Freezing Out Iran Doesn't Work

The U.S. policy of isolating Iran through unilateral trade sanctions is shortsighted, misguided--and wrong. True, the Iranian government doesn't have a pretty record. In the 18 years since the fall of the Shah, the mullahs in power in Teheran have sent out hit men to assassinate political opponents living abroad, opposed the Middle East peace process consistently, and placed a bounty on the head of writer Salman Rushdie--an outrage.

Yet there are signs that Iran's revolutionary fires are dying down. Within the Middle East, Teheran is now seeking political accommodation with longtime U.S. allies such as Egypt and Saudi Arabia. It has been playing a responsible role in the Caucasus and Central Asia by brokering peace between Azerbaijan and Armenia and by opposing the radical Taliban militias in neighboring Afghanistan.

Moreover, Washington's excessively tough Iran policy is also hurting the long-term political and economic interests of the U.S. For example, the U.S. has a strategic interest in the development of oil resources in Central Asia and the Caspian Sea region. But U.S. opposition to having any oil pipelines run through Iran--the shortest, cheapest route to the sea and to Asian markets--is not only holding up development but also giving Russia a near-total monopoly on the pipelines carrying the new oil to world markets.

In dealing with a troublesome state such as Iran, the choice for Washington need not be the stark one of appeasement or outright confrontation. As with China, the Administration can conduct a dialogue on human rights and arms control even as U.S. corporations do business. The advent of a fresh administration in Teheran following presidential elections on May 23 could provide a small opening for the U.S. to reopen contacts with one of the world's most strategically important countries.

    Before it's here, it's on the Bloomberg Terminal. LEARN MORE