The Iran nuclear deal faces ‘death by a thousand cuts’

Bloomberg | Ladane Nasseri: President Donald Trump decided against killing off the Iran nuclear deal in a day-one spectacular. It may face a lingering death instead.

Trump’s administration sends out mixed signals on many issues, but on the need for a tougher line against Iran, it speaks with one voice. And words have been accompanied by action. In Syria, the U.S. military is directly clashing with Iranian allies. In Saudi Arabia, Trump performed a sword-dance with Iran’s bitterest foes. In the Senate, new sanctions on the Islamic Republic sailed through with near-unanimous approval.

The 2015 accord reined in Iran’s nuclear program, and offered the Islamic Republic a route back to the mainstream of the world economy. It was the fruit of many years of work by many governments. Its breakdown would likely add to turbulence in the Middle East, and impose new strains on America’s ties with Europe. Yet there’s a serious risk that the deal could unravel, according to one former U.S. official who was intimately involved.

“Death by a thousand cuts” is what former Deputy Secretary of State William J. Burns fears could be the fate in store for the agreement he helped negotiate. Burns, who led the U.S. team involved in secret preliminary talks, says he’s concerned by “the chipping away of trust in the agreement from all sides.’’

“It’s a fragile enough environment as it is,” he said in an interview. “It’s easy to back yourself into a collision of one kind or another.”

‘Failed Approach’

The U.S. has slapped two additional sets of sanctions on Iran this year, tied to its ballistic missile program and alleged support of terrorism. The lifting of wider international curbs in January 2016, as part of the nuclear deal, has allowed Iran to resume oil sales to Europe, for example. But many American restrictions remain in place, especially on financial flows. Major banks, wary of falling foul of U.S. policy, have stayed clear of Iran. Several Western companies are watching to see what the administration does next.

The prevailing view in Washington seems to be “to let the agreement remain in place, but to press on Iran so it doesn’t get the commercial advantages expected,” said Alireza Nader, a senior analyst at Rand Corp.

The aerospace industry is a good example. Boeing Co.’s proposed sale of 80 jets to Iran Air is allowed in principle under the nuclear deal. Airbus has reached a similar agreement. But both companies remain at the mercy of the U.S. Treasury, which said last month it’s reviewing the licenses — amid criticism that new aircraft can be used to supply terrorist groups. “We will use everything within our power” to put additional sanctions on Iran, Treasury Secretary Steven Mnuchin told the House Ways and Means Committee.

Faced with a congressional requirement to report on the nuclear agreement, the Trump administration grudgingly certified in April that Iran is keeping its end of the deal. But Secretary of State Rex Tillerson added that the accord only delayed Iran’s ambitions to gain nuclear weapons — “the same failed approach of the past” — and didn’t curb its role in sponsoring terrorism.

‘Blame the Other’

Iran likewise says the U.S. is violating the agreement’s spirit, if not its letter. “Disregard for Iran’s genuine security concerns, either through deliberate changing of the military-security balance in the region, or by stoking Iranophobia in the region and beyond,” would put the hard-won gains of the deal at risk, Ali Akbar Salehi, who helped negotiate it as head of Iran’s atomic energy agency, wrote in a Guardian op-ed last week. “Engagement is not a one-way street.”

“Each side is now waiting to blame the other for undermining the deal,” Nader said.

In a separate confrontation, the Trump administration included Iran in its travel ban on migrants and refugees from six Muslim-majority nations, which is due to come into force on Thursday following a U.S. Supreme Court decision allowing parts of an executive order to proceed.

The mood in Europe is different. While Airbus must wait on the U.S. because of the American-made parts in its planes, Washington doesn’t have similar leverage over some of the other companies that are forging ahead into a market of 80 million people. Siemens AG has signed a $1.6 billion agreement to build trains and upgrade track. Vodafone Group Plc has partnered with an Iranian firm to modernize telecommunications. Nestle SA is adding staff in Tehran.

Even if Trump wants out of the deal, the European Union will guarantee it’s implemented in full, EU foreign affairs chief Federica Mogherini said on June 13.

In Iran, opinion polls have recorded disenchantment with the limited fruits of the deal. Still, President Hassan Rouhani, who signed it, was re-elected in a landslide last month against a hardline opponent who’d criticized him for giving too much, and getting too little in return, during the nuclear talks. The economy is growing again, and oil exports have doubled — mostly because European purchases resumed.

‘Unreasonable Party’

Rouhani and his foreign minister, Mohammad Javad Zarif, “are going to be very good at driving a wedge between the U.S. and Europe if it appears we are being the unreasonable party,’’ said Burns. “Let alone between us and Russia and China,” also signatories to the accord, he said.

Meanwhile, there are plenty of Middle East flashpoints that could inflict further damage on the accord. Saudi Arabia, a leading critic of the Obama administration’s nuclear diplomacy, has stepped up its anti-Iran campaign.

The Saudis picked a diplomatic row with Qatar, citing their Gulf neighbor’s cordial ties with Iran — and got vocal support from Trump, even though others in his administration have been more circumspect. In Yemen, a Saudi-led coalition is fighting against militias allied to Tehran. Earlier this month, Saudi troops shot at an Iranian boat and captured people on board, saying they were Revolutionary Guards. Iran says they were fishermen.

And when Iran was targeted by Islamic State attacks on June 7, the first time the extremist group had struck there, it promptly pointed the finger at Saudi Arabia — and fired off a volley of missiles at jihadist targets in Syria. On the same day, U.S. pilots shot down a plane from the air force of Iran’s Syrian ally, President Bashar al-Assad.

Trump’s coziness with the new Saudi leadership and lack of interest in engaging with Iran adds to evidence that his administration’s strategy “essentially is to try to kill the deal while appearing to uphold it,’’ said Trita Parsi, author of “Losing an Enemy: Obama, Iran and the Triumph of Diplomacy” and an Iranian-American leader who advocated for the nuclear accord.

“For the long-term durability of the deal you needed to have at least a slightly positive trajectory of U.S.-Iran relations,” Parsi said. “Right now, nothing positive is happening.”