Do As We Say, Not As We Do

Does the U.S. expect Iran to capitulate to sanctions in a way it would not?

As the international community awaits the next round of P5+1 negotiations with Iran over its disputed nuclear program, the utility of U.S. sanctions and the parameters of a potential diplomatic agreement are the subject of intense debate. Past U.S. experience as a sanctions target suggests that the only way forward is to explicitly tailor sanctions so that they can be used effectively to reach an agreement that the United States and Iran can both accept.

During the House Foreign Affairs Committee’s May 15, 2013 hearing on “Preventing a Nuclear Iran,” Ranking Member Eliot Engel (D-NY)expressed a common maximalist position vis-à-vis negotiations with Iran. In his opening statement Rep. Engel was resolute that “Congress will continue to insist on a full and sustained suspension of enrichment” and reiterated the Congress would focus on increasing sanctions going forward. There have also been attempts to attach a number of conditions unrelated to the nuclear issue to major sanctions bills. For instance, a leaked draft summary of a Senate sanctions bill would, among other conditions, require Iran to transition to a “free and democratically elected government” before entities designated as Government of Iran could be removed from U.S. Department of Treasury’s Specially Designated Nationals (SDN) list.

These potential conditions come despite the fact that they represent concessions that Iran is unlikely to agree to. A total enrichment suspension is diametrically at odds with repeated Iranian statements which maintain that uranium enrichment is within Iran’s rights under the Nuclear Nonproliferation Treaty (NPT). There are also few signs that that Iran is likely to become a full-fledged democracy or suffer a catastrophic economic collapse any time soon. The question then becomes, given the pace of Iran’s construction of advanced centrifuges, do sanctions have a chance of compelling Iran to cross its own declared redlines in order to reach accommodation with the West, within the limited time left before the United States or Israel will be forced to consider military action?

In order to better understand Iran’s negotiating posture and the parameters of a potential nuclear deal, policymakers would do well to look back to a time when the U.S. was itself subject to sanctions. On October 6, 1973, Egyptian and Syrian forces launched a surprise attack against Israel. Due to higher than expected Israeli losses in opening days of the conflict and a massive Soviet effort to resupply Syrian and Egyptian forces, U.S. officials were extremely concerned that Israel might resort to nuclear weapons should the military situation deteriorate further. In order to mitigate that possibility, on October 10, 1973, the United States began Operation Nickel Grass, a large-scale effort to supply military equipment to Israel. While supplies were initially shipped using the Israeli airline El Al, by October 14 U.S. military cargo aircraft were soon landing at Israeli airbases.

In response to U.S. support for Israel, including President Nixon’s public pledge of a $2.2 billion aid package, the Organization of Arab Petroleum Exporting Countries (OAPEC) decided to unleash the oil weapon. The initial conclusion of an October 17, 1973 meeting between the Arab oil ministers in Kuwait city was that production would be cut by 5% per month until their demands were met. The demands included a full Israeli withdrawal to the pre-1967 borders and the restoration of the “legal rights” of the Palestinians. Saudi Arabia’s King Faisal would also later add the condition that Jerusalem become an Arab Islamic city. However, following Nixon’s aid pledge two days later, Libya announced an immediate total embargo of the U.S., with Saudi Arabia and the other members of OAPEC following close behind. States who shifted their policies to conform to Arab demands would be placed on a “friendly” list and allocated their full share of oil.

The embargo placed intense economic and diplomatic pressure on the United States to alter its relationship with Israel. An October 19, 1973 CIA memo detailed in Foreign Relations of the United States Vol. XXVI included the rather dire prediction that the embargo would turn the US $1 billion trade surplus into a $2 billion deficit. Oil prices rose from $5.40 per barrel on October 16, 1973 to $11.65 in late December, an increase of over 215% in just 2 months. To put that in perspective,the same percentage increase today would result in $225 per barrel oil.

Oil-dependent economies, including all European states (other than the Netherlands), scrambled to be placed on the “friendly” list and urged the U.S. to be more amenable to the Arab position, resulting in what Pulitzer Prize-winning author Daniel Yergin described “one of the gravest splits in the Western alliance since its foundation.” Frustration with European capitulation to the embargo even prompted Secretary of State Henry Kissinger to declare during a November 20, 1973 meeting with U.S. oil executives, “I will say that the European performance has been incredible to me. It is suicidal from their own point of view. The idea that 10 million Arabs can hold up and blackmail Europe notwithstanding its military, economic and financial strength should be intolerable from the point of view of the Europeans themselves.”

Despite this pressure, the U.S. response to the embargo was clear. Following a backchannel message from Faisal in which the King reiterating the demand that Israel withdraw to the pre-1967 borders, the issue of the embargo was raised by Assistant Secretary of State for African Affairs David Newsom during an October 23, 1973 Secretary of State’s Staff meeting. Addressing Kissinger, Newsom asked, “Mr. Secretary, do you have any thoughts at the moment on what we do about the Arab oil boycott? My own feeling is that here is a very good chance to show them that there is a common interest—.” Interrupting, Kissinger’s answer was blunt—“We will break it. We will not provide auspices for the negotiations until they end it.” He would later publicly tell a combined meeting of the Harvard, Princeton, and Yale Clubs on February 6 that the embargo “must be construed as a form of blackmail, and it would be highly inappropriate, and cannot but affect the attitude with which we have to pursue our diplomacy.”

Those familiar with Iranian reactions to sanctions will note the similarities between Kissinger’s statements and Iran’s repeated assertions that sanctions are “illegitimate” and “counterproductive.”

Kissinger elaborated on his refusal to bargain with the Arabs over the embargo at a December 26, 1973 Secretary of State’s Staff Meeting, “our view has been that if we once begin to let ourselves be blackmailed, this weapon will be used time and time again at every stage of the negotiations.” Kissinger’s statement illustrates a characteristic of target-sender sanctions relationships described by Daniel Drezner in “The Sanctions Paradox:”

“Conceding in the face of economic coercion implies a redistribution of political assets between the target and sender. Nation-states care about this redistribution if they think it will harm their bargaining position in future conflicts. This expectation of future conflict is translated into short-run concern for relative gains and reputation that varies with the expectation of future threats or conflicts in the bilateral relationship between sender and target.”

Given the danger of future conflict between the U.S. and Iran over issues unrelated to the nuclear program, it is unsurprising that Iran is hesitant to accede to the full list of U.S. demands. Indeed, former State Department special advisor for nonproliferation and arms Robert Einhorn recently wrote of the need to convince Iranian leaders that United States will not “move the goalposts and demand additional concessions in other areas,” should they agree to U.S demands over the nuclear program.

The refusal to accept OAPEC blackmail should not imply that the embargo had no effect on U.S. decision-making. The record shows a deliberate recognition of the need to put pressure on Israel in order to convince OAPEC to remove the embargo. During a November 2, 1973 meeting of the Washington Special Actions Group, which included representatives from the State Department, Defense Department, Joint Chiefs of Staff, CIA, and NSC, Kissinger remarked to Chairman of the Joint Chiefs Adm. Thomas H. Moorer “The Israelis have to learn that we are going to go our own way, and there will be a brawl if they take us on… We can break the oil embargo if we can deliver something moderate.”

Several weeks later at a meeting on November 29, 1973 Kissinger told Deputy Secretary of State Kenneth Rush, “we will have to pressure Israel, but if it looks like we do it under pressure, we won’t even get credit for it.” Kissinger even went to far as to deliver an implicit threat to Israeli Prime Minister Golda Meir at a December 16 , 1973 meeting at the Israeli Foreign Minister’s residence. Warning the Prime Minister that America increasingly sees Israel as the primary obstacle to negotiations, Kissinger stated that “a year ago the idea that we would do something against Israel would have been an inconceivable question. What I’m trying to do is ensure that the conditions remain that it’s not conceivable.” Nevertheless, at no point would the U.S. even come close to considering the full list of Arab demands.

Ultimately, the OAPEC embargo ended on March 18, 1974 after successful negotiations resulted in a ceasefire on the Egyptian front and progress had been made on securing Syrian-Israeli disengagement. Though the ceasefire fell far short of initial Arab demands, OAPEC relented after pressure from Egyptian president Anwar Sadat, as well as a warning from Washington that U.S. efforts to secure a peace settlement could not proceed while the embargo persisted. The decision to sheathe the oil weapon rather than to insist on impossible conditions would pave the way for U.S. diplomacy that led to the 1978 Camp David Accords.

While historical analogies can never be perfect, the United States’ experience as a sanctions target provide a number of lessons regarding the negotiations Iran. Both U.S.-Israeli relations during the embargo and the Iranian nuclear program represent core interests that in each case the sanctions target was unwilling to wholly relinquish even in the face of significant outside pressure. However, sanctions can have an impact on internal decision-making. In the case of the U.S. the embargo did contribute to efforts to pressure Israel to be more accommodating during ceasefire negotiations. In the case of Iran, though it remains to be seen how Iran’s negotiating posture will change after president-elect Rouhani takes office on August 4th, his recent comments suggest that Iran could be more accommodating going forward.

While sanctions can be a useful tool, their effectiveness is magnified when used as leverage in a negotiation aimed at securing a mutually-acceptable outcome. It is dubious that insisting on maximum concessions, adding new conditions to existing sanctions, or instituting significant new sanctions unrelated to the nuclear issue will contribute to a diplomatic agreement. After all, if the United States would not roll over or give up fundamental interests in the face of diplomatic and economic pressure, why would Iran?

(Note: Statements by U.S. government officials cited above can be found in Foreign Relations of the United States volumes XXV and XXVI.)

This article was published by and can be viewed here

Special thanks to Joshua Faust for his comments.