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Iran: Dialogue, Divest, Delist

David Johnson - 7/18/2010

Earlier this month, Iran was slapped with a new round of United Nations Security Council sanctions for its nuclear noncompliance. Offers of meaningful dialogue and sanctions by the United States have slowed Iran’s sprint toward nuclear weapons capability. Unfortunately, sanctions have not been effective compelling Iranian nuclear compliance. Still, sanctions are an effective approach to coordinate the international community to achieve consensus and act effectively, at some point in the future. It is becoming increasingly evident that offers of dialogue should be directed toward Iran’s democratic opposition.

In addition to sanctions, the international community would be wise to accelerate voluntary divestment from Iranian business ventures. It is equally prudent for the Obama Administration to remove Iran’s principle democratic opposition from the Department of State’s list of foreign terrorist organizations (FTO). Western financial investment and suppressing opponents, both used invariably as incentives to encourage Iranian compliance, have instead encouraged Tehran’s nuclear noncompliance.

The combination of these three policy recommendations represents 3Ds; Dialogue, Divestment and Delisting. Instead of engaging in traditional international relations, where incentives are received, understood and reciprocated; the Islamic Republic of Iran extorts larger incentives with explosive rhetoric and escalating transgressions. U.S. dialogue with Iranian officials, and/or the democratic opposition, must express a direct correlation between incentives and subsequent behavior.

In 1997, to some, there appeared to be hope for better relations. Mohamed Khatami succeeded Hashemi Rafsanjani as president. Shortly thereafter, with well placed quotes from western philosophers, President Khatami opened doors for Iran with promises to American interlocutors of impending productive dialogue. To encourage the softer side of Tehran, the U.S. State Department listed Iran’s principle opposition, the Mujahedin-E Khalq (MEK) as an FTO.

The blacklisting proved to be as shortsighted as it was counterproductive. By the summer of 1999, Khatami was complicit in crushing his own political progeny. Instead of fostering moderation, listing of the MEK opposition movement legitimized and strengthened the rule of Velayat-e Faqih, the Supreme religious Leadership and all of the dysfunctional governance it represents.

The national security calculus, right or wrong, that landed the MEK on the FTO list in 1997 - particularly in light of ongoing extensive anti-government unrest in Iran, Tehran’s role in Iraq’s insecurity and political paralysis stability, and the September 11, 2001 attack on the World Trade Center, does not stand up to scrutiny in 2010.

Since mid-2001, the MEK has not engaged in any acts that resemble political violence. On the contrary, the organization’s compliance with its disarmament agreements with the United States and coalition forces in Iraq has rendered it vulnerable to the Iranian government and its Iraqi allies. Indeed, the U.S. blacklisting is used by Iraq and Iran as an excuse to crackdown on the group.

The continued FTO listing effectively punishes the MEK’s compliance with U.S. agreements and rewards Iran’s nuclear noncompliance. Rewarding compliance with delisting the MEK is more likely to encourage the Iranian Government to comply with the international community’s many demands.

In short, in addition to sanctions, policy makers should consider implementing the three Ds; encouraging open dialogue with Iran’s democratic opposition, delisting the MEK, and divestment from all businesses operating inside Iran, or with Iranian firms. The combination represents a more effective cocktail to improve Iran’s behavior than sanctions and rhetoric alone.