America hits Iran’s Pocket, Iran Strikes US in Iraq and on Israel’s Borders

Condoleezza Rice spoke the language the European nations, Russia and China wanted to hear before she met their representatives in Vienna Thursday, June 1, to discuss their incentives package for cajoling Iran into abandoning its proscribed nuclear activities. The US secretary of state said the US was willing to join European allies in direct talks with Iran – provided Iran abandoned its uranium enrichment program. Tehran predictably dismissed the offer as propaganda and presenting no “new and rational solution” to Iran’s nuclear case. The enrichment program would go on, declared Iran’s foreign minister Manouchehr Mottaki.
Rice had her answers ready for that response. Anticipating an Iranian brush-off, the US has already begun implementing its own package of sanctions. As Rice put it, “We’re prepared to go either way.”
She also made it clear that the United States would not “swear off ever using military action.”
The two parties are therefore closer to a collision course – first financial and, further down the road, military – than to dialogue.
Washington has also taken into account that its allies will not go along with stringent penalties for Iran’s refusal to give up activities that could lead to the production of a nuclear weapon. Russia and China are too heavily staked in business with Tehran to go along with this measure. And even if UN financial sanctions became feasible, it would take two to three years for them to bite. The Islamic republic has piled up $50 billion in reserve assets from rocketing oil prices, a solid cushion against real damage during the period it needs to complete its weapons programs.
With this timeline in mind, the US Treasury has begun activating a go-it-alone program targeting the personal finances of Iranian officials in foreign banks and government transactions, with a view to cutting the regime’s access to foreign currency and global markets and its isolation in the regime in the international financial community.
As DEBKA-Net-Weekly 254 reported on May 19
Three weeks ago, American emissaries began quietly visiting banks and financial institutions in West Europe and Asia. They showed the heads of these institutions lists of Iranian firms, industries and private tycoons associated in one way or another with Iran’s nuclear effort. They then indicated that American banking and corporate doors would slam shut against any financial bodies continuing to do business with the blacklisted Iranians. Our sources report that the Americans were pleasantly surprised by the success of this quiet campaign.
Many of the banking and financial bodies lobbied in this way were quick to cut their ties with the named Iranians, with immediate impact: A loud outcry arose in Tehran’s central bazaar where most business with foreigners is contracted.

During this period, Iran has activated assets of its own – the surrogate terrorist groups the Islamic Republic maintains across the Middle East.
debkafile‘s Washington sources report that President George W. Bush’s phone call to Israeli prime minister Ehud Olmert Wednesday night was more than a courtesy briefing on the Rice announcement. They held a down-to-earth discussion on the efforts needed to repulse Iran’s already-unfolding campaign of violence.
The dire situation of US troops in Iraq has taken a turn for the worse with the terrorist war leaking into the south. It is bolstered by a supply network Iranian agents have spread across the country to bring various types of rockets, bombs and funds to a broad spectrum of Sunni insurgents, Shiite militias and groups linked to al Qaeda.
The 1,500 troops of an American reserve unit, the 2nd Brigade of the 1st Armored Division, interrupted their training course in Kuwait Wednesday, May 31, and moved over to Iraq’s terrorist-infested Anbar Province.
Another asset Tehran proposes to field is the supply-and-operations network it has planted in Syria, Lebanon and the Palestinian areas – mainly to target Israel.
Israel’s security situation has deteriorated sharply in the last two weeks on two fronts, the Lebanese and the Gaza borders.
Faced with US sanctions, the Iranian regime proposes to cash in on a third asset by buttressing the Hamas government’s backbone and its ability to stand up to international isolation as the head of Palestinian government.
This tactic has not been lost on Hamas’s rival, Palestinian Authority chairman and Fatah leader Mahmoud Abbas. Even though the Bush administration and Olmert government are wooing him intensely to block Hamas, Abbas tends to lean more towards Moscow than Washington. Consequently, while Fatah and Hamas continue their internal feud, there are indications that in the final resort the two Palestinian groups may hook up so as not to miss the opportunity developing over the last few hours of gaining Iran as a strategic partner against Israel.

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