The Flaws in Both Sides-ing the Iran Crisis

William Burns and Jake Sullivan, two veterans of the Obama administration, had a co-authored op-ed in the New York Times yesterday. The piece, entitled “It’s Time to Talk to Iran,” makes a relatively predictable case for negotiations between Tehran and Washington as a path towards de-escalation. This predictability is rooted in the authors’ decision, in the well-established tradition of legacy media, to Both Sides the issue to death.

Here’s a smattering of their work: 

  • “We are now at a very dangerous point. The story of how we got here is one of faulty expectations on both sides.” 
  • “To start, both sides need to reset their expectations, and begin a step-by-step de-escalation that could create the basis for a longer-term resolution.”
  • Both sides should also seek to reduce tensions more broadly.”
  • “But we are where we are, and we know where we’re headed, especially given the surplus of mutual enablers in both Tehran and Washington.”

Placing the burden and, by extension, the blame on both parties ignores the critical fact that it was the United States, not Iran, that ignited this crisis in the first place. Iranian officials have repeatedly tried, in vain apparently, to make this point, noting that because the United States was the party originally at fault, the onus to take the first step back to the table is on them. American pundits and commentators — even ostensibly liberal-minded ones like Burns and Sullivan — simply refuse to listen to and understand the Iranian perspective.

What’s worse, Burns and Sullivan base their argument that Iran needs to take action on faulty assumptions. Illustrative of that, consider the point they are trying to make about expectations.

Burns and Sullivan argue that the Trump administration misunderstood its ability to bring Iran to its knees via its “maximum pressure” campaign. Instead, Trump provoked Iran to pursue “increasingly provocative actions in the gulf [sic], and started advancing their nuclear program.” So far, so good. This was indeed a misguided, misinformed, and useless attempt at compelling Iranian capitulation.

Over on the other side of this perfectly balanced equation, Tehran is guilty of underestimating its ability to run out the clock on Trump in the hopes that a new, presumably Democratic president in 2021 would bring the United States back into the Iran Deal. Burns and Sullivan highlight Iran’s economic woes as evidence of this alleged miscalculation:

But the pressure of economic sanctions, unilaterally reimposed by the United States, has been more formidable than Iran anticipated. Inflation is at 50 percent, and oil exports, the lifeblood of Iran’s economy, have declined from 2.5 million barrels per day to as little as a couple of hundred thousand this past summer.

Here, the authors’ feelings begin to diverge from the facts. While it’s true that Trump’s oil embargo has been particularly effective at reducing Iranian oil exports to near-zero levels, the rest of the sanctions program has not been nearly as devastating as they suggest.

I’m speculating, but I doubt Burns and Sullivan spend much time rummaging through the Statistical Center of Iran’s (SCI) website. Luckily, Djavad Salehi-Isfahani, a Virginia Tech (go Hokie Birds!) economics professor, does. In a post for Lobelog published last month, Salehi-Isfahani wrote that Trump’s pressure campaign “has not caused anything resembling economic collapse. Furthermore, these data suggest that the economy is not in a steep decline, one that would anytime soon force Iran to capitulate.”

Salehi-Isfahani points out that even with the decline in GDP following the reimposition of sanctions, GDP remains above its 2015 pre-deal levels. Services output and agriculture, which account for approximately two-thirds of Iran’s non-oil GDP, have stayed relatively stable. Scarcity is not yet an issue, as supermarket shelves remain stocked, and while high-prices have damaged the purchasing power of consumers, it hasn’t yet reached the point of inducing mass protests.

In a follow-up post on his personal blog, Tyranny of Numbers, Salehi-Isfahani delved deeper into the inflation numbers. Contrary to what Burns and Sullivan suggest, Iranian inflation has been in steady decline over the past year:

According to the latest consumer price index data published by the Statistical Center of Iran, during the Iranian month of Shahrivar (August 21-September20, 2019) inflation reached its lowest level since Trump’s assault on Iran’s economy began 18 months ago: the CPI increased at an annual rate of just 6.1 percent.

As Salehi-Isfahani notes, this does not mean that the Iranian economy is out of the woods just yet. There are plenty of unanswered questions about what the future might hold and whether or not this trend can continue. For the moment, at least, it seems reasonable to think that Iran is still pretty far from the breaking point. Until then, there’s no reason to believe that Iran won’t continue trying to ride out the Trumpian wave.

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