Crippling Sanctions and Isolation Likely to Drag Iran Back to the Negotiating Table

While Iran's military leaders continue to issue threats for external consumption, controversy is growing inside the country regarding the harsh effects of international sanctions.

A photo of Dr. Zvi Bar'el.
Zvi Bar'el
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A photo of Dr. Zvi Bar'el.
Zvi Bar'el

European Union threats to level another round of sanctions against Iran, along with Canada's decision to suspend its ties with Tehran, provoked furious responses from the Islamic Republic over the weekend, as expected.

Canada was accused of being a "racist state" that follows “American-Zionist” dictations, while Iran even suggested that its decision to close its embassy in Tehran was the result of "economic difficulties."

As usual, senior Iranian military commanders were brought in to respond to the threats of an attack against the Islamic republic. General Hussein Salami, the deputy commander of the Revolutionary Guard, warned on Saturday, “If it's attacked, Iran will take the war to enemy territory.”

While public statements by the Iranian regime and opposition regarding the Islamic Republic’s nuclear policy are largely consistent, there is substantial disagreement regarding the effects of the economic sanctions and the government's incompetent handling of the country's economy.

Mohammad-Reza Mahdavi Kani, chairman of Iran’s Assembly of Experts – one of the most important bodies in Iran, which is responsible for selecting the nation’s supreme leader, among other things – recently stated that “the Iranian revolution was not brought about only so that people would become more religious. This world, like the next world, is important for the lives of the citizens.”

Mahdavi Kani was referring to the government’s intention to implement the second state of its plan to cancel food subsidies, which have been in place since 1980. The plan, passed by the parliament with Khamenei’s approval in 2010, has already resulted in a rise in prices, with inflation reaching an official rate of 23%. In a letter to the Ayatollah, Iranian economists predicted that if the second phase of the plan is implemented, inflation could skyrocket to 60%.

The plan was meant as a bulwark against economic sanctions. Now that the Iranian finance minister has promised that the second stage “will be discussed further,” meaning delayed, Iran will be forced to respond to its budget difficulties. Meanwhile, income from oil has plummeted 50% in recent months, and the country doesn't have enough space to store the excess oil it produces.

The harsh criticism of Ahmadinejad’s regime will not necessarily translate into a change in the country's plans for enriching uranium. The intensity of the opposition, however, especially when expressed by conservative radicals, could inspire Iran to renew negotiations with the six world powers. Those talks ended when it became clear that Iran had nothing new to offer in negotiations.

Tehran is now in the midst of an election year, with presidential elections scheduled for next June, and this is liable to influence its actions over the next few months. A poll conducted by Khabar Online, a website associated with Iranian Parliament Speaker Ali Larijani, found that, with over 10,000 votes cast, former President Hashemi Rafsanjani was leading the race. Rafsanjani is Ahmadinejad’s bitter rival and is considered by the West to hold more moderate views. At such an early stage, such polls do not provide much of an indication of the election's eventual results, but it does reveal a certain mood among the public, which is the result of the situation inside Iran.

Against the background of public sentiment and the sharp controversy over the economy, one exiled Iranian analyst stated this week that “an attack on Iran less dependent on the American elections than it is on the Iranian elections.” The analyst told Haaretz that the West is waiting to see if Iran's new president – Ahmadinejad in any case cannot serve another term in office – will change the Islamic Republic’s nuclear policy.

While the West most likely does not have the patience to wait nine months for a change in Iran's policy, the change might actually occur sooner. If, that is, Khamenei decides to “drink the glass of poison and announce that he is freezing the enrichment program,” so that the Iranian people can continue to make a living.

The president of the Presidium of North Korea's Supreme People's Assembly Kim Yong-nam, center, reviews an honor guard alongside Mahmoud Ahmadinejad, second left, in Tehran on Sept. 1, 2012.Credit: AP



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