Senators Seeking More Iran Sanctions Resist Bid for Delay

Photographer: Atta Kenare/AFP via Getty Images

Iranian supporters of President-elect Hassan Rowhani gather at the mausoleum of the founder of Iran's Islamic Republic Ayatollah Ruhollah Khomeini, in Tehran on June 16, 2013. Close

Iranian supporters of President-elect Hassan Rowhani gather at the mausoleum of the... Read More

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Photographer: Atta Kenare/AFP via Getty Images

Iranian supporters of President-elect Hassan Rowhani gather at the mausoleum of the founder of Iran's Islamic Republic Ayatollah Ruhollah Khomeini, in Tehran on June 16, 2013.

Two top Senate backers of added U.S. sanctions against Iran said the Obama administration failed to persuade them to put their legislative push on hold during international efforts to negotiate curbs on the Islamic republic’s nuclear program.

Senator Robert Menendez, a New Jersey Democrat who heads the Foreign Relations Committee, and Senator Mark Kirk, an Illinois Republican, said they intend to push forward with new economic sanctions after emerging from a closed-door briefing yesterday with Vice President Joe Biden, Secretary of State John Kerry and Treasury Secretary Jacob J. Lew.

“I’d have to hear something far more substantive from what I heard today to dissuade me” from acting on legislation, Menendez told reporters.

Administration officials have called for a pause in expanding sanctions while the U.S. and allies test Iran’s willingness to take a new tack under President Hassan Rouhani, who took office in August sounding themes of moderation. Iran held two days of talks with six world powers in Geneva in October on its nuclear program, and consultations are scheduled to resume in the Swiss city this month.

Asked after yesterday’s meeting at the Capitol whether he was concerned Congress would pass sanctions despite the administration’s pleas, Biden said, “No, I’m not concerned. Sanctions are tough.”

Since U.S. and European Union oil sanctions went into effect in July 2012, Iran’s oil exports have dropped by half and inflation almost doubled in two years, reaching 40 percent in September. The majority of Iran’s government revenue comes from crude-oil sales.

‘Long Rope-a-Dope’

Kerry made a public case for negotiations with Iran in public comments last month. He said failing to test whether Iran is sincere would amount to “diplomatic malpractice of the worst order.”

Kirk said he saw no prospect of success from the talks in Geneva. “It just seems a long rope-a-dope,” Kirk said.

“Sanctions are the only way to prevent a war,” Kirk said. “Just leave it in place and let the Iranians run out of money. They might miss a payment to Hezbollah,” he added, referring to the Lebanon-based Shiite militia that the U.S., Israel and the European Union consider a terrorist group.

Other senators expressed a willingness to hold off, at least for a few months.

“I’ve supported every sanctions bill in the Senate, but I’m mindful of the fact that maybe these discussions will bear fruit,” said Senator Mike Johanns, a Nebraska Republican.

‘Good Case’

Senator Dean Heller, a Nevada Republican, said the administration was “making a good case” for delaying new legislation, although he hasn’t reached a decision on how he would vote.

A sanctions bill that passed the Republican-controlled House, 400-20, in July would subject more goods and services to sanctions and authorize the president to impose penalties on foreign entities that maintain commercial ties with Iran.

A related bill introduced by Kirk would limit Iran’s access to foreign currency by requiring the president to impose sanctions on foreign banks that knowingly conduct transactions in non-local currency, particularly euros, for the Central Bank of Iran and other designated entities based there. Kirk said his legislation would target “offshore accounts by Iranians, about $70 billion worth.”

The measures have yet to be taken up by the Senate Banking Committee, and that panel’s chairman, Senator Tim Johnson, a South Dakota Democrat, said he hasn’t decided whether to act.

‘Be Thoughtful’

Kirk said there are enough votes in the Banking Committee to advance sanctions legislation. “I think we would win, which is why there was so much pressure in there,” Kirk said of the administration briefing.

Menendez said he would use any legislative means available to push more sanctions, including attaching the measure to the annual defense authorization bill.

Senator Dick Durbin of Illinois, the chamber’s second-ranking Democrat, told reporters earlier yesterday that Congress should consider the administration’s request for a delay because “after 10 years of this bitter confrontation” it “makes sense for us to be thoughtful about how and when we respond to the Iranians.”

Even so, Durbin said, any request for a delay should be accompanied by a public statement from the administration about “the current status” of negotiations, “an indication about how long they are asking Congress to pause before initiating new sanctions” and “what we will view as a good-faith effort on the part of the Iranians.”

The U.S. and allies are demanding curbs on Iran’s nuclear work, which they say is probably a cover for a weapons program. Iran says it has a right to enrich uranium and is interested in using nuclear technology solely for peaceful, civilian purposes.

“Sanctions have hurt the Iranian people,” Iran’s deputy foreign minister, Abbas Araghchi, said in an interview last month. “But it’s not so severe that it will make us give up our rights to nuclear power.”

The House-passed sanctions bill is H.R. 850.

To contact the reporter on this story: David Lerman in Washington at dlerman1@bloomberg.net

To contact the editor responsible for this story: John Walcott at jwalcott9@bloomberg.net

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