Insider news & Analysis in Iran

By INU Staff
INU - On Thursday, Senator Tom Cotton appeared on MSNBC’s “Morning Joe” to discuss his reaction to last week’s announcement that the Department of Energy would be purchasing 32 tons of Iran’s heavy water, associated with the production of plutonium, at a price of 8.6 million dollars. During the brief interview, Cotton repeatedly described the plan as using taxpayer money to “directly subsidize the Iranian nuclear program.”

In line with this criticism, the Arkansas Republican added a last-minute amendment to a Department of Energy spending bill that Congress was set to vote on this week, in which he specified that taxpayer money could not be utilized for similar such purchases in the next budget year. As a result, Senate Democrats blocked the bill on Wednesday, in spite of the fact that its other provisions had reportedly had strong bi-partisan support.

Those Democrats described Cotton’s amendment as a “poison pill,” but CNN points out that his Republican supporters countered that the Democrats had refused a simple majority vote on the amendment, possibly out of concern that fellow Democrats would side with Cotton on the issue.

Indeed, a number of Democrats have joined the Republican Party in opposing or generally criticizing the Iran nuclear deal and the Obama administration’s overall Iran policy. Despite this fact, the Democratic minority succeeded in preventing a vote of disapproval on that deal last year, by utilizing congressional filibuster rules. Similarly, this week’s budget bill was blocked by minority opposition, as it needed 60 “yay” votes to advance but received only 50, as compared to 46 votes of “nay.”

Cotton has been a particularly strong voice of opposition to the White House’s Iran policy, having previously drawn stark criticism for convincing 46 of his fellow congressmen to sign a letter to the Iranian government announcing that the US government in the near future might elect to simply not enforce the agreement reached between the Obama administration and its Iranian counterpart.

The newer controversy over the purchase of heavy water comes close on the heels of largely Republican accusations that the Obama administration was considering a change in Treasury Department rules which would effectively give the Iranians access to the US dollar and the American financial system. The administration had previously promised Congress that this would not happen as a result of implementation of the Joint Comprehensive Plan of Action. The perceived betrayal of that promise was viewed as potentially giving away virtually the last bit of leverage that the US government had over Iran and its nuclear ambitions.

The Iranian regime had publicly taken issued with the retention of that leverage in recent weeks, with Iranian Supreme Leader Ali Khamenei accusing the US of implementing the JCPOA only “on paper,” while still scaring away international banks and some European businesses from reentering the Iranian market. Officials from the administration of Iranian President Hassan Rouhani have echoed these criticisms, apparently prompting two meetings last week between Foreign Minister Mohammad Javad Zarif and US Secretary of State John Kerry.

It is recognizably true that the ongoing separation of the Iranian and American financial systems is a contributing factor in keeping some investors and potential partners out of Iran. But many analysts have also observed that such decisions are also based on the legitimate fear that Iranian behavior will justify or even necessity the re-imposition of US-led economic sanctions at some point in the future.

This assessment of the situation was repeated on Thursday by Economy Watch, which reported that the Washington-based World Bank was still noticeably reluctant to reengage with Tehran following the implementation of the nuclear deal. The organization’s president, Jim Young Kim says that the World Bank has no specific plans at the current time, but Economy Watch says that the World Bank is not exploiting the lack of official restrictions yet because it wishes to remain on good terms with its host country, the US.

The article adds that the lending institution is no doubt aware of the possibility that relations between the two countries could rapidly deteriorate from the current climate of rapprochement. To be sure, the push-back from Cotton and other critics of the deal is a contributing factor in this, but so too is the anti-Western sentiment that is regularly being expressed by the Iranian regime, which arguably justifies a Republican response.

The World Bank and other international businesses may feel even more reticent in the midst of reminders of the possible consequences of falling afoul or lingering or re-imposed economic sanctions. As outstanding issues continue to be resolved and other instances of tension continue to develop between Iran and the West, these are not difficult to come by. The most recent such reminder comes in the form of the arraignment of Reza Zarrab, who was the key-figure in a scandal that emerged three years ago involving Turkish evasion of sanctions on Iran.

Radio Free Europe / Radio Liberty reminded readers of the details of that scandal on Thursday, noting that the case involves hundreds of millions of dollars’ worth of transactions. The fresh memory of such illicit activities no doubt serves to underscore Western critics concerns about Iran’s behavior and the possible danger of providing money to a financial system that remains the State Department continues to regard as being of “primary money laundering concern.”

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