The Iraqi government has promised to shutter Camp Ashraf -- the home of the Iranian dissident group Mujahedeen e-Khalq (MEK) -- by Dec. 31. Now, the United Nations and the State Department are scrambling to move the MEK to another location inside Iraq, which just may be a former U.S. military base.
The saga puts the United Nations and President Barack Obama's administration in the middle of a struggle between the Iraqi government, a new and fragile ally, and the MEK, a persecuted group that is also on the State Department's list of foreign terrorist organizations.
The Marxist-Islamist group, which was formed in 1965, was used by Saddam Hussein to attack the Iranian government during the Iran-Iraq war of the 1980s, and has been implicated in the deaths of U.S. military personnel and civilians. The new Iraqi government has been trying to evict them from Camp Ashraf since the United States toppled Saddam in 2003. The U.S. military guarded the outside of the camp until handing over external security to the Iraqis in 2009. The Iraqi Army has since tried twice to enter Camp Ashraf, resulting in bloody clashes with the MEK both times.
Now the United Nations, led by Martin Kobler, the head of the U.N. Assistance Mission in Iraq (UNAMI), is working with the State Department to convince the Iraqi government and the MEK to open up a new home for MEK members inside Iraq, at a facility near the Baghdad airport. U.S. officials won't confirm, but also won't deny, that facility is a U.S. military base that was recently handed over to the Iraqis.
"Ambassador Kobler and we are working flat out to put together the deal for the beginning of the implementation of his plan, which is to move the people in Camp Ashraf to a new facility," a State Department official told reporters in a special Monday briefing. The United Nations and State are hoping that if an agreement is reached, the Iraqi government will push back the deadline and not invade Camp Ashraf on Dec. 31 and forcibly extradite the MEK to Iran. But time is running out.
"Time is extraordinarily short," the State Department official said. "Oh yes, we're talking days."
The State Department official said the new facility under discussion is near the Baghdad airport, and has extensive infrastructure that "is very well known to the United States." Pressed by The Cable, the official refused to confirm that it was a former U.S. military base, but wouldn't deny it either. "It's a highly credible facility," the official said.
The official could not say if there was any precedent for a group that the United States labels a foreign terrorist organization being housed in a facility built by the U.S. military with U.S. taxpayer dollars, but emphasized that all U.S. military installations have now been turned over to the Iraqi government. The Victory Base Complex near the airport has several facilities that could be used for the Camp Ashraf residents.
Nobody knows how many people are in Camp Ashraf, because nobody can go inside. The residents are also suspected to be well armed. There could be as many as 3,200 people there, according to the State Department. If they are evicted from the camp, some will voluntarily go back to Iran and some will go to other countries. Others still may not actually be MEK members but could be living there for their own reason, making their relocation easier, the official said. The unknown number of "card-carrying members" of the MEK who can't or won't be relocated are the ones who the United Nations and State are trying to move to the new camp.
The United Nations and the Iraqi government have agreed on the basic way forward, but the MEK is not on board, the State Department official said. The Iraqi government won't talk directly to the MEK, and the MEK leadership living in Paris may have different priorities than the people actually living in Camp Ashraf.
Of course, the Iraqis have been warning for months that they would close Camp Ashraf by the end of the year. So why is everybody scrambling in the last two weeks? The State Department is placing the blame squarely on the MEK.
"For a long time, the MEK position was ‘here we are and here we stay, period,'" a State Department official said. "In recent days we've had the first signs that the MEK is finally, at long last, beginning to engage in a serious way, rather than simply politically through its many, many advocates. This is a good sign."
Reporters at the briefing wondered why the United Nations and State think simply relocating the MEK to another facility will solve the problem of its status as a terrorist group whose members are unable to get refugee status in a country where they are not welcome. The official said the new facility would be better because it would give the Iraqi government some control over what goes on there.
"[Camp Ashraf] is a state within a state. It is run by the MEK and when anybody else tries to enter, well, we've seen what occurs," one State Department official said, explaining that the new camp would have some type of Iraqi government administration and yet not be in total control of the MEK. "Iraqi soveriegnty will prevail with a robust set or arrangements and U.N. monitoring."
Another reason the United Nations and State are pushing for the MEK to be moved from Camp Ashraf to another facility is that the U.N. High Commission for Refugees (UNHCR) has refused to give refugee status to Ashraf residents because of the MEK's tight control over the people there.
"Many international observers have regarding the current facility at Camp Ashraf as a coercive environment. Independent observers have called it a cult," the State Department said. "The UNHCR requires an atmosphere in which people can make their own choice free of group pressure. What's happened in Camp Ashraf has not been conducive to this."
Advocating for the MEK is a tricky proposition for the State Department, because the organization is on its list of foreign terrorist organizations. The MEK has been lobbying hard for its removal from that list and State's review of their status has been "ongoing" for years.
As part of its multi-million dollar lobbying effort, the MEK has paid dozens of top U.S. officials and former officials to speak on its behalf, sometimes at rallies on the State Department's doorstep. MEK supporters have been stationed outside the State Department non-stop for months now, and are even showing up at Congressional hearings.
Their list of advocates, most who have admitted being paid, includes Congressman John Lewis (D-GA), former Pennsylvania Gov. Ed Rendell, former FBI Director Louis Freeh, former Sen. Robert Torricelli, Rep. Patrick Kennedy, former CIA Deputy Director of Clandestine Operations John Sano, former National Security Advisor James Jones, former Vermont Gov. Howard Dean, former New York Mayor Rudolph Giuliani, former Joint Chiefs Chairman Gen. Richard Myers, former White House Chief of Staff Andy Card, Gen. Wesley Clark, former Rep. Lee Hamilton, former CIA Director Porter Goss, senior advisor to the Romney campaign Mitchell Reiss, Gen. Anthony Zinni, former Pennsylvania Gov. Tom Ridge, former Sen. Evan Bayh, and many others.
The State Department officials didn't say outright that these officials are making the challenge of dealing with the MEK worse by shilling for the organization around Washington. But they did call on the MEK's paid representatives to use whatever clout they have to urge the MEK to go along with the relocation now.
"It is important for those advocates to support a solution that is feasible. Because maximalist demands and echoing a kind of martyrdom and complex of defiance and blood will produce the results they fear. Now is the time for everybody who says they want a peaceful solution to back that solution right now," the official said.
But what happens after the MEK moves to the new facility, even if the current deal is worked out in time? What's the plan to deal with these people over the long run?
"Right now our priority is in a successful, peaceful relocation," the State Department official said. "One huge problem at a time."
UPDATE: The AP reported has just reported that Iraqi Prime Minister Nouri al-Maliki has decided to grant a 6-month extenstion on the closing of Camp Ashraf, although he is backdating the start of the extension to November.
MLADEN ANTONOV/AFP/Getty Images
House Armed Services ranking Democrat Adam Smith (D-WA) told The Cable today that claims he is trying to "water down" Iran sanctions legislation inside secret conference negotiations is "utter and complete bullshit."
Smith reached out to The Cable today to refute claims made by a senior GOP aide in our story yesterday that he and Senate Armed Services Committee Chairman Carl Levin (D-MI) were pushing for changes to the Kirk-Menendez Iran sanctions amendment that would weaken its penalties on the Central Bank of Iran (CBI) and any foreign banks that do business with it. The administration has been pushing for changes to the amendment that would weaken the sanctions, and give the administration more flexibility in implementing them.
The Kirk-Menendez amendment was added to the fiscal 2012 defense authorization bill last week by a 100-0 vote in the Senate. House and Senate conferees are meeting behind closed doors this week to hash out a compromise version of the bill, which includes negotiations on the Kirk-Menendez language. Whatever emerges from the secret conference will be voted on by both chambers next week and sent to President Barack Obama for his signature.
A senior GOP aide told The Cable on Thursday that Smith and Levin were advocating inside the secret conference for the changes the administration wants. Smith said flatly today he may be seeking changes in the amendment, but is not trying to "weaken" the sanctions.
"It is not accurate to say we are trying to water it down," Smith said, declining to get into specifics about what changes he is seeking.
"Different people have different views on what is stronger than something than something else, but this notion that Menendez and Kirk got it absolutely 100 percent perfectly right, and that there's no point discussing anything else that can be done to it, doesn't make any sense to me," Smith said.
"It's not a matter of weaker or stronger, it's a matter of making sure we get the language right, in order to put us in a position to put the maximum amount of pressure on Iran. That's what we're trying to do."
The secret nature of the negotiations has contributed to the confusion of what's going on with the Iran sanctions language. Adding to the problem is that, once the conferees reach a final decision, it will be virtually impossible to go back and alter the language because that would open up the entire defense bill again and there's no time to do that if Congress wants to pass the bill this year.
Sen. Mark Kirk (R-IL) and Robert Menendez (D-NJ), who are both upset at the administration over its handling of the sanctions negotiations, could have kept total control over the amendment by not adding it to the defense bill in the first place, which is managed by the Armed Services Committee and therefore somewhat out of their control. But they needed to attach the amendment to a piece of "must pass" legislation in order to see their ideas sent to Obama quickly and without a real possibility of a veto.
Smith was careful in our interview to explain that while the secret process is managed by him, Levin, House Armed Services chairman Buck McKeon (R-CA), and Senate Armed Services ranking Republican John McCain (R-AZ), the negotiations would take the views of other lawmakers into consideration as well.
"We're certainly not going to just leave it up to the four of us to figure out how to work this," Smith said. "But we are trying to make sure it gets in the bill, gets signed, and gets into force as soon as we can do it."
House Foreign Affairs ranking Democrat Howard Berman (D-CA), who announced yesterday that he would definitely not be the one carrying the administration's water on the issue, is one of the other key voices within the conference.
"I will not, and Congress should not, give into entreaties from the administration or elsewhere ... to dilute our approach to sanctions on the Central Bank of Iran's petroleum transactions," Berman said to applause at a conference on Thursday sponsored by the Foundation for the Defense of Democracies, a conservative policy and research organization. "The Kirk-Menendez amendment is a good amendment."
Menendez also spokes at the FDD conference and doubled down on his push for the stronger measures.
"In the case of Iran I've argued that we have no choice but to impose the most robust sanctions possible because we will NEVER permit Iran to have a nuclear weapon and the timeline for acting is now - NOT when we are facing no other choice than military action," Menendez said.
"Last week, the U.S. Senate unanimously voted to support this option... The time to act is now."
Levin's office declined to comment on the secret negotiations.
House and Senate leaders are meeting this week behind closed doors to work out language for new sanctions on the Central Bank of Iran (CBI), and the administration is pressing key Democrats hard to adopt their position, which aims to weaken the sanctions measures.
The debate is taking place as part of the negotiations over the fiscal 2012 defense authorization bill, which passed both the House and the Senate and is in conference right now. The legislation will probably emerge from conference next week and pass both chambers, at which point President Barack Obama will be under heavy pressure to sign the "must pass" defense bill, with whatever Iran sanctions language the conferees agree on.
The current sanctions language at the center of the closed door debate is the amendment by Sens. Mark Kirk (R-IL) and Robert Menendez (D-NJ), which passed the Senate by a rare 100-0 vote over the very public objections of top Obama administration officials. The amendment would direct the Obama administration to take punitive measures against foreign banks that do business with the CBI, but gives the administration more leeway to implement the sanctions than Kirk's original language.
The administration urged Kirk and Menendez to come up with a compromise amendment but then came out against that very compromise last week, angering and alienating Menendez, who needs to be tough on the issue ahead of his re-election bid next year. The Cable has obtained the administration's private communications to the conferees spelling out the changes they want to the Kirk-Menendez amendment; they can be found here and here.
Basically, the administration wants to delay the implementation of sanctions not related to oil purchases from 60 to 180 days, and wants to water down the severity of sanctions measures if and when they are put into effect.
Initially, the administration turned to House Foreign Affairs Committee ranking Democrat Howard Berman (D-CA) to help them with the changes. Berman, who is inside the closed conference, initially indicated that he wanted to work with the administration to change the Kirk-Menendez amendment.
But Berman also has a tough reelection fight coming up against Rep. Brad Sherman (D-CA), who he must face after their districts were combined, and he can't afford to seem weak on Iran. Today, Berman announced that he does not want to want to water down the Kirk-Menendez language at all. In fact, he said he wants to strengthen it.
"Every administration wants total discretion on foreign policy, but that is an impulse that Congress must always resist," Berman said at a conference on Thursday sponsored by the Foundation for the Defense of Democracies (FDD), a conservative policy and research organization. Berman spoke just after a panel on Syria, moderated by your humble Cable guy.
"I will not, and Congress should not, give into entreaties from the administration or elsewhere ... to dilute our approach to sanctions on the Central Bank of Iran's petroleum transactions," Berman said to applause. "The Kirk-Menendez amendment is a good amendment."
Berman said the only change he wants to the Kirk-Menendez amendment is to shorten the administration's window for implementing sanctions on those who do oil business with the CBI from 180 days, as the Kirk-Menendez bill specifies, to 120 days.
Sherman, in a Thursday interview with The Cable, accused Berman of flip-flopping on the issue and said the Kirk-Menendez language should be sent to Obama's desk exactly as it is.
"Berman was helping the administration and now he's made a 180 degree change, which is good," Sherman said.
"We need to protect the Menendez-Kirk language," he said, making sure to name the Democrat first. "The White House doesn't want to do it. And the White House will be trying to stop the Menendez-Kirk amendment from being in legislation that the president has to sign."
Having lost Berman, the administration then turned to other senior Democrats to carry its water inside the conference. We're told by a senior GOP congressional aide close to the conference negotiations that House Armed Services ranking Democrat Adam Smith (D-WA) and Senate Armed Services Committee Chairman Carl Levin (D-MI) are now arguing inside the conference for changes to the Kirk-Menendez amendment to satisfy the administration's concerns.
"Right now the Republicans want to adopt the
Menendez/Kirk amendment while the Democrats, specifically Congressman Smith and
Senator Levin, are working to incorporate the Obama administration'
The administration has argued publicly that the Kirk-Menendez amendment could alienate foreign countries, make it more difficult to form an international coalition to pressure Iran, and raise oil prices, which could actually help the Iranian economy. They have argued in private meetings with lawmakers that the effort could hurt the U.S. economy.
Supporters of the Kirk-Menendez amendment point to an extensive report on CBI sanctions compiled in the midst of the negotiations by the FDD.
"The (once) confidential report was provided to the administration and select members of Congress during the discussions on the Menendez-Kirk Central Bank amendment," FDD's Mark Dubowitz told The Cable. "The report concluded that, even if the Saudis did not release additional oil supplies, it was still possible to reduce Iran's oil revenues without spooking oil markets and driving up the price of oil."
Sherman's view on that tension is shared by most lawmakers. "You can't stop Iran from getting a nuclear weapon without breaking some eggs," he said.
President Barack Obama's administration is working behind the scenes to water down congressional language that would impose crippling sanctions on the Central Bank of Iran (CBI).
The Obama administration sent to Congress this week a list of requested changes to the sanctions language found in the Senate's version of the defense authorization bill, which was passed last week. Those sanctions, which would punish any bank that does business with the CBI, were part of an amendment authored by Sens. Mark Kirk (R-IL) and Robert Menendez (D-NJ) that passed the Senate over the administration's objections by a vote of 100 to 0.
The House and the Senate are negotiating over the defense authorization bill this week behind closed doors, so the administration has one more chance to try to change the sanctions language before the bill lands on Obama's desk. If the Kirk-Menendez language is sent to the president without any alterations, he will be forced to either accept it or veto the entire defense authorization bill. There's no indication yet which way he would go.
The administration's laundry list of requested changes to the bill was sent to leaders of the House and Senate Armed Services Committees. The administration wants to delay the implementation of sanctions not related to oil purchases from 60 to 180 days, and wants to water down the severity of sanctions measures if and when they are put into effect.
Kirk and Menendez sent a letter on Monday night to House Armed Services Chairman Buck McKeon (R-CA) and ranking member Adam Smith (D-WA), which was obtained by The Cable, urging them to hold the line and keep the Senate language as-is.
"The Menendez/Kirk amendment is tough, responsible and, most importantly, bipartisan. It provides the Administration another key tool to curb Iran's pursuit of nuclear weapons while keeping oil markets stable and encouraging other nations to reduce Iranian oil purchases. With the support of every single United States Senator, it needs no alterations," they wrote.
"We understand the administration has submitted to your Committee a list of proposed changes to the Menendez/Kirk amendment -- both ‘technical fixes' and ‘alterations.' We would note that proposals to delay sanctions implementation and water down the amendment's penalties are not ‘technical' in nature and should be rejected."
Menendez had been working with the administration on how to sanction the CBI, but publicly announced on Dec. 1 that he felt burned by the administration's public opposition to his amendment. "This certainly undermines your relationship with me for the future," Menendez told administration officials at a Senate Foreign Relations Committee hearing.
So the administration must now look toward Howard Berman (D-CA), the ranking member on the House Foreign Affairs Committee, for help in altering the Kirk-Menendez amendment. Berman's committee has shared jurisdiction on the bill, and Berman has been active in sponsoring legislation to sanction Iran and the CBI.
In a statement e-mailed to The Cable, Berman indicated that the Kirk-Menendez language might not be the final say in how Congress moves to sanction Iran.
"As the original author of the House amendment to sanction the Central Bank of Iran, I am pleased that the Senate has taken action on this urgent issue. In the near future, the House will pass the Iran Threat Reduction Act, which includes my amendment," Berman said. "Meanwhile, I will be working with my colleagues in the House, the Senate, and the Administration in an effort to ensure that the final language of the Kirk-Menendez amendment is as tough and sensible as possible and provides a time-frame that corresponds to the rapid progress Iran is making toward developing nuclear weapons."
One GOP congressional aide told The Cable that if Berman seems to be working to weaken the Senate language, Republicans are ready to use that as fodder against him in his upcoming primary fight against Rep. Brad Sherman (D-CA). The two lawmakers' districts were combined due to redistricting, and they now have to run against each other next year.
"I can't imagine why Howard Berman would want to put his seat at risk by helping the Obama administration weaken Iran sanctions," the GOP aide said. "All he needs to say is 'The House recedes' and the Menendez/Kirk amendment becomes law. Brad Sherman must be licking his chops."
A team of conservative policymakers and thinkers believes that there's a real chance that Western efforts to stop Iran from acquiring a nuclear weapon will fail, in which case the United States would have to lead an international effort to contain Iran and deter the Islamic Republic from using its nuclear weapons capability.
Experts at the American Enterprise Institute (AEI), a conservative Washington think tank, have spent the last six months thinking about how the United States should respond to a nuclear-armed Iran. They are getting ready to release an extensive report tomorrow detailing a comprehensive strategy for dealing with that scenario, entitled, "Containing and Deterring a Nuclear Iran."
"The report is very much an acknowledgement of the very real possibility of failure of the strategy to prevent Iran from obtaining a nuclear weapon, and any responsible party should recognize that failure is an option. There's been a huge disservice done by all who have spent their lives in denial of that possibility," AEI Vice President Danielle Pletka told The Cable in a Monday interview. "Whenever you devise a strategy for what happens before a country gets a nuclear weapon, you should have a strategy for what happens after they get one as well."
Pletka will unveil the report on Tuesday morning at an event with Sen. Mark Kirk (R-IL), and fellow AEI experts Tom Donnelly, Maseh Zarif, and Fred Kagan. The project brought together Iran experts of all stripes to brainstorm what would be needed to create the maximum level of confidence that, if Iran does develop a nuclear weapon, it would not decide to use it.
"While there can never be certain deterrence, Cold War presidents often had confidence that the United States had sufficient military power to support a policy of containment through a strategy of deterrence; for most of the period they felt that deterrence was assured," the report states. "It is worth repeating Dean Acheson's basic formulation: ‘American power would be employed in stopping [Soviet aggression and expansion], and if necessary, would inflict on the Soviet Union injury which the Moscow regime would not wish to suffer.' Assured deterrence began with assured destruction of the Soviet regime."
Pletka said that while the geopolitical environment is now different, the basic goal of U.S. policy is the same -- to create a situation whereby Iranian leaders would credibly believe that any nuclear attack would mean the end of their regime. But Pletka doubts whether this administration has the stomach for such a stance.
"Take out Soviet and Moscow from Acheson's quote, and sub in Iran and Tehran. Are we willing to inflict on Iran injury which the Tehran regime would not wish to suffer? I doubt it," Pletka warned. "There's no question that a country can be deterred from using a nuclear weapon, the only question is if there is the will to put those tools in place."
The report works under the assumption that Iran is working to build a nuclear weapon now and could complete one before the 2012 U.S. presidential election, after which it would continue to build nuclear weapons at a rapid pace. The report also assumes that the Obama administration is unwilling to go to war with Iran before November 2012 over the issue, and that even a limited strike by Israel would not achieve a full destruction of Iran's nuclear capabilities.
"Strategically, Iran's leaders would be foolish to wait until after November 2012 to acquire the capability to permanently deter an American attack on their nuclear program," the report states. "Sound American strategy thus requires assuming that Iran will have a weaponized nuclear capability when the next president takes office in January 2013. The Iranians may not test a device before then, depending, perhaps, on the rhetoric of the current president and his possible successor, but we must assume that they will have at least one."
"Make no mistake -- it would be vastly preferable for the United States and the world to find a way to prevent Iran from crossing that threshold, and we wholeheartedly endorse ongoing efforts that might do so," the authors write. "But some of the effort now focused on how to tighten the sanctions screws must shift to the problem of how to deal with the consequences when sanctions fail."
For Donnelly, part of the report's value is that it highlights the high costs of a deterrence and containment strategy compared to the costs of taking stronger actions now to prevent a nuclear-armed Iran.
"Deterrence and containment are the default mode for the people who are not up for going to war, but we wanted to point out that this was not a cheap or easy alternative, which is the way a lot of people make it sound," Donnelly told The Cable in an interview.
At Tuesday's event, Kirk will make the argument that the deterrence and containment strategy are too costly and too uncertain to depend on. His speech will be entitled, "If Iran gets the bomb..."
"Today, the Islamic Republic of Iran is on the march to nuclear weapons. And if this brutal, terrorist-sponsoring regime achieves its goal -- if Iran gets the bomb -- we, the United States of America and freedom-loving nations around the world, will have failed in what could be our generation's greatest test," Kirk will say, according to excerpts of his speech provided to The Cable.
"Iran remains the leading sponsor of international terrorism -- a proliferator of missiles and nuclear materials -- a regional aggressor -- and an abuser of human rights. We cannot afford to risk the security of future generations on a policy of containment."
The Obama administration first urged Senate leaders to compromise on new legislation that would sanction the Central Bank of Iran (CBI) -- but then came out today against that very compromise, angering and alienating a key Democratic Senate ally.
Two senior administration officials testified Thursday morning that the current bipartisan amendment to impose new sanctions on the CBI and any other bank that does business with them is a bad idea that could alienate foreign countries, make it more difficult to pressure Iran, and raise oil prices, which could actually help the Iranian economy.
The administration's strategy of working behind the scenes to change what's become the Kirk-Menendez Iran sanctions amendment, only to publicly oppose it today, angered several senators, including Robert Menendez himself. The New Jersey Democrat took seven minutes at the Senate Foreign Relations Committee hearing to chastise Undersecretary of State Wendy Sherman and Treasury Undersecretary David Cohen at Thursday's Senate Foreign Relations Committee meeting for asking him to negotiate on their behalf, and then criticizing the compromise he struck with Sen. Mark Kirk (R-IL).
"At your request we engaged in an effort to come to a bipartisan agreement that I believe is fair and balanced. And now you come here and vitiate that agreement.... You should have said we want no amendment," Menendez said. "Everything that you have said in your testimony undermines your opposition to this amendment. The clock is ticking."
Menendez said he regretted working with the administration on the issue, and said that perhaps he should have just agreed to Kirk's original Iran sanctions amendment, which was more severe and provided the administration with less room to maneuver than the compromise amendment that is set to be voted on and passed in the Senate as early as tomorrow.
"This certainly undermines your relationship with me for the future," Menendez told the administration officials. He also urged for more drastic measures, such as a gasoline embargo on Iran. "If the Europeans are considering an embargo, we shouldn't be leading from behind, we should be leading forward."
The break between this Democratic senator, who is up for reelection next year, and the Obama administration comes two days after the administration sent three very senior officials to meet with senators to try to get them to scuttle the amendment. On the morning of Nov. 29, Treasury Deputy Secretary Neal Wolin, Deputy Secretary of State Bill Burns, and Deputy National Security Advisor Denis McDonough called an emergency meeting on Capitol Hill, multiple Hill sources told The Cable.
They sat down with Sens. Kirk, Menendez, and SFRC Chairman John Kerry (D-MA). The officials argued that the Kirk-Menendez would get in the way of their efforts to build a multilateral coalition designed to increase pressure on Iran, and they warned the amendment might cause severe disruptions to the world oil markets and therefore have negative effects on the U.S. economy. Kirk and Menendez flatly refused to back down, our sources said, while Kerry reportedly said exactly nothing in the meeting.
The officials' sentiments were echoed in a letter sent today to Senate leaders by Treasury Secretary Timothy Geithner, who we're told is personally invested in the administration effort to thwart the Kirk-Menendez amendment.
"I am writing to express the administration's strong opposition to this amendment because, in its current form, it threatens to undermine the effective, carefully phased, and sustainable approach we have taken to build strong international pressure against Iran," wrote Geithner. "In addition, the amendment would potentially yield a net economic benefit to the Iranian regime."
Geithner argued that because the Kirk-Menendez amendment would force foreign banks to choose between doing business with the U.S. or Iran, some might choose Iran and resist going along with American unilateral efforts, thereby helping the Iranian economy and hurting our own.
Menendez addressed that point by saying that the amendment allows the implementation of the sanctions to be waived if the president determines there's not enough supply in the world oil market, or if he determines a country is making progress in divesting itself from Iranian business relationships.
"So we basically say to financial institutions, do you want to deal with a $300 billion economy, or do you want to deal with a $14 trillion economy? I think that choice is pretty easy for them," Menendez said at the hearing. "So I find it pretty outrageous that when the clock is ticking, and when you ask us to engage in a more reasoned effort, and we produce such an effort in a bipartisan basis, that in fact you come here and say what you say."
One GOP Senate aide told The Cable today that while the amendment was crafted to avoid disrupting the world economy as much as possible, administration officials' warnings of economic consequences could have an effect of their own.
"The administration is going to spook the oil markets themselves in opposition to an amendment that would not," the aide said. "They could create their own self-fulfilling prophecy of driving up oil prices, so their strategy seems to be self defeating."
UPDATE: The Kirk-Menendez amendment passed the senate late Thursday by a unanimous vote of 100-0.
Senate Democrats and Republicans have agreed on a way forward regarding new sanctions on the Central Bank of Iran (CBI) that would impose crippling sanctions on the Iranian economy, with an eye toward preventing a catastrophic consequence for the world oil markets.
Last night, Sens. Mark Kirk (R-IL) and Robert Menendez (D-NJ) filed a new amendment to the defense policy bill that represents a compromise of the two separate amendments each had filed last week. The new bipartisan language would build upon the administration's announcement last week that it was naming the CBI as a "primary money laundering concern" under the Patriot Act and go further than President Barack Obama's Nov. 19 executive order expanding sanctions on Iran's petroleum sector. The Senate amendment would add to that by barring any U.S. financial institution from doing business with any foreign financial institution that knowingly conducted any significant financial transaction with the CBI.
The Kirk-Menendez amendment got unanimous consent in the Senate on Monday for consideration on the defense bill, which is on the floor this week. It will get a vote, probably before Dec. 2, and is expected to pass overwhelmingly. The administration has resisted any congressional efforts to force the imposition of Iran sanctions ahead of its own schedule, but Obama will be hard pressed to veto the must-pass defense bill over the issue.
"The amendment is hard-hitting, responsible and, most importantly, completely bipartisan. It'll have an enormous impact on the Iranian economy without hurting our own while providing the administration additional diplomatic leverage," a GOP Senate aide told The Cable today. "Last week the administration told the world that the Central Bank of Iran was a terrorist bank; I think they'd have to agree this amendment is an appropriate way of dealing with a terrorist bank."
The main concern with Kirk's original amendment was that it would have forced measures against central banks in other countries that do oil business with the CBI. The compromise language softens that requirement by giving a six-month grace period for petroleum-related sanctions to go into effect. And after six months, the penalties against central banks in other countries could be waived by the president for another six months if the Energy Information Agency reports there's not enough non-Iranian oil supply in the market, or if specific countries are showing strong efforts to move away from Iranian oil purchases.
The amendment would also require the president to initiate a "multilateral diplomacy initiative" aimed at convincing other countries to stop purchasing oil from Iran.
Read a best-guess timeline of the implementation of the Kirk-Menendez sanctions, compiled as a memo by Hill aides and given to The Cable, after the jump:
For years, Iraq hearings on Capitol Hill were marked by the often disruptive presence of the anti-war group Code Pink; now their presence at hearings has been replaced by an Iranian dissident group.
About 50 supporters of the Mujahideen-e-Khalq (MEK) took over the first three rows of the audience at Tuesday morning's hearing of the Senate Armed Services Committee in the Senate Hart Office Building. The hearing was to examine President Barack Obama's decision to withdraw all U.S. troops from Iraq by the end of the year, and featured testimony by Defense Secretary Leon Panetta and Joint Chiefs Chairman Gen. Martin Dempsey.
Unlike the Code Pink representatives, who were famous for disrupting Senate hearings, the MEK supporters at the Hart building today sat politely in their bright yellow sweatshirts and ponchos, which had slogans printed on them calling for the State Department to take the MEK off of their list of foreign terrorist organizations -- a move that is supposedly under consideration.
We overheard one staffer at the hearing quip, "When your critics allege you are a cult, you probably shouldn't dress like one."
The MEK, whose ideology fuses Islam and Marxism, was formed in Iran in 1965. It allied itself with Ayatollah Ruhollah Khomeini and fought against the Shah and his Western backers during the Iranian Revolution. After falling out of favor with Khomeini, the group was given shelter in Iraq by Saddam Hussein, who used them to conduct brutal cross-border raids during the Iraq-Iran war.
After the fall of Saddam, the United States helped broker an agreement whereby 3,400 MEK members were confined to a complex in northeast Iraq called Camp Ashraf, protected by the U.S. military. The camp was handed over to the Iraqi government in 2009. In an interview this summer with The Cable, Iraqi Ambassador to the United States Samir Sumaida'ie said that the MEK was dangerous and "nothing more than a cult."
Since 2009, the MEK has conducted a multi-million advocacy and lobbying campaign in Washington, with the help of dozens of senior U.S. officials and lawmakers, many of whom have been paid for their involvement. The list includes Congressman John Lewis (D-GA), former Pennsylvania Gov. Ed Rendell, former FBI Director Louis Freeh, former Sen. Robert Torricelli, Rep. Patrick Kennedy, former CIA Deputy Director of Clandestine Operations John Sano, former National Security Advisor Gen. James Jones, former Vermont Gov. Howard Dean, former New York Mayor Rudolph Giuliani, former Joint Chiefs Chairman Gen. Richard Myers, former White House Chief of Staff Andy Card, Gen. Wesley Clark, former Rep. Lee Hamilton, former CIA Director Porter Goss, senior advisor to the Romney campaign Mitchell Reiss, Gen. Anthony Zinni, former Pennsylvania Gov. Tom Ridge, former Sen. Evan Bayh, and many others.
In an August rally outside the State Department, Kennedy declared, "One of the greatest moments was when my uncle, President [John F.] Kennedy, stood in Berlin and uttered the immortal words ‘Ich bin ein Berliner,'" Kennedy exclaimed. "Today, I'm honored to repeat my uncle's words, by saying [translated from Farsi] ‘I am an Iranian, I am an Ashrafi.'"
Kennedy admitted he was paid $25,000 to emcee the rally.
Senate Armed Services Committee Carl Levin (D-MI) called on the administration to protect the MEK from Iraqi government violence in his opening statement at the hearing.
"The status of the residents at Camp Ashraf from the Iranian dissident group MEK remains unresolved," Levin said. "As the December 2011 deadline approaches, the administration needs to remain vigilant that the Government of Iraq lives up to its commitments to provide for the safety of the Camp Ashraf residents until a resolution of their status can be reached."
"We need to make it clear to the Government of Iraq that there cannot be a repeat of the deadly confrontation begun last April by Iraqi security forces against Camp Ashraf residents," Levin said.
Josh Rogin / Foreign Policy
The Obama administration reacted cautiously to today's International Atomic Energy Agency report on Iran's nuclear weapons program and declined to say how exactly how they would respond. But across Washington, suggestions for tightening the noose on the Iranian regime were abundant.
"I'm definitely going to tell you we need time to study it," State Department spokeswoman Victoria Nuland told reporters on Tuesday following the release of the IAEA report, which alleges that Iran had until 2003 an intricate and extensive program to design and build a nuclear warhead to fit atop a Shabaab-3 missile. The report also stated that Iran worked on components for such a warhead, prepared for nuclear tests, and maintained aspects of the program well past 2003 -- activities that may still be ongoing today.
"I think you know the process here: that after a report like this comes out, we also have a scheduled meeting of the IAEA Board of Governors coming up on November 18th, so Iran will be an agenda item at that meeting. So we will take the time between now and then to study this," Nuland said.
In a conference call with reporters on Tuesday afternoon, two senior administration officials predicted that the Obama administration would increase sanctions on Iran in light of the report but declined to offer any specifics on what they might be.
That explanation wasn't well received by lawmakers in both parties on Tuesday, who offered plenty of specific ideas on how to ramp up pressure on Tehran and have no intention of waiting for the administration to "study" the IAEA's findings.
The Cable spoke on Tuesday with Sens. John Kerry (D-MA), Mark Kirk (R-IL), John McCain (R-AZ), and Lindsey Graham (R-SC) about the report.
"It's of enormous concern to everybody and a lot of conversations are taking place right now about how to respond," Kerry told The Cable. "It clearly means we have to ratchet up on Iran, probably tougher sanctions and other things."
Kerry declined to endorse one big idea floating around town, namely to take actions that would collapse the Central Bank of Iran (CBI) and ruin the country's currency, bringing the Iranian economy to its knees.
"There are a lot of options, you want to pick them carefully and you want to be thoughtful about what's going to be effective," Kerry said.
Kirk, who co-authored a letter in August with Sen. Chuck Schumer (D-NY) calling for collapsing the CBI, and which was signed by 92 senators, tweeted today that the White House's reaction to the report Tuesday constituted "national security malpractice."
Kirk met with White House Chief of Staff Bill Daley on Monday night to give him the "hard sell" on the idea of collapsing the CBI, he told The Cable. Kirk said that the concept under consideration is to give friendly countries that are dependent on Iranian oil -- such as Japan, South Korea, and Turkey -- a time window to shift their purchases from Iran to Saudi Arabia.
Kirk and Schumer are planning to introduce a bill soon that would be a Senate companion to an amendment by Rep. Howard Berman (D-CA) to require the president to determine within 30 days the CBI's role in Iran's illicit activities. If the president determines that the CBI is complicit, the bill would require the administration to cut off any foreign banks doing business with the CBI from participating in the U.S. financial system.
The main risk in collapsing the CBI is that it could bring down the Iranian oil industry along with it, risking a cascading effect on world energy markets that would exacerbate the global economic crisis.
McCain told The Cable today that it's a risk he is willing to take. "Libya is cranking up their oil exports. There's always risk, but there's a greater risk when you know that they're about to become nuclear weaponized," he said.
"The first thing we should do is talk to the Russians and the Chinese and tell them to get with it and pass the increased sanctions through the U.N.," McCain said, adding that the Obama has leverage against Russian and China if it chooses to use it. "Russia wants in the WTO, China wants a lot of things. There should be consequences for their failure to act."
Graham agreed that the negative impact of collapsing the CBI was a necessary cost of ramping up pressure on Iran.
"We've got make a decision: What's the biggest threat to the world, a nuclear-armed Iran or sanctions that would hurt us and the people of Iran?" Graham told The Cable. "You've got two choices, the policy of containment or the policy of preemption. I'm in the preemption camp. I don't think containment works. The only way to stop this is to prevent this and that means changing behavior."
Graham said existing sanctions don't seem to be working, which means that the sanctions regime has to be fundamentally changed. "If that doesn't work, the other option is military force." But Graham cautioned that if there were to be a military strike on Iran, it would have to include a massive assault on Iran's counterattacking capabilities.
"You'd have to destroy their air force, sink their navy, and deal with their long-range missile threat. So you'd have to go in big," he said. "If you attack Iran you open Pandora's box. If you allow Iran to get a nuclear weapon, you empty Pandora's box. So these are not good choices."
Sen. Joe Lieberman (I-CT) said in a statement that the threat of military force must be credible and he called for Congress to pass a new Iran sanctions bill, one that the administration previously said was unnecessary.
The House and Senate have each unveiled a version of the bill that would tighten existing sanctions, compel the administration to enforce penalties already on the books, and levy a host of new restrictions against members of Iran's regime and companies that aid Iran's energy, banking, and arms sectors. The bills are a follow-up to the Comprehensive Iran Sanctions, Accountability and Divestment Act (CISADA) that Congress passed and President Barack Obama signed in July 2010.
Former Treasury Department official Matthew Levitt, now a senior fellow at the Washington Institute for Near East Policy, told The Cable that there's no consensus yet inside the administration or around the world that collapsing the CBI would be possible without doing severe damage to the world economy.
But Levitt offered several things the administration can do immediately to ramp up pressure on Iran, including pressuring countries to scale back Iranian diplomatic presence in their capitals, restricting the travel of Iranian officials around the world, and setting up a multilateral customs body to enforce sanctions against Iran, modeled after what was done in wake of the Kosovo crisis.
"The administration is not being creative enough with the tools they have," Levitt said. In the coming days, he predicted, "You are going to see scrambling as to what can be done."
Former President George W. Bush's administration signed an agreement in 2008 to withdraw all troops from Iraq by the end of 2011, but policymakers in that administration always expected that agreement to be renegotiated to allow for an extension beyond that deadline, former Secretary of State Condoleezza Rice told The Cable.
When President Barack Obama announced on Oct. 21 that he would withdraw all U.S. troops from Iraq by Dec. 31, his top advisors contended that since the Bush administration had signed the 2008 Status of Forces Agreement (SOFA), both administrations believed that all troops should be withdrawn by the end of the year. This was part of the Obama administration's drive to de-emphasize their failed negotiations to renegotiate that agreement and frame the withdrawal as the fulfillment of a campaign promise to end the Iraq war.
"The security agreements negotiated and signed in 2008 by the Bush administration stipulated this date of December 31, 2008, as the end of the military presence. So that has been in law now or been in force now for several years," Deputy National Security Advisor Denis McDonough told reporters on Oct. 21. "So it's difficult to rebut the proposition that this was a known date."
Rice, speaking with The Cable to promote her new book No Higher Honor, said today that when the Bush administration signed the agreement, it was understood by both the U.S. and Iraqi governments that there would be follow-up negotiations aimed at extending the deadline -- a step that would be in both the U.S. and Iraqi interest.
"There was an expectation that we would negotiate something that looked like a residual force for our training with the Iraqis," Rice said. "Everybody believed it would be better if there was some kind of residual force."
Rice said the Iraqi government, despite SOFA's Jan. 2012 end date, was not only open to a new agreement that would include an extension for U.S. troops, but expected that a new agreement would eventually be signed.
"We certainly understood that the Iraqis preserved that option and everybody believed that option was going to be exercised," Rice said.
It's been widely reported that the negotiations between the Obama administration and the Iraqi government this year broke down over the issue of immunity for U.S. troops in post-2011 Iraq. The Obama administration had demanded that immunity be granted by the Iraqi Council of Representatives, the country's primary legislative body, which was unwilling to do so for political reasons.
Rice said that she didn't understand why the Obama administration was unable to reach an agreement on immunity with the Iraqis, considering that the previous SOFA granted immunity to U.S. soldiers and was passed overwhelmingly by the Iraqi parliament at the time.
"We did manage to negotiate an immunity clause that was acceptable to the Iraqis and acceptable to the Pentagon. I don't know what happened in these negotiations," Rice said.
Overall, Rice said that while the Iraqi Army is making progress, it still has flaws that U.S. forces could help remedy, and the wholesale withdrawal of U.S. troops from Iraq sends the wrong signal to the region.
"They continue to need help on the counterterrorism side and it would have been a good message to Iran [to keep some U.S. forces there]," Rice said. "That would have been a preferable option."
The Obama administration is claiming it always intended to withdraw all U.S. troops from Iraq by the end of this year, in line with the president's announcement today, but in fact several parts of the administration appeared to try hard to negotiate a deal for thousands of troops to remain -- and failed.
"I can report that as promised, the rest of our troops in Iraq will come home by the end of the year. After nearly nine years, America's war in Iraq will be over," President Barack Obama said today, after speaking with Iraqi Prime Minister Nouri al-Maliki. "The last American soldier will cross the border out of Iraq with their held -- heads held high, proud of their success, and knowing that the American people stand united in our support for our troops. That is how America's military efforts in Iraq will end."
Deputy National Security Advisors Denis McDonough and Tony Blinken said in a White House briefing that this was always the plan.
"What we were looking for was an Iraq that was secure, stable, and self reliant, and that's what we got here, so there's no question that was a success," said McDonough, who traveled to Iraq last week.
But what about the extensive negotiations the administration has been engaged in for months, regarding U.S. offers to leave thousands of uniformed soldiers in Iraq past the deadline? It has been well reported that those negotiations, led by U.S. Ambassador James Jeffrey, Army Gen. Lloyd Austin, the top U.S. commander in Iraq, and White House official Brett McGurk, had been stalled over the U.S. demand that the remaining troops receive immunity from Iraqi courts.
"What the president preferred was for the best relationship for the United States and Iraq going forward. That's exactly what we have now," McDonough said, barely acknowledging the administration's intensive negotiations.
"We talked about immunities, there's no question about that.... But the bottom line is that the decision you heard the president talk about today is reflective of his view and the prime minister's view of the kind of relationship we want to have going forward. That relationship is a normal relationship," he said.
Of course, the U.S.-Iraqi relationship is anything but normal. Following nine years of war, the death of over 4,000 Americans and perhaps hundreds of thousands of Iraqis, and the disbursement of at least hundreds of billions of dollars of American taxpayer' money, the United States now stands to have significantly less influence in Iraq than if the administration had been able to come to terms with Iraq over a troop extension, according to experts and officials.
"Iraq is not a normal country, the security environment is not normal, the embassy is not a normal embassy," said Marisa Cochrane Sullivan, managing director at the Institute for the Study of War, who traveled to Iraq this summer and has been sounding the alarm about what she saw as the mishandling of the negotiations ever since.
For more evidence that the administration actually wanted to extend the troop presence in Iraq, despite today's words by Obama and McDonough, one only has to look at the statements of Defense Secretary Leon Panetta.
In July, Panetta urged Iraqi leaders to, "Dammit, make a decision" about the U.S. troop extension. In August, he told reporters that, "My view is that they finally did say, ‘Yes.'" On Oct. 17, he was still pushing for the extension and said, "At the present time I'm not discouraged because we're still in negotiations with the Iraqis."
Sullivan was one of 40 conservative foreign policy professionals who wrote to Obama in September to warn that even a residual force of 4,000 troops would "leave the country more vulnerable to internal and external threats, thus imperiling the hard-fought gains in security and governance made in recent years at significant cost to the United States."
She said that the administration's negotiating strategy was flawed for a number of reasons: it failed to take into account Iraqi politics, failed to reach out to a broad enough group of Iraqi political leaders, and sent contradictory messages on the troop extension throughout the process.
"From the beginning, the talks unfolded in a way where they largely driven by domestic political concerns, both in Washington and Baghdad. Both sides let politics drive the process, rather than security concerns," said Sullivan.
As recently as August, Maliki's office was discussing allowing 8,000 to 20,000 U.S. troops to remain until next year, Iraqi Ambassador Samir Sumaida'ie said in an interview with The Cable. He told us that there was widespread support in Iraq for such an extension, but the Obama administration was demanding that immunity for U.S. troops be endorsed by the Iraqi Council of Representatives, which was never really possible.
Administration sources and Hill staffers also tell The Cable that the demand that the troop immunity go through the Council of Representatives was a decision made by the State Department lawyers and there were other options available to the administration, such as putting the remaining troops on the embassy's diplomatic rolls, which would automatically give them immunity.
"An obvious fix for troop immunity is to put them all on the diplomatic list; that's done by notification to the Iraqi foreign ministry," said one former senior Hill staffer. "If State says that this requires a treaty or a specific agreement by the Iraqi parliament as opposed to a statement by the Iraqi foreign ministry, it has its head up its ass."
The main Iraqi opposition party Iraqiya, led by former U.S. ally and former Prime Minister Ayad Allawi, decided to tie that vote to two non-related issues. It said they would not vote for the troop extension unless Maliki agreed give them control of a high-level policy council and let them choose the minister of defense from their ranks. Maliki wasn't about to do either.
"It was clear from the beginning that Maliki wasn't going to make a move without the support of the other parties behind him," Sullivan explained, adding that the Obama administration focused on Maliki and neglected other actors, such as Allawi. "There was a misunderstanding of how negotiations were unfolding in Iraq. The negotiations got started in earnest far too late."
"The actions don't match the words here," said Sullivan. "It's in the administration's interest to make this look not like they failed to reach an agreement and that they fulfilled a campaign promise. But it was very clear that Panetta and [former Defense Secretary Robert] Gates wanted an agreement."
So what's the consequence of the failed negotiations? One consequence could be a security vacuum in Iraq that will be filled by Iran.
"It's particularly troubling because having some sort of presence there would have really facilitated our policy vis-a-vis the Iranians and what's going on in Syria. The Iranian influence is going up in Iraq," said Andrew Tabler, senior fellow at the Washington Institute for Near East Policy. "It makes it harder for us to play our cards, and that's a real setback. We've spent a lot of blood and treasure in Iraq. And these days, stability in that region is not what it used to be."
House Armed Services Committee Chairman Buck McKeon (R-CA) echoed those sentiments in a statement today and expressed skepticism that Iraq is as "safe, stable, and self reliant" as the White House claims.
"Multiple experts have testified before my committee that the Iraqis still lack important capacities in their ability to maintain their internal stability and territorial integrity," McKeon said. "These shortcomings could reverse the decade of hard work and sacrifice both countries have endured to build a free Iraq."
Senate Foreign Relations Committee chairman John Kerry (D-MA), in his own Friday statement, backed up the administration's argument that the lack of a troop extension was in the best interest of the United States and Iraq.
"The United States is fulfilling our agreement with an Iraqi government that wants to shape its own future," he said. "The President is also following through on his commitment to end both the conflict in Iraq and our military presence... These moves appropriately reflect the changes on the ground. American troops in Iraq will be coming home, having served with honor and enormous skill."
UPDATE: This article was amended after a White House official called in to say that it was not the "White House" that was pushing for an extension of U.S. troops.
"The White House has always seen the president's pledge to get all troops out of Iraq as a core commitment, period," the White House official said.
Top officials in the State Department are going to extensive lengths to coordinate international pressure on Iran in the wake of the alleged assassination plot against the Saudi ambassador to the United States, Adel bin Ahmed al-Jubeir, although it remains unclear exactly what the Obama administration's next retaliatory steps might be.
Secretary of State Hillary Clinton and Deputy Secretary Bill Burns have been calling leaders around the world to discuss the indictment against a dual U.S.-Iranian citizen and an Iranian member of the notorious Islamic Revolutionary Guard Corps al-Quds Force (IRGC-QF), which alleges that they hatched an elaborate plan to kill Jubeir by bombing a restaurant in Washington, possibly Café Milano in Georgetown.
Clinton has personally spoken with Foreign Minister Prince Saud al-Faisal al-Saud, her Mexican counterpart Patricia Espinosa, Russian Foreign Minister Sergei Lavrov, and will be making several more calls today. Burns hosted a meeting of dozens of foreign diplomats this morning at the State Department on the plot, urging foreign ambassadors to convey a message back to their capitals that the United States is seeking more international pressure and condemnation of Iran.
Clinton and Burns met Wednesday morning with the Swiss ambassador to Tehran, Livia Leu Agosti. Switzerland represents U.S. interests in Iran through their embassy there because the U.S. and Iran have no formal diplomatic relations. The meeting was previously scheduled, but the focus was switched to discuss the bomb plot.
The State Department also sent a message to all U.S. ambassadors and chiefs of mission around the world directing them to meet with officials in their host countries to brief them on the situation and encourage them to aid the United States in increasing pressure on the Iranian government.
The administration sent briefers to talk to congressional staffers in a classified setting today, and Undersecretary for Political Affairs Wendy Sherman will testify tomorrow in an open hearing that is now expected to focus on the plot.
The State Department is also offering to send briefing teams to any embassy in Washington that wants more detailed information about the plot.
In New York, U.S. Ambassador to the United Nations Susan Rice is holding individual meetings will all 14 other countries on the U.N. Security Council on the issue today and tomorrow.
"We are looking for countries to join us in increasing the political and the economic pressure on Iran," State Department spokeswoman Victoria Nuland said at today's briefing. "We believe that all countries should look hard at how they can tighten sanctions, how they can enforce sanctions and whether sanctions are well-enforced to the limits of their own national law."
Iran's permanent representative to the U.N. Mohammad Khazaee sent a letter to U.N. Secretary General Ban Ki-Moon denying any role in the plot and stating that, "Iran has always condemned terrorism in all its forms and manifestations."
The State Department has made no decisions on whether to seek formal U.N. action against Iran, such as a Security Council resolution or presidential statement, Nuland said, and she wouldn't comment on Sen. Mark Kirk's (R-IL) demand that the administration sanction the Central Bank of Iran, an idea supported by over 90 senators.
Nuland said the administration doesn't know why Iran decided to attempt such an attack, but she dismissed the notion that the plot was out of character for the Iranian government.
"You know, Iran has a long history of using cut-outs. It also has some clumsy efforts in its past. I can't speak to what they were thinking when they planned this, but our concern is that it appears to be an escalation in tactics, and a dangerous one," she said.
Clinton spoke about the plot on Wednesday morning during remarks at the Center for American Progress.
"This plot, very fortunately disrupted by the excellent work of our law enforcement and intelligence professionals, was a flagrant violation of international and U.S. law, and a dangerous escalation of the Iranian government's long-standing use of political violence and sponsorship of terrorism.... This kind of reckless act undermines international norms and the international system," she said.
"Iran must be held accountable for its actions....We will work closely with our international partners to increase Iran's isolation and the pressure on its government, and we call upon other nations to join us in condemning this threat to international peace and security."
The Treasury Department sanctioned the Iranian commercial airline Mahan Air as part of the U.S. government response to the alleged Iranian-backed assassination plot on the Saudi ambassador to Washington.
Treasury announced in a press release early on Wednesday that Mahan Air would be sanctioned due to its financial, material, and technological support to the Islamic Revolutionary Guard Corps-Quds Force (IRGC-QF). On Tuesday, Treasury announced sanctions on four IRGC-QF officials who it alleges were involved in the plot to hire a Mexican cartel to bomb a Washington restaurant in order to kill Saudi Ambassador Adel bin Ahmed Al-Jubeir.
"Mahan Air's close coordination with the IRGC-QF -- secretly ferrying operatives, weapons and funds on its flights -- reveals yet another facet of the IRGC's extensive infiltration of Iran's commercial sector to facilitate its support for terrorism," said Treasury Undersecretary for Terrorism and Financial Intelligence David Cohen, in a statement. "Following the revelation about the IRGC-QF's use of the international financial system to fund its murder-for-hire plot, today's action highlights further the undeniable risks of doing business with Iran."
The new sanctions make it illegal for any Americans to do business with Mahan Air and freeze the airline's assets in the United States. The airline also provides assistance to the Iranian-backed terrorist group Hezbollah, the Treasury Department alleged.
Further retaliatory measures from the U.S. government are expected. The State Department has been reaching out to several countries to explore options for tightening multilateral sanctions. And lawmakers on both sides of the aisle are demanding tougher measures to punish Iran for its role in the alleged plot. Sen. Mark Kirk (R-IL) is calling for Treasury to sanction the Central Bank of Iran, which he says would collapse the bank and cripple the Iranian currency.
The New York Times reported on Tuesday that, in addition to the plan to kill the Saudi envoy, the Iranian agents -- who were working with a DEA informant they believed was a representative of Mexican drug cartel Los Zetas -- also discussed plans to bomb the Israeli embassy in Washington and the Saudi and Israeli embassies in Argentina.
Attorney General Eric Holder pledged on Tuesday that, "The United States is committed to holding Iran responsible for its actions."
The Obama administration must take stronger steps than just sanctioning five Iranian individuals, as it announced today, in response to the alleged plot to assassinate the Saudi envoy in Washington, Sen. Mark Kirk (R-IL) told The Cable.
"That's just charging the individuals involved," Kirk said in a Tuesday afternoon interview, emphasizing that the Iranian government should be held responsible for the plot directly. "What the administration should do is prepare to move against Bank Markazi [Iran's Central Bank] in response to the bomb plot."
Kirk took to the floor of the Senate on Tuesday to call on the Federal Reserve and the EU Central Bank to ban all transactions with Iran's central bank, which Kirk said would have the effect of crippling the value of Iran's currency.
"Their currency would become like North Korea's currency," Kirk said, arguing that the move would constitute a proportional and appropriate response to the Iranian government's involvement in the plot.
The administration did not brief Congress before announcing the plot in a press conference earlier today, but Treasury Undersecretary David Cohen is set to brief members of the Banking Committee tomorrow in private and then in public on Thursday.
Members will be pressing Cohen on what further steps will be taken to punish Iran for the plot in addition to what was announced today. By tomorrow, senators will put forward several more requests for specific actions against Iran, Kirk said.
"We're looking at a range of policies, but no military action, because the plot was foiled," Kirk said. "The level of anger in Congress tonight is only a fraction of what it will be tomorrow morning."
Senate Majority Whip Richard Durbin (D-IL) also called for additional measures against Iran in a speech on the Senate floor today. "We need to heighten the sanctions on Iran and make it clear that this type of action will not be countenanced," he said.
In August, more than 90 senators signed a letter to President Barack Obama, written by Kirk and Sen. Chuck Schumer (D-NY), which stated, "The time has come to impose crippling sanctions on Iran's financial system by cutting off the Central Bank of Iran. There is strong bipartisan support in Congress for the imposition of sanctions on the Central Bank of Iran."
Secretary of State Hillary Clinton spoke vaguely about possible future measures against Iran in response to the plot in a short comment onTuesday afternoon.
"We will be consulting with our friends and partners around the world about how we can send a strong message that this kind of action, which violates international norms, must be ended," she said. "And other areas where we can cooperate more closely in order to send a strong message to Iran and other actions to isolate it from the international community will also be considered."
But Clinton got a bit more specific about the State Department's behind the scenes outreach regarding the plot in a Tuesday interview with the AP.
"We are actively engaged in a very concerted diplomatic outreach to many capitals, to the U.N. in New York, to not only to explain what happened so we can try to pre-empt any efforts by Iran to be successful in what would be their denial and their efforts to try to deflect responsibility but so that we also enlist more countries in working together against what is becoming a clearer and clearer threat" from Iran, Clinton said.
UPDATE: Late Tuesday evening, the State Department issued a new worldwide travel alert in response to the assassination plot.
"The Department of State alerts U.S. citizens of the
potential for anti-U.S. actions following the disruption of a plot,
linked to Iran, to commit a significant terrorist act in the United
States," it stated. "The U.S. government assesses that this Iranian-backed
plan to assassinate the Saudi Ambassador may indicate a more aggressive
focus by the Iranian Government on terrorist activity against diplomats
from certain countries, to include possible attacks in the United
Hundreds of supporters of the Mujahedin-e-Khalq (MEK) movement converged on the State Department on Friday to hear former U.S. congressmen and senior officials call for the U.S. government to take the MEK off its list of foreign terrorist organizations.
Former Rep. Patrick Kennedy (D-RI) emceed the rally in front of the State Department headquarters. The event also featured speeches by former Gov. Ed Rendell (D-PA), former FBI Director Louis Freeh, former CIA Deputy Director of Clandestine Operations John Sano.
"One of the greatest moments was when my uncle, President [John F.] Kennedy, stood in Berlin and uttered the immortal words ‘Ich bin ein Berliner,'" Kennedy exclaimed. "Today, I'm honored to repeat my uncle's words, by saying [translated from Farsi] ‘I am an Iranian,' ‘I am an Ashrafi."
The crowd erupted in cheers and applause and began chanting, "MEK yes, mullahs no! They are terrorists, they must go!"
Kennedy advocated taking the MEK off the terrorist list, which it has been on since 1997, and accused the Iraqi government of committing war crimes by killing innocent members of the MEK at Camp Ashraf. 3,400 MEK members live in the desert camp in Iraq under restrictive conditions.
"To my friends in the State Department behind us, who continue to hold fast to an old policy that is supported by Tehran, you are on the wrong side of history," Kennedy shouted. "To [Iraqi Prime Minister] Nouri al-Maliki, your brutal and deadly assault on Camp Ashraf will land you in the International Criminal Court, where you will be held accountable."
"I love you," Kennedy told the crowd. "If you take the MEK off the list, you will unshackle a group that will help take out the mullahs in Iran."
Next up was Rendell, who called on the international community to militarily intervene in Camp Ashraf, comparing it to Muammar al-Qaddafi's assault on Benghazi earlier this year.
"The international community conducted a military intervention in Libya to protect innocent civilians. We should do the same thing to protect the innocent people in Camp Ashraf," Rendell said.
MEK leader Maryam Rajavi, who lives in Paris with her husband Massoud Rajavi (who hasn't been seen in public since 2003), is banned from traveling to the United States. But she spoke to the rally via a video message on a big screen, and accused the State Department of giving implicit permission to the Iranian and Iraqi governments to kill children.
"The terror listing in the U.S. is openly used as a justification to legitimize such bloodletting, by both the cruel mullahs as well as their proxy government in Iraqi," she said. "Therefore, the Iranian people are asking the United States, ‘Why are you not annulling the license to kill our children?'"
The Cable's informal headcount put the number of attendees at about 1,000 to 1,500, with long lines of young Iranian-Americans wearing shirts with photos of dead MEK members imprinted on them. Some attendees had photos of the Rajavis on their shirts. Add to that flags, confetti, and a full drum line.
We asked Kennedy if he had been paid for his appearance at the rally, but he refused to answer. Ali Safavi, president of a pro-MEK group Near East Policy Research, said the speakers were paid through a speakers bureau, which receives money from wealthy Iranian-Americans in the United States. He also said those Iranian-Americans work with the law firm DLA Piper, but he denied the allegation that DLA and these individuals help funnel money from the MEK to the former U.S. officials.
In a crowd made up of people who were mostly of Middle Eastern origin, a group of African-American attendees wearing MEK gear stood out. One man, who would only identify himself as "The Great Lonnell," was holding a "Delist the MEK" banner while wearing a shirt that said, "Behold the Great Beast."
"We are here representing on behalf of the Iranian community. This vicious dictator who is calling himself a president is murdering these people, he's slaying them, and nothing is getting done," the Great Lonnell said. "And they are here rallying to get the attention of a government that has deaf ears."
The Great Lonnell came to Washington from Staten Island, NY -- along with 200 people from a church he attends -- to support the MEK's struggle for human rights. He and his group have been attending MEK rallies for several months, he said.
The Great Lonnell then pulled your humble Cable guy aside and asked to pitch Foreign Policy another story.
"Do you want to write my own story?" he asked. "I am the Beast that will come to the earth, from Revelations in the Old Testament. I am that person."
The Cable was not able to confirm that The Great Lonnell was in fact the Beast from Revelations.
UPDATE: Zaid Jilani and Ali Gharib from ThinkProgress interviewed attendees at the rally, many who had tenuous if any links to the MEK and little understanding of why there were there. Many had traveled from far away on fully funded trips. Some appeared to be homeless. Watch the video here:
Josh Rogin/Foreign Policy
Supporters of the Mujahedin-e-Khalq (MEK) movement are planning their largest-ever gathering in Washington on Friday in front of the State Department.
"Join us in solidarity with the Iranian people, Camp Ashraf, and against the dictatorship ruling Iran," reads the flyer advertising the Aug. 26 rally and march at the 22nd and C Street entrance of the State Department's Foggy Bottom headquarters. MEK supporters have been gathering there for months, imploring State Department employees and visitors to press Secretary of State Hillary Clinton to remove the MEK from State's list of foreign terrorist organizations.
"Dear Hillary, My name is Shaghayegh. I am 14 and I live in Camp Ashraf, Iraq. I am afraid I am going to be murdered," begins an open letter from an MEK member to Clinton that has been printed in full-page ads in the Washington Post.
The State Department placed the MEK on its list of foreign terrorist organizations in 1999 for its involvement in bombings that killed six Americans, but is reviewing that status now.
The event is the latest and greatest example of the MEK's multi-million dollar effort to build support among Washington's political elite. The speakers at the event will include: Congressman John Lewis (D-GA), former Pennsylvania Gov. Ed Rendell, former FBI Director Louis Freeh, former Sen. Robert Torricelli, Rep. Patrick Kennedy, and former CIA Deputy Director of Clandestine Operations John Sano.
The MEK also lists among its supporters in Washington former National Security Advisor Gen. James Jones, former Vermont Gov. Howard Dean, former New York Mayor Rudolph Giuliani, former Joint Chiefs Chairman Gen. Richard Myers, former White House Chief of Staff Andy Card, Gen. Wesley Clark, former Rep. Lee Hamilton, former CIA Director Porter Goss, senior advisor to the Romney campaign Mitchell Reiss, Gen. Anthony Zinni, former Pennsylvania Gov. Tom Ridge, former Sen. Evan Bayh, and many others.
So what is the MEK? Well, that depends on who you ask. The group, which has an ideology based on the fusion of Islam and Marxism, was formed in Iran in 1965. It allied itself with Ayatollah Ruhollah Khomeini and fought against the Shah and his Western backers. After falling out of favor with Khomeini, the group was given shelter in Iraq by Saddam Hussein, who used them to conduct brutal cross-border raids during the Iraq-Iran war.
MEK leader Maryam Rajavi, who lives in Paris with her husband Massoud Rajavi, reportedly told her followers in 1991, "Take the Kurds under your tanks, and save your bullets for the Iranian Revolutionary Guards."
After the fall of Saddam, the United States helped broker an agreement whereby 3,400 MEK members were confined to a complex in Iraq called Camp Ashraf, which was protected by the U.S. military but then handed over to the Iraqi government in 2009. In an interview on Tuesday, Iraq's ambassador Samir Sumaida'ie said that the MEK was dangerous and "nothing more than a cult."
In 2005, Human Rights Watch published a report accusing the MEK in Camp Ashraf of enforcing loyalty by subjecting "dissident members to torture and prolonged solitary confinement," and being responsible for "two cases of death under interrogation."
Elizabeth Rubin wrote about her 2003 trip to Camp Ashraf in the New York Times earlier this month. "Access to the Internet, phones and information about the outside world is prohibited. Posters of Ms. Rajavi and her smiling green eyes abound," she said. "Friendships and all emotional relationships are forbidden. From the time they are toddlers, boys and girls are not allowed to speak to each other. Each day at Camp Ashraf you had to report your dreams and thoughts. If a man was turned on by the scent of a woman or a whiff of perfume, he had to confess."
The MEK says it renounced violence in 2001 and professes to be leading the resistance to the Iranian regime. That claim, in addition to lucrative payments to former officials in both parties, has bought it a lot of attention and friends in Washington. But how can senior officials take money from a terrorist group?
"The MEK's delisting campaign is funded by a fluid and enigmatic network of support groups based in the United States. According to an MEK leader, these groups are funded by money from around the world, which they deliberately shield from U.S. authorities," the Huffington Post reporter Christina Wilkie wrote. "These domestic groups book and pay for their VIP speakers through speaker agencies, which in turn pay the speakers directly and take a fee for arranging appearances. That way, the speakers themselves don't technically accept money from the community groups."
An event organizer told The Cable that the MEK is expecting between 5,000 and 10,000 people at its rally at the State Department on Friday, which begins at 10 a.m.
This week's toppling of the Qaddafi regime in Libya shows that the Obama administration's multilateral and light-footprint approach to regime change is more effective than the troop-heavy occupation-style approach used by the George W. Bush administration in Iraq and Afghanistan, a top White House official told Foreign Policy today in a wide-ranging interview.
"The fact that it is Libyans marching into Tripoli not only provides a basis of legitimacy for this but also will provide contrast to situations when the foreign government is the occupier," said Ben Rhodes, deputy national security advisor for communications, in an exclusive interview on Wednesday with FP. "While there will be huge challenges ahead, one of the positive aspects here is that the Libyans are the ones who are undertaking the regime change and the ones leading the transition."
Despite criticism from Congress and elsewhere, President Barack Obama's strategy for the military intervention in Libya will not only result in a better outcome in Libya but also will form the basis of Obama's preferred model for any future military interventions, Rhodes said.
"There are two principles that the president stressed at the outset [of the Libya intervention] that have borne out in our approach. The first is that we believe that it's far more legitimate and effective for regime change to be pursued by an indigenous political movement than by the United States or foreign powers," said Rhodes. "Secondly, we put an emphasis on burden sharing, so that the U.S. wasn't bearing the brunt of the burden and so that you had not just international support for the effort, but also meaningful international contributions."
Rhodes said that the United States is not going to be able to replicate the exact same approach to intervention in other countries, but identified the two core principles of relying on indigenous forces and burden sharing as "characteristics of how the president approaches foreign policy and military intervention."
Rhodes also weighed in on several other aspects of the Libya saga:
Sen. Mark Kirk (R-IL) has lifted his hold on the nomination of David Cohen to be the top sanctions official at the Treasury Department following the administration's announcement of several targeted sanctions against Iran.
Cohen, whose nomination to replace Stuart Levey as undersecretary for terrorism and financial intelligence had been stalled in the Senate, now could be confirmed as early as this week. Kirk, who had issued the hold late last month due to concerns over the administration's lack of enforcement of sanctions against Iran, released his hold late last week after Treasury designated Iranian companies such as Iran Air and Tidewater Middle East for sanctions under the Comprehensive Iran Sanction, Accountability, and Divestment Act of 2010 (CISADA).
"I applaud Acting Under Secretary David Cohen for moving decisively to designate Iran Air and a major Iranian port operator responsible for facilitating Iran's illicit transfer of weapons and other proliferation activities. Both designations will significantly restrict shipping to and from Iran and put even more pressure on the Iranian economy," Kirk said in a June 23 statement. "Under Secretary Cohen has proven himself to be a worthy successor to former Under Secretary Levey. He has my confidence."
A Kirk aide confirmed to The Cable that this statement was an acknowledgement that Kirk had removed his hold on Cohen's nomination. The aide said that Kirk, Cohen, and Sen. Jon Kyl (R-AZ), had a series of meetings and exchanged letters over the last month. Kirk was also reassured by their most recent meeting about two weeks ago.
"After their last meeting, Sen. Kirk lifted his hold and decided to back the nomination," the Kirk aide said. "[The nomination] has already gone through Finance and Banking so it could be hotlined for Senate confirmation before the Fourth of July recess."
"Hotlined" is shorthand for a Senate practice wherein the Senate majority leader sends around a message notifying all senators that a nomination is coming to the floor forthwith. If nobody objects, the nomination can quickly be confirmed by voice vote.
In fact, one Senate source told The Cable that the Cohen nomination could reach the Senate floor as soon as Tuesday, as part of a large nominations package the Senate leadership is preparing now.
Last week's Treasury Department action against Iran Air and Tidewater is just the latest in a series of administration moves to use the tools under CISADA to increase pressure on various parts of the Iranian government and the Iranian economy.
On May 24, the State Department rolled out sanctions against seven companies accused of doing business with Iran's energy sector. Those designations came one day after the Senate unveiled an entirely new Iran sanctions bill -- though that legislation doesn't appear to have the administration's support, as then Deputy Secretary of State Jim Steinberg told The Cable it was totally unnecessary.
Steinberg also announced on May 24 that the administration had separately decided to impose sanctions on 16 additional foreign firms and individuals, including three Chinese firms, under the Iran, North Korea, and Syria Nonproliferation Act (INKSNA), which prohibits involvement of foreign companies in those countries' missile and WMD programs..
Then, on June 9, State announced sanctions on three Iranian government entities involved in human rights abuses, the Islamic Revolutionary Guard Corps (IRGC), the Basij Resistance Force, and Iran's Law Enforcement Forces (LEF) -- as well as LEF Commander Ismail Ahmadi Moghadam.
The June 23 action against Iran Air and Tidewater was a joint State/Treasury effort. It was significant because it targeted the IRGC's main shipping companies, and because the administration also promised to continue imposing more sanctions.
"The steps we have taken this week seek to limit Iran's ability to use the global financial system to pursue illicit activities. We have made important progress in isolating Iran, but we cannot waver," State and Treasury said in a joint statement. "Our efforts must be unrelenting to sharpen the choice for Iran's leaders to abandon their dangerous course."
One issue Kirk has been pushing in recent days concerns the huge contracts between the Defense Department and Kuwait and Gulf Link Transport Company (KGL), which may have ties to the Islamic Republic of Iran Shipping Lines (IRISL), an entity long accused of operating a web of shell companies to evade sanctions, and three other Iranian companies already on the banned list of Treasury's Office of Foreign Assets Control (OFAC).
KGL was recently awarded a nearly $750 million contract by the U.S. Army and another $42 million sole-source contract by the Defense Logistics Agency. Kirk now wants to know if the U.S. military is indirectly putting money into Iranian government coffers.
"I am certain you agree that a prompt investigation is warranted due to the sensitive nature of the contracting work conducted by KGL for our men and women in uniform," Kirk wrote in a June 21 letter to OFAC Director Adam Szubin.
That letter was a follow-up to another letter Kirk sent May 26 to Defense Secretary Robert Gates, where he pointed out that KGL helped operate the ports used for Iran's nuclear program and also has influence and control over U.S. military supply lines. Gates has yet to respond to Kirk.
Kirk's research staff has also compiled an extensive file on KGL's suspicious activities and associations, which can be found here.
One senior GOP senate aide said it was ironic that the Obama administration has designated for sanctions the Israeli firm Ofer Brothers Group for doing business with Iranian entities that are suspicious but not designated as banned by OFAC, while allowing the U.S. military to do business with similarly suspect firms.
"We're now at a place where the Defense Department is holding itself to a lower threshold of due diligence for military contracts than the standard applied to foreign governments and foreign corporations in business dealings with regard to Iran sanctions legislation," the aide said.
The Obama administration will expand sanctions on Iran and countries that do business with it, but new congressional legislation is unnecessary, according to Deputy Secretary of State Jim Steinberg.
The House and Senate have each unveiled a bill that would tighten existing sanctions, compel the administration to enforce penalties already on the books, and levy a host of new sanctions against members of Iran's regime and companies that aid Iran's energy, banking, or arms sectors. The bills are a follow-up to the Comprehensive Iran Sanctions, Accountability and Divestment Act (CISADA) that Congress passed and President Barack Obama signed in July 2010.
Lawmakers are increasingly frustrated that the administration has decided not to use CISADA to penalize many companies from third-party countries such as China that are believed to be violating the sanctions, while only punishing a couple of firms from countries such as Belarus. The new bills are meant to force action on Chinese companies. But Steinberg said that the administration doesn't support another round of sanctions legislation and will proceed with enforcement on its own timeline.
"We think we have powerful tools, and we've welcomed CISADA and we think CISADA is a powerful tool, and what we've seen, not just with China but with everybody, is that the availability of that has caused countries and companies to stop doing things that they might otherwise do," Steinberg told The Cable in a June 6 interview on the sidelines of the Shangri-La Security Dialogue in Singapore.
Steinberg fundamentally disagreed with senators who believe that China has not been adhering to the sanctions and allowing its companies to backfill the business in Iran left open by the departure of firms from U.S. allies such as Japan and South Korea.
"I think the [Chinese] record has been reasonably good in terms of what they've done. It's not perfect, and we continue to work with them, we continue to keep some actions of theirs under investigation and review," he said.
"I think people -- if one would have asked two years ago, for example, on dealing with Iran, how much we would be in sync with China -- I think they would be amazed how well this has worked, both in terms of the formal stuff in the Security Council, but also in the P5+1," said Steinberg. "The Chinese have been fully on board, they haven't undercut it, they've been very clear and consistent with the need for Iran to meet their obligations and they've worked as a partner with us on that. They've been very restrained in their political and economic engagement with Iran."
Will the administration ever sanction Chinese companies for doing business in Iran, which, according to the Government Accountability Office, continues to this day?
"It depends what they do," Steinberg said. "As we've said to the Congress and to everybody, in the first best instance what we want is to see countries do it voluntarily, and we've seen a number of cases where we've raised issues of concern with China, and we've had some progress."
The lawmakers who spent months drafting the new sanctions legislation and who are planning to push it through Congress this summer fundamentally disagree with Steinberg's reading of Chinese behavior.
"I worry that the Obama administration has given Chinese banks and companies a get out of jail free card when it comes to sanctions law, and they should not," Sen. Mark Kirk (R-IL) said at last month's AIPAC conference in Washington.
In a Tuesday interview with The Cable, Kirk said that the Senate bill has strong leadership from both parties, including lead sponsors Jon Kyl (R-AZ), Robert Menendez (D-NJ), Joe Lieberman (I-CT), and many others.
"The hollowness of the administration's enforcement is evident when you compare how much the U.S. and Iranian economies grew last year. Because Ahmadinejad's economic growth was faster than Obama's, that underscores our concern that the results are meager at best," Kirk said.
"We have overwhelming bipartisan consensus here and in the House as well, so I would say to Secretary Steinberg, prepare for incoming legislation."
As the Obama administration struggles to find common ground with the Israeli government and the Palestinian leadership grapples with internal squabbles, one U.S. senator is proposing a host of ways to deepen cooperation between the United States and Israel.
Sen. Mark Kirk (R-IL) spent last week on what he calls "an intense fact-finding mission to Israel, the Palestinian Authority and Jordan," where he met with Israeli Prime Minister Benjamin Netanyahu, Palestinian Prime Minister Salam Fayyad, Jordan's King Abdullah II, and many others. In a soon-to-be-released report, obtained in advance by The Cable, he proposes a path forward for increased U.S.-Israeli defense cooperation and lays out his views on how Congress should deal with the thorniest issues of the U.S. approach to the Middle East.
Kirk is proposing an increased role for the Israeli Navy in global anti-piracy operations in the Indian Ocean in cooperation with India. He wants to vastly expand U.S.-Israeli cooperation on cyber security, beyond the suspected cooperation on the Stuxnet worm that has delayed Iran's uranium enrichment program. Kirk is also calling on the Joint Chiefs to review the possibility of adapting Israel's "Iron Dome" short-range missile defense system for use by the United States and NATO.
"We are stretched quite thin in the Indian Ocean and to have Israeli support will be critical in managing and reducing the pirate threat," Kirk said in a Tuesday interview with The Cable.
Regarding the stalled Middle East peace process, Kirk maintains that the United States should reaffirm President George W. Bush's 2004 letter on borders, which somewhat contradicts Obama's May 17 statement that borders should be based on 1967 lines with agreed swaps. Obama's new language for the first time made it official U.S. policy what had long been the Palestinian goal of using the 1967 lines as a basis for new borders.
Kirk's report also states that U.S. funding should not go to a Palestinian government that includes Hamas, nor should the United States give aid to the Palestinian Authority if it seeks a unilateral declaration of statehood at the United Nations in September or fails to curb anti-Israel incitement in Palestinian schools.
"It just seems extraordinarily difficult in the middle of deficits and debt that we should borrow money from China to fund a Hamas-supported government," Kirk said. "We would still support Palestinian schools and hospitals, but the approximately $200 million in direct support to the PA would be in jeopardy."
Kirk also wants the United Nations Relief and Works Agency (UNRWA) to start transferring its management of Palestinian health and education services over to the Palestinian government, and for the State Department to designate the Turkish aid organization IHH, which organized the flotilla of ships that tried to breach Israel's Gaza blockade in May 2010, as a terrorist organization.
On his trip, Kirk also met with Israeli Defense Minister Ehud Barak, IDF Chief of Staff Benjamin Gantz, Mossad Chief Tamir Pardo, senior advisor to the Israeli Prime Minister Ron Dermer, Israeli Navy commander in chief Vice Admiral Eliezer Marum, Israeli Ministry of Defense Political-Military Bureau Director Amos Gilead, Deputy Israeli Prime Minister and Minister for Strategic Affairs Moshe Ya'alon, Israeli Prime Minister's Office spokesman Mark Regev, Israeli opposition leader Tzipi Livni, Jewish Agency Chairman Natan Sharansky and Jerusalem Post Palestinian Affairs correspondent Khaled Abu Toameh.
Human rights in Iran were also a big focus for Kirk on the trip. The senator made a video with Sharansky, a former Soviet dissident, in which Sharansky recited a list of dissidents who are currently imprisoned by the Iranian regime.
You can watch that video here:
One day after the Senate unveiled its wide ranging new Iran sanctions legislation and on the same day 10,000 AIPAC supporters are on the Hill, the Obama administration announced it would enforce penalties on seven companies doing business with Iran.
Outgoing Deputy Secretary of State Jim Steinberg briefed the press on Tuesday on the administration's move to sanction seven companies under the Comprehensive Iran Sanctions, Accountability, and Divestment Act (CISADA), passed and signed into law last July. For those keeping count, that's a total of nine sanctioned firms since the law has been in place. The companies are: Petrochemical Commercial Company International (PCCI), UK and Iran; Royal Oyster Group, UAE; Speedy Ship, UAE, Iran; Tanker Pacific, Singapore; Ofer Brothers Group, Israel; Associated Shipbroking, Monaco; and Petroleos de Venezuela, sometimes known as PDVSA, in Venezuela.
All of the companies have been involved in the supply of refined petroleum products to Iran, Steinberg said.
"In its struggle to secure the resources it needs for its energy sector, Iran repeatedly has resorted to deceptive practices to evade sanctions... Today's actions add further pressure on Iran to comply with its international obligations," he said. "By imposing these sanctions, we're sending a clear message to companies around the world: Those who continue to irresponsibly support Iran's energy sector or help facilitate Iran's efforts to evade U.S. sanctions will face significant consequences."
Not all the companies were sanctioned in all the same way. For example, PDVSA will no longer have access to U.S. government contracts and U.S. Export-Import Bank financing and technology licenses, but the company can still sell oil to the United States and their subsidiaries are exempt from the sanctions.
Many in Congress are increasingly unhappy with the Obama administration for failing to enforce penalties on companies from countries who are not part of the sanctions team that do business with Iran. CISADA directs the administration to punish all these companies. Last October, the Government Accountability Office (GAO) released a report that identified 16 companies as having sold petroleum products to Iran between Jan. 1, 2009, and June 30, 2010. Of those 16, the GAO reported that five have shown no signs of curtailing business with Iran. Three of those companies are based in China.
But no Chinese companies have been sanctioned by the Obama administration to date for aiding Iran's energy sector.
"I worry that the Obama administration has given Chinese banks and companies a get out of jail free card when it comes to sanctions law and they should not," Sen. Mark Kirk (R-IL) said Monday at the AIPAC conference.
Steinberg also noted that the administration has separately decided to impose sactions on 16 more foreign firms and individuals for their misbehavior on missile programs or WMD under the Iran, North Korea, and Syria Nonproliferation Act (INKSNA), three of which are from China.
Initial reaction to the administration's Tuesday announcement was mixed, with some praise and some skepticism that the new sanctions won't go far enough to transform the intent of the legislation into results.
"This sanction is a good first step and shows the importance of deeds, not only words. This step should send ripples of fear throughout the energy sector that Iran sanctions will be enforced," said Mark Dubowitz, executive director and head of the Iran Energy Program at the Foundation for the Defense of Democracies.
But multiple Senate aides told The Cable that they would continue to press the administration to enforce energy industry sanctions against third-party countries such as China and Russia.
"The question is, how does this appear to the international community? Do they look at these sanctions and say that the Americans aren't serious about stopping what's going on in the market? Sadly, I think the answer is yes," said one senior GOP Senate aide.
"It's always good when they sanction somebody, but the devil is in the details."
Both the House and Senate are preparing new legislation to increase pressure on Iran, but the House fired the opening salvo on Monday with a new bill authored by both heads of the Foreign Affairs Committee.
"U.S. policy towards Iran has offered a lot of bark, but not enough bite. This new bipartisan legislation would bring to bear the full weight of the U.S. by seeking to close the loopholes in existing energy and financial sanctions laws, while increasing the type and number of sanctions to be imposed," committee chairwoman Ileana Ros-Lehtinen (R-FL) said in a statement unveiling the Iran Threat Reduction Act (ITRA).
The bill is meant to close loopholes that Ros-Lehtinen and others believe the administration is using to avoid enforcement of the Comprehensive Iran Sanctions, Accountability, and Divestment Act of 2010 (CISADA), which was signed into law by President Barack Obama in July 2010.
"Given the grave nature of the Iranian threat, it is my hope that my colleagues will support further strengthening the bill as it moves through the legislative process and not fall into the trap of enabling the Executive Branch to ignore U.S. law," she said.
To date, only two companies have been sanctioned under provisions in CISADA that were designed to clamp down on Iran's energy sector -- one Iranian state-owned corporation, and one corporation from Belarus. The new bill eliminates some of the waivers available to the president, raises the bar for other waivers, and expands the list of targeted Iranian officials and entities.
Other original co-sponsors are committee ranking Democrat Howard Berman (D-CA), Dan Burton (R-IN), Edward R. Royce (R-CA), Brad Sherman (D-CA), Steve Chabot (R-OH), Gary Ackerman (D-NY), and Ted Deutch (D-FL).
"We must use every economic tool available to force Iran to end its pursuit of nuclear weapons," Berman said in his own statement. "As we await vigorous enforcement by the Obama Administration under CISADA, we must continually look ahead and examine additional means to pressure Iran, and that is exactly what this new legislation is intended to do."
Over in the Senate, top lawmakers are also preparing new Iran sanctions legislation, which could be unveiled as early as this month. Like the House bill, the Senate's version will incorporate ideas from a range of individual lawmakers on how to increase pressure on Iran. However, the Senate bill will likely focus on expanding sanctions rather than tightening enforcement of existing sanctions, as the House has done.
The Senate effort is being led by Sens. Jon Kyl (R-AZ), Joe Lieberman (I-CT), and Mark Kirk (R-IL), but will likely incorporate ideas from others, such as Robert Casey (D-PA) and Kirstin Gillibrand (D-NY).
"The new legislation for the first time targets Iran's crude oil exports and the dominant role played by the Iranian Revolutionary Guard Corps (IRGC) in the development, production, and distribution of Iran's oil," said Mark Dubowitz, the executive director of the Foundation for the Defense of Democracies, who helped develop the House bill. "With the introduction of this new legislation, companies now are on notice that ‘buyer beware': If you're buying crude from Iran, you're buying it from the IRGC, and that's bad for business, bad for your reputation and could make you the target of U.S. sanctions."
You can find the bill text here.
Seven Republican senators are demanding that the Obama administration take tougher measures to punish banks still doing business in Iran, and they are threatening to stall the nomination of a top Treasury Department official unless they get their way.
The dispute between the White House and Congress revolves around implementation of the Comprehensive Iran Sanctions, Accountability, and Divestment Act (CISADA) of 2010, the wide-ranging law signed into law last year. The Treasury Department issued a draft rule last week that lays out how it intends to implement a key provision of the law, which deals with Iran's banking partners in countries around the world. And that rule raised the ire of seven GOP senators, who expected Treasury to enforce the law much more stringently.
The key provision, section 104(e), directs the administration to punish any international financial institutions still doing business with Iran by cutting them off from the U.S. financial system.
"We were extremely unhappy with the draft rule to implement section 104(e) of CISADA publish by the Treasury Department last week," wrote Sens. Jon Kyl (R-AZ), Mark Kirk (R-IL), Roger Wicker (R-MS), David Vitter (R-LA), Jerry Moran (R-KS), Mike Crapo (R-ID), and Mike Johanns (R-NE), in a previously unreported letter sent Tuesday, and obtained by The Cable.
The letter was addressed to David Cohen, the acting undersecretary for terrorism and financial intelligence at the Treasury Department. Cohen took over for Stuart Levey, the previous sanctions chief at Treasury, who moved on to the Council on Foreign Relations last month after more than 4 years on the job.
The senators are threatening to hold up Cohen's nomination if their demands regarding enforcement of the sanctions provisions aren't met. Cohen had his confirmation hearing before the Senate Banking Committee on Tuesday and, afterwards, Kirk sent Treasury a list of follow-up questions he says must be answered before he'll allow Cohen's nomination to move forward.
"The acting undersecretary's response to our letter and questions for the record will weigh heavily in any confirmation decision," Kirk told The Cable.
Kirk also identified 44 international financial institutions servicing Iranian banks and 18 U.S. institutions that are working with those who do business inside Iran. He got this list from a 2010 report entitled "Iran's Dirty Banking", which sourced the information to the Banker's Almanac.
Kirk wants Treasury to require all U.S. banks to certify that any foreign banks they deal with aren't dealing with Iran. He also wants those foreign banks to certify that any banks they are dealing with aren't doing business with Iran. But Treasury's current plan calls for banks to provide such information only if and when the Obama administration asks for it.
"The object is to make sure we are doing anything and everything we can to drive Iranian business out of our banking system and this is how to do it," one senior GOP senate aide said.
"Large American banks and foreign banks that are operating here have not been hauled before Congress and have not been forced to tell the people and shareholders why they have not complied with the law," said another senior GOP aide.
Specifically, the aide said that the senators who signed the letter want Treasury to publish a final rule on implementation of the provision that requires audits of all banks' interactions with Iran on an ongoing basis. If that happens, the Cohen nomination can go through.
All of the senators who signed the letter, except for Kyl, are on the banking committee.
In his Tuesday testimony, Cohen defended the Treasury Department's efforts to tighten the noose around Iran's banking sector, including the passing of U.N. Security Council Resolution 1929 and subsequent successful efforts to convince European and northeast Asian countries to drop their Iranian banking ties.
Since 2006, Treasury has sanctioned 20 Iranian state-owned banks involved in facilitating Iran's nuclear program for penalties, and officials have traveled the world to try to convince foreign governments to take similar actions.
Cohen also said that sanctions against foreign owned banks that are working with Iran aren't necessarily the best tool in all cases, and indicated that there are more penalty decisions coming soon, such as the designation of more third country banks.
"The first best option is to get them to stop. Our second best option is to apply sanctions. And without getting too much into the details of any particular investigation that we're conducting, I can tell you that we are, I would say, close to a decision point on several institutions," he testified.
Matthew Levitt, a former deputy assistant secretary for intelligence and analysis at the Treasury Department and now a senior fellow at the Washington Institute for Near East Policy, said that Treasury was not against congressionally mandated sanctions, but believes they should only be used after all efforts to persuade foreign banks to shape up fail.
"What you have here is a struggle between two branches of government trying to get the same job done, but using two different paths to the same end," he said. "In some instances, it may be, you will get more compliance if you don't hit them with the hammer."
Levitt also defended the Treasury's efforts to put pressure on Iran's financial activities. "It's almost silly for anyone to claim the Treasury Department has been soft on Iran," he said.
The Obama administration and most of Washington may be focused on Libya or Pakistan, but several offices on Capitol Hill are preparing new sanctions bills to increase pressure on Iran.
Sen. Mark Kirk (R-IL) will kick off the slew of new Iran sanctions legislation expected to be introduced in May on Wednesday, when he introduces a new bill to promote human rights and democracy in Iran. He is working on a bipartisan and bicameral basis with Sen. Kirsten Gillibrand (D-NY), Rep. Robert Dold (R-IL), and Rep. Ted Deutch (D-FL). The bill, called the Iran Human Rights and Democracy Promotion Act of 2011, would force the administration to appoint a special representative on human rights and democracy in Iran and impose sanctions on companies that sell or service products that enable the Iranian regime to oppress its people, such as communications spying equipment.
At a press conference scheduled for Wednesday, Kirk will also host a family member of a Baha'i religious leader imprisoned in Iran.
But Kirk's bill is only one piece of the larger puzzle of Iran bills circulating on Capitol Hill right now. Two senior Senate aides told The Cable that the plan is to compile several Iran bills together into one massive, new Iran sanctions bill to be unveiled by the end of May.
"By the end of this month, there's probably going to be a comprehensive bill that deals with Iran on a variety of levels, including proliferation, human rights, and energy," one senior GOP Senate aide said.
A primary focus of that bill will be ways to increase pressure on companies based in other countries that are still doing business with Iran's energy sector.
Many in Congress are increasingly unhappy with the Obama administration for failing to enforce penalties on companies from third-party countries that are still doing business with Iran. The Comprehensive Iran Sanctions, Accountability, and Divestment Act (CISADA) of 2010 directs the administration to punish these companies. However, only a few have actually been punished -- and they hail from places like Belarus where the administration has little concern for delicate bilateral relations.
The details of the Senate's new comprehensive Iran sanctions bill aren't worked out yet, but there are several pieces of legislation floating around that could be included. For example, Gillibrand has a bill that would introduce criminal penalties against companies that fail to disclose their business ties with Iran.
Sen. Robert Casey (D-PA) introduced a bill last year that would make it harder for Iran to issue energy bonds -- the idea being to make the export of crude oil more costly and difficult. That bill could also reemerge as part of the new Senate comprehensive Iran package.
There's no official leadership for the Senate's new comprehensive bill yet, but the legislators most active on Iran have been Jon Kyl (R-AZ), Joe Lieberman (I-CT), and Kirk. The three wrote a letter March 28 to Secretary of State Hillary Clinton and Treasury Secretary Timothy Geithner on this very issue.
Over in the House, Rep. Ileana Ros-Lehtinen (R-FL) could unveil her own version of new sanctions legislation as well. Our sources say that the House is more focused on increasing enforcement of existing sanctions and closing loopholes -- as opposed to introducing new punitive measures -- but nothing is finalized.
But there's one thing both chambers agree on: the need to stop Chinese companies from undermining U.S. sanctions by backfilling the business Iran is losing due to the exit of American and European countries.
"There's just no doubt that China is going to be a big focus of our bill," the Senate aide said.
President Barack Obama and Israeli President Shimon Peres discussed how the Israeli-Palestinian peace process fits into the wave of democratization sweeping through the Arab world during a working lunch and then a 40 minute one-on-one meeting on Tuesday..
"We had an extensive discussion about what's happened in the Middle East," Obama said at a press conference after the meetings. "I think he and I both share a belief that this is both a challenge and an opportunity; that with the winds of change blowing through the Arab world, it's more urgent than ever that we try to seize the opportunity to create a peaceful solution between the Palestinians and the Israelis."
At the working lunch, Obama was joined by Secretary of State Hillary Clinton, National Security Advisor Tom Donilon, NSC Chief of Staff Brooke Anderson, NSC Senior Director Dennis Ross, incoming U.S. Ambassador to Israel Dan Shapiro, Special Envoy for Middle East Peace George Mitchell, and NSC Senior Director Puneet Talwar.
Both presidents expressed the opinion that bringing the Arab-Israeli conflict to a resolution would help the United States and Israel support democratic change in the Middle East.
"We see it as a clash between generations, a clash between those who want democracy and those who want to go backwards," an Israel official who was present at the lunch told The Cable. "One of the ways to make sure the right side wins is if there could be progress in the peace process."
The most immediate issue for Israel how to set good relations with the next government in Egypt. Obama said the two presidents discussed ways for both countries to support Egypt's economic development as a means of supporting the Egyptian youth. Peres believes restarting the Israeli-Palestinian peace process would also help Israel navigate its changing relationship with Egypt.
"Peres' message is that Palestinians and Israel now have a common interest to get to negotiations, because both sides want Egypt to continue to support the peace process," the Israel official said.
But Obama, following the breakdown of the direct negotiations he and Clinton worked so hard to push forward in 2010, warned Peres that he would only try again if he first saw increased commitment from both parties.
"Obama said he's willing to help, he's willing to push forward, but... he wants to see that a serious effort is being made and then he will add his weight," the official explained.
Obama and Peres also addressed the issue of Iran at their meetings. Peres noted that dealing with Iran is also a moral issue, because the Islamic Republic heads the anti-democratic camp in the region. The two presidents also agreed on continuing cooperation on missile defense against the Iranian threat and the necessity of maintaining economic sanctions on Tehran. .
According to the Israeli official, Peres told Obama that Israel is increasingly concerned about the flow of Russian strategic weaponry into the region and said that Israel wants to purchase an additional 20 F-35 fighter jets.
U.S. officials at the lunch raised the touchy issue of continued Israeli settlement building, but Peres didn't give any ground.
"Look, our policy hasn't changed," the official said, referring to Peres's position. "We have our differences with the administration but this has been our policy all along. We don't agree on everything."
Peres also asked Obama to consider clemency for convicted Israeli spy Jonathan Pollard, and he reminded the U.S. president that he has an open invitation to visit Israel whenever he wants.
Obama acknowledged both points but gave "no sort of reply one way or the other," the official said.
The State Department announced on Tuesday that it has decided to apply the recently passed Iran sanctions legislation to the Belarusian company Belorusneft. But GOP senators monitoring the implementation of the law said the move was marginal and unsatisfactory.
The action prevents Belorusneft, a subsidiary of the government-owned conglomerate Belneftekhim, from seeking any loans or doing any business in U.S. financial markets. The sanction was implemented under the Iran Sanctions Act (ISA) of 1996 as amended by the Comprehensive Iran Sanctions, Accountability, and Divestment Act (CISADA) of 2010. In a press release, the State Department focused on Belorusneft's 2007 $500 million contract with the NaftIran Intertrade Company (NICO), which is also being punished under U.S. sanctions.
"Since President Barack Obama signed CISADA into law on July 1, 2010, Iran's ability to attract new investment to develop its oil and natural gas resources, and to produce or import refined petroleum products, has been severely limited," the release said. "The State Department's direct engagement with companies and governments to enforce CISADA is raising the pressure on the Government of Iran."
State Department spokesman Mark Toner said on Wednesday that, in practical terms, the action prohibits Belorusneft from seeking assistance from the Export-Import Bank of the United States, obtaining U.S. government export licenses, obtaining private U.S. bank loans exceeding $10 million, and securing any procurement contracts with the U.S. government.
Belarusneft, the largest oil company in Belarus, hasn't actually tried to apply for any of those things, but Toner explained that the new announcement "also sends a message to our partners in Europe as well that this is a company that we've decided to sanction. And I'm sure they have access or would seek access into European markets." Toner didn't say if State was pushing the EU to follow suit.
Three senior senators who have been intimately involved in the Iran sanctions law and its implementation immediately shot off a letter to Secretary of State Hillary Clinton, obtained by The Cable, criticizing today's announcement as too weak.
"We are writing to express our disappointment with today's announcement that the administration designated only one additional entity for violating U.S. sanctions with regard to Iran," wrote Sens. Jon Kyl (R-AZ), Mark Kirk (R-IL), and Joe Lieberman (I-CT). "We do not believe this represents full compliance with the sanctions regime put in place by Congress."
"It appears that Chinese firms in the energy and banking sectors have conducted significant activity in violation of U.S. law," ten senators wrote to Clinton on March 10. "We cannot afford to create the impression that China will be given free rein to conduct economic activity in Iran when more responsible nations have chosen to follow the course we have asked of them. We are sure you agree."
The State Department's Bob Einhorn briefed senators on Capitol Hill on this very issue on March 11, but a senior GOP senate aide told The Cable that the meeting was disappointing.
The GOP senate offices in question see today's designation as marginal, especially as the parent company, Belneftekhim, was already sanctioned by the U.S. government in 2007 through Executive Order 13405, which targeted firms connected to President Alexander Lukashenko for human rights violations, and three other subsidiaries were sanctioned in 2008.
"It's a complete disappointment," one senior GOP aide told The Cable. "You would have thought they had already found a way to only designate the lowest hanging fruit when they sanctioned NICO. Alas, they found a lower hanging fruit."
A different senior GOP aide said the move sends the signal that the Obama administration only has the willingness to punish Iranian companies such as NICO and companies from other states that doesn't have close or critical relations with, such as Belarus.
"While the administration is patting itself on the back for its empty action today with Belarus, we can hear the sighs of relief coming from Tehran, Beijing, Ankara and Geneva where bankers, gasoline traders, and oil and natural gas financiers just realized that the Obama administration isn't serious about stopping Iran's nuclear weapons program," the aide said.
Dubowitz, executive director and head of the Iran Energy
Program at the Foundation for the Defense of Democracies, told The Cable that today's announcement "is a step in the
right direction for both human rights and national security, but it's only a small
and incremental one."
"The administration should be praised for moving against the energy lifeblood of both Belarus and Iran, two regimes which savagely repress their own people," he said. "But this was only a borderline meaningful designation since Belneftekhim and three other subsidiaries are already subject to designations. While a designation against this fourth subsidiary is helpful, the time for incrementalism is long past as Iran drives towards a nuclear weapon."
The wide-ranging sanctions law passed by Congress and signed into law by President Barack Obama last July calls for the administration to punish companies from third-party countries that are still doing business in Iran. However, U.S. senators still aren't sure whether the administration will follow through with this punishment, especially when it comes to companies in China.
A bipartisan group of 10 U.S. senators, led by Sens. Jon Kyl (R-KY) and Robert Menendez (D-NJ), wrote to Secretary of State Hillary Clinton on Thursday to demand an update on the State Department's investigation into these companies' ongoing business with the Iranian regime. Their letter was subsequently obtained by The Cable. Deputy Secretary of State James Steinberg announced that State's investigation began on Sept. 29, which means that law requires the results to arrive by March 29, the senators wrote.
"It appears that Chinese firms in the energy and banking sectors have conducted significant activity in violation of U.S. law," the senators stated. "We cannot afford to create the impression that China will be given free rein to conduct economic activity in Iran when more responsible nations have chosen to follow the course we have asked of them. We are sure you agree."
The State Department's Bob Einhorn is briefing senators on Capitol Hill on this very issue on Friday, a senior GOP Senate aide told The Cable.
In remarks at the Carnegie Endowment for International Peace on Wednesday, Einhorn addressed the issue directly, saying that "we continue to have concerns about the transfer of proliferation-sensitive equipment and materials to Iran by Chinese companies, there is substantial evidence that Beijing has taken a cautious, go-slow approach toward its energy cooperation with Iran."
That explanation won't be enough to satisfy the senators' demands for more active confrontation if Chinese companies are indeed flouting sanctions.
One of the main concerns on Capitol Hill is that as countries pull out from Iran, other countries will take over contracts, thereby nullifying the effect of the sanctions -- a practice known as "backfilling."
For example, the administration and Congress worked hard to convince Japan and South Korea to impose unilateral measures against Iran. However, there's particular concern that China firms will simply come in and take over those contracts.
Kyl and Sen. Chuck Schumer (D-NY) sent a letter to Clinton last October on this very issue, noting reports that China National Petroleum Company (CNPC) replaced the Japanese firm Inpex and agreed to invest around $2 billion to develop Iran's South Azadegan oil fields last year.
One week later, the Government Accountability Office (GAO) released a report that identified 16 companies that sold petroleum products to Iran between Jan. 1, 2009, and June 30, 2010. Of those 16, the GAO reported that five have shown no signs of curtailing business with Iran. Three of those companies are based in China, one in Singapore, and one in the UAE.
Other lawmakers who have pressed the administration to enforce Iran sanctions against China include Sens. Joe Lieberman (I-CT), Susan Collins (R-ME), Mark Kirk (R-IL), and Rep. Howard Berman (D-CA).
"Clearly, Congress -- on both sides of the aisle -- is losing patience and expects the administration to act," said Josh Block, a senior fellow at the Progressive Policy Institute and former spokesman for AIPAC. "If not, what kind of message are we sending to these companies in China and Venezuela and Turkey and elsewhere -- and their governments -- that are helping Iran break international isolation?"
Former FBI agent Bob Levinson is most likely alive and imprisoned in "southwest Asia," Secretary of State Hillary Clinton said in a statement Thursday.
"As we approach the fourth anniversary of Bob Levinson's disappearance, we have received recent indications that Bob is being held somewhere in southwest Asia," she said. "As the Government of Iran has previously offered its assistance in this matter, we respectfully request the Iranian government to undertake humanitarian efforts to safely return and reunite Bob with his family. We would appreciate the Iranian government's efforts in this matter."
The State Department offered no details on who is holding Levinson or where in "southwest Asia" he is being held. But Clinton's contention that he is alive and somewhere in the region is the first disclosure of new information on the case in quite a long time.
Levinson disappeared during a 2007 visit to Kish Island, a resort island owned by Iran known for its beauty and its status as a free trade zone where no entry visas are required. Levinson checked out of his hotel there March 9, 2007 but did not board his scheduled flight to Dubai.
U.S. officials have repeatedly asked the Iranian government to assist in the return of Levinson, who many believe was arrested by Iranian agents and held in Iran, at least for a time. The Iranian government has repeatedly denied knowing anything about his whereabouts.
While denying that Levinson was still working for the U.S. government, the State Department and the FBI have worked behind the scenes to try to gather information on his situation and secure his return. State Department officials have also met with Levinson's family members several times.
"Our family is tremendously encouraged by the news Bob is alive but remains concerned for his safety and well being," Levinson's wife Christine said in a statement Thursday.
So what was Clinton referring to when she said Levinson is in "southwest Asia?" The term is vague, even by government standards. There was a dispute over its borders in 2009 when Dennis Ross was given "southwest Asia" as his portfolio, leading State Department spokesman P.J. Crowley to define the region as Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, UAE, and Yemen. According to the CIA Fact Book, "southwest Asia" also includes Afghanistan.
The U.S. intelligence community has completed and is circulating a new National Intelligence Estimate (NIE) on Iran's nuclear weapons program that walks back the conclusion of the 2007 NIE, which stated that Iran had halted work on its covert nuclear weapons program.
Intelligence officials briefed executive branch policymakers on the revised NIE last week. The document is being shared with members of Congress and their staff this week, an administration official and several Capitol Hill sources told The Cable. This is in advance of an early March meeting of the International Atomic Energy Agency's Board of Governors, where there may be another resolution on Iran's nuclear program, the official said.
The 2007 NIE was attacked in public due to its conclusion: "We judge with high confidence that in fall 2003, Tehran halted its nuclear weapons program." The new estimate might not directly contradict that judgment, Hill sources report, but could say that while the intelligence community has not determined that Iran has made the strategic decision to build a nuclear weapon, it is working on the components of such a device.
Several sources said they are being told there will be no declassified version of the new NIE, and that only those cleared to read the full 2007 NIE (pdf) will be able to see the new version.
"It does exist," House Intelligence Committee chairman Mike Rogers (R-MI) said in an interview with The Cable. Rogers said the administration was right to take its time to revise the 2007 NIE before releasing the updated version. "Intelligence is a fluid thing, sometimes you get great stuff and sometimes you don't get great stuff to make good conclusions. I think they were prudent in what they've done."
House Foreign Affairs ranking Democrat Howard Berman (D-CA) told The Cable he had heard the new NIE would walk back the controversial conclusions of the 2007 version, but that he hadn't read it yet. Regardless, he said, the 2007 Iran NIE was now obsolete and discredited.
"Nobody had been paying attention to the older NIE. A few people on the outside focused on it because they didn't want us to go down the sanctions route but neither the administration nor the Congress paid it much attention," Berman said. "I thought the NIE estimate then was a faulty one because it focused on some aspects of weaponization -- even as Iran was continuing to enrich."
Revelations that Iran had a secret uranium enrichment facility at Qom, which occurred after the release of the 2007 NIE, were further proof that the Iranian regime was pursing nuclear weapons, Berman said. Regardless, the Obama administration has disregarded the 2007 Iran NIE, he said.
"For a year and a half the administration has been convinced that Iran has been pursuing a nuclear weapon. That's what they whole sanctions push is based on," Berman said. "There can be no serious doubt that Iran wants to have a nuclear weapons capability."
Sen. Mark Kirk (R-IL), a former intelligence officer for the U.S. Navy, told The Cable, "The 2007 NIE was a mistake," and this document appears to be more realistic. He urged the intelligence community to take a less technical and more comprehensive look at the Iranian leadership's actions when making such judgments.
"My hope is that the current leaders of the intelligence community look not just at technical details and also comment regularly on Iran's leaders," Kirk said. "In Intelligence 101 we are taught to measure both capability and intent politically, and the intent here on the part of the Iranian regime is pretty clear."
Several lawmakers refused to discuss the new NIE because it was classified or because they hadn't read it yet. Senate Armed Services Committee ranking Republican John McCain (R-AZ) told The Cable he had been briefed on the new NIE, but declined to comment on its contents. Senate Intelligence Committee chairwoman Dianne Feinstein (D-CA) told The Cable she hadn't yet seen the new NIE but planned to review it soon.
Senate Armed Services Committee Chairman Carl Levin (D-MI), who supported the conclusions in the 2007 NIE, contended that the old estimate was misconstrued as an attempt by its authors to head off an attack against Iran by the Bush administration.
"I think it was interpreted incorrectly," Levin told The Cable.
The NIE is compiled by the National Intelligence Council, but rollout and classification decisions are ultimately made by Director of National Intelligence James Clapper.
Levey will resign next month and the administration will nominate Cohen to replace him next week, a senior administration official told The Cable. Levey has been serving as the under secretary for terrorism and financial intelligence since 2004; Cohen has been assistant secretary for terrorist financing since 2009. The Cable received e-mailed statements from several top Obama administration officials praising Levey's tenure and pledging that the drive will continue unabated to increase and enforce sanctions on Iran, North Korea, and groups that financially support violent extremist groups.
The resignation comes just as the latest round of talks between the P5+1 countries and Iran regarding its nuclear program seem to have sputtered and even Secretary of State Hillary Clinton has indicated more sanctions could be in the offing.
"It will have no effect on policy, or on our ability to execute the President's policy," said Treasury Secretary Timothy Geithner. "David came to Treasury with well established outside expertise and has worked at Stuart's side for the last two years."
Geither said that when the Obama administration took office, Levey had agreed to stay for six months but ended up staying for over two years.
"There's no perfect time for these things. But this is as good a time as any," said Geithner.
Geither called Levey "tremendously effective" and "the best mixture of toughness and creativity," and credited him with convincing a host of public and private actors to join the U.S. government's fight to name and shame organizations that help rogue states and non-government actors finance illicit activities.
For example, Levey's team was instrumental in convincing Japan and South Korea to take step to end their business with Iran's energy sector after President Obama signed new sanctions legislation last July. In 2006, Levey's team led the drive to publicly accuse Macau's Banco Delta Asia of doing laundering money for the North Korean regime.
"Every financial institution anywhere in the world needs to preserve its reputation for integrity in order to do business globally and especially in the U.S....Stuart has been able to use that reality as an incentive to get the private sector to move to reinforce our policies," he said.
White House counterterrorism advisor John Brennan said in a statement that Levey's work had directly degraded the capabilities of those who seek to do the U.S. harm.
"Stuart has helped save lives, and our country owes him a strong debt of gratitude," said Brennan. "While we will greatly miss Stuart's involvement in these ongoing efforts, we are very fortunate to have someone of David Cohen's caliber and in-depth experience to build upon Stuart's outstanding work."
National Security Advisor Tom Donilon said that Levey had elevated Treasury's role in the national security sphere and praised his work on devising and enforcing sanctions on Iran.
"Stuart designed and executed innovative financial strategies for targeting terrorists, proliferators, and other illicit actors, and built an international consensus around the use of targeted sanctions as an effective means of combating threats, pressuring regimes, and safeguarding the financial system," Donilon said.
The Wall Street Journal, which first reported Levey's departure, said that Levey had not yet decided what to do next. Here's how the paper described Levey's tenure:
The Ohio native traveled widely across Asia, the Middle East and Europe to press foreign governments and businesses to cut off their financial ties to Iranian and North Korean entities believed to be involved in weapons proliferation and terrorism. Since 2004, he has also built up Treasury's Office of Terrorism and Financial Intelligence into a major cog in the U.S. national-security apparatus, with more than 700 people involved in activities such as tracking illicit financing and approving export licenses for sensitive technologies.
Treasury officials now have a prominent seat in virtually every national-security debate.
Levey's work on Iran and North Korea sanctions also earned his praise today from Capitol Hill, where sanctions hawk Sen. Joseph Lieberman (I-CT) praised Levey's impact on the overall financial sanctions regime.
"Indeed, what David Petraeus has done for counterinsurgency warfare, Stuart Levey has done for economic warfare -- completely rewriting the book on the subject," Lieberman said.
The Cable goes inside the foreign policy machine, from Foggy Bottom to Turtle Bay, the White House to Embassy Row.