saudi Arabia than in outmanoeuvring Hezbollah and Syria. There appears little that Saudi Arabia, Egypt, the US and France can do to strengthen moderate forces in Lebanon against Iran’s more determined Syrian and Hezbollah allies.164

Iraq Iraq is an even more complex political situation. Nouri al-Maliki, who has ruled Iraq since 2006, was Iran’s choice to break the political deadlock since the Iraqi election in April 2010. The Sunnis fear that Maliki will do Iran’s bidding, and Maliki’s unworldly, religious Shi’a, pro- Iran Dawa party suggests exactly that. Still, Iraqis as a whole distrust their Persian neighbour and Maliki will be constrained from being too overtly pro-Iranian. At a minimum, he might bring in the Sadrists and further distance himself from his former American patrons. Maliki’s rivals, Ayad Allawi and Adel Abdul Mehdi, are seen as more secular and worldly Shi’a (despite Mahdi’s ties with the pro-Iranian SCIRI, now renamed Islamic Supreme Council of Iraq or ISCI). Unlike Maliki, they would work more closely with the Sunni Arabs and Kurds to curb Iranian influence, and possibly extend American force protection beyond the 31 December 2011 deadline for the withdrawal of all US military.

Pakistan Since the inception of Pakistan over six decades ago, Pakistan-Iran relations have been fairly good despite the Shi’a-Sunni divide. The Iranians and Pakistanis share a restive Baluch population, just as Iran, Iraq and Turkey share a restive Kurdish minority. Pakistan sees Iran as a potential commercial partner and is eager to share proposed pipelines for Iranian energy into Pakistan and onward to energy-hungry India.

Afghanistan Afghanistan poses a dilemma for Iran. On the one hand, Iran seeks to undermine US interests in achieving a stable pro-American government in Kabul. This leads Iran to support the Taliban insurgency against NATO forces in Afghanistan. On the other hand, Iran’s traditional assets in Afghanistan, comprising mainly the Hazara tribes and Shi’a Afghans, are threatened by a resurgent Taliban. Iranian and American interests coincide in preventing the re-emergence of the Taliban, which lead some analysts to predict that a breakthrough in US-Iran relations might happen over a post-conflict compact in Afghanistan.

3.3 The Impact of a Nuclear Iran on the Arab and Muslim Countries in the Region

The Arab states and Turkey have three options if Iran achieves nuclear potency. They can: 1. Acquire nuclear capabilities either indigenously or through possible proliferators like

164 In one week alone in late November, 2010, Saad Hariri went to Teheran to reciprocate Ahmadinejad’s October visit to Lebanon, and Turkey’s Prime Minister Erdogan travelled to Beirut to urge that Lebanon delay the release of the UN tribunal’s findings on the assassination of Rafiq Hariri for a year.

67 Legatum Institute

the cash-starved, secretive North Korea and, more narrowly, Pakistan. A nuclear Iran will generate a proliferation cascade throughout the region, dealing a harsh blow to the NPT and to the Obama Administration’s counter-proliferation initiative. 2. Accommodate Iran, in Turkey and possibly Qatar’s case, by opposing continuing international sanctions to isolate Iran, and increasing cooperation in trade (Turkey) and the joint development of massive gas fields that lie between the two countries (Qatar). The other moderate Arab states in the region will at a minimum waver between their traditional dependence on US security and a large neighbour armed with a nuclear bomb. Much will depend on the Arab perception of the US commitment to the region and the muscularity of its containment of a nuclear Iran. 3. Rely on a US strategic nuclear umbrella. This will probably be the preferred option of the pro-US Arab states like Saudi Arabia and Egypt, Iran’s arch-rivals in the Muslim world, and the UAE and Bahrain. The UAE has long-standing island disputes with Iran that are likely to be exacerbated by a rising Iran, and Bahrain worries about Iranian support for an internal Shi’a uprising. Kuwait, with its deep ties with the US and UK, is also likely to resist accommodating Iran and embrace the US umbrella. Oman is a wild card. Historically a maverick despite its close military and economic ties with the UK, Oman plays a pivotal role in its geographic location at the Straits of Hormuz in either checking or accommodating Iran’s pursuit of hegemony in the Persian Gulf.

It is likely that many if not most countries in the region will choose more than one of the three options in responding to a nuclear Iran. Turkey may choose to remain a member of NATO and continue its close political and economic ties with Iran. Saudi Arabia helped finance Pakistan’s nuclear arms development and has had over five decades of military ties with Pakistan dating back to the late 1950s and early 60s, when the Pakistani military served as the praetorian guards for King Saud. It would not be far-fetched for Pakistan to make nuclear weapons available to Saudi Arabia as needed even with a US nuclear umbrella for Saudi Arabia. It is possible that Saudi Arabia may pursue all three objectives at the same time, accommodating Iran by inviting Iranian leaders, as they have done in the past, to participate in GCC meetings. The UAE has indicated its intention to develop a nuclear programme as well as stay within the US alliance. Qatar is the most practised at maintaining simultaneous relations with adversaries, and will continue to accommodate Iran and retain close defence ties with the US. Many other states will be tempted to follow Qatar’s hedging strategy when the US is no longer perceived to be the master of the Gulf. In short, the politics of the Gulf in the shadow of a nuclear neighbour will be in constant flux, highly contradictory, unpredictable and unstable, with the possibility of a periodic crisis escalating into a regional war. The US will be looking at a far less accommodating neighbourhood than it has had ever since it took over Britain’s Gulf security role in the early 1970s. Pakistan, the one country with the Sunni bomb, is unlikely to react with hostility to an Iran with a Shi’a bomb. For one thing, Pakistan has a population of over 170 million, of which as many as 15% are Shi’a. One concern for Pakistan would be the collapse of the NPT, which would dilute its coveted status as one of a half-dozen nuclear powers. Another concern to the secular elites in Pakistan would be the adverse impact of Iranian Islamic triumphalism on

68 Prospects for Iran

the already strong anti-American feelings among the large and poor population of a Pakistan that will reach 250 million in twenty years.165 More generally, two reasons moderate Arabs and Muslims may continue to resist Iranian hegemony are still resonant: Arab vs. Persian and Sunni vs. Shi’a divides. Ahmadinejad’s rhetoric is driven in part by an effort to overcome this divide by appealing to the Arab and Muslim street against the United States, its Israeli ally and, more generally, the Judeo- Christian West.

3.4 Chronic Instability Flows from a Multi-Polar Nuclear Middle East

Already five countries in the region have started civil nuclear programmes and, as mentioned before in this Report, the larger countries in the region, Saudi Arabia, Egypt and Turkey, are unlikely to remain non-nuclear after Iran passes the threshold. Most analysts see nuclear proliferation in the region as a disaster. The most recent Global Trends Report issued by the US National Intelligence Council in 2008 mentions the danger of conflicts escalating into nuclear exchanges: “Although Iran’s acquisition of nuclear weapons is not inevitable, other countries’ worries about a nuclear-armed Iran could lead states in the region to develop new security arrangements with external powers, acquire additional weapons, and consider pursuing their own nuclear ambitions. It is not clear that the type of stable deterrent relationship that existed between the great powers for most of the Cold War would emerge naturally in the Middle East with a nuclear-weapons capable Iran. Episodes of low-intensity conflict taking place under a nuclear umbrella could lead to an unintended escalation and broader conflict if clear red lines between those states involved are not well established.”166 One security analyst forecasts that a multi-polar, nuclear Middle East will be a strategic nightmare, listing six reasons: “The geographical proximity in the region’s small distances in the Mideast, the lack of adequate early warning systems, the rudimentary stage of nuclear arsenals, the presence of elites newly initiated into the intricacies of nuclear strategy, regional strategies that allow brinkmanship and use of force, and the low sensitivity to cost create a strategic nightmare.”167 It is possible that a containment strategy based on deterring Iran might make sense even though some view the ayatollahs as extremely problematic. One consistently contrarian and often prescient Israeli analyst believes that the advent of a nuclear Iran will not change the Middle East all that much.168 One becomes less sanguine about a stable Middle East, however, when more countries become nuclear powers. Dealing with a nuclear North Korea and Iran is a serious and full-time problem for the international system. Preventing the collapse of the NPT and further proliferation beyond these two countries will be exponentially more challenging.

165 See Jonathan Paris, “Prospects for Pakistan”, Legatum Institute, 2010 at http://www.li.com/attachments/ProspectsForPakistan.pdf 166 “Global Trends 2025 ,” National Intelligence Council, 2008 at http://www.dni.gov/nic/PDF_2025/2025_Global_Trends_Final_ Report.pdf 167 Efraim Inbar, infra. 168 Conversation with Shlomo Brom, INSS, 14 September 2010

69 Conclusion

There are two separate time clocks with respect to Iran: the slow crumbling of a regime that has lost its legitimacy and that’s struggling to hold power in the face of a brewing rebellion among the populace and the nuclear clock. If Iran were not inching toward nuclear potency, strategic patience on the part of the US and the international community would be a logical policy prescription. The internal contradictions within Iran’s system will eventually lead to its demise. But strategic patience runs up against the reality that Supreme Leader Khamenei could decide to go for a breakout to nuclear potency, and the region would realign accordingly. Some criticise the Obama Administration for not fully trying strategic engagement with the regime. The bigger stick of increasing sanctions has, in their view, poisoned prospects for engaging Iran as an equal. Others are critical of the Administration’s neglect of the democracy movement inside Iran in pursuit of a deal with the regime. The emphasis should be on human rights and economics, the Achilles heels of the regime, and not exclusively on the nuclear programme, which is widely supported by the Iranian population. The one area where the two clocks potentially intersect is on sanctions, which have the potential for stoking popular anger against the regime for its economic mismanagement. This in turn could generate the pressure needed to persuade the regime to compromise on the nuclear file. The maximum sanctions envisaged by the Europeans, however, may not be enough to either mobilise the streets of Teheran or alter the calculus of Khamenei and Ahmadinejad, for whom economics is subsidiary to the various ideological causes (Islamism, Shi’ism, Iranian nationalism) they espouse. If sanctions and engagement do not work, the next step will likely be for the US to articulate a credible military threat. So then, what are the prospects for Iran? In the long term, the prospects are positive for the people of Iran with the likelihood that the Velayat Faghih or rule of the Jurists will be replaced by an Iranian democracy where, unlike in June 2009, the people’s vote will count. It is hard to say how Iran’s regime will leave.It may fall gradually via an interim reformist government that, like Gorbachev in the last days of the Soviet Union, introduces elements of popular sovereignty which slowly erode the pillars of Islamic rule. Alternatively, the regime might collapse as a result of a precipitous shock and a loss of confidence on the part of the regime leadership, like the last days of the Shah in 1979.

70 Prospects for Iran

A military attack on Iran poses numerous short-term uncertainties for the region. A nuclear Iran will have more lasting consequences, and not limited to the region. Domestically, whether or not the nuclear installations of Iran are attacked will have little impact over the long term on the demise of the Islamic Republic of Iran. Iranians may rally around the flag, and Ahmadinejad and his allies in the Revolutionary Guard may gain a momentary advantage, but the grievances that gave rise to the Green Movement will not go away.

Legatum Institute

Prospects for Iran

Jonathan Paris Prospects for Iran Jonathan Paris

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