There are sanctions and sanctions


Surprise! Surprise! Our “multilateralist” European allies – never mind the Chinese and Russians — won’t crank up Iran sanctions.

Hypocrisy has reached new heights: during the annual German-Israeli joint cabinets meeting — deciding whether the Jewish state will again be gifted more submarines – comes a billion-dollar German package to stand up the mullahs’ LNG business. That’s the latest in1700 German companies tripling Hermes subsidized exports to $6.5 billion annually between 2000 and 2007. Some 50 German companies sell nuclear tech for Russia’s Iranian Bushwehr plant. And then there’s non-lethal support for Tehran’s ambitious missiles program. Ditto Italy, France.

Meanwhile, Pres. Obama might shade his eyes to survey the scene with the badly chewed open hand he has been extending the mullahs: a nuclear-clad Tehran would not only test the metal of Israel’s “Never Again”, likely producing new Mideast wars. It would redraw the world strategic map.

Just the threat has sent the Saudis again throwing money at Iranian ally Syria. Riyadh is trying to coax the Gulf minipetrostates into appeasement of Big Brother just across their pond. [They don’t call it the Persian Gulf for nothing.] A whirling idiosyncratic Muslimistic regime in Ankara bites its nails.

With nuclear weapons to dominate Arab oil, the mullahs might even halt the escalating erosion of their failed theocracy. [“Munich” not only armed a Nazi division with Skoda weapons for the attack on Poland initiating WWII but fed German nationalism.] Iranian WMD could help stifle nascent domestic dissidence with dreams of a new Persian empire – especially after latecomer Obama’s tepid endorsement of its martyrs.

In this muddle, conventional wisdom holds American unilateral sanctions won’t work.

That’s patently wrong. As always, the devil is in the details.

When Pres. Bush finally went after Pyongyang’s fronts in Macao – threatening Chinese banks dealing with them – Beijing saw to it that decades of counterfeiting $100 bills stopped, and Kim Jong Il had to look elsewhere for laundered money to cover his Danish pork tab.

NYC District Attorney Morgenthau has got the Treasury after years of dithering to move on flamboyant sanctions violators. Probably working around Presidential Adviser Volcker – the Swiss’ favorite American banker – Credit Suisse forfeited a $536-million fine for helping clients evade sanctions, giving up names. The U.K.’s Lloyds paid $567 to the Treasury and Morgenthau’s prosecution for setting up a special unit to flummox authorities. Barclays is under investigation. Morgenthau hints that Washington should do more, warning against Caracas’ growing ties to Iran.

If U.S. sanctions haven’t worked against Burma’s thugs – Sen. Webb’s endless mantra echoing in Foggy Bottom – it just could be because Chevron [successor to UNOCAL] and Total have poured billions into their pockets [receipts from a gas pipeline to Thailand built with slave labor].

The real question, as more often than not, is whether Obama will act. State has done a soft-shoe dance with California Congressman Berman for a ban on Iran’s petroleum product imports. But the legislation is camouflage. Does anyone really believe the always ambivalent Indians and the fragile Gulf states would halt the lucrative trade or that Washington would jeopardize relations to enforce it?

Furthermore, as George Washington University Professor Askari points out, it might have unanticipated consequences: Tehran’s more serious economic planners would welcome reducing extravagant consumption, saving foreign exchange and trimming monstrous subsidies —  all the while blaming it on The Great Satan.

Equally lame is the purported effort to go after accounts of the Revolutionary Guards. Dubai, for example, certainly before its recent near collapse, is happy hunting ground for South Asian embezzling politicians hiding their loot. And what about the VIP thieves running Iran?

But really effective – the operative word — unilateral sanctions against Iran could add one last straw to the mullahs’ camel’s back.

It requires sanctioning the central bank of Iran, cutting off credit lines to other central banks; Malaysia, for example. It means squashing letters of credit from American banks.

Most painfully, it means going after some of the two million Iranian Americans who flout the IRS by not reporting worldwide income. In the former environment no one could blame them – many refugees from the regime itself – for making a buck on the 15-20% interest rates on Iran-based accounts. But the income tax law ought to be enforced, and Berman ought to have a heart-to-heart talk with some of his constituents.

But in Washington, true enough Treasury Secretary Geithner has his hands full. New duty calls in trying to mitigate the scapegoating “populist” strategy of his boss against the banks. Obama now threatens New York City’s role as the world’s pre-eminent financial center. Nor does it help that the nominee for Treasury international assistant secretary hasn’t taken her seat, apparently because of tax and nannygate delinquencies.

Given the high priority Iran holds in the long litany of U.S. foreign policy issues – not the least its state terrorist maneuvers in Syria, Lebanon, Gaza, Bahrain, Yemen, and most importantly Iraq and Afghanistan – an authentic sanctions route ought to be tried. Tried before it is too late.

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