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Middle East Policy Council

Fifty-third in the Capitol Hill Conference Series on U.S. Middle East Policy
 
War with Iran: Regional Reactions and Requirements
 
Speakers:

John Duke Anthony,
Founding President, Chief Executive Officer, National Council on U.S.-Arab Relations

Tayyar Ari,
Professor of Economics & Administrative Sciences, Uludag University

Jean-François Seznec,
Visiting Associate Professor, Center for Contemporary Arab Studies, Georgetown University

Wayne White ,
Former Deputy Director, Near East and South Asia Office, INR, State Department

Moderator/Discussant

Chas W. Freeman, Jr.,
President, Middle East Policy Council

Caucus Room, Cannon Office Building
Washington, D.C.
Friday, June 20, 2008

Transcript by:
Federal News Service
Washington, DC






AMB. FREEMAN: Good morning. I'm Chas Freeman. It's my honor and sometimes my pleasure to be president of the Middle East Policy Council, a small group that does three things. We come up here to Capitol Hill and try to enlighten debate about policy issues of importance to the United States by introducing a fact or two, as we will attempt to do this morning.

We take our discussions and make them the first item in "Middle East Policy," which is, I'm proud to say, the most frequently cited journal in the field, both here and internationally, and which I invite you to look at.

And finally, throughout the country we have a program of training high school teachers in how to teach about Arab civilization and Islam. We've trained about 18,000 teachers. We're in the process of reinventing that program. It remains unique.

I should end this brief introduction with a commercial announcement, and that is that we depend entirely on donations for our work, and anybody who has a fat wallet and doesn't know what to do with what's in it is most welcome to contribute.

We are here today to have - I think it's the 53rd in our series of Capitol Hill conferences, this one on the subject of war with Iran and the regional reactions, and requirements of regional actors with regard to that.

This may seem not terribly timely since much of the concern about a possible Israeli or American strike on Iran has receded in recent days. And yet within the last week Israel apparently ran a huge military exercise in the eastern Mediterranean, exercising the capacity to engage in long-range airstrikes. The president has on several occasions declared that he will not leave office without dealing with the menace of Iran, as he defines it. And, therefore, perhaps the topic is not quite so academic and unrealistic as many of us might hope.

Over the last several years, several rationales for a military action against Iran have been put forward. Initially, the discussion was about taking out Iranian nuclear facilities. When it appeared that the Iranians had suspended the weaponization aspect of their nuclear program, for a while at least, that talk was suddenly succeeded by a discussion of the need for force protection of American forces in Iraq, who allegedly were being attacked with weapons primarily provided - deliberately provided by Iran.

There have also been grave concerns expressed about the possibility of an incident at sea between the Iranian Revolutionary Guard and its naval flotilla and the United States. These concerns intensified after a March incident in the Gulf of Suez, in which an American naval vessel fired on a Egyptian bumboat and killed a couple of civilians. Our navy is jittery after the USS Cole incident and operating under more robust rules of engagement that require small boats to keep a distance from U.S. naval vessels.

In the most recent issue of - I think it's the most recent issue; well, maybe not. I will get clarification from Anne Joyce. In a recent issue of "Middle East Policy," Anthony Sullivan analyzed some of the regional metastasis of a conflict with Iran that might ensue, talking about actions in and by Lebanon, in and by Syria against Israel, and, of course, by Hamas from Gaza. And I encourage you all, if you have not read that article, to take a look at it because it is very sobering.

At any rate, we are here to explore regional views of this possible scenario. That's a bit unusual. Most commonly, in recent years, the United States hasn't been terribly interested in what anybody in the region thought about what we were doing. But perhaps we should be. Are they concerned primarily about Iranian military power, about Iranian nuclear weapons development? Are they concerned primarily about Iranian political influence and inroads in the region? What would the reaction be if either Israel, or Israel and the United States, or the United States alone were to take military action against Iran?

We have a panel today to discuss this which is extraordinarily well qualified. I will not recapitulate their biographies, which are on the back of the program, but simply note that John Duke Anthony, who is the founding president and chief executive officer of the National Council on U.S.-Arab Relations, many, many years of teaching and program activity focused mainly on the Arab Gulf, will lead off.

He will be followed by Jean-François Seznec, who is a visiting professor at Georgetown at the moment, but who spent many years analyzing Saudi Arabia, living in Riyadh for a while and in Bahrain, and is a noted expert currently at the Center for Contemporary Arab Studies at Georgetown.

Wayne White, a Foreign Service officer who retired a few years ago and has come out of the closet and become a very often cited, nationally quoted analyst on these matters. You probably all recall that the Bureau of Intelligence and Research at the Department of State established a record of remarkable orneriness and correctness during the run-up to the invasion of Iraq. Well, that was Wayne White. So we're very pleased to have Wayne here to address this topic.

And finally, as a special treat, we have a visiting scholar from Turkey who is here doing a special project on Turkish-American relations and the Middle East. That is Tayyar Ari who is a professor of international relations at Uludag University in Bursa in Turkey, and is here unaffiliated, I think just doing research, but who has contributed a couple of articles, which we are hoping we will be able to publish in "Middle East Policy." We're very pleased to have you here, sir.

With these few words, let me invite John Duke Anthony to the podium with the usual admonition that speakers get 10 to 12 minutes to say what they need to say, and if they begin to exceed that, I have built sufficient bulk over the years that I can eject them forcefully, and will, from the podium. So when we get to that point that the time is exhausted, don't be surprised if you see me stand up in a menacing fashion and speakers should move from the podium promptly or suffer the consequences.

After the speakers, we will have a - the piece de resistance of these meetings really is the questions and comments session. I would ask only that you identify yourselves, if possible direct your question or comment to somebody on the panel, and try to be succinct. And if you want to give a speech, please give it somewhere else, not here.

So we will get into that afterwards, but now, John.

JOHN DUKE ANTHONY: Thank you, Chas. It’s good to be here. I will address the topic of “War with Iran: Regional Reactions and Requirements” by dividing my remarks into four parts of three minutes each. This will keep the stipulated time frame of twelve minutes.

The four parts are in turn divided into equal components of two each. The first two will focus on reactions to the idea of an attack itself and what is required to prevent it. The second two will focus on the likely reactions and requirements in the event an attack actually occurs.

My remarks on regional reactions to the possibility of an attack and the requirements to prevent it are as follows. At this point a consensual response to the very thought of such a war is that there is no reason why the idea of attacking Iran militarily ought to be viewed by anyone as necessary, inevitable, or unavoidable. A related reaction, as reflected among leaders throughout the Gulf with whom I have met and discussed the matter, is that the Bush administration has deliberately failed to level with the American people about this issue. Within this view is a conviction that the administration has not been forthright about the real reasons -- ones that, were they acknowledged and subjected to vigorous public debate by the American people would likely result in their refusing to support, let alone endorse, such a policy, position, or action. A third dimension of reactions already in play is the sheer uncertainty of what could follow. This can be seen even now not only in the significantly higher, fear-induced, price of oil and how rapidly discussion about the possibility of a war has shifted from riveted attention to acute apprehension to sheer anxiety about the likely follow-on implications of an attack for the Gulf Arab countries’ strategic, economic, political, commercial, and defense needs, concerns, and interests, not to mention their objectives and relations vis-a-vis each other and outside parties.

As to the requirements side of the equation in advance of an attack, one is the obvious need for the Gulf Arab governments to persuade their citizenries that every possible precaution is being taken not only to deter and defend against an attack but ensure their inherent right to self-preservation no matter what transpires. Another need is for them to assure their populations that everything imaginable has been and is being done to provide for contingency national and local emergency alert status. All agree that this is imperative in the event of a near certainty that an attack against Iran by the United States or Israel, or some combination of the two, is not a question of whether but when.

Still another is the requirement of being prepared to withstand the probability of a range of retaliatory actions by Iran or its agents following an attack. Certainly, possibilities for retaliation would not be lacking. Among them, to name but a few, could be the infliction of damage to offshore drilling platforms on the Arab side of the Gulf, to undersea energy valves, gauges, and pipelines, threats to shipping in the strategic Hormuz Strait, and attacks on power generation and desalination plants along the coasts.

There would also be am obvious need for heightened domestic surveillance and security measures vis-à-vis the overseas Iranians in these countries. Some 400,000 Iranians live and work in the UAE Emirate of Dubai alone. There are additional thousands of Iranians in Bahrain, Kuwait and Qatar, although nowhere near the same number in Oman or Saudi Arabia.

There would likely also be political consequences. These would likely be driven by the perceived as well as actual nature, extent, and overall effectiveness of what these countries’ elite policy-makers and decision-makers did or did not do to prevent an attack. Regardless of their actions or inaction, if whatever they do is perceived as inadequate or ineffective the prospects are great that the resultant accusations could represent a rhetorical throwback to an earlier era. A frame of reference is the 1960s when many in the Arab Gulf states were labeled by Arab nationalists beyond the region as “America’s Arabs,” “Anglo-Arabs,” “running dogs,” and “lackeys of imperialism.” If but a fraction of this kind of reaction were to occur, it would not be difficult to imagine how this would impact negatively on the perceived legitimacy of these leaders domestically and further afield. Even now, the meaning of the phrase “moderate Arab leaders” has increasingly been debased. In the eyes of critics, it has migrated from being synonymous with a commendable attribute of a leader to an epithet attached descriptively to any Arab leader seen as inclined to accommodate America’s aims.

Regarding a range of requirements deemed necessary to prevent an attack, among the most obvious is the need to engage Iran in every possible imaginable way in the search of common interests and needs that would render the idea of launching of yet another war on their doorstep unthinkable. A close cousin to this requirement is the need not to be precipitous in concluding that diplomacy has been exhausted. Certainly, within the region the consensus is that the case cannot be made that diplomacy has been exhausted. On the contrary, greater and more effective diplomacy is needed.

Further, if an attack is to be prevented, a third requirement is that the United States and Israel not fail to focus on the positive aspects of Iran’s behavior or non-behavior over the last quarter of a century, for which a range of evidence is hardly lacking. If only to quiet the extremist warmongers among their respective policymakers, each needs to publicize and take appropriate measures to commend, empathize with, and strategize in relations to these positive aspects.

There’s no need or reason to go overboard in this regard. It should be sufficient merely to cite various facts and key milestones in the chronology. For example, apart from the Iranian involvement in the deadly attack on the Al Khobar Towers complex in Saudi Arabia in 1996, and the strengthening of Iran’s occupation of three islands claimed by the UAE in the 1990s, there has been no Iranian conventional actual or potential military attack on any of the GCC countries for nearly a quarter of a century. -- since June, 1984, when, in a combined configuration of American-manufactured AWACs and F-15 aircraft, Saudi Arabia effectively prevented what could easily have been an Iranian armed aerial attack on the kingdom’s eastern province oil and gas installations. he sky over the Gulf, and there has not been such an action by Iran since; neither has there been a recurrence of two incidents in Bahrain, one in December, 1981, and another alleged in June of 1996 by Iran seeking to destabilize, and perhaps lay the groundwork for a coup d’état in Bahrain. Nor has that been anything remotely comparable to the Iranian instigated attack on the life of the emir of Kuwait in 1985. Nor has that been any recurrence of something like Iranian complicity in the attack on el-Khobar Towers in Saudi Arabia in 1996.

The last part of this analysis has to do with if all else fails and there really is an attack, what the aftermath would be in terms of requirements. One is a set of geopolitical, social, and psychological ones, believing that there’s possibly a 50-50 chance of their being able to survive such an attack, if it is just and proven to be just the United States.

Secondly, however, if it is the Israelis, alleged or perceived to be the Israelis, either independently or in combination with the United States, all bets are off in terms of the domestic probability of rage and demonstrations on behalf of a people who believe that enough is enough is enough with regard to what the Israelis have done with the United States and against American and Arab interests in the region.

And lastly, this aspect of requirements having to do with logistics, operational, economic, and financial dynamics, embedded in part in the three Defense Cooperation Agreements that the United States has signed and entered into with Kuwait, Bahrain, and Qatar in the aftermath of Iraq’s aggression in Kuwait, the Modified Defense Cooperation Agreement with regard to the United Arab Emirates, the Access to Facilities Agreement with Oman, dating from January, 1980.

And lastly, though there is no defense cooperation agreement with Saudi Arabia, there is nonetheless, in spite of that, far vaster undertakings and understandings in defense cooperation relationships dating over a far longer period of time and involving far more Arabs and Americans than anything remotely comparable with the other seven Arab Gulf countries.

AMB. FREEMAN: Thank you. Admirably succinct and to the point. I will make a couple of points following on John Duke's presentation.

The first is that the United States cannot conduct military operations in the Gulf without support from countries in the Gulf. An effort to stage military operations without permission, as we did from Oman with Desert One, the rescue attempt on hostages in Tehran almost 30 years ago, will result in a suspension of military cooperation, as was the case with Oman.

Second, because logistics require cooperation from countries in the region, they cannot avoid a measure of complicity with a U.S. operation against Iran, and the word in the region is that Iran has already told Qatar, for example, that if there is such an attack, the Qatari regime is toast.

The third point is that it's not just the use of bases that is involved. We cannot conduct air operations in either Iraq or over Iran, or for that matter in Afghanistan, without over-flight of Saudi Arabia, and there is no agreement between the United States and Saudi Arabia that guarantees our right to such over-flight. It is on a case-by-case basis.

The U.S. airbase in Qatar, from which the air wars in both Iraq and Afghanistan are directed, depends entirely on this air bridge. And, therefore, the question of complicity cannot be avoided by countries in the region. The likelihood of retaliation, which John Duke mentioned, cannot be avoided. And of course, there would be collateral damage to things like oil prices, which I suspect Jean-Francois may now mention, although he will be talking primarily about Saudi Arabia.

Jean-Francois?

JEAN-FRANÇOIS SEZNEC: Thank you very much. There's so much to say. I'm going to speak a little bit like the salesman for the loan advertisements on the radio, when I speak at about 200 words every second. But what I will try to do is present a little bit what I think the Saudi point of view is. And my argument is really an economic argument that's based on living for 10 years - having lived in the Gulf for 10 years being a banker, so I have seen the business angle of things and followed it since 1974 quite extensively.



Now, I find that the GCC, and Saudi Arabia in particular, is really caught between the anvil and the hammer here because they really worry about Iran, of course, for obvious reasons, but they also distrust the United States just as much, if not more these days. So the Saudis, I think, are very worried about the potential strike on Iran because they feel they can handle Iran on their own. Now, that may sound a little surprising since their military is not that strong, but then again, neither is the Iranian military.

On the other hand, they have another approach. I think there is a new paradigm in Saudi thinking in terms of defense and in terms of security. I think the Saudis are seeking now to gain time. Why? Because they want to maximize their economic growth, their wealth, and their importance to the world markets. They assume that at the same time, Iran is, at this time, going bankrupt, basically - and I will go into this a little bit later - and because of this, be forced to change policies. So from their point of view, they have to sort of gain time because time is on their side, they feel anyway, I think.

The main thing is that a U.S. attack, whether it's U.S. or Israeli, but it will be viewed as U.S.-based anyway, would stop the economic growth of the region. It would kill the Saudi chances to become the economic hegemon of the region. That's what the Saudis are aiming to be is the economic hegemon of the region and one of the hegemons of the world and we'll see why in a minute. And it would weaken them relative to Iran and Iraq, which they actually feel they can dominate.

Now, the major points of conflicts, of course, are well known. There's the islands, and that's the conflict - potential conflict - between the UAE and Iran, which has been in the books for a long, long time. The strategic part, of course, of Hormuz is very important. The Saudis are not so worried about that because if the Iranians were blocking Hormuz, they would be committing hara-kiri, because they could not ship their own oil.

Another issue, which has been almost alluded by Ambassador Freeman, is the fact that the Iranians are very worried about the enormous development on the Qatar North Dome Field. You know, it's the largest gas field in the world. Qataris are developing it like crazy right now. And the Iranians are upset by that because they own half of that field, and they feel that the Qataris are really stealing their gas at this point. And they've mentioned that, because they have not been able to develop that field for lack of money, mostly, and lack of technology from overseas.

The other area of potential conflict are the oil platforms on the Kuwaiti-Iraq field, and there has been not conflicts, but there's been a lot of pressure between the Kuwaitis, the Saudis, and the Iranians on those platforms. It has delayed a little bit the development of these fields.

The Iranians are not happy with the Saudis trying to decrease the price of oil. Going from $130 to $110 maybe or $100 would make the Saudis very happy. It would make us happy. It would not change that much, but it will make us happy. The Iranians are very happy at $130. That brings a little bit more money into Iran. It allows the ayatollahs to steal even more money, and it hurts our own economy.

The other point of conflict, of course, and that's very important for the Saudis, are the Shi'a communities. In the GCC in particular, Iran can claim that the Saudis are oppressing the Shi'a, which in all fairness they have done over the years, but things are improving as we will see.

Finally, another point of conflict potentially is the Iranian communities. There are 400,000 Iranians living in Dubai alone. There are 3,000 Iranian-owned businesses in Dubai alone, so there is some potential for disagreements on these issues.

But the GCC and the Saudis are not totally without defense on this. Why? The first one is that the Iranians are totally mismanaging their economy. As I said before, the Iranians are going bankrupt very happily. In 2007, they made about $80 billion from their sales of oil at the very average price of about $80 a barrel. But out of this, there was very little left for the Iranians, because the ayatollahs are sending about $50 billion a year into Dubai. They have to import gasoline in this country, which is a very large producer of oil. That costs them another $5 billion. They have to pump the oil. That costs money. And all manners of cost of this nature are making the ability of the Iranians to have money for themselves to be very limited.

Dubai also - one of the reasons that would push the Iranians not to do too much in the Arab world, if they can, is that Dubai is vital to the ayatollahs, of course, because that's where they put their money. And they don't want to push the GCC too much towards the U.S.

The Saudi strategy basically is to wait the Bush administration out. They want to make sure that there is no direct U.S. attack on Iran, because as I said, it would limit their ability to grow and become a major power - economic power. Let me go through this just a second. The Saudis are today the fifth largest producers of chemicals in the world. According to their present plans, what is going to happen is being built today.

By 2015, which is around the corner, they will be the largest producers of chemicals, and I'm not saying just petrochemicals - I'm saying chemicals in the world by 2015. The Gulf will be the largest producer of aluminum in the world by 2015, 2018. So they feel that by creating this major industrial power, it gives them tremendous diplomatic strength. And they really would like to continue on that because that means that from an economic standpoint, they will be vastly superior to Iran.

The problem Iran has today is that Iran is ensuring itself to remain a third world power, totally dependent on one commodity, on the production of one commodity, highly dependent on forces that have nothing to do with their own doing. Saudi Arabia is going way up in the value-added productions and industrial capacity. They feel that if they can be given a chance, they will be able to have a major advantage over Iran, and Iraq in particular, which means very simply that if we attack Iran today, the money that is really being invested by the hundreds of billions of dollars in the Gulf today will disappear. A lot of this is private local money, and instead of going to Switzerland as it used to, it now comes to the Gulf, and that would change.

Finally, another - I don't have that much time, I gather - but another issue which I would like to point, which is not quite so economic, there's been a lot of effort in Saudi Arabia by the leadership these days to improve the relationship with Iran. The strategy of Saudi Arabia is to improve economically and at the same engage Iran, to sort of make them wait also. So they want us to wait, and they want the Iranians to wait and do nothing stupid.

One of the things they are doing, which is very remarkable, which happened about a week ago or 10 days ago, is the conference between Sunni and Shi'a in Mecca and that was done by the king of Saudi Arabia who brought in Rafsanjani from Iran to discuss any kind of - and to try to unite the Shi'a and the Sunnis a little bit, which coming from Saudi Arabia is a revolution.

And he has done that - has been done by the Saudi leadership and the king in particular, against the Wahabis. He was advised by the Wahabis not to do this and he went ahead and did it. So there is a lot of tension in Saudi Arabia on that issue, but the king feels that you have to engage Iran. You can only engage Iran if you bring them into the fold of Islam in particular. So that is actually meeting great success in the region because people trust the Saudis a little more, and it allows them to defuse a little bit the tension with Iran.

One other thing the Saudis are likely to do in the future is to encourage the sale of gas from Iran into the other countries of the Gulf. Bahrain is very short of gas for its industrialization purpose and they need to bring gas, and they have signed - and I'm sure they could not have signed without the agreement of Saudi Arabia - an agreement to bring gas from Iran into Bahrain which is - I'm sure it's not to the taste of our State Department.

They have signed an agreement to bring gas into Oman. Again, none of these agreements can be done without the Saudi approval. And the view of the Saudis on that is that it is perfect to bring Iranian gas, because it takes away their primary commodity, which means that they will run out of gas faster, which is good for the Saudis, and it provides the GCC with the feedstock for its industrial development.

So I think that's really the strategy of Saudi Arabia is to delay any kind of conflict as quickly as possible - as much as possible, in order to overcome Iran as rapidly as possible from an economic standpoint, and therefore from a political standpoint in their relationship with especially the Far East. And I'm running out of time, and you're behind me. I'm scared.

Thank you.

AMB. FREEMAN: Thank you very much. That was a terrific presentation looking at Iran largely thorough and economic viewpoint, rather than the usual political-military one. And I think it was very informative.

One of the most interesting developments in the Gulf recently has been the emergence of shortages of gas, such that countries are increasingly talking about importing LNG, liquefied natural gas, from outside the region in order to fuel the huge chemical industries that Jean-François identified as being built.

Jean-François, you mentioned that there is widespread distrust of the United States these days in the region, and I can't help but note that in many ways the United States appears to be becoming the dispensable nation, not the indispensable nation, in the politics of the region.

Consider that the Lebanese political crisis was mediated by Qatar and the Arab League without reference to the United States, even though the United States has been heavily involved in Lebanese internal affairs; that talks between Israel and Syria, which the United States had opposed, are underway in the form of proximity talks brokered by Turkey, again without reference to the United States; that Egypt has now mediated a ceasefire between Israel and Hamas - again, contrary to American desires; and that Saudi Arabia, as Jean-François mentioned, even as it received President Bush, also invited Mr. Rafsanjani to come to Mecca for a pan-Islamic dialogue, and as part of an effort to manage Arab relations with Iran.

Now, this latter development may be nothing new. If you look at the Al Khobar towers incident, you will find that the Saudis were very reluctant to share information with the United State because they feared what we might do. And so we have a problem in terms of leadership in a region which we all agree is of vital importance to our nation.

Wayne, can you tell us what's in store?

WAYNE WHITE: One cannot emphasize enough the complex set of circumstances that's surrounding the Iraqi dimension of practically any U.S. military action in Iran. I don't want to minimize what is being said by the other speakers, but the Iraqi dimension is quite dicey because of our presence so heavily in Iraq. In fact, the Pentagon apparently also raised some such complications, some of the ones I'm going to be talking about in reportedly pushing back against an initiative on the part of the vice president last summer to launch limited attacks across the border against suspected Iranian Revolutionary Guard, IRG, facilities, training, gun running, and what have you. But there are, in the context of Iraq, different scenarios to address, various factions to be taken into account, and first off, the issue of sovereignty, which now looms much larger than it did even a few months ago.

The intense and heated diplomatic battle over the U.S.-Iraqi Status of Forces Agreement, called the SOFA, has made clear that the issue of Iraqi sovereignty would be of much larger consideration related to such U.S. military action in the future.


Intense skirmishing over the SOFA has exposed what has always been historically a very raw nerve for Iraqis. The issue goes all the way back to Britain's much resented retention of Habbaniyah Air Base in the 1930s, following its occupation during the mandate period, and its attempt to do so again in the late '40s, to extend that agreement well into the future.

Any use of very convenient and large U.S. bases in Iraq, or even Iraqi air space for a military action against Iran could jumpstart a major crisis between the two governments. And there probably is a rather broad based and emotive consensus, especially among Arab Iraqis, when practically anything smacking of occupation or proceed just compromising Iraqi sovereignty. As a result, even Sunni Arab Iraqis, with no love lost concerning the Iranians to say the least, would nonetheless almost certainly object strongly to the use of bases in Iraq, Iraqi air space to mount U.S. military operations in Iran against another Middle East state. Many observers would expect the Shia dominated government, containing factions with ties to Iran or large portions of the Iraqi Shia community to be sympathetic, but that would be an overly narrow definition of a likely adverse impact. I should have said unsympathetic, sorry.

Many Iraqi Shia would be considerably more sensitive to issues of sovereignty than military action against Iran because many of them have very vivid memories of the war with Iran that Iraq fought throughout the 1980s.

First off, Washington would have to confront the Maliki government. Not only Prime Minister Maliki, but other major government figures like President Talabani, a Kurdish leader with also some very close ties to the Iranians, are trying to maintain correct, even friendly relations with Tehran. So even the lowest option on the scale of military escalation against Iran, say limited air strikes along the border against alleged Iranian Revolutionary Guard training facilities, or facilities storing arms for movement into Iraq, would bring a rather negative reaction from the Iraqi government.

Should the U.S. ask permission for even limited action along those lines, such request not only might well be turned down, but also generate an Iraqi warning to the Iranians about what was in store for them.

That said Maliki might find it very hard to resist one thing, allowing the U.S. to take some very limited military action against Iran along the border if there was glaring evidence of IRGC training of and/or gun running to elements such as Moqtada al-Sadr Mahdi Army and Tehran turned a deaf ear to strong Iraqi diplomatic protests. So far, however, the U.S. ahs not been able to produce any really convincing evidence, despite a stream of allegations along those lines. And there's another potential problem regarding more limited U.S. military action against the IRGC.

The IRGC's main training facilities for Iraqi militiamen, Hezbollah fighters from Lebanon, and others, isn't near the border. It's near Tehran, deep inside of Iran. We must bear this in mind because the IRGC may well have kept any facilities along border to the bare minimum in order to avoid giving the United States easy targets within say five, 10, or 15 miles of the border, in order to take away that later option that it might be able to sell in certain circumstances for the Iraqi government. A deep strike against the facility near Tehran, that's quite large, would naturally be far more provocative with respect to Iran's reaction, including a possible Iranian response inside of Iraq. That said such a facility could be hit with a salvo of cruise missiles or air strikes from fleet elements in the Persian Gulf that would not involve Iraqi air space or bases in Iraq, at leas eliminating one complication regarding potential blow back from the Iraqi government and population regarding the issue of sovereignty. Nonetheless, Iran still might opt to step up its aid for anti-U.S. elements in Iraq like Moqtada al-Sadr Mahdi Army. In reaction to such actions, Iraq might become involved in any case.

The consequences in Iraq of what so many of us fear most, robust U.S. military action against Iran's nuclear infrastructure could be very, very serious. Given the shear magnitude of the op plan, the operations plan and play back in 2006 was briefed to the president, between 1,500 and 2,000 combat air strikes in Iran, destruction of much of the Iranian military's ability to retaliate in the Gulf, last thing as long as five days or so to accomplish all that before, in some case, even moving on to the nuclear infrastructure, is almost certain to involve Iraqi air space in one way or another. And the more painful blow for Iran, the more pressure the Iraqi government would come under to express its Iran extreme to the U.S. in the wake of such action. Frankly, that could mean - it's hard to say with real precision what this could mean. It could go on a number of directions that we could explore in questions.

In fact, before to dust - (unintelligible) - over the SOFA between the U.S. and Iraq, I was inclined to believe that the Maliki government and other official denizens of the green zone would probably go along with the SOFA if certain concessions were made because they depend so heavily on the United States for their very political and security survival. Clearly Washington made that same assumption too, and it evidently turned out to be very wrong and it overreach in its first draft that was sent to the Iraqis. That's said it's difficult to sort out what the U.S. actually proposed because of all the contrary claims and denials that have been bouncing around over the last several weeks regarding the SOFA.

So in the context of large-scale U.S. military operations against Iran, the Iraqi government would find itself unpleasantly caught in the middle of a major popularly perceived issue of sovereignty. First off, it would mean that despite the dangers involved for the Iraqi government, such as the SOFA, will go down the terrain, possibly forcing a speeder U.S. exit from Iraq. And if it's still fragile, and it is fragile, Iraqi government were compelled by U.S. military action against Iran to take steps rendering it impossible for U.S. troops to remain in great numbers in Iraq, it could take the first step in more speedily destabilizing itself. I should point out that the Iraqi government, still in the early phases of development and very fragile, also would be ill prepared to deal with a veritable war on its doorstep, which is exactly what the worse scenario involving Iran would be. Moreover, there would be a burst, of course, of anti-American demonstrations in various quarters of Iraq following a robust U.S. attack against Iran.

The thing that worries me most, that would be of course rocketing, mortaring of the green zone, U.S. bases, all manner of this kind of thing, public demonstrations - the thing that worries me most is that attacks could come against our PRT teams, Provincial Reconstruction Teams, U.S. forces, contractors, others from people who are armed and presumed to be our friends at this point. This wouldn't be ordered by militia leaders or leaders of the concerned local citizen groups or tribal leaders. They could come in a very occasional and spotty fashion, which is the worst fashion because it'd be unexpected. It would happen here, there, and in various places by individual fighters or small groups of them.

Additionally, there is the Iranians and what the Iranians themselves might opt to do in Iraq in the worst-case scenario. The Iranians would greatly increase obviously the amount of support they're giving at anybody who would fight the United States or stand up the United States, all the way from Moqtada al-Sadr's people, even the Sunni Arab elements if that were a possibility. In an absolute worse case scenario, they might throw all caution aside and send the Revolutionary Guards, hundreds of them into Iraq across a poorest border, and attack U.S. forces directly, not caring much about their own losses in such a scenario.

The latter of course would involve violating Iraqi sovereignty, turning Iraq into yet another battlefield. I'm inclined to think they wouldn't do that last thing.

Consequently, I would regard that reaction's less likely, and what would be perhaps more dangerous for the entire Gulf and beyond, as well as Iraq, is that the Iranians might surprise everyone by not striking back immediately, by biting their time and looking for a better opportunity. And this doesn't limit itself to Iraq or even the Gulf, but other places, including Lebanon.

I haven't talked about Israel. I figure that would come up in Qs&As, and there's more to discuss for sure. And I think I'll stop right now, or else Chas -

AMB. FREEMAN:I should note before we turn to the next and final panelist that we were honored earlier by the presence of the Congressman Jim Moran, who is a very modest man. I didn't want to call attention to him when he was here, but I would just say that he is one of the few members of the House who continues the tradition of hearings that are intended to educate the public and to explore issues without any partisan focus or search for advantage. And I think the modesty and seriousness of the man are illustrated by the fact that he came and stayed as long as he could at this early session. So I would like to recognize and commend that seriousness.

We turn now to a Turkish perspective. The United States has troubled relations with Turkey. Our speaker is an expert on those relations. I would just say, as a former assistant secretary of Defense, that I was very much impressed when I was in that job by the extent to which American policy depends on the cooperation or acquiescence of Turkey and the range of issues that are involved.

The United States cannot conduct policies toward Iran, Syria, the Eastern Mediterranean, Greece, Cyprus, the Arab Gulf, the Caucasus, Central Asia, Russia, NATO enlargement, the countries of the Islamic Conference, or the Balkans without the involvement or acquiescence of Turkey. And therefore it is particularly striking that Turkey in cooperation with Israel and Syria, its neighbors with which it has had very troubled relations, has been in the process of brokering proximity talks.

I now invite Professor Tayyar Ari to come to the podium and tell us something about this.

TAYYAR ARI: The problem we are discussing is very important; if a solution can not be found, it may cause uncontrollable consequences. I will, first of all, try to outline Turkish-Iranian and Turkish-American relations and then suggest potential options and scenarios.

Turkey, as a democratic, parliamentarian government has deep relations with the West and the United States. During the Cold War years, Turkey strengthened these relations as a member of organizations such as NATO, the European Council and the Organization for European Economic Cooperation (OEEC). In the Cold War era, Turkey became a vital ally for the United States and supported its policies in the Middle East against Soviet expansion toward the region. It recognized Israel and established diplomatic relations with Tel Aviv. Ankara became a reliable ally for Washington and supported Eisenhower and Nixon policies toward the region to reduce the threat of international communism. At the same time, during the long lasting Iraq-Iran war and the war against the Iraqi invasion of Kuwait, Turkey cooperated with the United States and international community.

Turkey and Iran, which were important US allies during the Cold War, also have good relations. In fact, the two states have never been at war since the beginning of the seventeenth century. After World War I, Turkey and Iran took the lead in establishing a regional alliance called the Sadabat Pact with Afghanistan; during the 1950s, they signed the Baghdad Pact with Iraq. The basic purpose of these agreements was to make the region secure. In 1962, they established the Regional Cooperation for Development, an economic organization that in 1985 evolved into the Economic Cooperation Organization.

But it should be noted that after the collapse of the Iranian monarchy in 1979, relations between Turkey and Iran became heavily economic rather than military or strategic. This process also influenced the strategic architecture of the region since Iran was perceived as a new threat to the countries of the region and the United States. Iran's relationship with the United States ended as a result of the hostage crisis, which lasted more than a year. Also as a result of this threat perception, the Gulf countries, with the exception of Iraq, established an organization called as the Gulf Cooperation Council in 1981. Moreover, after the collapse of the Soviet Union, but particularly after 9/11 attacks, a new threat perception stemming from international terrorism and nuclear proliferation replaced the Communist threat.

In this new security environment, Turkey continued its relations with the United States and the West against these emerging threats. Having experienced terrorism, Ankara gave full support to Washington and took part in the Afghanistan operation as a member of NATO and as an ally of the United States.

The collapse of the Soviet Union and the end of the Cold War changed Turkey's security structure. Turkey has good and relations with Russia and the newly independent states. Along the way, Turkey has tried to reduce its security concerns by taking some initiatives to solve existing problems with Syria and Greece. It has also improved its relations with the Balkan countries. This has hastened the EU accession process. In this context, Turkey benefited from the new opportunity to make its foreign relations multidimensional, in terms of both geographical and functional levels. In this framework, Turkey has developed its economic, political, and social relations with other countries.

In this new period, Turkish-Iranian relations have been virtually problem-free, particularly in the economic sphere. Turkey has been importing 10 billion cubic meters of natural gas from Iran annually; recently their trade volume increased to $7 billion. Ankara respects Washington's concerns about Tehran's nuclear ambitions and is willing to try to solve this problem by peaceful means. Turkey is definitely against nuclear proliferation. The U.S. government has been insisting that the Iranian nuclear program is aimed at producing weapons, not nuclear energy, since Iran is the second largest energy center in the world.

However, after this conceptual and historical framework of relations between Iran and Turkey, and between Iran and the United States, let's focus on the issue of war with Iran and its regional implication. There are several options for the United States:

  1. Inspect the Iranian nuclear program through the International Atomic Energy Agency and search for a settlement in cooperation with Security Council permanent members and NATO allies; continue the limited isolation of Iran through multilateral action. As noted before, Turkey initially would prefer to find a solution under the cooperation of the international community and international organizations such as the IAEA and the United Nations. But Turkey is willing to play a constructive role to persuade Iran not to develop nuclear weapons and cooperate with the international community. Iran should fully cooperate to eliminate all suspicions about this subject.
  2. Implement strict isolation of Iran with the support of permanent members of the UN Security Council, NATO and the Middle Eastern countries. Under a comprehensive economic and military embargo, Turkey as well the Europeans and other countries that have important trade relations with Iran might be significantly affected. It is also too difficult to apply under current UN mechanisms. Iran has been an important gas supplier for Turkey in recent years and their trade relations are growing. But under international law, if a decision were adopted by the United Nations, Ankara would perform its responsibilities, as happened during the first Iraqi operation in 1991 and in succeeding years. But without a UN decision, if the United States tried to isolate Iran to deter it from its nuclear ambitions, then Turkey would contribute by reducing its economic and political relations with Iran.
  3. Strike lower-value targets in Iran with a limited strike. Iran might not retaliate if an American strike is conducted toward non-vital Iranian targets. In such a situation, the United States also needs to be supported by regional and global allies against possible retaliation by Iran. But this would be political rather than military support.
  4. Strike high-value targets recognized by the IAEA and the EU3 to show the credibility of using a military option and to minimize reaction of international public opinion. There is the probability of escalation as a result of retaliation by Iran against U.S. forces and U.S. allies in the Middle East. The United States would need to be supported by Turkey and NATO members. If international society were convinced that all peaceful means had been exhausted, Turkey's support might be obtained.
  5. Strike with a wide range of military capabilities to destroy Iran's nuclear infrastructure. Escalation would probably occur. In such a situation, Iran might retaliate and escalate the war. World public opinion, Middle Eastern countries, and Russia, and China might respond to the unilateral action of Washington. In such a situation, Turkey's support would be limited to the allocation of certain bases. But if the United States received the support of the UN or NATO members, Turkey's support would not be a problem, and the operation might succeed.
Of course, all of these option/scenarios can be reevaluated by taking into account other factors not included in this analysis. But all scenarios relating to the use of military power against Iran have a potential for escalation, because Iran may retaliate against U.S. forces in Iraq and Afghanistan. Iran would have the support of all Shia groups inside or outside Iraq. Iran might attack the U.S. homeland with suicide bombs by proxy groups. Iran might also attack US naval forces stationed in the Gulf and temporarily shut off the flow of oil from the Strait of Hormuz.

In this case, the United States and its allies in the region would be under threat, and escalation to war could destroy the stability of the region. Anti-Americanism would increase and militant groups might attack American targets, as they do in Iraq. Some Iraqi groups have warned the United States against military strikes on Iran. For example, Moqtada al-Sadr pledged he would come to aid of Iran in the case of military strike. A military strike against Tehran would increase the chaos in Iraq and could complicate the U.S. position.

To summarize, it is not desirable for Turkey and other countries in the region-or the United States-to exercise military options. U.S. forces are preoccupied, and the lack of security in Iraq would make difficult a full military attack against Iran. Employing military power to solve this question might increase potential threats and risks rather than contributing to regional stability. Even if Iran were occupied, the control of such a large country would be very difficult and would impose too many political cost on America. Oil prices would increase and would not be brought under control, since oil wells and pipelines would be destroyed during a war. Iraqi politics would suffer the most, and the American position would be at risk. It must also be remembered that Iran is very different from Iraq; it is ethnically and religiously not as divided. Most of the population of Iran is Persian or Azeri, sharing the same religious beliefs.

Thank you very much.

AMB. FREEMAN: Thank you. Thank you, Tayyar, for that very methodical analysis of five options and the Turkish stand on each. I was very struck by your statement that if the United Nations and NATO were to authorize action against Iran that that would bring with it Turkish support. It's a reminder that one of the issues in a putative American or Israeli strike on Iran is the question of international law and international order, often forgotten in this capital, but of considerable concern to those in the capitals of other UN Security Council and NATO member countries.

You also mentioned - which no one had done - the vulnerability of American forces in Afghanistan to Iranian retaliation, and raised the possibility of a plausibly deniable series of terrorist actions in the United States by sympathizers of Iran. I note in this connection that Anthony Sullivan's article, which I mentioned at the outset, has in it the rather chilling statement that Hezbollah knows where all the Americans in Lebanon are and would be prepared to take them into custody in the event of such a development. So clearly we're dealing with something with very wide implications which have been, I think, very nicely explored by the panel.

We now move to the comment and question session. Here, if you will indicate to me somehow with a wink, a nod, or a hand that you wish to pose a question or make a comment, I will note you down, and then invite you to take your stand at the microphone. You may now engage in a mad scramble to go to the microphone.

Yes, Michelle, you may. And you must tell us who you are, even though we know. So please, if you'll go to the microphone, and then others, let me know if you wish to follow.

Q: Thank you, Chas. Michelle Steinberg from Executive Intelligence Review. I have a question, and I think you and Dr. Anthony could uniquely answer. I'd like to think of it as called, perhaps, preventive diplomacy. We've heard a lot about preventive war, which we do not support, but recently, EIR magazine was honored to have a very unusual interview with Dr. Mohammad-Reza Khatami, the brother of the former president, the same age as Ahmadinejad, approximately, and the leader of a reform party, the Participation Party.

And he spoke repeatedly of dialogue. And then on Capitol Hill here, we had Representative Barbara Lee introduce, I think, a bill, a long overdue bill. I support it. I don't know about the rest of my crew, but I certainly will advise it. It's called the Iran Diplomatic Accountability Act of 2008 requiring a special envoy. Now, I don't know if you were present at the creation like, I think, Atchison used to say, but you did have a significant role in the China opening. How would you foresee preventive diplomacy or engagement with Iran? What should the United States do? I think there are members of Congress who are all ears on this question.

AMB. FREEMAN: Thank you, Michelle. I don't know. John Duke, do you want to lead off on this, and then I'll add a - need to press the button.

DR. ANTHONY: Sure, it's a missing piece and a well-put question. There would be those on the American side who would say, oh, we've tried this; we've tried this; we've engaged them in the United Nations; we've engaged them in London' we've engaged them in other offsite places, and nothing much has come of it. We've been frustrated; we've been set back; we've found that there's a lot of nodding of the heads and agreement with the rationality and logic of our points' positions, yet, we see no real accommodation in terms of realities on the ground. We have concluded that those with whom we have been speaking do not have the means, power, influence to implement that which they orally agree to in our meetings. So we find this to be unfruitful.

There's another aspect of this though that is less acknowledged and less stated, and that is amongst those within the Bush administration who seek regime change in Iran, they moved from that position to state that engaging the regime in diplomatic discourse vitiates that particular strategic objective. In other words, at the end game, the objective is regime change, and it is for many in the Bush administration. Diplomatic engagement with the regime that you seek to change is not exactly oxymoronic, but it's counterintuitive, and potentially, counterproductive.

AMB. FREEMAN: I think the issue of regime change does figure heavily in the answer to this question, because, of course, the opening to China was premised on abandoning a long-standing effort to produce regime change in Beijing, and on accepting the realities as they were, somewhat unpalatable realities to be sure, and on agreeing in the Shanghai communiqué to pursue a strategic cooperation, notwithstanding differences in the ideologies and social systems in the two countries.

I think the notion of preventive diplomacy is a sound one. A great deal of diplomacy is, of course, invisible, and is not credited with success, because it consists of preventing things from happening that you cannot prove would have happened if you had not engaged in diplomacy. But leave aside the word preventive; simply rediscovering diplomacy in the Middle East would not be a bad idea!

The failure to include it in our strategy is what has produced the sidelining of the United States in the several instances that I mentioned with respect to Lebanon, with respect to Syria and Israeli dialogue, with respect to Hamas and Israel, and with respect to a new arrangement and dispensation within the realm of Islam. All of these are things we have sidelined ourselves from. So, opening a dialogue with Iran would imply not a narrow agenda limited to developments in Iraq, serious as those are, but a broader agenda based on the pursuit of common interests, where we can find them, and reservation of differences for later resolution, if that can be achieved. We will see whether after January 20, such an approach is tried.

Sir?

Q: Yes. I think I can use -

AMB. FREEMAN: Move to the mike, Gene.

Q: Well, there's so much echo. I think you can hear me. Okay? Yes, I'll just speak up a little bit because there's so much echo in the chamber here with the microphone. Eighteen months ago, we had a New York Times ad, as you know - (unintelligible) - which showed a little guy with Uncle Sam, and on one side of Uncle Sam was an old wreck of a car with Iraq on it, and on the other side of the guy, of a little circus hustler, was a car that was brand new, and beautiful, and it was called Iran. And he was saying, forget about that old wreck; I've got a brand new model for you. I think the unspoken dialogue here is not with Europe or Russia or - and they've had the point man on relationships to try to bring Iran away from having nuclear - any nuclear weapons whatsoever.

But I'm wondering if we have to deal with only really two individuals on this. It seems to me that Olmert and Bush are going to be equally responsible for going to war. I was talking with a Republican congressman the other day, and he surprised me by saying, when I asked what would happen if they struck Iran, and he said, we would impeach him. Well, lots of luck. I don't think that's going to happen, but there doesn't seem to be any restraint on either the president of the United States, nor the prime minister of Israel, so far as coming to a diplomatic surge or taking steps that are pretty obvious to any diplomat or to any person interested in multilateral relations and international relations.

My question is to the panel, what would happen if there was a delegation of American Foreign Service officers and ambassadors and former heads of CIA, and so on, who would step out and say, we're going to Teheran. We're not going to - in other words, do the Carter bit with regard to the Iran situation. Would that be at all effective?

AMB. FREEMAN: So the question, in other words, is whether a private diplomatic initiative and opening of the sort that Jimmy Carter conducted in Pyongyang, which took us from the brink of war with North Korea onto a negotiating track, might not work with Iran. That's the question. And who would like to - Wayne, why don't you give us your thoughts on this, and then we'll go around the panel?

MR. WHITE: (Off mike.)

AMB. FREEMAN: Push your button, right in the middle.

MR. WHITE: Yes, got it. One of the problems in trying to address that would be, what would the Iranians say to a delegation like that? The Iranians very much want to deal directly with the United States government. They don't want to receive a note to (the Swiss?). They don't want a delegation coming. It would be positively received, but it wouldn't probably produce any results.

Probably the only thing that might produce results in a situation that's gotten positions hardened quite considerably on both sides, the issue of enrichment, continued enrichment, would be an attempt at what people refer to as the grand bargain between the United States and Iran, in which the United States would essentially give security guarantees to the Iranians in exchange for the cessation of enrichment. But frankly, at this late stage in the game, I'm not so sure that Iran would want to step back from enrichment.

The best-case scenario on the diplomatic side - I'm not discouraging that at all; far from it - would be the negotiation by a robust initiative in which the U.S. took the lead, and to not use the Europeans essentially as their cat's paw in all of this - willing to make meaningful concessions that have not been made since 1979, and resolve some outstanding issues, would be to allow Iran to enrich, but under an extremely ramped-up situation in which there would be intense IAEA monitoring of everything that Iran was doing.

I'll raise something that could probably be very controversial, and that is, in the end, if all else fails, all diplomacy fails, the worse situation that we seem to be boxing ourselves into is if diplomacy fails, somebody goes to war. Either it's going to be Israel, or it's going to be the United States, a combination of both. The exercises that Chas was referring to - we were joking about before the session, because I've seen those sorts of exercises in situations like this in government, and they're usually done in a way so it's quite clear that a number of governments are going to detect the exercises, and draw the warning from them. They're not usually conducted with much secrecy. There is much a diplomatic signal of danger as they are an actual military exercise.

But let me suggest something that's absolutely outrageous, that there is actually another option. Iran remains recalcitrant in the face of UN Security Council resolutions that will probably never have enough teeth to force Iran to stand down, particularly at a time when Iran is selling oil at the incredible price it is now, despite its struggling and ineptly run economy.

There's a choice in between war and failed diplomacy, and that is letting Iran continue, doing nothing. This is very interesting, because so often, the American psyche drives one toward solving a problem, doing something. Somebody has to do something about this. There are a number of governments around the world that have learned that sometimes the best solution is doing nothing about something.

I suggested that once in a meeting with an assistant secretary of state for Near Eastern affairs. He thought it was absolutely outrageous. It looked like - he had a request sitting on his table, and he wanted me to execute something that was against the rules. And I said, let's just forget about it. And he said, well, what if the government comes back? I made a commitment. And I said, well, there were probably a lot of other people who made commitments over the past six months to this government. The government probably knows the commitment you made was a little bit inappropriate, and so we just act as if we forgot about it, and it just goes away. He said, what if it doesn't? I said, well, then we'll deal with that. It went away.

But anyway, what I'm trying to suggest is, and this is, I realize, sort of Bureau of Intelligence and Research (that stayed?) off the wall, kind of out-of-the-box thinking, but letting Iran go nuclear, and I'm saying that even if there is a risk that Iran might develop a nuclear device.

Why would I say that? Because of the absolute insanity that would be behind a nuclear strike against Israel, which is really what's driving all of this, where Iran could, in no way, knock out Israel's massive nuclear capabilities estimated at between 150 and 300 deliverable weapons in a first strike. And Iran would absolutely, without fail - certain Israelis assure me - suffer a return strike that would demolish most of that country, millions dead, maybe even tens of millions dead. There is no way that I can conceive an Iranian government doing this.

And one of the problems we have in our own discourse is focusing too intensely on Mahmoud Ahmadinejad. He's the president of Iran. That doesn't mean he's the president of the United States. His finger isn't on the trigger. He has very little relative power compared to the president of the United States and the presidents of some other countries we're familiar with.

The finger on the button is going to be the Supreme Leader, the clerical elite around him. These are people who have grown very comfortable in ruling a country in which they're making vast amounts of money, have huge economic empires, are quite happy with the way things are going right now. For them to throw it all away in some quixotic attack against Israel with a nuclear weapon is down there with that 1 percent possibility.

I understand Israelis, how they feel. It's easy for me to sit here in Washington and say there's only a 1 percent possibility that you're going to suffer a nuclear attack in the next 10, 15, 20 years. But I'm sorry, it is easy for me to sit back and say that, because that's how low the probability is.

And so, I offer that as an option. Even if all else fails, leave them alone, because there is a 99 percent chance that they want it for reasons that we used to hear that they wanted it. They want the ultimate deterrent. They want to be able to wag that in the face of the United States, and say we've got it, leave us alone. That is almost certainly why Iran is quite determined to go in that direction.

Yes, you're hearing somebody who actually believes that Iran might well have a nuclear weapons program embedded in its overall nuclear program, and who's telling you don't do anything about it; try to forestall it. Try to intensify diplomacy to the level where it can work, perhaps. But if it fails, that doesn't mean war is the only option.

AMB. FREEMAN: There is a strong resonance here with the American experience during the Cold War, which I remind you consisted of a nuclear standoff in which 17 minutes after someone turned a key in Moscow, something between 60 and 80 million Americans would have died. And we lived with that, and we managed it, and it was not fatal.

My second observation on Wayne's comment is that in my experience, generally, people who attribute irrationality to foreign leaders and countries do so as an excuse for not taking the time to figure out what does motivate these leaders or countries or how they think. It's too easy to say so-and-so is irrational and that the only language they understand is the language of death. Generally, that's not true. And I would argue that, in fact, Iran has behaved with consummate rationality on quite a range of issues, even if its reasoning processes and its premises are not ones we share.

John Duke?

DR. ANTHONY: Gene, in answer to your question, I would favor the frame of reference that is in the adage of children asking the question, “Daddy, where were you during the war?” In this particular case, inactivity is not an option. And diplomacy is not limited solely to those incumbents, the foreign affairs practitioners, Foreign Service officers, envoys, intermediaries, and the traditional exercise of “good offices” within the United States government. By definition, the concepts of citizen and private diplomacy, if not also public diplomacy, encompass the kind of initiative that you mention -- those in government have no patent on the process, no trademark on the technique, no monopoly on the method, no copyright on the concept. An effort such as the one you suggest would at least show concern on the part of an important segment of the American people. It would show courage, conviction, and commitment as to the seriousness implications of this problem. To the extent it would be covered by the media it has the potential to italicize, neonize, and capitalize the dangers and slow if not complicate the rush to war. It would contribute to a more robust and wide-ranging discussion and debate. It would enhance people’s knowledge and understanding. I support it.

AMB. FREEMAN: Jean-François.

DR. SEZNEC: Well, very much along the same line, I think it would be great to have private diplomacy go. It would complicate the rush to war. I mean, I think the purpose is to actively do nothing, and to actively gain time here. It's very important, and I think, as I mentioned in my little talk, I think the countries in the region feel that if we do actively nothing, Iran will collapse sooner or later. So why create enormous amount of trouble in the meantime for ourselves and for themselves? They view their own interests first. But I think in this case, their interest goes along with ours

AMB. FREEMAN: Several observations. First of all, it's not always better to talk than not to talk. It's not better to talk if you don't know what you're going to say, and you don't know what you want to accomplish. And there is no consensus in the United States about how to deal with Iran. The issue of private diplomacy, therefore, is inherently exploratory, rather than definitive at this stage, it seems to me.

Second, we have a tendency to treat Iran as a nuclear problem rather than as a country, and here, I think Wayne said something very important. He raised the issue of security guarantees for Iran. Why is it that Iran seeks nuclear weapons? Well, there are probably quite a number of reasons, but one of them might be a concern to deter attacks of the very sort that we are discussing, that is, gaining the ability to retaliate against the sort of scenarios that have been outlined. And a final thought -

MR. WHITE: I think there's another point, Chas, too.

AMB. FREEMAN: Please.

MR. WHITE: And that is I covered Iraq during the time when Tuwaitha was bombed. I was the Iraq analyst in those days. And at the time that Tuwaitha was in existence - this is the Iraqi Osiraq reactor facility south of Baghdad - there was absolutely no evidence, and good evidence came out later, that Iraq had a nuclear program. The Osiraq project was smothered with IAEA observation, and there were French and Italian contractors on site who had considerable access to what Iraq was doing, the (sea?) diversion of materials and what-have-you.

Now, the Iranian program isn't that confined - far from it. The Iranians learned the lesson from Iraq's Osiraq disaster when the Israelis on June 7th, 1981, took it out, because it was in one place. By dispersing their nuclear infrastructure throughout the country, which of course, means that when you go into Iran after that nuclear infrastructure in that op plan I mentioned, which eliminates also other retaliatory options, you are not making a surgical strike against the capability of that country. You're going to war with Iran. That's what I'm talking about. You're going to war with Iran.

But Iraq's nuclear program did not start until after Osiraq was bombed. And using nuclear materials that it could acquire, and that it had on hand from the bombing of the reactor, it is estimated that they got frightfully close to at least the explosion of a nuclear device around the time they were attacked during the Gulf War. In fact, a crash program was put on in order to try to get that to forestall Desert Storm. But the IAEA inspectors were astounded at what a country could do, shorn of even its major nuclear site.

The same thing with Iran - there are a number of technical people out there who are nuclear engineers, and who have followed proliferation, who say that Iran, even if many of its key targets were taken out, could then embark on a crash nuclear weapons program. In other things, the very thing made to deter them from doing this could propel them forward in that direction. The average person would say, well, that's impossible; it was bombed. You'd be surprised what one can do, once one has achieved the expertise, and the world assumes that you're not capable anymore in going for a weapon. It could be that the Iranians would move more rapidly toward a weapon, if they were hit, than if they were left alone.

AMB. FREEMAN: There is a key point here. Science and technology are in the mind, not in the equipment and the buildings that contain the equipment. And bombing, as we saw after World War II, does not destroy modern societies. They can resurrect themselves very quickly.

I was going to make a point which follows on Wayne's, and that is under the heading of Iranian rationality. Let me suggest that it is intelligent and rational for the Iranians to have suspended their weapons development program while they concentrate on the far more expensive and difficult task of building a comprehensive nuclear fuel cycle. So the fact that they suspended their weapons program does not mean that they don't have the intention of developing a weapon. They certainly have ample reason to develop a weapon, especially in light of the threats which are constantly issued against them.

In this connection, I think, however, we need to recall an unlearned lesson from the Iraq experience, namely, we should be very distrusting of the assertion that a country or its leadership are an imminent threat against others in the region when those in the region do not agree that they are. Iran is not primarily a nuclear problem from the perspective of most countries in the region, with the exception of Israel, which is an important exception.

It is a threat in terms of influence, political power, and prestige. And many of its inroads in the region have actually been facilitated, if not actually brokered by American policy. This brings me to another observation, and that is the effort to isolate and ostracize Iran is probably, as it has been in the case of the Cuban regime and the North Koreans, and now Comrade Bob Mugabe in Zimbabwe, the greatest guarantee against regime change due to internal causes, because it rallies Iranian nationalism behind the current leadership. It concentrates patronage power in that leadership, and it provides a ready excuse for everything that's going wrong. It can be blamed on foreigners who are attempting to do in the regime or oppose the country.

All of this does argue that perhaps diplomacy of some sort, perhaps with some exploration by private emissaries, might be a better idea than the five options that Professor Ari outlined. In this connection, I note that there has been a very constructive proposal made regionally to deal with the problem of the Iranian nuclear issue, and that is to regionalize the nuclear fuel cycle, and to ensure that bits and pieces of that process are scattered through the Gulf in the various countries of the Gulf, and not concentrated in any one country, meaning Iran.

This proposal, which was made first by the Saudis, and since been echoed by some American thinkers, has passed unattended by our government, and not much noticed by the think-tank community. And yet, it is an obvious means to diplomatic resolution of a serious issue and likely to be much less unacceptable to Iranians than the earlier effort to bring in the Russians, their traditional enemies, as the guarantors of their nuclear security.

So I think a little bit of diplomacy might not be a bad thing. And whether it's begun on a private level, as Gene (Byrd?) suggested, or is thought of as preventive, as Michelle suggested, is really secondary to the point that we need to explore alternatives before we decide either to bomb or do nothing.

Q: Andy (sp) Constanzas (ph), private consultant. The option that was - the panel covered the option of do nothing, and it appears that it is a possible alternative. The panel also covered the question that the negotiations have not been explored, and there is still room for more negotiations. The panel also covered the fact that Iran has an economic problem, and they're about to collapse. So I spent five years in Iran, and my problem in dealing with Iranians was to find out what they meant. As the British very well said, they never mean what they say and they never say what they mean.

So if we are going to - then the question becomes, what is the problem? Is Iran the problem or is Israel the problem, because if we do nothing, and Israel, afraid that they're going to lose hegemony in the region, attacks, and we agree to provide air refueling support, which they don't have, then what do we have? We still have a problem, and then the problem is not Iran anymore. It's Israel. So if we are to pursue discussions with Iran, what do we talk about? What is their hidden agenda that we haven't hit yet? And I would appreciate if the panel could discuss that point, because I think that is the most important point that hasn't been covered.

AMB. FREEMAN: Thank you. This does raise the question of whether there is a possibility of regional diplomacy of the sort that has been going on in the various instances I mentioned. And I would like to ask Professor Ari to comment on whether it's true that Iranians never say what they mean and never mean what they say. Please.

DR. ARI: It is a problem that stems from Iranian activities and the perceptions of Israel. Because Iran is an oil hegemon and a military power, it is perceived as an important threat to Israel. So this, in the case of Israel, is why it is against Iranian nuclear ambitions. But, as my friends have also said, this problem cannot be solved only by military options. Maybe there are other options that should be taken into account in this process. Economic isolation should be continued, with the support of regional countries and the world - NATO allies and the United Nations. This is as important as military options. Let's talk to them, to prevent a process that escalates into a war and worsens the situation in the region.

AMB. FREEMAN: Jean-François, and then John Duke.

DR. SEZNEC: Okay. Just to pick up really on this point, and your point on the regionalization of the diplomacy, I think by doing nothing, I think we really would be - and we are, but if we can achieve doing nothing, we automatically put the diplomacy on the region, and I think it is already happening, actually. There are a tremendous number of contacts between the Saudis, in particular, and the Iranians. I'm sure there are contacts between the Turks and the Iranians just as well to see how they can, not mediate with the United States, but at least make Iran feel comfortable in the region. I think that's happening already.

They're trying to open up, not only the diplomacy, but also the economy, so that as I mentioned earlier, that they can sort of help, so to speak, Iran, have problems faster in many ways. But I think the fact is the region is becoming much more active in all manners of diplomacy, as Ambassador Freeman mentioned, with Qatar being involved not too long ago - and then Turkey being involved in the Israeli negotiations, Qatar being involved in Lebanon. So I think this regionalization, they're dying to become move involved, if we could see there is any success into this.

AMB. FREEMAN: Dr. Anthony.

DR. ANTHONY: Andy asked whether this might become an Israeli problem more than an Iranian problem. The answer is potentially yes for the following reasons. One is rooted in the fact that this is 2008, the 60th anniversary of Israel’s founding as a Jewish state. Look at the arithmetic. Exactly half of these 60 years have been ones when Israel and Iran were thicker than thin. At many different levels, their relationship was closely intertwined; it was pervasive, massive. Strategically at both ends of the spectrum, it was seen as mutually beneficial, reciprocally rewarding. There are many Israelis who long to return to a similar situation.

Two, there are Israelis like former longtime Israeli intelligence official and Foreign Minister Director General David Kimche who was asked by an interviewer on a BBC television program I once watched, “Are there no people on the earth that you trust?” Kimchi answered, “Yes, one.” The interviewed followed up with, “Who?” Kimche replied matter-of-factly, “The Persians,” the allusion being to Esther and the liberation of the Jewish people from Babylon.

Three, during the middle of the Iran-Iraq war there was what is known in the U.S. as Contragate and in the region as the Iran-Israel Contragate scandal. The episode was one where the U.S. government pressured all the GCC Arab countries and many other nations to do whatever they could to ensure that all flows of weapons into Iran were stopped, but lo and behold the United States and Israel were caught red-handed providing arms to Iran.

Four, there is the fact, in the eastern part of the Middle East, that Iran is home to the largest number of Jews that has not yet immigrated to Israel.

Five, there is the question of domestic politics in the United States. This is the so-called “silly season,” where the entire House of Representatives is standing for election together with a third of the membership in the Senate, and the president by law and the vice-president by decision will step down. How the topic of today’s discussion on war with Iran will play out with the pro-Israeli element in American domestic politics remains to be seen.

Six, there is also the element of the Baha’i faith among its believers in the United States and those among its remaining adherents in Iran, where the faith began and the Temple Mount in Karmel, Israel, which constitutes a link between the peoples of the two countries of which many are unaware.

Seven, Shaul Mofaz, one of Israel’s deputy prime ministers, who is the country’s former Minister of Defense, was born in Iran and is widely known for being one of Israel’s most hawkish advocates for attacking Iran militarily with a view to preventing it from continuing its nuclear program along the lines it has been pursuing.

Eighth, there are Israelis and their American and other supporters that view regime change in Iran as holding out the prospect of replacing it with one more amenable to Israel, more moderate in its approach to the Arab-Israeli conflict, less supportive of Hezbollah, and less likely to continue supporting Hamas as much as it has.

Lastly, numerous Israel strategists acknowledge the possible strategic and geopolitical benefits that could follow any shift in attention from the eastern Mediterranean, away from the Israeli-Palestinian and/or Syrian peace process and pressure to withdraw from the settlements in the Israeli-occupied territories. Certainly, were the status quo of leaving the Teheran regime in place to remain, Israel would be unlikely or find it far more difficult to accomplish many or most of the potential accomplishments associated with these kinds of objectives or benefits.

AMB. FREEMAN: Wayne.

MR. WHITE: Yes. I think one thing that I didn't have in mind until John Duke raised it is we are in the silly season, as he said, and we shouldn't limit that just to the United States. We have Iraqi elections coming up, which is one reason why the Iraqis are going to be extremely sensitive on issues of sovereignty that I referred to. The Iranians have elections coming up. In Israel, we have an extremely weak - probably the most - the weakest prime minister in a long period of time. And so we are seeing diplomacies trying to struggle in the midst of the worst possible conditions that it can find.

One thing I'd like to clear up is there's been a discussion about the doing nothing option. When I was joking about that, that wasn't my recommendation. It was if we got to the end of the road and all the diplomatic, far more aggressive diplomatic efforts had been put in play, and then we were faced with something that somebody had painted us into a corner to believe is war as the only option, then we should do nothing.

But the silly season is upon us and this is very dangerous, because we are in the last six months of the presidency that's probably most likely to carry out a robust military action against Iran, and the campaign will actually make a population become more inclined toward that, that option, which is an extremely dangerous thing. It feeds into each other.

Somebody mentioned before, which is more of a problem, Israel or Iran? Frankly, I think they're both a problem. I think the Israelis are painting themselves into a corner, demanding that certain things be done or else, and the Iranians have painted themselves in the corner in the person of the very vocal president in making the worse threats, existential threats, that Iran has ever made. And so we are roundly in a silly season, extending all the way from Teheran back to Washington, and it's making diplomacy extremely hard to work in the midst of this kind of inflammatory environment.

AMB. FREEMAN: But I think, in fairness, Wayne, you're not really posing the option of doing nothing. What you're saying is -

MR. WHITE: Oh, yes.

AMB. FREEMAN: - if you can't solve the problem, manage it, which is not the same as doing nothing.

MR. WHITE: Precisely, precisely.

Q: My name is Carl Osgood. I'm also with Executive Intelligence Review. In 2003, there was nothing that Saddam Hussein could have done to stop the U.S. attack, short of an unconditional surrender, and that was because the war party in the United States that was dominating the Bush administration had determined - those people had determined, probably 10 years before that, that war with Iraq was necessary. It seems to me it's the same case with Iran, and Iran is even less likely to surrender unconditionally than Saddam Hussein was. So doesn't it mean - doesn't that -

AMB. FREEMAN: You're arguing to either modify the objective of overthrowing the regime come hell or high water, or accepting the consequences of that?

Q: Well, I think actually what I'm asking is if - what I'm suggesting is that raising the cost to the war party in the United States of going to war with Iran, such that they decide for their own self interest that they can't do it.

AMB. FREEMAN: We haven't discussed this, and I think it's an interesting point, because in the case of the invasion of Iraq, there was a remarkable lack of enthusiasm across the board among professionals in the intelligence community and the military and the diplomatic establishment in Washington. This was done entirely by people who had come in as a result of an election, and arguably, a Supreme Court decision connected with that election, and not by the professional bureaucracy.

And we seem to have a very similar situation now. One detects very little enthusiasm, in fact, a lot of antipathy, among the uniformed military for the prospect of what, as Wayne has pointed out, would be a war with Iran, an open-ended conflict with no obvious point of termination. So I think your question is very good, and I'd like to ask several of the panel members to comment.

Jean-François, you're first.

DR. SEZNEC: To answer your question, how do we deter the war party? How about oil at $300 a barrel, because that's what would happen, and that means people would start paying very substantially at the pump, like $10 a gallon. I think that would really - I think that's very - we should probably make clear that's what would happen, because if we start cutting the exports of Iran - that's 2.8 million barrels a day - if there are any problems in the Straits of Hormuz because of Iran, there would be a total net loss to the world market of 16 million barrels a day, that would be a major, major problem for the world and a major recession.

We would probably suffer less than most other countries, because (Iran?) imports maybe two million barrels a day from the Middle East - from the Gulf today, but the price would go through the roof, and we would end up paying very dearly for this.

AMB. FREEMAN: Well, I think the point you're making is again, that the global oil market is like a reservoir into which supplies discharge, and from which we draw what we need, and regardless of whether we are dependant directly on bilateral supplies of oil from the Middle East, we are affected; everyone is affected by the withdrawal of supply that would be entailed in a conflict.

John Duke?

DR. ANTHONY: Unmentioned thus far is another strategic gambit. It is one that was in play in the lead-up to the American military attack against Iraq, and it applies also to Iran, only more so. In the period leading to the American-led invasion and occupation, I sat in countless meetings where numerous specialists argued that, “The United States has got its head upside down, inside out, and backwards – it should be invading Iran first, Iraq second, Syria third, and either Egypt or Saudi Arabia, fourth or fifth.”

And this particular school of thought, again, on the regime change aspect there has the following objectives in mind. One – and the vice president himself when he was out of office in the mid-1990s and continuously to the end of the 1990s, would refer to American’s self-inflicted wound, that it’s one thing to be patriotic, another to be imbecilic and idiotic with regard to shooting ourselves in the foot, and keeping ourselves out of Iraq and Iran’s economies and energy industries through the sanctions that we were leaders of applying there.

Secondly, with regard to this game plan for regime change in Iran that any regime that would be grateful to – (unintelligible) – and Uncle Sam for having helped them come to power would likely be more amenable to be moderate on the Arab-Israeli conflict, and less supportive of Hezbollah and Hamas and elsewhere there.

There’s also the strategic setback that the people pushing this perceive to be dealt Russia and China. If one goes back, and Chas, you can elaborate on this, please, to the defense policy guidance of 1992, and Paul Wolfowitz’s role in drafting this, and I was – orally summarized a draft of it and asked to comment – the vision then was called 2020, what does American have to have still in being by 2020 to remain the world’s sole superpower?

And the answers were continued economic, financial, technological, military and industrial supremacy, and key to that was energy, and key to that was the energy resources of the Arabian Peninsula and the Persian Gulf.

Iran is the last remaining piece on the chess board. Of the eight countries in the Gulf, seven are effectively under U.S. influence and domination and predominance on regional stability, regional defense issues. And unlike Iraq, which has only 48 miles of coast on the Gulf, and is therefore, barely a card-carrying Gulf country, Iran has 550 miles of territory on the Gulf coast, and up to a potential of 20 ports that can be developed for imports and exports, whereas Iraq has only three. And all of those are in shallow water that tends to silt up; not to mention that Iraq couldn’t be further away in the Gulf from the Hormuz Strait, whereas Iran is directly across from it.

So these dimensions that make Iran potentially the greatest strategic prize, and not least because it’s the only country on the planet that borders – is adjacent to two deeply rich energy reservoirs: the Caspian Sea and the Gulf. Iraq has only half that kind of an access.

AMB. FREEMAN: I might just note that the American position of preeminence in seven of the eight oil producers has done wonders for the price of gas at the pump.

Sir?

Q: Thank you. I'm Benjamin Toua (ph), a retired Foreign Service officer. And I came back a few days ago from a trip to the Middle East which included Gaza, the West Bank, Israel, Jordan, Syria, Egypt and Lebanon sponsored by the Council for the National Interest Foundation, or at least organized by them. And during our trip, we asked about Iran, and the answers that we got from senior, current officials in the Arab countries that we visited, as well as former officials and others, indicated a certain ambivalence about the Iranian role in the region.

On the one hand, they see a positive in the sense that Iran is supporting Hamas, which they see as support for the Palestinian cause, and Hezbollah, which they see as support for Lebanese territorial integrity. On the other hand, they are obviously a little bit nervous about this new influence, but they essentially blame the U.S. And as Ambassador Freeman suggested a little while ago, this is because of our policies in Iraq and also because of a certain absence in the region.

So I just throw these out as perhaps tying in some of the ideas that have been put together about the efficacy of diplomacy, public diplomacy, and Iran's role in the region. It's rather ironic that when we have international conferences on solving the problems of the Middle East, Iran is not included in these conferences. Thank you.

AMB. FREEMAN: Thank you. Old habits die hard, and there is a propensity among Arab governments and elites in the region to look to the United States to manage problems, as we once did, and there is a great deal of distress that we now seem to be the problem in many cases. So I think the ambivalence that you detected toward Iran reflects this factor, as well as others. I don't know whether anybody would like to comment on that very useful observation. Would you?

DR. ARI: Yes.

AMB. FREEMAN: Please.

DR. ARI: Yes, that is an interesting approach -- to find a solution to the problem by an international conference. But the basic problem, I think, stems from the situation caused by the enrichment activities of Iran and how these are perceived from the outside. Some countries, led by especially the United States, think that such a process would create another nuclear power, making a nuclear power of Iran, and that Iran's nuclear program is aimed at acquiring nuclear weapons and not peaceful purposes.

In the end, finally, Iran will try to produce nuclear arms. So the United States insists that Iran should relinquish this program and not continue to do nuclear enrichment programs. But many states think that peaceful nuclear programs can be accepted. In terms of the 1968 NPT Treaty, to have a nuclear program for peaceful purposes is acceptable. For this reason, an international conference cannot solve the problem but should be taken into account.

AMB. FREEMAN: John Duke.

DR. ANTHONY: If I infer correctly about the concern about the American non-engagement of Iran on the one hand, and Israel with regard to the Arab-Israeli conflict, Israeli-Palestinian, Israeli-Syrian process, those with whom I speak in the region from Kuwait to Oman, and everybody in between, couldn’t agree more on this. And there are two dynamics of this. Without such serious and effective and measurable engagement, the atmosphere is unreceptive, as it could be, to being able to prepare better, to plan better, to anticipate better, to invest better, to be more efficient.

Because of these uncertainties, capital is a coward. It does not like to go into places that are uncertain where the situation is seemingly insecure, or an imbroglio, or a different kind of oil in the Gulf, namely turmoil, is being introduced into the situation there. So engagement that’s serious, rather than just pro forma, and rather than just full of – (unintelligible) – empty rhetoric is indeed desired from one end of the region to the other.

And the second aspect of it is for the American community, which is growing and robust within the GCC region; whereas there were 500 U.S. companies as recently as three years ago, now there are 750 companies in the region. And as Andy Constanzas knows, when the United States is seen to be doing the right thing in the right way at the right time for the right reasons and the right people and the right issues, it is much more easy for the American community to live and work in that region, much easier for them to be trusted, much easier to extend the American’s confidence. When the United States is not doing that, it’s the reverse, and this spells dire implications for the American assets and interest and investment and involvement in that region.

AMB. FREEMAN: Please.

Q: Hi. I'm Steve Fetter, University of Maryland School of Public Policy. I think there was a lot of wisdom in Mr. White's earlier remarks about what he called the do-nothing option. I don't think there is a realistic military option for the elimination of Iran's nuclear program. You can destroy facilities that you know about, but the know-how is in the minds of people, and that program would almost certainly be rebuilt underground, and would lead to a nuclear weapon, if we were to attack. So really nothing short of the occupation of Iran could accomplish an elimination of the program, and that's certainly beyond Israel's capability, and I think beyond ours.

And I think you're right that an Iranian nuclear attack could be deterred, and that those risks could be managed, but I also think it probability would not be the end of the spread of nuclear weapons in the region. And an Iranian nuclear program would raise the risk that other countries would pursue their own nuclear programs. It would raise the risks of accidents of the transfer of technology perhaps, the loss of control of materials or weapons in Iran. I was wondering if you could comment on that.

And then second, I think the situation highlights that the only existential threat to Israel is nuclear weapons in the hands of a hostile country. And so I'm wondering why doesn't it occur to Israel to put its own nuclear program as a bargaining chip on the table? I know that's a little awkward, since it has never acknowledged the fact that is has a nuclear weapons program, but there are probably ways of going about that. Certainly, it's thinking mostly about its nuclear weapons as a deterrent against attack, but there's obviously the likelihood or the possibility that deterrence can fail. And so I was wondering if you could comment on those two things.

AMB. FREEMAN: Wayne?

MR. WHITE: One of the major problems associated with allowing Iran to become armed with nuclear weapons is nuclear proliferation. Anyone would oppose proliferation anywhere, and try to stop that. In fact, my personal fear, and the fear of a number of my colleagues in the Bureau of Intelligence and Research as far back as the late '90s, was that if Iran acquired that capability, Saudi Arabia would be next. And people would say, well, how could that happen? The Saudis don't have a nuclear program. They'd have to start it from the ground up; they'd be vulnerable to Israeli bombing. They're much closer and an easier target.

No, it would be to buy them. It would be to buy them from Pakistan, buy a few, buy enough Pakistani - (unintelligible) - personnel in order to maintain them and instruct Saudi personnel in their use and maintenance, and then to construct large billboards in various parts of the kingdom in Farsi saying, we've got it, leave us alone.

So, yes, there is very serious risk that there could be proliferation. But one of the problems we have is that one of the reasons Iran has gone in this direction, and some people would say, well, no, nothing is proven. Well, if you accept the 2003 - the most recent November 2007 NIE that says that Iran stopped its program in 2003, it meant it had a program to stop.

And I know there's some frustration among the drafters of it that people who have said that this was a deliberate attack on the administration haven't read the small print, in which the head of the National Intelligence Council, Tom Fingar, along with the Energy Department, which also dissented in the 2002 WMD estimate, take a footnote essentially, in the text and say, whoa, wait a minute. We have less confidence than the rest of the drafters that that program has been stopped in its entirety, because of certain gaps in intelligence.

And so, yes, they had a program, and to some degree, that program itself was a product of regional proliferation, the fact that Israel, which Iran viewed as an enemy, again, not as an enemy so much to destroy, but an enemy that could attack, and harry Iran along with its ally, the United States. Pakistan, next door, had a bomb. The Iranians knew they were in a very dangerous neighborhood.

In fact, the Israelis and other parties in the region were just as - seemingly before this arose as a major issue - just as concerned about Iran's development of long-range ballistic missiles. Now, of course, there's a lot of concern because that could be married to a nuclear weapon. In fact, one of the allegations against the Iranians is they were engaging in nose-cone design, you know, for a re-entry vehicle for one of those Shahab series missiles.

But it's very interesting that the origins of the Shahab program are not nuclear. The origins of the Shahab program was the pounding that Iran took from Iraq's more advanced ballistic missile capabilities during the Iran-Iraq war, and the determination that no one would ever do that again to Iran, outgun Iran in the missile department. And so, yes, there is a proliferation domino effect that we have to be concerned about in the region.

I agree with you on the Israeli program. The Israelis have no intention, and will not put their program on the table. I think they've made that pretty apparent that it is non-negotiable, and would, in fact, prefer that most people think it doesn't exist, which seems absurd, of course, because it does, but they keep it as shadowy as possible. And they have no intention, from what I've heard, of ever putting that on the table, particularly, for example, in the context of the Egyptian proposal that's been on the table for 20 years, which is to declare a nuclear-free region, which, of course, would make the most sense all around. But the main obstacle has been Israel, which views, with its small size, a nuclear counterstrike as its ace in the hole, ultimately, in the face of challenge.

One thing that has been unfortunate, however, is relying on that capability so heavily, and relying on a military solution to various problems has sucked Israel into, at the present time at least, two major asymmetric wars off and on, Palestinian and Lebanese, to which nuclear weapons are not a solution at all.

And the unfortunate aspect of American policy in the region is the United States has increasingly militarized its approach to problems in the region. And the second exercise of military - U.S. military might in the region, after the first Gulf War in '91, being the 2000 war, involved the United States in a major asymmetric challenge for which its regular military was ill-equipped to handle, even if you're an optimist, for the better part of four or five years.

AMB. FREEMAN: Three very quick comments - first, technology diffuses regardless of efforts to halt it. The Chinese invented export controls in 400 B.C., and since then, various countries have tried to inhibit the export and diffusion of technology. Always, they have failed. There have been efforts since the 12th century at arms control on a multilateral basis. They have inhibited the diffusion, but not ultimately succeeded in halting the diffusion of dangerous technology.

All of this brings me to the point that the Israelis may, in fact, have it right. They may have invented something that might be called preventive proliferation; that is, they anticipated an eventual proliferation, and therefore, jumped the gun and began it, and seem to be prepared to live with this logic. Ultimately, they have to be prepared to manage the consequences of their own nuclear program, which are proliferation elsewhere in the region.

There is no prospect that one country can retain a nuclear monopoly in its region when it is engaged in conflicts with all of the other countries of the region, which brings me to the final point. And that is that, in the end - I hate the phrase, guns don't kill people; people kill people, but it is correct that security issues, and the concerns that they drive, are what create weapons development programs and drive defense procurement, unless, of course, you develop a military industrial complex with an insatiable appetite for funding, and a marvelous imagination about the weapons systems that that funding might purchase. That might be an exception.

But this problem, like so many others, is going to have to be managed. I don't agree that the only existential threat to Israel, by the way, is nuclear attack. I think the greatest existential threat to Israel is Israel's own inability to use anything but military means to manage its security problems, which ultimately, can't be solved by military means but threaten the very existence of Israel. Israel's "success" in its settlements policy, it seems to me, has made a two-state solution essentially impossible, and raises existential questions about the compatibility of a Jewish state with the other values that Israel aspires to embody.

Young lady?

Q: My name is Celeste Mayhew, and I'm an intern for the Senate Foreign Relations Committee. And I'm just curious about if - since Iran is not economically doing well, and if the U.S. decides to change its foreign policy and decides to engage with Iran, would trade be an option to gain a leverage over their nuclear weapons program? And if that is an option, what could we trade with Iran?

AMB. FREEMAN: Jean-François, you need to step up to this question. The question is whether trade and economic relations with Iran might not be a means of addressing the nuclear threat and the menace that Iran poses to American interests. Did I get that right?

Q: (Off mike.)

AMB. FREEMAN: No.

Q: (Off mike.)

AMB. FREEMAN: Yes, whether trade could be leveraged in relation to Iran.

DR. SEZNEC: Well, absolutely. I think one of the key items on the table is that Iran is trying to join WTO. And for Iran to have a successful development in industry just like the Saudis have today, they need to be members of the WTO. Otherwise, their products, assuming they can produce them and sell them into China, would be under the mercy of all the WTO requirements. And since they'd be competing with major WTO members, they would not be able to compete. So I think it would be a big trading chip to bargain, and that that would make a big difference. So this kind of arrangement would work very well, I think, definitely.

If I may bring another thought I had when we were talking, I think one of the key problems - the whole thing of the nuclear issue is - and you say, if we try to slow it down, we cannot really stop it. We can slow it down, but slowing it down means making it much more expensive. And if at the same time, we could have a policy where we continue to make this acquisitions very expensive, if at the same time we can decrease the price of oil very substantially, that will hurt Iran very, very strongly, because then they won't have the means, or they will have to really sacrifice enormous amounts in order to continue there.

But how do we reduce the price of oil without us taking the brunt of it? We would have to make policies where either we increase interest rates to bring the dollar up and what-not, and really, basically bring our economy to recession. That would bring the price of oil down, but I don't think we are ready to do that either. But in any event, I think that would be a possibility. Keep the price of nuclear cost very high, but cut the income very substantially, and the cutting of the income is on our shoulders, and I'm not sure we're willing to do that.

But to your question, by the way - I think to answer your question, the kind of trade, yes, they would be very happy to do this. I'm not sure it would sway the likes of Ahmadinejad and what-not, but there is a whole community in Teheran that would really like to see the trade come back, and they would be wiling to sacrifice a lot for that.

AMB. FREEMAN: I think you have to consider the nature of economic power when you talk about leverage. Economic power attracts; it builds relationships. It's like a string; it can pull others with it. You can't push on it. If you have an economic relationship, you can threaten to cut it; or you can actually cut it, and then drive the two parties at the ends of the string apart. But you lose your leverage as you cut it, because you create a new situation that people adjust to, and this of course, is one of the problems with our tendency to base our policy on sanctions.

In the case of Iran, we don't have much of an economic relationship to leverage. We have excluded ourselves from that market, and I think what Jean-François says is absolutely correct. Iran would like to be reintegrated into the global economy and join the WTO. This is as much for acceptance as anything else, but it also is related to their own economic health at home, which they value, and which we have hurt by our financial sanctions and the other punitive measures that we have taken. But in the absence of a relationship, you don't have much to work with in the economic area, and this is one of the problems we have in relation to Iran. If you give up your relationship, you give up your influence.

Sir?

MR. WHITE: One thing I think that should be said is at a time when there are a lot of countries that aren't really that interested in American trade, Iran happens to be an exception to that. Iran is very interested in certain things that the United States has to offer. Chas is absolutely right. The United States has done little more than take itself out of the Iranian picture. The Iranians very much want us in.

In fact, the collapse of the Conoco deal, which came so close to fruition in the 1990s at a time when it could have been a breakthrough, and people did not want to see that breakthrough, made it, therefore, a huge target to short-circuit, shows the extent to which the Iranians want the United States, for one thing, into its oil industry.

Whether true or not - I'm not an oil engineer - the Iranians are one of the believers that it's the United States that can find oil and develop it the best, oil and natural gas. And it has tremendous reserves, as was pointed out over here, from the Caspian Sea all the way down through the Gulf that have been unexplored and undeveloped, in part, because the United States won't do it itself and will do everything it can to interfere with others doing it.

It also will allow Iran to get into the European market more than she has, because of course, we have been ignored, and this is what you read a lot about - this country or that country has ignored American sanctions is now doing business with Iran. The fact is an awful lot of countries have not ignored that, and feel uncomfortable dealing with the Iranians and what that might mean in the relations to Washington.

So indeed, Iran has suffered considerably because of the lack of trade with the United States. So there is a huge opportunity there, if the Iranians really thought we were going to come through with the goods, and this is why, even though I do not want to deemphasize public discussion with Iran, I think that's terrific. It's great. It often leads the way to what I'm interested in.

The Iranians want to see the goods. They've seen too many times when the United States has promised rapprochement with a power, and then once the United States has pretty much gotten what it wants, it sort of forgets about what were its original obligations. The most recent is Libya. After Libya agreed to give up its WMD, Libya still is under the impression that it got short-changed in that arrangement.

AMB. FREEMAN: In fact, it got virtually nothing, and it is wriggling very hard, as we speak, toward getting off the hook, out of disgruntlement with the absence of benefit from the deals that it made.

If you can hold on one second, John Duke Anthony has a comment.

DR. ANTHONY: Wayne White’s quite accurate and appropriate to recall the Conoco deal in 1995 that was roughly $2.3 billion in value to develop oil and gas in the South Pars field offshore Iran. And the Israeli lobby was adamantly opposed to that, and put enormous pressure on the Clinton White House. And in March of 1995, Clinton used executive privilege to cancel – veto that concession, and then one-upped it in May of 1995, through a different, additional executive order, to invoke the territoriality clause in the sanctions against Iran.

Now, all of their sanctions against Iraq were universally agreed, and universally applied through the UN Security Council. The additional sanctions against Iran were solely, exclusively by the United States. It’s only been since 2006 that the UN Security Council has joined in on various sanctions towards Iran. And so when that happened, you can say – or one can say that, well, you can’t win everything, and at the end of the year, you say, well, we won some, we lost some, but we didn’t have such a bad year – not so.

There was a consensus among certainly, the American energy industry, that this policy cannot, must not, be allowed to stand. We’re the world’s single largest consumers of energy, importers of it, wasters of it and loudest cry-babies with regard to our terms of trade. And here is one of the vastest pools of remaining hydrocarbon deposits on the planet, and we, ourselves, have kept ourselves out, as Wayne said, of this particular market and as Chas said. It’s as though not only have we shot ourselves in the foot, but we’ve shown a remarkable propensity to reload faster than anybody else there. (Laughter.)

And so there is this disconnect between our official government policy and support of sanctions and the American private sector. And it’s not just the energy companies that are against the sanctions. They see Iran as potentially a vast marketplace. It’s got more than three times the population of Iraq, and it’s got the world’s second single largest possession of gas reserves.

And there are those in the finance industry who would love to finance the reconstruction and the reintroduction of American expertise in terms of procurement, in terms of design, in terms of engineering, in terms of construction that Iran needs to fulfill its industrial and modernizing, progressive, economic goals there. So we’re dealing with the implications of what we did in 1995 with these sanctions. We’re paying the price big-time, certainly in our private sector, for having done so.

AMB. FREEMAN: Sir, you'll have the last comment or question.

Q: All right. My name is Brad Bosserman (ph). My question is kind of the flipside of this question about economic progress, which is there's been lots of talk about the inevitable or eventual economic collapse of the Iranian regime.

And so my question is kind of what will that actually look like? Obviously, I mean, a collapsing Iranian regime probably wouldn't be content to simply fade into obscurity and let their country crumble around them. Do you portend them lashing out to try and grab resources when they're pushed into a corner? And I guess, what's in the long-term strategic benefit to the United States to either reach out with an economic relationship, or to kind of contain an economic collapse?

AMB. FREEMAN: Would you like to take a shot at that? I think nobody's talking, by the way, about the collapse of Persia, which has been around for quite a long while, and is likely to continue to be around for a very long time. What we're talking about is the existing regime perhaps decaying from within under some of the pressures that it is now suffering from.

DR. ARI: Yes, it's a good option to find a solution, but there are some problems, because the oil price is increasing. Before Ahmadinejad came to power, the Iranian economy was very weak and the petrol price was half what it is today, around $50 or $60 a barrel. Now it's twice that, so it has strengthened the Iranian economy, and now internal responses or reactions against the regime have been reduced. These are very important dilemmas which we should solve. Yes, there should be economic isolation o