Will Sanctions Stop Iran?
- 03.24.2008 - 4:53 PMNot likely. So far, it looks like an enfeebled Bush administration will pass into irrelevance, the Security Council will impose additional ineffectual measures, and Tehran’s mullahs will enrich enough uranium for an atomic device that can kill hundreds of thousands.
Of course, history does not always travel in straight lines. Are there any off-ramps in sight? President Mahmoud Ahmadinejad has kept Iran’s nuclear weapons efforts on track by essentially buying support from the populace with his massive program of subsidies for food, fuel, transport, and other items. The government can make these payments thanks to bulging oil and gas revenues—some $70 billion last year—resulting from surging prices. This month, light sweet crude futures hit a record $111.80 a barrel.
No price goes up forever, and oil is about $10 off its high partially due to fears of a mild recession in the United States. If the downturn in America is more severe or goes global, the Iranian government will not be able to maintain its subsidization program. Even today, the economy is fragile. The world’s fourth-largest extractor of crude had to resort to gas rationing last year, and this year inflation is slipping beyond control of Tehran’s technocrats. “Sometimes we have to change the price stickers three times a day because of inflation,” says Ali Daryani, a grocer in the Iranian capital.
Iran, in a buoyant economic environment, can withstand anything the Security Council or the West will throw at it in the way of sanctions. In a global collapse—last Sunday the invariably optimistic Alan Greenspan stated that the current crisis will probably be “the most wrenching since the end of the second world war”—the Iranian nuclear program is a goner.
For the record, I am not arguing that Washington should purposely try to destroy the global economy to get at Iran. But we should remember that the Reagan administration succeeded in depressing commodity prices to undermine the Soviet Union. It’s time, therefore, we started looking at the price of oil and gas as a national security issue of the first order.
| »Back to Contentions | »Back to Commentary |
March 24th, 2008 at 5:09 PM
No kidding. We should tax gas/oil/carbon at $10 a gallon. The U.S. currently taxes gas at the lowest level among developed countries (see Economist graph today). The social cost of gas is $15 a gallon, including pollution, asthma, roads, congestion - and this does not even account for global warming and US foreign policy.
Why not eliminate the income tax for all income below $30,000 a year, and hike up the gas tax dramatically? It’s the most obvious policy solution in some time, yet aside from Dingell, our politicians are not brave enough to do the right thing.
March 24th, 2008 at 5:14 PM
I apologize. My numbers were incorrect. It costs America about $10 per gallon for gas, and this includes the cost of defense expenditures, but not the cost of global warming. (Source: Milton R. Copulos of the National Defense Council Foundation.)
March 24th, 2008 at 6:23 PM
David Pryce-Jones, writing in the April 7, 2008, issue of NATIONAL REVIEW, cites Benny Morris as saying that with four or five nuclear weapons, Iran could wipe out Israel. Pryce-Jones then writes, perhaps echoing or paraphrasing Morris, “Never mind that thousands, perhaps millions, of Muslims would die, because in the Islamist mindset, Allah would know his own. Never mind Israeli reprisal either: Iran would have turned itself into a suicide bomber.”
Benny Morris, and, presumably, David Pryce-Jones, are saying that nothing can persuade Iran to change its policies.
March 24th, 2008 at 7:11 PM
dellis,
have you also figured out the consequences on american society and its way of life at the taxation level you are recommending? not that I do not want to bankrupt Iran, but I would not want to live in an America with social dislocations as consequences.
george,
if you pay close attention, islamist leaders never become suicide bombers, they send the low level indoctrinated soldiers to martyr themselves. i suspect that iranian mullahs are not different. that’s why the west is so pathetic in refraining from standing up them and letting them make a mockery of the west.
oao
http://fallofknowledgeandreason.blogspot.com/
March 24th, 2008 at 7:45 PM
There is also one other situation which could arise from an Iranian economic collapse (resulting from US/global recession): war. Iran has a massive young population - in the event of significant economic deterioration they may conclude that a war is the best option to utilise those youth - say, annexing the Shi’ite heartlands of Iraq, or the Shi’ite portions of Afghanistan or even Azerbaijan? I’m not even sure the US could handle such a significant conflict under those financial circumstances?
oao
Morris/Pryce-Jones are probably right on this - if Iran gets the bomb they will probably use it to wipe out Israel. I think this is the case because even the casualties, even of the Mullahs themselves and their martyrdom, is not the significant factor in their thinking - perhaps they think that wiping out Israel would be the greatest political coup for Shi’ites in the Islamic world - they could demonstrate that it was their strength and success (rather than Sunni Muslim efforts - read Saudi) which led to the total defeat of this great enemy. Additionally, they could always restore their surviving population through birth control policies (similar to Khomeini’s in the 80’s) - supplemented by Shi’ites from the diaspora (eg. Lebanon, Bahrain, Saudi etc).
March 24th, 2008 at 9:02 PM
A ten dollars a gallon tax on gasoline means, maybe, fifty dollars per gallon at the pump. The Shi’ites would not have to bother with oil-less Israel.
March 24th, 2008 at 9:22 PM
A $10 gas tax would have to be phased in over a substantial period to give suppliers time to adjust their product offerings and consumers time to adjust their commutes. It probably would not solve our short-term Iran problem, but it would help solve our long-term oil import dependency, our hostile petro-state subsidization, and our carbon emissions issues.
March 24th, 2008 at 9:23 PM
Just another reason why gas is too expensive. The American government should definitely manipulate the “market” in its favor. I’m pretty sure the country can survive the dire threat of global warming.
YbA, your comment about Iran’s youth fighting for the mullahs was hilarious. Maybe the New York Times editorial staff will join the Marines and fight terrorists in Iraq? Thanks for the laughs.
March 24th, 2008 at 9:31 PM
Rininger
The youth fought in massive numbers in the Iraq-Iran war didn’t they? Nationalism and religion are strong influences and I don’t think they could be easily discounted, especially in times of economic crisis.
I guess I could suggest that the Iranian economy collapses, everyone starts starving, and the youth rise up - and are killed by the Revolutionary Guards run by the Mullahs? Instead of laughing, perhaps you can suggest what other plausible alternative you have in such circumstances?
March 24th, 2008 at 10:39 PM
This is interesting. We should destroy our own economy rather than simply attack Iran and destroy its nuclear program, its air and naval defenses, and its western-deployed military resources (the ones that are used to meddle in Iraq)?
The alternative to cutting off our nose to spite Iran isn’t letting Iran have nuclear weapons — it’s attacking Iran militarily, so that we don’t have to try to starve Iran out by pointing a howitzer at our own economy and firing.