One of the new talking points for defenders of the Obama White House’s Iran deal is that lifting sanctions will hurt the regime’s hardliners, in particular the Revolutionary Guard. It may be true, the argument goes, that some of the $150 billion “signing bonus” in immediate sanctions relief will fund the clerical regime’s military adventures around the Middle East and its terrorist activities elsewhere around the world, but ignore that big cash windfall. The real story, they argue, is that since the IRGC benefited more than anyone else in Iran, the end of sanctions will hurt them more than anyone else.
Unfortunately, this is not true. It sounds good, but it’s just a flaw in logical reasoning. Yes, it may be the case that the IRGC benefited from the sanctions regime. However, it is not necessarily true that the lifting of sanctions will hurt the IRGC. In fact, the absence of the sanctions regime will further strengthen the IRGC.
Insofar as the sanctions regime strengthened the IRGC’s hold on the Iranian economy, it merely underscores the privileged place of the IRGC. Sanctions remind us of basic economic facts—namely, that nations, like individuals, prioritize their needs, like guns and butter, for instance. Nothing focuses the mind like economic hardship, since it compels us to make stark decisions regarding the allocation of vital resources. Our choices reveal our priorities.
The reason that the IRGC got stronger under sanctions is because Iranian decision-makers cared less about the health and survival of other institutions than this one. The growing economic power of the IRGC is key evidence that this is the institution that the regime believes it can least allow to suffer. After all, the IRGC is not only in charge of the nuclear file, it is also the organization that defends the clerical regime against potential popular unrest, like the 2009 Green Revolution that may have toppled Ali Khamenei had the IRGC and its Basij auxiliaries not put it down violently.
Those same instruments—i.e., guns and proximity to state power—are also what put the IRGC in position to take advantage of a bad economy. Who was capable of challenging what amounts to an organized crime racket that, thanks to the regime’s support, also enjoys the legitimate monopoly on violence? It is doubtful the bazaaris and other businessmen were tempted to risk conflict with the IRGC since it would have meant almost certain imprisonment or death, and at best an open war that the IRGC would invariably win.
Now that the IRGC has so much control of the economy, it is hard to see what will change the equation. Even if say, German, Italian and Japanese investors would prefer a more competitive Iranian market, there is little they can do about it.
It is possible that the relative economic strength of the IRGC could be attenuated if other unexploited or yet to be created sectors of the Iranian economy began to blossom and the economy expanded. However, Iranian society has none of the basic features that would drive a vital and dynamic economy like Israel’s or America’s. The Iranian educational system is famous for graduating clerics, not IT innovators. Where Silicon Valley and Tel Aviv produce software and apps, Qom produces fatwas. Talented Iranian students tend to go abroad for their advanced degrees. If they return home, it’s to an economy that has little room for what they learned—unless it’s to serve the regime. A country like Iran that jails its dissidents is incapable of nurturing a culture of entrepreneurship.
Obama may believe that Iran has the makings of a very impressive regional power, but the reality is that Iran’s economy is one of the least dynamic in the world. It produces very little the world wants, except oil, and of course weapons, which it can now sell on the open market with the U.N. arms embargo due to be lifted in five years’ time, or less, with the IRGC chiefly enjoying the income.
The belief that lifting sanctions will hurt the IRGC also misrepresents the purpose of sanctions. Remember that the goal of sanctions was not simply to choke the Iranian economy and force Tehran to make choices. Sanctions also denied the clerical regime access to the Western and Asian industrial base without which the Iranians cannot build a nuclear program.
Those who utter the refrain that you can’t destroy the knowledge it takes to build a bomb have got it precisely wrong. The hard thing to do is not figuring out the science it takes to build a bomb—the Iranians have plenty of scientists who know how to do it; some U.S. high schoolers know how to do it. The hard thing rather is to build the technical, economic, and industrial infrastructure it takes to manufacture the bomb. The Iranians are incapable of making almost all of this. And that’s why it has taken them nearly 30 years to get this far, because they’ve had to buy or steal almost all of it, from Europe or Asia. The sanctions regime closed that market. Now it will be open again. And that, too, is good for the IRGC since it manages the nuclear file.
But it’s not just the lifting of sanctions that will benefit the IRGC. Indeed, the entire Joint Comprehensive Plan of Action is good for the hardliners—especially perhaps the sunset clause, which stipulates that in 15 years the deal has expired, Iran emerges as a normal nuclear power and can build a bomb at will.
What U.S. policymakers fear almost as much as proliferation is the prospect of any country’s nuclear file changing hands in an intra-regime turf war, coup or revolution. This is one thing that keeps American policymakers awake at night regarding Pakistan, and it was also an enormous concern with the fall of the Soviet Union. Washington always wants to know who has control of any given country’s nuclear weapons program and insofar as possible to keep it in those same hands. Since the IRGC controls the nuclear file, American policymakers will now have a stake in ensuring that the IRGC continues to do so, which is only possible if they continue to be the real power on the ground. The JCPOA locks them in.
The Iran deal ties vital American interests—from Persian Gulf security and prevention of nuclear proliferation, to our regional alliances with Israel and the Sunni powers—to the vital interests and continued success of the IRGC. The deal is a huge victory for the regime’s hardliners.