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US-Iranian Dialogue in Obama’s Second Term – Stratfor

U.S.-Iranian  Dialogue in Obama’s Second Term is republished with permission of  Stratfor.”

Read more:  U.S.-Iranian Dialogue in Obama’s Second Term | Stratfor

By Reva Bhalla Vice President of Global  Affairs

As U.S. President Barack Obama’s second-term foreign policy team begins to  take shape, Iran remains unfinished business for the U.S. administration. The  diplomatic malaise surrounding this issue over the past decade has taken its  toll on Washington and Tehran. Even as the United States and Iran are putting  out feelers for another round of negotiations, expectations for any breakthrough  understandably remain low. Still, there has been enough movement over the past  week to warrant a closer look at this long-standing diplomatic impasse.

At the Munich Security Conference held Feb. 1-3, U.S. Vice President Joe  Biden said the United States would be willing to hold direct talks with Iran  under the right conditions. Iranian Foreign Minister Ali Akbar Salehi responded  positively to the offer but warned that Iran would not commit unless Washington  shows a “fair and real” intention to resolve the issues dividing the two  sides.

An Uneven Record in U.S.-Iranian Diplomacy

This diplomatic  courting ritual between the United States and Iran has occurred a handful of  times over the past several years. Like previous times, the public offer of  talks was preceded by denials of secret pre-negotiations. (This time, Ali Akbar  Velayati, a presidential hopeful and senior adviser to Iranian Supreme Leader  Ayatollah Ali Khamenei, denied that he met with a U.S. representative in Oman.)  Meanwhile, as a sideshow to the more critical U.S.-Iranian bilateral track, Iran  has announced it will hold negotiations with the P-5+1 group Feb. 25 in  Kazakhstan to demonstrate its willingness to seek a compromise on the nuclear  issue as part of a broader deal. For good measure, Iran has balanced these  diplomatic moves with an announcement that it is upgrading uranium centrifuges  at the Natanz enrichment facility. Though this  will rile Israel, the thought of Iran accelerating its nuclear program could  add just the right amount of urgency to propel the talks.

The first step to any negotiation is defining a common interest. For the  United States and Iran, those interests have evolved over the past decade. In  2003, they shared an interest in bringing Saddam Hussein down and neutralizing a  Sunni jihadist threat. By 2007, it was a mutual interest in relieving  the U.S. military burden in Iraq. In 2011, it was a common interest in  avoiding a war in the Strait of Hormuz. In 2013, as the region fragments beyond  either side’s control, Washington and Tehran are each looking to prevent the  coming quagmire from undermining their respective positions in the Middle  East.

But talks have also stalled many times due to issues of timing, misreading of  intentions, lack of political cohesion or a number of other valid reasons. At  base, timing is everything. Both sides need to create a favorable political  climate at home to pursue controversial negotiations abroad. Complicating  matters, both sides have the mutually contradictory goal of negotiating from a  position of strength. In 2007, Iran could still claim to hold thousands of U.S.  troops hostage to attacks by its Shiite militant proxies in Iraq. In 2011, a Shiite  uprising in Bahrain threatened to upset the balance of power in the Persian  Gulf in Iran’s favor while Iran could at the same time shake energy markets with  military maneuvers in the Strait of Hormuz.

Iran, however, couldn’t hold that position for long. With time, Tehran’s  still-limited covert capabilities in the eastern Arabian Peninsula were exposed.  Meanwhile, the United States built up its military presence in the Persian Gulf.  With minesweepers  now concentrated in the area, Iran now must think twice before carrying out  provocations in the strait that could accidentally trigger a military  intervention.

Before Tehran could recover, the regional climate flipped against Iran. In  2012, the Sunni rebellion in  Syria gained steam, in no small part due to a growing regional imperative to  deprive Iran of its Mediterranean foothold in the Levant. As Iran’s position in  Syria and Lebanon began to slip, the Sunni momentum predictably spilled into  Iraq, where massive Sunni protests against the Shiite government in Baghdad  already are under way.

Now, Iran no longer poses a strategic threat to U.S. interests in the way it  did just a few years ago, and the prospect of Iran solidifying an arc of  influence from western Afghanistan to the Mediterranean has evaporated. Iran is  on the defensive, trying to help its allies survive in Syria and Lebanon while  at the same time being forced to devote more resources to holding its position  in Iraq. And while Iran’s overseas expenses are rising, its budget is  simultaneously shrinking under the weight of sanctions. U.S.-  and European-led sanctions over the past two years have gradually moved from  a policy of targeted sanctions against individuals and firms to a near-total  trade embargo that has prompted some Iranian officials to openly admit that  Iran’s oil revenues have dropped more than 40 percent.

At this point, the United States has two options. It could allow the regional  forces to run their course and whittle down Iran’s strength over time. Or it  could exploit the current conditions and try negotiating with Iran from a  position of strength while it still has the military capacity to pose a  legitimate threat to Iran. Iran may be weakening, but it still has levers with  which to pressure the United States. Preparations are already under way for  Alawite forces in Syria to transition to an insurgency with Iran’s backing. In  Afghanistan, Iran has militant options to snarl an already fragile U.S. exit  strategy. So far, the United States has shown a great deal of restraint in  Syria; it does not want to find itself being drawn into another conflict zone in  the Islamic world where Iran can play a potent spoiler role.

It appears that the United States is pursuing the strategy of giving  negotiations another go with the expectation that these talks will extend beyond  the immediate nuclear issue. Iran has frequently complained that it cannot trust  the United States if Washington cannot speak with one voice. For example, while  the U.S. administration has pursued talks in the past, Congress has tightened  economic sanctions and has tried to insert clauses to prevent any rollback of  sanctions. The economic pressure produced by the sanctions has helped the United  States fortify its negotiating position, but the administration has tried to  reserve options by keeping a list of sanctions it could repeal layer by layer  should the talks yield progress.

Seeking Flexibility in Sanctions

Washington could look to Europe for more flexibility for its negotiating  needs. In a recent story overlooked by the mainstream media, the General Court  of the European Union on Jan. 29 revoked sanctions against Bank Mellat, one of  the largest commercial banks in Iran that is primarily involved in financing  Iran’s vital energy sector. Bank Mellat was sanctioned in 2010 based on  allegations that it was a state-owned bank involved in Iran’s nuclear  proliferation activities. But the EU court has now ruled that there was  insufficient evidence to link the bank to the nuclear program. Even so, though  Iran claims that the bank has been fully privatized since 2010, it is difficult  to believe that it does not maintain vital links with the regime. Nonetheless,  rumors are circulating that more EU sanctions de-listings could be in store.

Given the impossibility of sealing every legal loophole, perception plays a  vital role in upholding any sanctions regime. Over the past two years, the  United States — in coordination with an even more aggressive European Union —  has signaled to traders, banks and insurers across the globe that the costs of  doing business with Iran are not worth jeopardizing their ability to operate in  Western markets. Enough businessmen were spooked into curbing, or at least  scaling back, their interaction with Iran and known Iranian front companies that  Iran has experienced a significant cut in revenue. But with large amounts of  money to be made in a market under sanctions, it can be very difficult  politically to maintain this level of economic pressure over an extended period  of time. And the more the sanctions begin to resemble a trade embargo, the more  ammunition Iran has for its propaganda arm in claiming sanctions are harming  Iranian civilians. The prospect of additional sanctions being repealed in court  in the coming months could deflate the West’s economic campaign against Iran and  give more businesses the confidence to break the sanctions — but if the  sanctions were intended to force negotiations in the first place, that may be a  risk the U.S. administration is willing to take.

There is no clear link between the recent U.S. offer of talks and the  sanctions de-listing of Bank Mellat. But if the United States were serious about  using its position of relative strength to pursue a deal with Iran, we would  expect to see some slight easing up on the sanctions pressure. This would likely  begin in Europe, where there would be more flexibility in the sanctions  legislation than there would be in the U.S. Congress. Germany,  Iran’s largest trading partner in Europe, has perhaps not coincidentally  been the strongest proponent for this latest attempt at direct U.S.-Iranian  talks. It is also notable that U.S. President Barack Obama’s picks for his  second-term Cabinet include senators Chuck Hagel and John Kerry, both of who  have openly advocated dialogue with Iran.

Iran is now the most critical player to watch. Iran is weakening in the  region and is becoming heavily constrained at home, but even so, the clerical  regime is not desperate to reach a deal with Washington. Reaching an  understanding with the United States could mitigate the decline of Alawite  forces in Syria and the Sunni backlash that Iran is likely to face in Iraq, but  it would not necessarily forestall them. And with general elections in Iran  slated for June, the political climate in the country will not be conducive to  the give-and-take needed to move the negotiations forward, at least in the near  term.

The United States would prefer to reduce the number of unknowns in an  increasingly volatile region by reaching an understanding with Iran. The irony  is that with or without that understanding, Iran’s position in the region will  continue to weaken. Even if Washington doesn’t need this negotiation as badly as  Iran does, now is as good a time as any for a second-term president to give this  dialogue another try.

Read more:  U.S.-Iranian Dialogue in Obama’s Second Term | Stratfor

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The Israeli Periphery from Stratfor

The Israeli  Periphery is republished with permission of Stratfor.”

By Reva Bhalla Vice President of Global  Affairs

The state of Israel has a basic,  inescapable geopolitical dilemma: Its national security requirements  outstrip its military capabilities, making it dependent on an outside power. Not  only must that power have significant military capabilities but it also must  have enough common ground with Israel to align its foreign policy toward the  Arab world with that of Israel’s. These are rather heavy requirements for such a  small nation.

Security, in the Israeli sense, is thus often characterized in terms of  survival. And for Israel to survive, it needs just the right blend of  geopolitical circumstance, complex diplomatic arrangements and military  preparedness to respond to potential threats nearby. Over the past 33 years, a  sense of complacency settled over Israel and gave rise to various theories that  it could finally overcome its dependency on outside powers. But a familiar sense  of unease crept back into the Israeli psyche before any of those arguments could  take root. A survey of the Israeli periphery in Egypt, Syria and Jordan explains  why.

Maintaining the Sinai Buffer

To Israel’s southwest lies the Sinai Desert. This land is economically  useless; only hardened Bedouins who sparsely populate the desert expanse  consider the terrain suitable for living. This makes the Sinai an ideal buffer.  Its economic lifelessness gives it extraordinary strategic importance in keeping  the largest Arab army — Egypt’s — at a safe distance from Israeli population  centers. It is the maintenance of this buffer that forms the foundation of the 1979  peace treaty between Egypt and Israel.

The question percolating in Israeli policy circles is whether an Islamist  Egypt will give the same level of importance to this strategic buffer. The  answer to that question rests with the military, an institution that has formed  the backbone of the Egyptian state since the rise of Gamel  Abdul Nasser in 1952.

Achieving National Security in the Periphery

Over the past month, the  military’s role in this new Muslim Brotherhood-run Egypt quietly revealed  itself. The first test came in the form of the Gaza crisis, when the military  quietly negotiated security guarantees with Israel while the Muslim Brotherhood  basked in the diplomatic spotlight. The second test came when Egypt’s Islamist  president, Mohammed Morsi, attempted a unilateral push on a constitutional draft  to institutionalize the  Muslim Brotherhood’s hold on power.

 

The military bided its time, waiting for the protests to escalate to the  point that rioters began targeting the presidential palace. By then, it was  apparent that the police were not to be fully relied on to secure the streets.  Morsi had no choice but to turn to the military for help, and that request  revealed how indispensable the military is for Egyptian stability.

There will be plenty of noise and confusion in the lead-up to the Dec. 15  referendum as the  secular, anti-Muslim Brotherhood civilian opposition continues its protests  against Morsi. But filter through that noise, and one can see that the military  and the Muslim Brotherhood appear to be adjusting slowly to a new order of  Nasserite-Islamist rule. Unlike the 1979 peace treaty, this working arrangement  between the military and the Islamists is alive and temperamental. Israel can  find some comfort in seeing that the military remains central to the stability  of the Egyptian state and will thus likely play a major role in protecting the  Sinai buffer. However, merely observing this dance between the military and the  Islamists from across the desert is enough to unnerve Israel and justify a more  pre-emptive military posture on the border.

Defending Galilee

Israel lacks a good buffer to its north. The most natural, albeit imperfect,  line of defense is the Litani River in modern-day Lebanon, with a second line of  defense between Mount Hermon and the Sea of Galilee. Modern-day Israel  encompasses this second barrier, a hilly area that has been the target of  sporadic mortar shelling from Syrian government forces in pursuit of Sunni  rebels.

Israel does not face a conventional military threat to its north, nor will it  for some time. But the descent of the northern Levant into sectarian-driven,  clan-based warfare presents a different kind of threat on Israel’s northern  frontier.

It is only a matter of time before Alawite forces will have to retreat from  Damascus and defend themselves against a Sunni majority from their coastal  enclave. The conflict will necessarily subsume Lebanon, and the framework that  Israel has relied on for decades to manage more sizable, unconventional threats  like Hezbollah will come undone.

Somewhere along the way, there will be an internationally endorsed attempt to  prop up a provisional government and maintain as much of the state machinery as  possible to avoid the scenario of a post-U.S. invasion Iraq. But when  decades-old, sectarian-driven vendettas are concerned, there is cause for  pessimism in judging the viability of those plans. Israel cannot avoid thinking  in terms of worst-case scenarios, so it will continue to reinforce its northern  defenses ahead of more instability.

Neutralizing the Jordan River Valley

The status of the Jordan River Valley is essential to Israel’s sense of  security to the east. So long as Israel can dominate the west bank of the river  (the biblical area of Judea and Samaria, or the modern-day West Bank) then it  can overwhelm indigenous forces from the desert farther east. To keep this  arrangement intact, Israel will somehow attempt to politically neutralize  whichever power controls the east bank of the Jordan River. In the post-Ottoman  Middle East, this power takes the form of the Hashemite monarchs, who were  transplanted from Arabia by the British.

The vulnerability that the Hashemites felt as a foreign entity in charge of  economically lackluster terrain created ideal conditions for Israel to protect  its eastern approach. The Hashemites had to devise complex political  arrangements at home to sustain the monarchy in the face of left-wing Nasserist,  Palestinian separatist and Islamist militant threats. The key to Hashemite  survival was in aligning with the rural East Bank tribes, co-opting the  Palestinians and cooperating with Israel in security issues to keep its western  frontier calm. In short, the Hashemites were vulnerable enough for Israel to be  considered a useful security partner but not so vulnerable that Israel couldn’t  rely on the regime to protect its eastern approach. There was a level of tension  that was necessary to maintain the strategic partnership, but that level of  tension had to remain within a certain band.

That arrangement is now under considerable stress. The  Hashemites are facing outright calls for deposition from the same tribal  East Bankers, Palestinians and Islamists that for decades formed the foundation  of the state. That is because the state itself is weakening under the pressure  of high oil prices, now sapping at the subsidies that have been relied on to  tame the population.

One could assume that Jordan’s oil-rich Gulf Arab neighbors would step in to  defend one of the region’s remaining monarchies of the post-Ottoman order  against a rising tide of Muslim Brotherhood-led Islamism with heavily subsidized  energy sales. However, a still-bitter, age-old geopolitical rivalry between the  Hejaz-hailing Hashemite dynasty and the Nejd-hailing Saudi dynasty over  supremacy in Arabia is getting in the way. From across the Gulf, an emboldened  Iran is already trying to exploit this Arab tension by cozying up to the  Hashemites with subsidized energy sales to extend Tehran’s reach into the West  Bank and eventually threaten Israel. Jordan has publicly warded off Iran’s  offer, and significant logistical challenges may inhibit such cooperation. But  ongoing negotiations between Iran’s allies in Baghdad and the Jordanian regime  bear close watching as Jordan’s vulnerabilities continue to rise at home.

Powerful Partners Abroad

In this fluctuating strategic environment, Israel cannot afford to be  isolated politically. Its need for a power patron will grow alongside its  insecurities in its periphery. Israel’s current patron, the United States, is  also grappling with the emerging Islamist order in the region. But in this new  regional dynamic, the United States will eventually look past ideology in search  of partners to help manage the region. As U.S.-Turkish relations in recent years  and the United States’ recent interactions with the Egyptian Muslim Brotherhood  reveal, it will be an awkward and bumpy experience while Washington tries to  figure out who holds the reins of power and which brand of Islamists it can  negotiate with amid messy power transitions. This is much harder for Israel to  do independently by virtue of ideology, size and location.

Israel’s range of maneuver in foreign policy will narrow considerably as it  becomes more dependent on external powers and as its interests clash with those  of its patrons. Israel is in store for more discomfort in its decision-making  and more creativity in its diplomacy. The irony is that while Israel is a  western-style democracy, it was most secure in an age of Arab dictatorships. As  those dictatorships give way to weak and in some cases crumbling states, Israeli  survival instincts will again be put to the test.

Read more:  The Israeli Periphery | Stratfor

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