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Where’s My Trigger?! Your Weekly Iran Sanctions Update

This week saw more confident language surrounding ongoing UN sanctions talks:

“I am very confident that unless Iran does something significant that demonstrates that it is taking confidence building measures, I am very confident we will get a Security Council resolution that is supported by the majority of the UN Security Council.”

In his comments this past Tuesday, White House WMD czar Gary Samore confirmed his belief that both Russia and China are likely to support an eventual resolution.

Unfortunately, Samore is not so confident about the zombie fuel swap, noting that that current Brazilian and Turkish efforts are unlikely to achieve a diplomatic breakthrough and, as such, the US is holding out little hope for the deal.

“The Iranians have frankly not been prepared to accept that offer, it’s pretty clear to anybody,” Samore said, “and Turkey will soon satisfy themselves of that.”

He also added that Iran’s “nuclear clock is not moving as quickly as some feared, because of problems the Iranians have had in terms of their centrifuges,” but declined to say whether the centrifuge problems were a result of alleged Western attempts to thwart work by the machines.

Meanwhile, Congress is hard at work making the case against exemptions for cooperating countries from corporate sanctions, such as those requested by the administration…

On Wednesday, the Senate Homeland Security and Governmental Affairs Committee, led by Chairman Joe Lieberman, heard testimony from GAO that, despite existing US sanctions, seven firms involved in the Iranian oil, gas and petrochemical sectors received $880 million in US government contracts over the past four years.  

CQ Today reports that:

Although the GAO report, dated May 4, did not attempt to determine whether the seven firms violated the existing U.S. sanctions enacted in 1996, senators were quick to interpret the findings from Congress’ independent investigative arm as further evidence that successive administrations have failed to enforce the restrictions.

Lieberman made clear after the hearing that “a lot of the ‘should’s’” in the 1996 bill language will need to “become ‘shall’s’” this time around.

To that end, Lieberman announced that he would put together a letter to both Hillary Clinton and Robert Gates detailing the panel’s concerns, including the GAO’s latest findings.

Though it may look like the administration has dropped a pretty significant ball here by not pressing harder for exceptions, especially when those same exceptions could potentially make or break the aforementioned, very confident, support needed for UN sanctions, it seems that the administration may be busy waging its own private, very sanction-ish, campaign on the sidelines.  

Since March, a significant number of foreign companies have announced plans to cut, suspend, or rein in ties with Iran, including oil majors Eni, LUKOIL and Royal Dutch Shell, Indian refiner Reliance Industries, US construction and mining equipment maker Caterpillar, and luxury German carmarker Daimler.  KPMG, PricewaterhouseCoopers, and Ernst & Young have also declared themselves free of any business ties to Iran.

Reuters reports that all this may be the handiwork of Stuart Levey, Under Secretary for Terrorism and Financial Intelligence, who has been traveling to foreign capitals to talk to governments, financial regulators, banks and business leaders for months:

“We view the business community as an ally and we talk to them in that sense. We have information regarding Iranian illicit conduct that they might not have, and we provide them with the advantage of our viewpoint so they can better assess their own risks.”

Levey notes that his goal not to squash Iran’s economy completely, and he would prefer to minimize the impact of these cuts on Iran’s citizens, but “It’s hard to get it surgically precise.”

Three Quick Thoughts on the Gates Op-Ed

Secretary of Defense Robert Gates has an Op-Ed in today’s Wall Street Journal on New START.  The last paragraph is the key paragraph:

The New START Treaty has the unanimous support of America’s military leadership—to include the chairman of the Joint Chiefs of Staff, all of the service chiefs, and the commander of the U.S. Strategic Command, the organization responsible for our strategic nuclear deterrent. For nearly 40 years, treaties to limit or reduce nuclear weapons have been approved by the U.S. Senate by strong bipartisan majorities. This treaty deserves a similar reception and result—on account of the dangerous weapons it reduces, the critical defense capabilities it preserves, the strategic stability it maintains, and, above all, the security it provides to the American people.

 My takeaways:

1. Given that DoD plans to deploy up to 240 SLBMs and keep 14 boomers (probably 12 deployed with 20 SLBMs each and 2 in overhaul), we’re really going to be putting Section IV of Part III of the Protocol and the Ninth Agreed Statement to work.  Amy Woolf runs the numbers here.

2. The Senate ICBM coalition fared pretty well. It looks like one squadron of 50 Minuteman III ICBM’s will now become non-deployed, but DoD will retain all 450 silos.  Recall that non-deployed ICBMs are not limited by the treaty, so the U.S. will not have to destroy the extra missiles.  There also appears to be a built-in ceiling of 20 ICBMs for a prompt global strike capability, in the event that DoD decides to deploy it.Update 5/13: Upon closer inspection it looks like the 420 number for deployed ICBMs probably has nothing to do with Prompt Global Strike. Jeffrey asks some questions here . I think the key point, as he notes, is that the administration has seven years to figure out how to get down to 700 deployed delivery vehicles, and they may not be quite sure how they’re going to do that yet.

3. I was glad to see Gates say that the treaty “limits significantly U.S. and Russian strategic nuclear arsenals” instead of something like“the limit is 30 percent lower than the limit in SORT.” The former formulation is more accurate.

Gates Calls for Real Spending Priorities

By Lt. Gen. Robert Gard and Laicie Olson

This conjunction of an immense military establishment and a large arms industry is new in the American experience. The total influence – economic, political, even spiritual – is felt in every city, every Statehouse, every office of the Federal government. We recognize the imperative need for this development. Yet we must not fail to comprehend its grave implications. Our toil, resources and livelihood are all involved; so is the very structure of our society. – President Dwight D. Eisenhower

Invoking the memory of President Eisenhower’s farewell address last weekend, Defense Secretary Robert Gates delivered a fiery speech aimed at overhauling the Pentagon’s budget and restructuring its bureaucracy.

This rhetoric is anything but new, and builds on previous initiatives set out by the Secretary.  

Just last Monday at a Navy League conference, Gates urged the Navy and Marine Corps to think more deeply about the challenges facing their costliest platforms – including aircraft carriers that run $11 billion each, future ballistic missile submarines costing $7 billion apiece and a Marine Corps amphibious assault vehicle “suited only to Eisenhower’s D-Day planning.”

While he later joked that he is “not crazy” and wouldn’t just cut out a carrier, the speech ruffled more than a few feathers.

It also pointed to just a few of the many extreme cases in which U.S. defense outweighs that of other countries (h/t to Chris Hellman):

The U.S. operates 11 large carriers, all nuclear powered.  In terms of size and striking power, no other country has even one comparable ship.

The U.S. Navy has 10 large-deck amphibious ships that can operate as sea bases for helicopters and vertical-takeoff jets. No other navy has more than three, and all of those navies belong to our allies or friends.  Our Navy can carry twice as many aircraft at sea as all the rest of the world combined.

All told, the displacement of the U.S. battle fleet – a proxy for overall fleet capabilities – exceeds, by one recent estimate, at least the next 13 navies combined, of which 11 are our allies or partners.

“It is not a great mystery what needs to change,” Gates said. “What it takes is the political will and willingness, as Eisenhower possessed, to make hard choices — choices that will displease powerful people both inside the Pentagon and out.”

Gates is seeking $10 to $15 billion in savings from the $547-billion Pentagon base budget, a number that has risen to astronomical heights:

The attacks of Sept. 11, 2001, opened a gusher of defense spending that nearly doubled the base budget over the last decade… Military spending on things large and small can and should expect closer, harsher scrutiny. The gusher has been turned off, and will stay off for a good period of time.

This cut will not, however – as one might expect – contribute to an overall lowering of the Pentagon’s budget.  Instead, resources will be redirected, as they usually are, to fund more essential and more relevant capabilities – “tail to tooth,” as they say.

Unfortunately, Congress is unlikely to be helpful. It sees the Defense budget as a jobs bill; continually appropriating funds for such programs as yet more unneeded C-17 aircraft and an unwanted second engine for the Joint Strike Fighter. It also loads the budget with billions to reward contributors and fund pet projects.  

In future Pentagon budgets, Gates hopes to cut overhead costs and transfer the savings to force structure and modernization within the programmed budget.

“What I’m asking for is not a simple budget cut; I’m talking about changing the way we do business. It’s taking the savings from that and applying it to long-term investments,” he said. “This is a lot harder than cutting the budget for one year.”

This may not be the revolution some had hoped for, but it may be a start.

Gates did not attack the Pentagon’s misguided procurement requests or call for a freeze on defense spending, but he did call for setting real priorities, and he even specified a few.

Lamenting that the gap between him and an action officer may be as high as 30 layers, Gates noted that “A request for a dog-handling team in Afghanistan – or for any other unit – has to go through no fewer than five four-star headquarters in order to be processed, validated, and eventually dealt with.”

Therefore, as the Defense Department begins the process of preparing next’s years Fiscal Year 2012 budget request, I am directing the military services, the joint staff, the major functional and regional commands, and the civilian side of the Pentagon to take a hard, unsparing look at how they operate – in substance and style alike.

According to rumors, Gates may be building a second portfolio of cuts similar in scope to those he made on April 6, 2009.

“When it came to defense matters, under Eisenhower, real choices were made, priorities set and limits enforced.”  If Gates meant what he said on Saturday, the cuts will be substantial.

Gates’ Other Speech

While everyone may still be talking about Gates’ recent speeches at the Navy League Sea-Air-Space Exposition and Eisenhower Library (analysis to come), Gates delivered another speech this past week you may be interested in (h/t to Small Wars Journal).

The speech addressed students at the U.S. Army’s Command and General Staff College in Fort Leavenworth, Kansas, and focused on an issue I’m sure we are all very familiar with:

Good afternoon.  Thank you, Kevin, for the introduction.  I can tell you it is good to be out of D.C. and back in my home state – at least for a short visit.

However, I realize that it is Friday, and after lunch, so I will be content with thanking you for staying awake, or trying to anyway.

Of course, falling asleep in a leadership class or here is one thing.  Falling asleep in a small meeting with the president of the United States is quite another.  But it happens.  I was in one cabinet meeting with President Reagan where the president and six members of the cabinet all fell asleep.

In fact, the first President Bush created an award to honor the American official who most ostentatiously fell asleep in a meeting with the president.  This was not frivolous.  He evaluated candidates on three criteria – first, duration – how long did they sleep?  Second, the depth of the sleep; snoring always got you extra points.  And third, the quality of recovery – did one just quietly open one’s eyes and return to the meeting, or did you jolt awake – and maybe spill something hot in the process?  Well, you will appreciate that the award was named for Air Force Lieutenant General Brent Scowcroft, who was the national security adviser at the time.  He was, as you might suspect, the first awardee, and, I might add, won many oak leaf clusters.

Click here for the full transcript.

Iran and North Korea – Growing Connections

News has surfaced that Iran has invited Kim Jong-Il to Tehran in order to ‘to further economic ties’.  The invitation comes amid a flurry of recent diplomatic contact between the two states.  Two weeks ago, an Iranian delegation led by Vice-Minister Mohammad Ali Fathollahi met with Kim Yong Nam, de facto head of the North Korean state, to hold talks regarding ‘bilateral political, economic and cultural relations’ and ‘international and regional issues’.  Last week Iran’s ‘Press TV’ subsequently reported that Kim Yong Nam will visit Iran this summer to launch a ‘scientific and cultural exchange program’ between the two countries.  

Even if suggestions that Kim Jong-Il has an aversion to flight are true (thus rendering the idea of him visiting Tehran unfeasible), that the invitation was sent is in and of itself significant.  Indeed, it marks the greatest diplomatic contact between the two countries since their recognition of one another diplomatically in 1979.  Given their shared history of missile collaboration, however, these closer ties raise some disconcerting questions…

Regarding economic relations, Iran’s Oil Minister Kazem Vaziri Hamaneh said in 2007, that ‘Both nations can cooperate in the fields of exploration, production and other fields of the energy sector’.  It is well known that Pyongyang has had difficulties obtaining crude oil for many years, and that Tehran lacks enough refined petroleum to meet domestic demand.  As such, Hammeneh summarized his Iranian-Korean proposal as ‘North Korea [getting] oil from Iran and [providing] Iran with a surplus of its own refined petrol’.  However, a closer look reveals that this concept doesn’t quite add up.

According to research released by Choi Su Young just three months after Hamaneh’s statement, North Korea was at the time importing its ‘entire amount of petroleum for transportation and production’.  The CIA World Factbook 2010 states today that this situation remains unchanged, with North Korea only importing – not exporting – petroleum.  Indeed, so reliant has the DPRK’s been on importing petroleum that it remains highly unlikely that Pyongyang has ever had a surplus of petroleum to export.  Thus, the notion that North Korea might import extra heavy oil from Iran to refine it into petroleum for export back to the Iranian market seems far fetched, especially due to the extreme distances and costs involved.  So if North Korea is getting oil from Iran, what might Pyongyang be getting in return?

Well, history shows that in the 1980s and early 1990s Iran got arms in return.  Early in its war with Iraq, Tehran bartered with North Korea to obtain conventional Soviet technology in exchange for crude oil.  Similarly, Iran used its oil in 1993 to invest in the research and development of North Korea’s new No-Dong missile, which helped greatly in the establishment of an indigenous Iranian missile production infrastructure.

Recent reports suggest that Iran may be continuing to purchase arms from North Korea – although with what intensity is unclear.  An article from 2007 stated that Iran may have received four mini submarines from North Korea.  In August 2009, the UAE intercepted a ship carrying DPRK-manufactured munitions bound for Iran.  And just days ago, Shimon Peres stated that North Korean entities were continuing to supply weapons to both Iran and its affiliates, although admittedly without any evidence.

Whether Iran is still purchasing missile technology from the DPRK today seems less likely, due to the more advanced state of the Iranian missile / space program.  That said, there does appear to still be some evidence detailing scientific cooperation in this area, with Iranian nationals allegedly dispatched to North Korea to assist in last April’s attempted satellite launch.  The Department of Defense’s April 2010 report on Iran’s military power states that “In developing and expanding its missile program, Iran has received assistance from North Korea and China,” but it does not elaborate on what form this assistance has taken or when it occurred.

In the nuclear domain it is interesting to note the sympathetic regard Iran and North Korea have for each other’s respective programs.  Following North Korea’s 2006 test Iran targeted the totality of its criticism at the U.S (for provoking it). Likewise, following Pyongyang’s 2009 test, Tehran simply denied that it had been involved – it did not criticize North Korea.  For its part, North Korea’s ambassador to Tehran, Kim Chon Ryong, reportedly has expressed North Korea’s support for Iran’s right to peaceful nuclear technology.  How far cooperation in the nuclear domain goes or will go beyond this mutual deference is unclear.

Overall, it is evident that Iran and North Korea are forging closer and closer ties – a worrisome development.  And further sanctions would likely ensure that these ties continue to flourish.