Nothing Like A Financial Crisis to Put Things In Perspective

The author of “Ahmadinejad’s Nemesis” (The Gulf, Jan. 10-16) restates what should have been obvious to U.S. policy makers for some time: the longer-term fate of Iran’s leadership and the identity of Ahmedinejad’s successor hinges much on what happens to the Iranian economy.

It has been fashionable of late to claim Iran’s economy is “relatively” unscathed by the global credit crisis, as international sanctions effectively shielded the Iranian economy from easy money and fancy derivatives that have caused so much damage elsewhere. This is only partly true. The fatal blow for the Iranian economy may yet come with the fall in the price of oil, which of course is linked to the state of the global economy.

Ahmedinejad’s popularity in part is based on his ability to divert state funds to Iran’s lower classes. With oil revenues providing 90% of the State budget, the President’s electoral grease is running low. As the above-mentioned article points out, herein lies an opportunity for the US and Western allies to apply more pressure. Should this pressure be applied, and to what ends?

Piecemeal sanctions, in isolation, will not force the Iranian regime to give up the pursuit of advanced nuclear capabilities–global economic crisis or no. Weak conciliatory gestures on the part of the US, will also never lead to a positive result. While a “carrot and stick” approach to Iran has a logical ring to it, if one considers what is required by way of cooperation from friends, quasi-allies and worse, it is completely un-workable. Where, then, should we be looking for a solution to the Iran problem? Perhaps our own basic, unadulterated self-interest, for that is likely where Iran’s leadership and its people will look for a solution to their American problem.

A U.S. administration that rushes neither to court or vilify Iran, would almost certainly face a better prospect of ‘movement’ on the relevant issues than the confrontation-baiting Bush, particularly if the Iranian leadership has decided it needs a life preserver. Perhaps the best we can hope for is that the world financial crisis gives everyone a sense of reality, and cooperation happens, if not quickly, then “naturally.”