Will sanctions persuade Iran to stop building nuclear weapons? No such question can be answered with finality, but it is more likely that the Obama administration’s graduated sanctions will accelerate Tehran’s efforts to acquire nuclear weapons. The Obama administration, according to news accounts, is aghast that Israel might take preemptive action rather than give sanctions time to work. Sanctions, though, are more likely to prompt Iran to stake everything on the nuclear card. The last time the West dealt with a similar case, the prospect of economic collapse and the fear of regime change motivated the outbreak of World War II.
Iran is planning to double its defense budget even though its currency is collapsing. These are related events: in the medium term, the free-fall of Iran’s rial constitutes a transfer of wealth to the government from what remains of Iran’s private sector. As the Washington Post reported yesterday, “The government, which receives oil revenue mostly in dollars and euros, is profiting from the rial’s decline, analysts said. ‘Their income is in dollars, so a strong dollar helps them to buy more rials to pay their bills,’ said one prominent economist, who asked not to be identified, for fear of reprisals.” At least for the time being, sanctions strengthen the relative position of the regime, while undermining its long-term staying power — unless, of course, Tehran begins a new set of regional wars under a nuclear umbrella.