President Obama is getting heaps of praise for the tough Iranian bank sanctions he ordered today. But lost in the pro-Obama media coverage are the names of the two lawmakers who made these sanctions happen: Sens. Mark Kirk and Robert Menendez.
The Kirk-Menendez bill – which was signed into law by Obama in December only after he fought for it be watered down – actually required the president to sign the executive order implementing these sanctions. In fact, Obama waited over a month after he signed the law to actually comply with it.
After trying to persuade Congress not to pass sanctions on all entities doing business with Iran’s Central Bank and then warning he might not enforce them after the legislation passed, President Obama went ahead and ordered the ban to proceed via an executive order signed yesterday. The order was announced today in a letter to Congress and lends credence to previous statements from the administration that their problem with Congress’s attempt to impose the sanctions was an issue relating to separation of powers rather than reluctance to confront Iran and halt its efforts to obtain nuclear capability.
It is far from certain the order would have gone through had Congress not acted to mandate such action in the first place. But the prime motivation for acting now, well in advance of the six-month deadline Congress laid down for Obama to enforce the legislation, may have had more to do with fear of an Israeli strike on Iran than scruples about the Constitution. With Israel making it clear it will not wait indefinitely for sanctions and diplomacy to work, Obama had little choice but to implement the legislation, thereby setting in motion a chain of events that could lead to the complete economic isolation of Iran. The question facing Washington now is whether this measure can be quickly implemented, and will it be too little and too late?
President Obama has been assuring the public since before he was elected in 2008 that he would never allow Iran to acquire nuclear weapons. But the question facing the White House this year is whether a failure to make good on that pledge will be more damaging to his chances of re-election than a spike in oil prices.
That’s the dilemma Obama has been grappling with since Congress passed a bill over his objections last month that mandated a complete ban on all transactions with entities that did business with Iran’s Central Bank. Sanctions on the bank are the lever by which an international embargo on the sale of Iranian oil is made possible. But as American diplomats are laying the groundwork for such an embargo, the administration is also sending out signals that indicate it is less than enthusiastic about dealing with the possible economic fallout of the one tactic that might stop the Iranians short of war.
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.
Anyone listening to what’s being said about Iran by the White House and State Department lately could easily be convinced stopping the ayatollah’s nuclear program is one of Washington’s top priorities. But the public “disappointment” being expressed in Israel by senior members of the Netanyahu government tells a different story. While the New York Times was reporting a few days ago that American diplomats were going all out to persuade Japan, South Korea and even China to comply with American sanctions on Iran’s Central Bank as part of a prelude to a U.S.-led oil embargo of the Islamist state, the Israelis seem to be reading from a different playbook.
Though Prime Minister Netanyahu himself has registered support for Obama’s sanctions drive, his chief political deputy today contradicted him and denounced the administration’s cautious approach to pressuring Iran. And though the White House issued a statement summarizing a phone conversation between Obama and Netanyahu on Thursday that emphasized U.S.-support for Israeli security, reports out of Israel about the talk lead one to believe the focus of the chat was something else entirely: an American demand that Israel promise not to attack Iran on its own.
When Congress passed an amendment to the National Defense Authorization Act last month that mandated a ban on all transactions with Iran’s Central Bank, it gave the administration the tool it needed to allow President Obama to make good on his promise to prevent Tehran from ever obtaining nuclear weapons. Restrictions on dealing with the bank would make it possible to put into place an oil embargo on Iran, the one type of sanction that could bring the Islamist regime to its knees. But the inclusion of waivers in the bill at the White House’s request also made it possible that nothing would be done. Though the president signed the Act into law during the holiday weekend, the release of his signing statement confirms our doubts about his intentions.
As the Wall Street Journal reported yesterday, the statement explicitly noted the sanctions were passed over his objections and might interfere “with my constitutional authority to conduct foreign relations.” Obama’s statement bluntly warned Congress that if he was so inclined, “I will treat the provisions as nonbinding.” While administration officials said in spite of this, Obama still intended to pursue sanctions on the bank, the statement is a clear signal he has no such intentions.
The Obama administration has repeatedly said it takes the threat of Iran’s nuclear break-out seriously and yet, in order to have truly biting sanctions, the Congress had to go over both Obama’s head and that of the State Department.
Showing how serious sanctions can work, Iran’s currency has declined precipitously since Congress imposed the measures against Iran’s Central Bank. Now, Turkey—whose terrorist-embracing leader both President Obama and Defense Secretary Panetta praise in the most effusive of terms—is requesting a waiver of U.S. sanctions so that its biggest refinery can deal with Iran’s Central Bank. The moment of truth is here. Is Obama serious about sanctions? Or would he prefer to kill two birds with one stone to help two adversaries at the expense of U.S. national security?
The Wall Street Journal reports today the Obama administration is engaging in talks with America’s European allies and various Arab states about what would happen in the event of an embargo on the export of Iranian oil. Such a measure was made possible late last week when Congress passed the Defense Authorization Act. The bill included a measure that would ban any dealings with financial entities that dealt with Iran’s Central Bank; the institution by which Tehran is able to conduct its oil trades. The U.S.-led discussions seemingly are a precursor to a move to ramp up sanctions on the Iranians so as to force them to abandon their quest for nuclear weapons.
If the United States were to actually enforce a ban on the Iranian Central Bank, then cooperation between the Arab states, Europe and the U.S. would be necessary to limit the impact of a rise in oil prices that might inevitably result from this course of action. But the real question we should be asking today is not so much “when” the ban would be enacted but “if.” Since President Obama had opposed passage of the bank transaction ban and insisted upon and got the inclusion of waivers in the legislation that would ignore the law, it is far from clear that Iran is actually in any trouble. For three years, the ayatollahs have been acting as if they believed Obama wasn’t serious about stopping him. We may soon see whether or not they are right.