WASHINGTON, March 15 (UPI) -- Can financial pressure on Iran to halt its nuclear program succeed where U.S. diplomacy has failed?
Some experts are now advocating a new approach backed by the power of the U.S. market.
"Financial measures are not often thought of as part of the apparatus for dealing with Iran and some of our hardest targets, but this tactic is increasingly the only one that is working," said Matthew Levitt, director of the Stein Program on Terrorism, Intelligence and Policy at The Washington Institute for Near East Policy.
Others contend that unless economic sanctions have full backing from a multi-national entity such as the United Nations, the action may create more harm than good, or simply do nothing at all. In the case of Iran, even policy experts who think sanctions are the best strategy admit that it is challenging to draft a U.N. Security Council resolution that will win unanimous approval and can still sting.
Paul J. Sullivan, a professor at National Defense University and Georgetown University, had stronger reservations. "Sanctions usually do not work unless they're multinational through the U.N. Security Council resolution, which means getting the Chinese, Japanese, Russians, the European Union on board. That will be extremely difficult if not impossible," he told UPI.
Levitt was speaking at the annual policy conference of the American Israeli Public Affairs Committee, the powerful pro-Israel lobby, on a panel to discuss how targeted financial measures could undermine Iran's nuclear ambitions.
Levitt told his AIPAC audience that a broad divestment campaign could be a "useful tool as part of a sanctions package." If it garnered enough support, investors could convince financial institutions and corporations that it was not in their interest to conduct business with Iran.
Missouri Treasurer Sarah Steelman, who has taken a lead among states for her efforts to screen the Misosuri State Treasury's portfolio for investments in countries that sponsored terrorism, also spoke in favor of divestment.
Steelman said that when citizens in Missouri learned that their pension plans were invested in state sponsors of terrorism like Iran and Sudan they were "shocked and outraged."
She cited the grassroots divestment campaign of the 1980s that "effectively cut off the lifeline" from the United States to the apartheid regime in South Africa.
However, other experts rejected the comparison of South Africa and Iran.
"In South Africa you had a majority population that was treated very badly by the minority population, and the majority population wanted the change to happen," Sullivan said.
From the perspective of U.S. involvement, the policy in South Africa "was also racist, and it's very easy to argue against racism," he said.
In contrast, it is unclear how many people in Iran are actually against the mullahs. A weakened economy may in fact push people in the direction of the more conservative if not extremist mullahs, Sullivan explained.
Wayne White, former deputy director of the U.S. State Department's Middle East Intelligence Office, agreed.
He added: "South Africa is in fact an example of how ineffective divestment can be in the short term. We don't have the time to wait a decade for Iran to be affected enough to back off from her nuclear program. South Africa sanctions took years to affect change, and we don't have years."
Speaking at the AIPAC conference, Levitt acknowledged the limitations of divestment, emphasizing that it has to be one component of targeted financial measures.
"Government imposed sanctions are far more effective because regimes like Iran fear them more. When you suspend an Iranian bank, you are hitting closer to the heart than when you indirectly threaten an entity that investing in Iran," he said.
Levitt said that travel bans and targeted financial sanctions against leaders of Iran's Revolutionary Guard Corps would be a "regime-hostile, people-friendly" way of weakening the Iranian regime, since the IRGC is a leading hard-line element in Iran's defiant behavior.
"There is no such thing as smart sanctions," Sullivan countered.
"If you're going to be harming a powerful person, there are going to be a lot of people who are attached to that person that will be harmed directly or indirectly ... The powerful people always have a back-up plan," Sullivan said.
White said sanctions have previously been ineffective against Iran was because the United States was not joined by the international community, leaving Iran to "go elsewhere" to do business. That problem persists today to an even greater extent because there are other players vying for power in the region, he said.
"The Iranians, through fierce national pride, have been willing to absorb damage from sanctions rather than give in," White said. The Tehran government has demonstrated this determination and the general population has also chosen to endure inconveniences to defy external pressures, he said.
White said some of the sanctions targeting key individuals "will not even inconvenience the regime all that much."
Having defied the most recent demands by the U.N. Security Council to halt its nuclear enrichment process, Iran will soon face a new round of sanctions. U.N. officials say that drafting of the next Security Council resolution on the issue is in its final phase, and a vote is anticipated over the weekend. However, as several members of the Security Council, especially China and Russia, have invested deeply in Iranian energy, experts do not expect a breakthrough.
"There are lots of players involved in this; it's not just the United States. It seems that many people still look at the world as if the United States can move mountains and everyone else can be ignored. That's just not the case anymore," Sullivan said.
