On January 20th, 2009 President Obama and his administration will be taking the reins of foreign policy, including the United States’ relationship with the Islamic Republic of Iran.  Recent appointments and statements by Obama and his transition team offer some clues as to what to expect from the next administration.

The first significant development is President-elect Obama’s announcement of his foreign policy and national security team on Monday, December 1st.  His selection of Hillary Clinton as Secretary of State is certainly interesting. During the the primary season, Senator Clinton tried to portray herself as being tougher on Iran than Obama.  She even went so far as to suggest that if Iran should “foolishly consider launching an attack on Israel”, the U.S. “would be able to totally obliterate them”.  Senator Clinton was also criticized by some Congressional Democrats for her support for a resolution labeling Iran’s Revolutionary Guard as a terrorist organization. She has also, however, expressed support for diplomatic options, stating in 2007 that if elected President she would open a “diplomatic track” to discern “what levers of power in their society we might be able to pull and push”.

Overall, Senator Clinton’s stance toward Iran is characterized by the belief that the U.S. must “use every tool at our disposal, including diplomatic and economic in addition to the threat and use of military force”.  While I am pleased to see that our new Secretary of State is ready to use a variety of methods, including diplomacy, in dealing with Iran, it worries me that she considers the threat of violence to be an equally effective foreign policy tool.  Of course the United States must be prepared to use force to protect itself and its allies, but the militaristic threats and gesturing that have characterized the Bush administration’s approach to relations with Iran have gotten us nowhere.  I hope that as Secretary of State Hillary Clinton will be ready to tone down the rhetoric and use diplomatic and economic tools before resorting to threats and violence.

President-elect Obama himself has also spoken about the strategies that his administration will pursue with Iran.  Today while appearing on Meet the Press Obama articulated a carrot and stick approach that will include diplomatic engagement and the possibility of economic sanctions.  For more on Obama’s plan and the thoughts of other analysts, continue reading.Obama’s proposed plan is a classic carrot and stick approach.  He notes that Iran, despite being an exporter of oil, has an economy that is struggling with unemployment and inflation and suggests that economic incentives could be used to encourage Iran to stop its nuclear activities.  Should Iran’s behavior not change, he believes that stricter economic sanctions could act as an effective deterrent.  In his remarks, however, Obama did not specify what kinds of economic incentives he would offer Iran or how he would modify the current sanctions against Iran.

There is debate about whether or not sanctions are an effective strategy.  It is quite clear that the sanctions as they exist right now are not consistent or stringently enforced.   The Wall Street Journal reported in November that the German-Iranian Chamber of Commerce is teaching seminars in Germany entitled “Iran Sanctions — Practical Consequences for German Companies”.  These seminars are designed to teach German businesses how they can legally conduct business in Iran, completely undermining the purpose of economic sanctions.  Schlumberger Limited is a company that sells oil drilling equipment, including machines with readioactiive chemicals, to Iran by using a loop-hole in the sanctions laws.   According to Iran News Blog, Schlumberger is based in the Carribean but has a CEO based in Houston.  The blog also has a photo of Schlumger’s offices in Tehran.

So if President-elect Obama decides that sanctions are an appropriate stick, he will have to close the current loopholes and convince our European allies to not undermine international sanctions.  Trita Parsi, author of Treacherous Alliance: The Secret Dealings Israel, Iran, and the United States, recently commented that for sanctions to be used effectively in negociations, the U.S. must be willing to lift them as a reward for good behavior.  Parsi reminds us that if sanctions are a stick, then the lifting of sanctions can be considered a carrot, so we must be willing to consider lifting the some of the sanctions that we have had in place for almost thirty years.  Parsi doubts whether or not Obama can create the the political will to lift any sancions.

Obama must also consider what effects his actions, either carrots or sticks, will have over the domestic political scene in Iran.  Presidential elections are coming up in June and President Mahmoud Ahmadinejad has made it clear that he is willing to use anti-American rhetoric for personal political gain.  If Obama imposes new sanctions, Ahmadinejad may continue to present himself as the victim of Western bullying and the defender of Iranian national pride.  Conversely, if Obama pursues direct talks with Iran, Ahmadinejad may claim that he brought the Great Satan to its knees.

It is clear that President-elect Obama and his foreign policy team will need to procede with caution.  The idea of carrots and sticks is appealing but it will only work if the carrots are truly enticing or if sticks are truly punitive.  The system of rewards and punishments is also only effective if it is applied fairly and consistently, in coordination with the international community as a whole.  Hopefully President-elect Obama and Senator Clinton can work together to develop a strategy that uses both carrots and sticks.