State Department Official Downplays Iran’s Strategic Influence

By Adam Graham-Silverman

Congressional Quarterly

July 9, 2008

On the same day Iran test-fired missiles in a show of force in the Persian Gulf, the Bush administration Wednesday sought to downplay the country’s power and influence.

“For its part, Tehran seems to relish heightening concerns by promoting the illusion that Iran is on the ascendance,” Undersecretary of State William Burns said in prepared testimony for the House Foreign Affairs Committee. “However, Iran is not 10 feet tall, nor is it even the dominant regional actor.

“Iran has no real friends anywhere that could offer strategic reassurance, vital investment, or a secure future in a globalized world.”

That statement seemed at odds with the friendly relations Iran maintains with some of its neighbors, including Iraq, Russia and Turkey — a situation committee members pointed out.

In his prepared remarks, Chairman Howard L. Berman , D-Calif., called on the United States to enforce sanctions against European countries and companies that do business with Iran.

“It is time for our European allies and their corporations to cease investing in Iran,” he said. “It’s time for them to take far more significant steps along the lines of cutting off all significant commerce with Iran, as we did years ago – or at least I thought we did.”

That last comment was a reference to an Associated Press report Tuesday that found that despite heavy sanctions, the United States sent Iran $546 million in goods from 2001 through last year.

Some items like medicine and agricultural products are exempt, but the AP report also found that the Treasury Department has issued 2,821 licenses to trade with Iran and denied only 178 applications. Cigarettes were the largest commodity going to Iran — $158 million under President Bush, AP reported.

Since their initial enactment in 1996 (PL 104-172), sanctions against Iran have never been applied to foreign entities, largely because of strong opposition from the European Union, which considers them an extraterritorial application of U.S. law. Critics say the Clinton and Bush administrations have been unwilling to ruffle European feathers or inconvenience multinational corporations.

Burns, the No. 3 official at State, quoted President Bush in his prepared testimony to emphasize the need for continued multilateral, not unilateral efforts.

Burns pointed out that the European Union has recently stepped up its sanctions against Iran, including an asset freeze on its largest bank, Bank Melli.

“The international community is more unified than in the past on the necessity for Iran to fully and verifiably suspend its proliferation sensitive nuclear activities and reestablish international confidence in the peaceful nature of its nuclear program,” Burns said. “Many foreign investors, particularly from Iran’s historic trading partners, are reluctant to commit capital in such a precarious political environment and while Iran continues to pursue threatening policies.”

Berman also called for direct, unconditional talks with Iran in order to keep it from obtaining a nuclear weapon, which he said would set off an arms race among Persian Gulf states and terrorist groups and effectively end the international nuclear arms control regime.

“Achieving nuclear status would exponentially increase Iran’s influence and the appeal of fundamentalism throughout the Islamic world,” Berman said.

Burns said the United States remains ready to talk, making no mention of U.S. policy that Tehran set aside its nuclear program as a precondition for negotiation.