Center for American Progress

How to Resolve the Iranian Nukes Crisis, In Just Three Steps

How to Resolve the Iranian Nukes Crisis, In Just Three Steps

Confused about the Iranian nukes crisis? Here's an explanation of the situation and how CAP's experts think we should handle it.

Delegates from Iran and the European Union met in Turkey last week as the EU hopes to talk Iran down from its nuclear ambitions. Iran claims its program to make nuclear fuel is aimed at producing energy, but Western powers worry that the program could be abused to produce bombs. The EU promised Iran that sanctions will be dropped if Iran suspends its uranium enrichment program. But an Iranian representative announced before the talks in Turkey began on Wednesday that Iran has no intention of suspending its program.

If the EU doesn’t make headway with Iran—and there isn’t much hope they will—Western powers must pursue a new strategy to counter the threat of a nuclear Iran.

This week’s discussions are the latest of many attempts by the West to resolve the Iranian nukes crisis. The United Nations Security Council has repeatedly demanded that Iran halt its nuclear program. And for the past six years the Bush administration has squandered opportunities to restrain—perhaps even end—the programs by rejecting chances to negotiate in favor of trying to replace the clerical regime that currently rules Iran.

After all these failed strategies it’s clear we need a better way of countering the threat of a nuclear Iran. Here’s how we can go about it, as laid out in “Contain and Engage,” a report recently released by Center for American Progress experts Joe Cirincione and Andrew Grotto.

Step One: Brandish a Stick—Contain Iran.

The United States and its international partners have many tools in their arsenal to raise the costs of Iran’s defiance. The United States and United Nations Security Council can put the squeeze on Iran in the form of sanctions such as those enacted by the Security Council in December 2006 and March 2007.

These sanctions will block important sources of revenue for Iran’s Revolutionary Guard Corps—an important advocate of Iranian nuclear capability—and freeze its senior officials’ assets. The U.N. resolution also requires countries to block several Iranian financial institutions—including Bank Sepah, which finances various illicit Iranian activities—from access to the international financial system, further ratcheting up the pressure on the country.

These efforts—along with continued diplomatic isolation—show Tehran that uranium enrichment comes at a cost. Ongoing discussion within the Security Council of additional sanctions should Iran continue to defy international law suggest that these costs may continue to rise.

Another dimension of a U.S. strategy to contain Iran is strengthening relationships with allies and partners in the Middle East. The United States should assure allies that it remains committed to their security. The United States should also invest in new diplomatic infrastructure in the region—to promote regional security, nonproliferation principles, and other important policies. For example, the United States should support the creation of a nuclear fuel bank led by the International Atomic Energy Agency, the world’s leading technical assistance and monitoring agency for everything nuke-related. The bank would guarantee a supply of nuclear fuel for countries that don’t enrich uranium and comply with their other nonproliferation commitments.

Step Two: Offer a Carrot—Engage Iran.

It’ll take more than sticks to stop Iran from enriching uranium, however. As long as Iran can keep its economy afloat by selling its abundant petroleum resources, sanctions and isolation alone will fall short. The United States must show Iran that the potential benefits of suspending its uranium-enrichment program outweigh the drawbacks. Credible economic incentives from the United States and its global partners can make a deal too sweet for Iran’s political leadership to resist, particularly if it taps into the economic malaise that ordinary Iranians feel.

Here, the United States needs to think “outside the box.” The incentives already on the table—including civil nuclear energy cooperation, possible World Trade Organization membership, spare parts for aging aircraft—have evidently not done the trick. They are either too meager (aircraft parts; civil nuclear energy cooperation) or too controversial within Iran (WTO membership) to fundamentally change Iran’s cost/benefit calculus.

At a minimum, the United States should in principle be prepared to address Iran’s security concerns if Iran addresses ours. The more Iran gives, the more it gets.

One “outside the box” carrot the United States could offer Iran is lifting restrictions on foreign investment in Iran’s gasoline refinery industry. Because Iran’s domestic refineries are largely derelict and inefficient, the country has to import more than one-third of its gasoline from international markets. It then pays a subsidy to bring the price down to 34 cents a gallon for consumers. The Iranian parliament, currently headed by hardliner conservatives, has threatened to cut back these subsidies because of the huge strain they place on Iran’s budget and the inflationary pressures they put on the country’s economy. This threat has provoked public outrage within Iran because cutting back on the subsidies would be expensive for ordinary Iranians.

Most Iranian leaders would find the prospect of strengthening Iran’s domestic gasoline refinery sector very attractive. It’s also the kind of proposal that is likely to appeal to most of Iran’s political factions. Pragmatists and reformists will value the foreign investment potential. Many hardliners will appreciate the long-term impact it could have on gasoline subsidies, which they generally oppose. Both factions will value the added energy independence. The proposal could divide hardliners who oppose foreign investment from those who oppose gas subsidies, while providing pragmatists and reformists with an opportunity to make the case to the Iranian people that foreign investment will help Iran’s economy in tangible ways.

Step Three: Hedge your bets.

In a perfect world, the measures outlined in the steps above would convince Iran that uranium enrichment is not worth it. But ours, of course, is not a perfect world. The United States must hedge against the possibility that negotiations fail.

The contain-and-engage strategy outlined here does just that. The elements of the strategy outlined above—targeted economic engagement, new security and political initiatives, and renewed regional non-proliferation efforts across the Middle East—would position the United States to more effectively contain Iran over the long term if attempts at negotiation don’t work.

Because this strategy of containment provides Iran with opportunities to halt its nuclear program with its dignity intact through agreements that will be beneficial to the Iranian people, the strategy will be sustainable over time and attract the support of China, Russia, and other key partners that have grown wary of U.S. motives. In addition, the strategy would reduce the chances of an arms race in the Middle East. Finally, it would help assure U.S. allies that the United States remains a resolute partner in maintaining peace and security in the region.

A new strategy

Solving the near-term nuclear crisis with Iran may not be an easy task. But once you look past tried-and-failed administration strategies like trying to force a regime change, hitting hard with military force, or sticking with soft sanctions and softer incentives, it’s clear that a new tack is necessary. Successful intervention will require measures to contain and engage Iran.

For more information on this strategy, please see:

To speak to CAP’s experts, Joseph Cirincione and Andrew Grotto, please contact:

For TV, Sean Gibbons, Director of Media Strategy
202.682.1611 or [email protected]
For radio, Theo LeCompte, Media Strategy Manager
202.741.6268 or [email protected]
For print, John Neurohr, Press Assistant
202.741.6273 or [email protected]
For web, Erin Lindsay, Online Marketing Manager
202.741.6397 or [email protected]



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