US-Israel tough sanctions strategy falls apart. Tehran is sitting pretty

The US-led Western powers are scrapping tough measures incorporated in the original motion they drafted for a UN Security Council sanctions resolution against Iran, according to diplomats at the UN Center. To make the draft more acceptable to Russia and China, the blacklisting of Iran's central bank has been replaced by a decision to "strengthen vigilance" over the bank's transactions, leaving only new overseas Iranian banks to be targeted.

The text earlier dropped the restrictions proposed by France against Iran's oil and gas industries, as well as the original US plan to halt supplies of gasoline and other refined oil products to Iran. As the haggling goes on, Moscow refuses to endorse a full arms embargo similar to the regime in place against North Korea.

debkafile reports: By the time it is tabled, the sanctions resolution will be toothless as an instrument for holding back Iran's dash for a nuclear bomb and its weapons of delivery.
Tehran already senses the new penalties will leave it sitting pretty with its economy, military assets and commercial ties unimpaired.
China is holding out against any talk of sanctions, stalling Western efforts to convene an early conference of the Six-Power negotiating forum next month to approve the motion for tabling.
By then – as debkafile has predicted for months – not much will be left of the impressive sanctions package put together by the Obama administration to deprive Iran of its regular supplies of essential goods and cash flow. With a third of its economy crippled, Tehran was expected to come to heel on its nuclear program.
The package consisted of five restrictive measures:
1.  A boycott of Iran's banking system, particularly its central bank, to restrict its overseas commercial activities. This measure dropped by the wayside Friday, March 5.
2.  A crackdown on foreign investment in Iran by withholding US and European insurance and reinsurance coverage.
3.  Suspension of projects for developing Iran's gas and oil deposits, mainly by withholding replacement equipment and spare parts.
4. Sanctions against the Revolutionary Guards Corps, its business empire and its military, technical and financial arms within Iran and overseas. If the measure survives the ongoing bargaining process, this boycott would affect the IRGC's fleet of 115 merchant vessels and its giant military-civilian building complex, also subjecting its individual generals and executives to travel bans and freezing their assets.
Even so, dropping the ban on refined oils exports has left the IRGC which controls this sector with a large slice of its revenue intact.
5.  Canvassing the United Arab Emirates and Saudi Arabia to close their ports and banks to Iranian merchandise and financial transactions.

For months, the US and Israel have worked hard to enlist worldwide support for these sanctions.
Secretary of State Hillary Clinton made the rounds of the Persian Gulf, Europe, China and latterly Brazil and Argentina. Israeli prime minister Binyamin Netanyahu held talks in various European capitals, ending in Moscow. Defense minister Ehud Barak visited Washington every few weeks to keep Israel aligned with the Obama administration's efforts. Last week, Strategic Affairs Minister Moshe Yaalon and Governor of the Bank of Israel Stanley Fischer were in Beijing to argue the case against allowing Iran to become a nuclear power.

The reasons this carefully-crafted sanctions tool is losing its edge are, firstly, because Washington went for international endorsement without showing the way first. Had the Obama administration led the way by starting to clamp down stiff sanctions in stages itself from the end of 2009, as the US president promised Netanyahu, the enterprise might have attained enough momentum to gather in key European nations.
Instead, the effort is fading, as attested to by Clinton's statement last week that instead of March, "several months" were needed to get the measures going. Key world powers, such as Moscow and Beijing, took this second postponement as an invitation to press harder for softer penalties.
Secondly, the North Korean example has demonstrated that sanctions don't work if not backed by stern measures.  Pyongyang has not only refused to dismantle its nuclear program, but no one is stopping its transfers of nuclear and ballistic missile technology to Iran and Syria.

Thirdly, whenever asked in world capitals what would happen if sanctions failed, US emissaries had no answer, while their Israeli partners could only hint at a military option as the only remaining recourse.
Most world powers therefore switched the main thrust of their Iran policies toward strengthening the Obama administration's hand in opposing a Israeli military strike against Iran's nuclear facilities, thus leaving the sanctions threat without a follow-up strategy.


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