Commentary Magazine


Exemptions Granted by U.S. Prove Iran Sanctions Won’t Work

Those aware of the profound nature of the threat that an Iranian nuclear weapon would pose to the West and to Israel have long been assured by the Washington foreign policy establishment that if diplomacy fails to persuade Tehran to behave, international sanctions provide the leverage that can solve the problem. Well, after two years of an administration dedicated to “engagement,” even President Obama seems to know diplomacy won’t work. So that leaves us with sanctions.

Amassing an international coalition to back the sort of economic sanctions that could bring Iran to heel has proven beyond the capacity of the United States. Even if our European allies are now prepared to think about tough sanctions, the Chinese and the Russians are not. So the best President Obama could do was to get the United Nations to pass a set of mild sanctions this past year that didn’t impress the Iranians. We knew that the confidence of the Khamenei/Ahmadinejad regime as they faced down the West was due to its knowledge that Russia and China would never allow serious sanctions to be passed. We also knew that Tehran felt it could count on its Western European business partners to ensure that the West was sufficiently divided on the need to enforce sanctions, let alone resort to force to prevent Tehran from achieving their nuclear ambitions.

But today we learned another reason why the Iranians were so confident about their chances for victory: the United States government has been allowing a vast number of companies to evade the existing sanctions and to do literally billions of dollars in business with Iran.

A story on the front page of today’s New York Times informs us that a “little known office of the Treasury Department has granted more than 10,000 licenses” allowing Americans to trade with Iran and other blacklisted countries. The companies that have gained these exemptions include some of the biggest, such as Kraft Food and Pepsi as well as major banks. While the purpose of the statute that allows for exemptions was to provide humanitarian aid, the Obama administration has let things like chewing gum, sports equipment and even hot sauce be sold to Iran. Even worse, it has allowed an American company to “bid on a pipeline job that would have helped Iran sell natural gas to Europe, even though the United States opposes such projects. Several other American businesses were permitted to deal with foreign companies believed to be involved in terrorism or weapons proliferation.”

An administration spokesman claimed that focusing on the vast number of exemptions “misses the forest for the trees,” since “no one can doubt that we are serious about this.” But as even former Clinton administration official Stuart Eizenstat told the Times, “When you create loopholes like this that you can drive a Mack truck through, you are giving countries something for nothing, and they just laugh in their teeth. I think there have been abuses.”

The loopholes in the law are bad enough. But, as the Times reports, they are widened by the influence of politicians who seek to grant favors to local businesses and contributors. In one instance, Sen. Daniel Inouye (D-Hawaii) intervened to force the Treasury office to allow a company owned by one of his contributors to do business with a Chinese firm that had been banned for its role in selling missile technology to Iran and Pakistan.

The point here is not so much the corruption of our political system. Rather it is that as much as we doubted the determination of our allies to enforce sanctions, the United States government has shown itself to be equally incapable of getting tough with Iran. While concerned citizens can pray that clandestine operations, such as the Stuxnet virus, will undermine Iran’s nuclear program, the fact remains that the countdown toward an Iranian nuke proceeds. Though it was common knowledge that this administration, like its predecessor led by George W. Bush, seemed to lack the will to fully confront Iran, we didn’t know just how much our own government was allowing the existing sanctions to be flouted. In light of these revelations, it’s clear that sanctions will never work to halt the march of this terror sponsor toward nuclear capability. After reading this shocking story, there’s little doubt that Ahmadinejad and his tyrannical Islamist confederates are laughing at us.