Berlin — Pres. Barack Obama chose last week to sanction the Swiss-based Naftiran Intertrade (NICO) energy-trading company for violating the recently enhanced U.S Iran Sanctions Act, which bars significant investments in Iran’s energy and gas sectors.
Obama and Secretary of State Clinton are well-versed in Saul Alinsky’s Rules for Radicals, yet they are failing to apply its core ideas to their Iran policy. Alinsky, after all, took to heart Frederick Douglass’s imperative: “Power concedes nothing without a demand. It never did and it never will.” Unfortunately, the U.S. State Department’s meek approach toward sanctions enforcement was on display in the handling of NICO, a subsidiary of Iran’s national oil company, which has no economic presence in the United States.
Sanction enforcement ought to replicate contract enforcement. Legislation, like a contractual agreement, is worthless unless there is aggressive enforcement. But according to Republican congresswoman Ileana Ros-Lehtinen of Florida, who serves on the House Foreign Affairs Committee, “Critical questions concerning the big companies’ involvement with Iran remain unanswered. The heavy lifting remains undone.”
For instance, the same week that Deputy Secretary of State James Steinberg boasted of assurances from Royal Dutch Shell that the company would not invest in Iran, the British press reported that Shell had increased its import of Iranian crude oil and paid $1.5 billion to Tehran. Royal Dutch Shell, it could be argued, essentially just pumped $1.5 billion into the lifeblood of Iran’s coffers, which could be used to finance its nuclear-weapons program and support its terror subsidiaries, Hamas and Hezbollah. Why is the U.S State Department issuing public relations statements for a company that is turning the U.S. sanctions strategy into a theater of the absurd?
There is no shortage of Swiss, Chinese, and Russian companies circumventing — and possibly violating — U.S sanctions against Iran. Take the example of the Swiss, who are bending over backwards to curry favor with Iran’s clerical rulers. Switzerland’s massive energy giant EGL has refused to terminate its estimated €18-27 billion gas contract with Iran.
According to an article in today’s Washington Post, the General Accounting Office has highlighted companies from China, the United Arab Emirates, and Singapore that are supplying gas to Iran. The lack of refinery capability in Iran is one of the principal forms of Western leverage. By selling gas to the Iranians, these energy firms are severely undercutting efforts to isolate Iran. The GAO writes: “The companies include subsidiaries of Sinopec and PetroChina, which are listed on the New York Stock Exchange. Another is a Beijing-based state-owned oil firm called Zhuhai Zhenrong, which has an office in Tehran and is one of four companies allowed to import oil to China.”
It is more than striking that the U.S. State Department decided to not trigger investigations into Chinese, Russian, and European companies that may be violating Iran sanctions. The result is business as usual for sanction busters, and giant question marks over whether the Obama administration is genuinely prepared to confront Iran. Iran’s regime will not abandon its nuclear weaponry and end its repression of the pro-democracy movement unless painful demands are placed on it. Obama and Clinton should embrace Alinsky 101 and punish those companies contributing to Iran’s energy sector.
— Benjamin Weinthal is a fellow at the Foundation for Defense of Democracies.