Guess what? Mike Pompeo, John Bolton and John Bolton’s mustache are not fans of the notion that the E.U., China and Russia are set to circumvent U.S. sanctions on Iran using a new special purpose vehicle as announced on Monday evening and detailed on Tuesday.
If you missed that story, you can read the details here, but suffice to say the idea is to facilitate transactions with Tehran in order to ensure what the signatories are describing as “legitimate business” is not curtailed by the Trump administration’s sanctions push.
There’s also an element of de-dollarization going on as it would appear that the euro would play a prominent role in any transactions channeled through the new SPV.
On Tuesday afternoon, Bolton and Pompeo attempted to play down the idea as something that’s not even feasible, let alone desirable. Specifically, they said Washington simply won’t allow anyone to evade the sanctions.
“[Anyone who establishes financing vehicles] does so at their own risk,” Bolton declared, while speaking to United Against Nuclear Iran (that’s a group, apparently) in New York. SWIFT, he went on to warn, should “take a good hard look at their business with Iran.”
Speaking at the same event, Pompeo called the SPV idea “one of the most counterproductive measures imaginable for regional and global peace and security”.
In reality, nothing could be further from the truth. Iran is on the brink of economic collapse, but the resistance in the country is whatever the opposite of “organized” is. That means that a successful popular revolt against the regime is unlikely at best and a figment of Trump’s imagination at worst. Without regime change, the sanctions push will simply corner Tehran and likely compel them to lash out via the Quds and regional proxy armies which, despite Steve Mnuchin’s best efforts, will continue to raise U.S. dollars via all manner of nefarious activities.
Pompeo has been on the offensive when it comes to Iran for months, and has gone out of his way to call out Qassem Soleimani, a larger-than-life figure in the Mideast. Recently, Soleimani’s fingerprints have shown up on everything from Putin’s intervention in Syria to the infamous kidnapped Qatari falconry party that purportedly helped spark the Qatar embargo last year, to the rather embarrassing seizure of Kirkuk.
As we’ve been over more times than we care to count in these pages, Trump’s agenda is less about nuclear arms and more about a mixture of pride, spite for one of Obama’s signature achievements and a desire to foster goodwill with Israel and the Saudis by helping to rein in Soleimani, whose already legendary status has been bolstered by the wars in Syria and Iraq, where he wields almost God-like influence over Shia militias. Consider these quick excerpts from a recent Washington Post piece:
Since Iraq held national elections in May, White House envoy Brett McGurk and Maj. Gen. Qasem Soleimani, chief of the Iranian Revolutionary Guard Corps’ elite Quds Force, have competed with each other to assemble support behind their favorites for parliament speaker, president and prime minister. McGurk and Soleimani have both spent much of the past few months meeting with powerful Shiite, Sunni and Kurdish politicians in rival bids to build a parliamentary majority.
“That foreign influence has canceled itself out,” said Abbas Kadhim, an Iraqi historian and political analyst. “At the end of the day, the U.S. and Iran work against each other, and they both made each other fail in getting what they want.”
Everyone of course knows there’s more to this than the farcical claim that the Iranians are on the verge of nuking somebody, and there’s certainly something to be said for clipping Soleimani’s wings and guarding against a situation where Hezbollah continues to gather strength.
That said, there are serious questions as to the relative desirability of putting Iran’s back against the wall at a delicate time domestically in the interest of trying to shape the regional balance of power by preventing Soleimani from further cementing the Shia crescent.
What Europe and Russia and China are presumably trying to do with the SPV is ensure that U.S. sanctions don’t end up causing an outright economic calamity for Iran that then leaves the regime with no choice but to restart its nuclear program in order to gain leverage over the U.S.
And do you know what the ironic thing about that latter point is? Kim Jong-Un has given Tehran a blueprint for how to manipulate Donald Trump with nuclear threats.
The rogue regimes of the world now know that all they have to do to go from the brink of war with Washington to being called “courageous” by the U.S. President, is fire off a few missiles, conduct a few nuclear tests and then agree to a photo op in Singapore that plays into a 72-year-old narcissist’s ego.