The Iranian Standoff

BY JASON LAURITZEN

A recent poll conducted by The Los Angeles Times found that 57 percent of Americans favor
military intervention against Iran if the country pursues a nuclear program that enables the
building of nuclear weapons.

President Bush labeled Iran as one of the members of the “axis of evil” in his 2002 State of the
Union speech. Harsh rhetoric has come from the United States and Israel, accusing the Islamic
Republic of what Adam Ereli, the deputy spokesman at the State Department, calls “a
clandestine nuclear weapons program.”

Iran was recently reported to the U.N. Security Council by the International Atomic Energy
Agency for not being transparent enough with details of its nuclear energy program. However,
nuclear energy is a right Iran can pursue because it is a signatory of the Nuclear Non-
Proliferation Treaty (NPT).

Article IV addresses the right to pursue nuclear energy: “Nothing in this Treaty shall be
interpreted as affecting the inalienable right of all the Parties to the Treaty to develop research,
production and use of nuclear energy for peaceful purposes without discrimination and in
conformity with articles I and II of this Treaty.”

Israel, which has been pressuring for action against Iran, is not a signatory of the NPT and has a
nuclear arsenal of 85 warheads, according to a Defense Intelligence Agency report. The Israeli’s
have a policy known as “nuclear ambiguity,” which means they will not disclose whether their
country does or does not have nuclear weapons, yet they insist Iran must cooperate and disclose
elements of its nuclear program.

The public is not engaging in a debate of whether Iran really is a threat to the United States.
Instead, poor reporting from several major news agencies and unchallenged accusations from
figureheads in the Bush administration and Israel are what the majority of Americans receive.

Voice of America news, which has an estimated audience of 100 million, published an article on
Iran. The headline read, “Iranian President Vows Not to Back Down on Nukes.” The headline
implies that Iran has a nuclear weapons program, but there is only evidence presented of Iran
pursuing a nuclear energy program—a big difference.

Does Iran Really Need Nuclear Energy?

Vice President Dick Cheney described a broad opinion in the Bush administration when he said,
“They’re already sitting on an awful lot of oil and gas. Nobody can figure out why they need
nuclear as well to generate energy.”

Cheney’s comment is partially true—Iran is sitting on a lot of oil and gas, but that is exactly why
Iran needs nuclear energy. There is rationale for Iran to develop a nuclear energy program.

Iran has the fourth largest reserves of crude oil in the world and has the second largest proven
natural gas reserves. Here’s the key point: Iran’s economy relies heavily on exporting or selling
oil to other countries. Iran relies so much on its oil that it makes up 80 percent of export
earnings, 40 to 50 percent of the government budget and 10 to 20 percent of the GDP.

It would be absurd for Iran to want to use those resources for domestic energy needs when it
could be sold to other countries for a tremendous profit. The more energy used domestically, the
less that can be sold internationally.

Enter Russia and China

At the end of October 2004, China announced it was signing a deal to purchase natural gas from
Iran. The deal spans 25 years and could generate as much as $200 billion in revenue for Iran.

Russia has even more to gain than China. Like China, Russia wants energy from Iran, but in
return Iran wants something from Russia—nuclear energy knowledge and expertise. The Iranians
will sell the Russians oil and in turn, the Russians will help Iran build nuclear power plants. One
plant—the Bushehr plant in south Iran—will net the Russians $800 million. Industrial contracts
between Russia and Iran are expected to reach $10 billion a year.

Business deals with Russia and China will ensure a huge flow of capital into Iran’s economy, but
there is one more factor that will increase Iranian’s profits: The Euro.

The Economics: Trumping The Dollar

Iran is setting up an oil bourse (stock market) that will allow oil to be invoiced in euros, not
dollars. The move would be logical because oil exports to the United States are non-existent,
while exports to Europe account for 45 percent of Iran’s oil trade. The euro is also more valuable
than the dollar, so the longer the Iranian’s trade oil in dollars, the less they stand to make.

The move away from trading in dollars directly threatens the supremacy of the dollar. Right now
the dollar is the standard currency of international trade. The United States enjoys this status
because no matter how huge the deficit gets, more dollar bills and treasury bonds can be printed
to cover that debt. An international monetary switch to the euro would hamper that option.

Before the United States invaded Iraq, Saddam Hussein switched his oil sales to euros. While it
was a political move aimed at the United States, it improved Iraq’s earnings due to the rise in
value of the Euro against the dollar. After the United States invaded, oil sales were promptly
switched back to dollars.

Nuclear Energy Does Not Equal Nuclear Weapons

A central contention of opponents of Iran’s nuclear energy program is that at any moment, it can
be switched from a civilian energy program to a nuclear weapons program. Uranium
“yellowcake” needs to be taken to a processing plant to be turned into uranium hexafluoride gas
(UF6), which can be enriched for either nuclear energy or a bomb.

One of Iran’s plants—the Isfahan plant—converts yellowcake into UF6 for nuclear energy but
the quality of the UF6 is so poor that it could not be used to make a bomb. The quality is so low
that one western diplomat said, “The UF6 is crap.”

Another diplomat commented on the UF6: “I wouldn’t say it’s garbage. But the UF6 produced at
Isfahan is of such poor quality that if it were fed into centrifuges it could damage them.”

Is There a Smoking Gun?

Dr. Mohamed ElBaradei, the director-general of the IAEA, told the Jerusalem Post that most talk
of Iran’s nuclear program was based on “lots of speculation” and said, “We haven't seen a
smoking gun in Iran. We haven't seen an underground production enrichment facility. We
haven't seen enough materials in Iran, other than gram quantities, to put into a weapon."

Former chief U.N. weapons inspector Hans Blix said that it would take Iran many years to
produce enough enriched uranium for a bomb.

A major U.S. intelligence review projected Iran being about a decade away from manufacturing
a nuclear bomb

According to the Washington Post, “The new National Intelligence Estimate includes what the
intelligence community views as credible indicators that Iran's military is conducting clandestine
work. But the sources said there is no information linking those projects directly to a nuclear
weapons program.”

Some sources put Iran even further away from a nuclear bomb. A report by the International
Institute for Strategic Studies in London, said it could take Iran as long as 10 to 15 years to reach
full nuclear capabilities.

Laying the Populist Cards on the Table

Iran’s president, Ahmad Ahmadinejad, speech at a conference entitled “The World Without
Zionism, drew heavy criticism from the United States, Israel, Germany and the United Nations.

Several major newspapers quoted the leader as saying Israel should be “wiped off the map.”
However, very few newspapers analyzed the actual speech and instead stuck to the convenient
headline-grabbing title of “wiped off the map.”

Iran Focus—hardly a proponent of Ahmadinejad—has a transcript available on its website. In the

speech, the phrase used is not “Israel should be wiped off the map,” but “Our dear Imam
[Ruhollah Khomeini] ordered that the occupying regime in Al-Qods be wiped off the face of the
earth.”
While not a peaceful statement by any means, what it illustrates is that he was quoting the former
Ayatollah or high cleric, who had advocated this position.

Another aspect of the harsh rhetoric in the speech is that it does not directly advocate attacking
Israel. Instead, it advocates letting the Palestinians and Muslims countries have more of a say in
politics in the Middle East.

Ahmadinejad clarified this outlook in an article in the New York Times: “There is no new
policy. They created a lot of hue and cry over that. It is clear what we say: Let the Palestinians
participate in free elections and they will say what they want.”

What compels Ahmadinejad to make such an inflammatory statement is simple and is a part of
all politics: populism.

"Taking an anti-Israel position is certainly not going to hurt him in the public mind," said Gary
Sick, an Iran expert at Columbia University told the Christian Science Monitor. “His attitude
says that 'no one is going to shut me up' and probably goes down pretty well with [average
people] in Tehran."

The Joint U.S.-Israeli Push

On January 27 the U.S. Senate unanimously passed a resolution condemning Iran for its nuclear
program and pressed other countries to refer the Islamic Republic to the United Nations Security
Council. One of the reasons the resolution cites for referring Iran to the Security Council is for
secretly trying to develop nuclear weapons, but no solid evidence was offered to back the claim.

The House of Representatives passed the same resolution on Feb. 16 with a vote of 404-to-4.
Republicans and Democrats were united in condemning Iran based on flimsy information about
the country’s nuclear energy program.

Israel has made allegations and offered an unverifiable timetable of when Iran could have a
nuclear bomb. Sylvan Shalom, Israel's Foreign Minister, said “According to our people, security
and intelligence, they are very, very close. It may be only six months before they will have that
full knowledge."

Unverifiable claims and a lack of factual evidence have not stopped Israel and the United States
assessing military strike options against Iran. According to Der Spiegel, a German political
magazine, Porter Goss, head of the CIA, recently met with Turkish Prime Minister Recep Tayyip
Erdogan to ask for Turkish support for a possible 2006 air strike against Iranian nuclear and
military sites.

Israel’s armed forces have been ordered to been ready for possible strikes on uranium enrichment
facilities in Iran by the end of the March

In response, Iran signed a $700 million contract with Russia for the purchase of Tor M-1 air-
defense missile systems. The Tor M-1 is designed to take out aircraft, cruise missiles, unmanned
air vehicles, guided missiles and precision-guided weapons.

While Iran is bolstering defenses in anticipation of a strike, Israel sees this as a reason to attack
sooner than later.

““Once the Iranians get the Tor-M1, it will make our life much more difficult,” said an Israeli air
force source to London’s The Times. “The installation of this system can be relatively quick and
we can’t waste time on this one.”

An Ineffective Strike

The Israelis and Americans are hoping for two potential outcomes from a strike against Iran: a
destruction of Iran’s nuclear program and a revolution that would remove the Islamic
fundamentalists and replace them with a pro-west Democracy. Neither would be a likely
outcome.

A National Intelligence Estimate reported that Iran is not in a pre-revolutionary state and
immediate regime change would be unlikely. A recent study from the U.S. Army War College
said that Israel’s air force was “military incapable” of halting Iran’s nuclear program.

The United States and Israel have not presented a solid case to the international community and
their citizens about an Iranian nuclear threat. Both countries are preying on the fear of their
public instead of promoting an open debate with verifiable facts.