Lawmakers Seek White House Support For New Iran Sanctions Bill

Wednesday, June 23, 2010

By Martin Matishak

Global Security Newswire

WASHINGTON — Members of a key Senate panel yesterday urged a pair of senior Obama administration officials to embrace new legislation that would ratchet up U.S. sanctions against Iran over its alleged nuclear weapons program (see GSN, June 22).

(Jun. 23) – U.S. Senator Richard Lugar (R-Ind.), shown last year, yesterday joined other lawmakers on the Senate Foreign Relations Committee in pressing two Obama administration officials to take full advantage of an Iran sanctions bill making its way through Congress (Mark Wilson/Getty Images).

"Countless experts agree that the way to really pressure Iran is to target its oil and gas sectors," Senator Barbara Boxer (D-Calif.) said during a hearing of the body’s Foreign Relations Committee. "And that’s exactly what this sanctions bill will do."

Senate and House lawmakers announced Monday they had reached an agreement on legislation — the Comprehensive Iran Sanctions, Accountability and Divestment Act of 2010 — that would punish foreign companies for doing business with companies connected to Iran’s Revolutionary Guard and select banks, and cut off certain Iranian banks from the U.S. financial sector. Companies that continued selling gasoline to Tehran would face severe financial penalties.

The announcement came two weeks after the U.N. Security Council adopted a fourth round of economic sanctions against the Gulf nation (see GSN, June 9). The resolution, numbered 1929, expands the list of conventional weapons that Iran is not allowed to purchase and prohibits Iranian activity on ballistic missiles that could be topped with nuclear warheads, among other measures.

The European Union last week also launched a new set of economic penalties against the Middle East country, most notably prohibiting investment in Tehran’s energy sector (see GSN, June 17).

Yesterday, senators asserted that legislation from Washington was needed to maintain pressure on Tehran.

"We’re at the point where we really need to do something," said Senator James Risch (R-Idaho). "We have got to get better at this because we’re going to have a real wreck on our hands."

"It is important that we speak with a very strong voice," said Senator Benjamin Cardin (D-Md.), who added that he hoped the legislation would be voted on by both chambers of Congress this week.

Iran has insisted that its atomic aspirations are strictly for civilian purposes but the United States and other world powers have viewed that assertion with outright skepticism. A key area of concern is Tehran’s uranium enrichment program, which could be used to produce fuel for nuclear weapons (see related GSN story, today).

White House spokesman Robert Gibbs said in a statement Monday that the administration would work with Congress on the sanctions bill and "in our ongoing efforts to hold Iran accountable."

"We want to work with you to help shape that legislation so that it amplifies the impact of the international coalition that we’ve built," Undersecretary of State for Political Affairs William Burns told lawmakers yesterday.

Senator Richard Lugar (Ind.), the committee’s ranking Republican, said "it is past time for the administration to weigh in with a concrete response to this legislation." The Indiana lawmaker said he wants to know which provisions in the bill the White House supports or opposes and what changes, if any, the administration believes should be made to the measure.

Burns said the administration has "sought to sharpen the choices before the Iranian leadership" regarding its atomic activities through dual-track diplomatic and economic measures. "We’ve sought to demonstrate what’s possible if Iran meets its international obligations and adheres to the same responsibilities that apply to other nations," the diplomat said.

The latest Security Council resolution is an opportunity for the United States and its allies to further limit Tehran’s options, said Treasury Undersecretary for Terrorism and Financial Intelligence Stuart Levey, testifying alongside Burns.

Just last week, the Treasury Department listed five front companies and more than 90 ships that Iran’s national maritime carrier, IRISL, used to evade sanctions, he said. Officials also identified another Iranian bank as helping facilitate Iran’s proliferation activities, bringing the total number of such institutions to 16.

The recent economic actions taken by the Security Council, the European Union and other entities have effectively cut Iran off from the worldwide economy, according to Levey. As a result, private companies have started to join governments in spurning the Gulf nation.

"We are now starting to see companies across a range of sectors, including insurance, consulting, energy, and manufacturing make similar decisions," he told the panel. "The private sector really is getting the point that if they do business with Iran, they put themselves at enormous risk."

Asked by Isakson to discuss the impact the petroleum portion of the proposed sanctions bill might have on Iran, Levey noted that a few years ago the country imported about 40 percent of its refined petroleum products. That figure is now closer to 25 percent.

"They’ve anticipated … their vulnerabilities, the kind of pressures that could be exercised against them, and tried to act accordingly," Levey said. "But … there’s still a significant exposure there."

"Iran is not 10 feet tall, and its economy is badly mismanaged," Burns said in his opening statement. "Beneath all their bluster and defiant rhetoric, its leaders understand that both the practical impact of [U.N. Security Council] Resolution 1929 and its broader message of isolation create real problems for them."

He later said he interpreted Russia’s recent apparent decision not to deliver an order of S-300 air-defense missiles to Iran as a sign of the overall effectiveness of the latest Security Council resolution.

However, China’s "continuing and potential investment in Iran’s energy sector is going to remain a very important concern," the diplomat said. "We’re going to continue to press that hard."

Burns reiterated that the United States remains willing to talk with Tehran.

"The door is open to serious negotiation if Iran is prepared to walk through it," he told the committee. "There is growing international pressure on Iran to live up to its obligations and growing international isolation for Iran if it does not."