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President Biden trip to Israel and Saudi Arabia was a good change in direction

By Gabriel Noronha

President Biden, like President Obama before him, is still convinced that the key to

peace in the Middle East is a nuclear deal with Iran. To get a stubborn foe like Iran to

make concessions, the United States must keep pressure strong so that the costs of

resistance are higher than can be tolerated. However, President Biden’s policies

significantly reduced pressure on Iran. The natural result has been that the Ayatollahs

lack the incentives to strike a deal with the West because they do not feel the existential

threat of sanctions.

The United States’ maximum pressure campaign under President Trump and Secretary

Pompeo significantly undermined Iran and its ability to conduct terrorism and military

destabilization around the world. According to Iranian President Rouhani, U.S.

sanctions deprived Iran of US$200 billion dollars in revenue that they would have

otherwise had. Iran would send the money gained from the termination of sanctions to

its proxies like Hezbollah, Hamas, and the Houthis, whose goals are the destabilization

of countries across the Middle East.

Had the sanctions continued after the end of the Trump Administration, or ideally been

ratcheted up further while Iran continued to advance its nuclear enrichment, we could

be dealing with a far weaker and poorer Iran today. The regime was falling into

bankruptcy. Iran was down to just $4 billion US dollars in foreign exchange reserves at

the end of 2020, according to IMF data. That shortfall led to trouble conducting trade

abroad because it did not have any money to exchange in return for importing goods.

Leaked reports from Iran’s budget office forecast that the size of the country’s debt

would skyrocket to $1.4 trillion in six years if the sanctions continue. But at the regime’s

regular debt offerings in 2020, they couldn’t even find buyers for their bond sales.

Due to Biden’s policy, Iran now can tap and draw from their estimated $40 billion in

reserves of hard currency to support foreign trade. In addition, Iran exported around $23

billion in crude oil last year – a massive increase over the $6.6 billion earned in 2020.

The Iranian Government netted the equivalent of $5 billion from the International

Monetary Fund in Special Drawing Rights back last August. It is this sort of misguided

bailout program that allows the regime to have all the money they need to buy and sell

goods around the world – and accordingly feel little need for sanctions relief.

The Biden administration had one primary goal heading into office, to re-enter the

nuclear deal with Iran. The Trump Administration had two main policy goals with respect

to Iran. The first, to negotiate a stronger deal with Iran, failed. But the second goal was

to weaken the regime, and it accomplished this beyond most expectations as the

regime was beset by simultaneous economic, political, and military crises. But Biden

has not been able to attain even his incredibly unambitious goal. The last few months

have seen no further progress in the nuclear negotiations with Iran. This is a policy

failure of immense proportions and a political defeat.

In the meantime, Iran’s nuclear program has advanced with no consequence from the

Biden Administration to either stop Iran from enriching more uranium or extracting a

pledge from Tehran to stop spreading terrorism. No American hostages have been

released. No peace has blossomed between Iran and its Arab neighbors. But Iran has

committed to assassinating top U.S. leaders and their terror proxies are on the march.

With sanctions removed or unenforced, Iran’s militias can thrive. Hamas wasted no time

in attacking Israel. Hezbollah is throwing Lebanon into chaos and ruin. Iran’s militias in

Iraq are in near-open warfare against Kurdish infrastructure in the north, targeting oil

producers and to intimidate their businessmen into subservience. In Yemen, the Houthis

have responded to U.S. overtures of lifting the FTO designation by launching dozens of

missiles into Saudi Arabia and the United Arab Emirates – killing innocent civilians.

It’s well-past time for the Biden administration to admit their policy has been a failure.

His trip to Israel and Saudi Arabia was a good change in direction, with finally publicly

committing that Iran would not get a nuclear weapon. He should build on this by re-

sanctioning the Houthis, targeting Iran’s oil exports more aggressively, and cutting off

their proxies’ finances. I hope President Biden’s Middle East policy can succeed. If he

changes course, that can be possible again.

ABOUT THE AUTHOR

Gabriel Noronha is the former Special Advisor for the Secretary's Iran Action Group at

the Department of State and a fellow at JINSA. Previously he was Special Assistant for

the U.S. Senate Armed Services Committee under Chairmen John McCain and Jim

Inhofe. He worked for Senator Kelly Ayotte from 2015-2016. He is @GLNoronha on

 

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