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The way to deal with Iran
By Roger Cohen
Published in The Saudi Gazette on 20 - 02 - 2010

Here's what happens when a business linked to Iran's Islamic Revolutionary Guards Corps (IRGC) is targeted with sanctions. A representative of the Revolutionary Guards finds a lawyer in Dubai and says: “Look, I'm on this stupid US Treasury list. I'll give you 10 percent. Help me set up a shell company in Dubai or Malaysia.”
Revolutionary Guard tycoons in Tehran know that. Once they have a new shell company, say in a cousin's name, they circumvent the list. They go on reaping the heady profits open to the in-crowd when sanctions distort an economy.
Iran has lived with sanctions for a long time; its immune systems are highly developed. As much as 20 percent of the gross national product of Dubai is linked to Iran trade. I don't see new “targeted” sanctions disrupting this traffic. Iran's economy, even in a slump, is too big, too diverse and too sophisticated: North Korea it is not.
Still, thanks to Iran's erratic response to President Obama's overtures and its ongoing nuclear nationalism (a more coherent political than weapons program), the United States finds itself in lockstep toward new sanctions.
I expect China, averse to conspicuous isolation, will eventually abstain on a new round of UN sanctions on Iran. They will be imposed. Stuart Levey, the undersecretary of the Treasury for terrorism and financial intelligence (and a household name in Iran), will burrow away in search of actionable US sanctions against the Iranian regime.
The sanctions will feel cathartic, satisfy the have-to-do-something itch in the Congress, and change nothing. I'm just about resigned to that. But there is a smarter approach to Iran: Instead of constraining trade, throw it open.
On Dec. 15, Richard R. Verma, an assistant secretary for legislative affairs at the State Department, wrote to Carl Levin, the chairman of the Senate Armed Services Committee, informing him that the State Department had asked the Treasury to waive certain sanctions on Iran relating to the export of technology. Yes, waive – not tighten. (How much have you read about that?)
Verma wrote: “The Department of State is recommending that the Department of Treasury's Office of Foreign Assets Control (OFAC) issue a general license that would authorize downloads of free mass-market software by companies such as Microsoft and Google to Iran necessary for the exchange of personal communications and/or sharing of information over the Internet such as instant messaging, chat and e-mail, and social networking.”
Now that's smart! There's a way to bolster the remarkable, still unbowed opposition movement in Iran as well as weaken the Revolutionary Guards' stranglehold on society and the economy. And what has OFAC done about this request in the past two months?
No license has been issued. It's still illegal for Microsoft to offer MSN Messenger in Iran. Instead, earlier this month, Treasury sanctioned four Guards companies – a meaningless gesture. Treasury has things upside down.
“With respect to Iran, human rights and free speech efforts have been made illegal under federal law!” said Austin Heap, a brilliant “techie” working for an organization that's been trying to get technology designed to bypass government filters and other censorship into Iran, but has been frustrated by sanctions that make that illegal. “Sanctions are deterring people from doing things to help.”
That's right. With Iran weaker than at any time in its 31-year history, fractured by regime divisions and confronted by a Green movement it has tried to quash through force, US sanctions are abetting the regime's communications blackouts.
Heap works with Babak Siavoshy, 27, at the Censorship Research Center (CRC), whose engineers have developed software called “Haystack” that makes it near impossible for censors to detect what Internet users are doing.
“Double-click on Haystack and you browse the Internet anonymously and safely,” Siavoshy said. “It's encrypted at such a level it would take thousands of years to figure out what you're saying. It's a potent open-society tool. It's just a matter of getting it to Iran – and that's still illegal.”
The CRC has applied for a license from OFAC to distribute in Iran. Without pro-bono lawyers, it would have given up long ago. They've had to draft hundreds of pages of applications to Treasury.
My understanding is the license may soon be approved. Treasury insists it's now sitting at State. My urgent message to the Obama administration is: Hurry up with this license and the general one for mass market software!
Iranians are resourceful. On thumb drives, SIM cards, encrypted photo files and the like, they'd get Haystack software into the country. The United States is shooting itself in the foot by making this illegal. Hillary Clinton's speech on the importance of an open Internet was good, but right now it's just a speech. Don't shut down on Iran; open up to its promise. Sanctions are a feel-good impasse.
“Tear down this wall!” was a 20th-century cry. It has given way to the 21st century's “Tear down this firewall!” That, not sanctions, is what the IRGC fears most; and that, not sanctions, should be Obama's priority. __

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