News from Iran is that the new sanctions on its oil industry and Central Bank enacted by Congress over President Obama’s protests are already starting to bite—even before the European Union finalizes its own embargo of Iranian oil. The Wall Street Journal reports:
Iran’s rial currency has declined 40 percent to 55 percent against the dollar on the black market since December. Iranian inflation, meanwhile, now exceeds 20 percent a month, according to the Central Bank. While the rial has been falling for almost a year, the latest drop appeared to be triggered by a recent U.S. announcement that it would penalize companies that do business with Iran’s Central Bank, and a proposed plan to ban Iranian oil purchases in the European Union later this year.
That’s certainly good news on some level although no one can be happy about the economic suffering being inflicted on the Iranian people who have no say in their leaders’ attempts to acquire nuclear programs. But will these sanctions be enough to deter the mullahs from going nuclear? Perhaps so, if the sanctions galvanize social unrest that threatens the ayatollahs’ hold on power. But I am not especially hopeful that will be the case.
As the Journal notes, the examples of Cuba, North Korea and Iraq under Saddam Hussein are not encouraging: all three countries faced years of crippling sanctions (decades in the case of the first two) yet their leaders’ hold on power was not seriously challenged. Instead, as the Journal writes, the result was “a populace that is poor and dependent on state welfare.”
This is the flip side of the argument that opponents of bombing Iran’s nuclear installations often make: Such strikes, they claim, will only lead the people to draw closer to their rulers. But that could also be the effect of sanctions. The difference is that, whatever their impact on Iranian popular opinion (impossible to predict), strikes would at least deliver short-term benefits by setting back Iranian nuclear efforts. Sanctions could simply be ineffectual.