The Bloomberg editors have outdone themselves with their latest bizarre attack on European efforts to support the Joint Comprehensive Plan of Action (JCPOA):
The European Union is trying to have it both ways on U.S. sanctions against Iran. It voices solidarity with the Trump administration’s concerns about the Islamic Republic’s rising threat to stability in the Middle East — most recently by expressing alarm at Iran’s ballistic-missile program and other “unacceptable behavior.” At the same time, EU leaders condone efforts by their member countries to skirt U.S. restrictions — as if to reassure the Iranian regime that trade can continue despite the U.S. decision to pull out of the 2015 nuclear deal.
The editorial’s criticism of our European allies is confused at best. European governments and the EU are abiding by their commitments under the JCPOA to lift sanctions and resume legitimate trade with Iran in response to Iran’s continued compliance with the nuclear deal. (The IAEA just released its latest report re-confirming Iranian compliance.) As far as they are concerned, trade can and should continue with Iran because Iran has fulfilled its side of the bargain on the nuclear issue. The editors can’t seem to grasp that our allies regard attempts to sanction their companies for conducting legitimate business with Iran as illegal interference in their affairs and an attack on their sovereignty. They don’t acknowledge that these restrictions are valid or lawful, and so they don’t respect them.
It is the Trump administration that wants to have things both ways. They want to withdraw from the nuclear deal, threaten our allies with secondary sanctions, and then expect the allies and Iran not to respond with their own countermeasures. The administration assumes that it can issue whatever decree it wants and our allies are supposed to fall in line. Naturally, our allies resent and oppose this, and for the first time in a long while they are actually doing something to push back. Bullying Europe has backfired on the U.S., and the editors’ repeated demands that Europe capitulate to Trump’s bullying have been ignored. Both the administration and the editors have been reduced to denunciations and whining as a result.
If some of our allies share U.S. objections to other Iranian behavior, that is not a contradiction of their position on the JCPOA and their use of their new “special purpose” mechanism. Our allies are capable of distinguishing between the nuclear issue, where Iran is cooperating, and other issues where disagreements with Iran remain. This distinction is lost on the Trump administration and the Bloomberg editors alike, who insist on lumping everything together and using other Iranian behavior as a reason to undermine the nuclear deal.
The editors go beyond their usual carping to propose something truly destructive:
U.S. officials would be right to insist that the SPV be shut down — if necessary, by threatening sanctions against any person, bank or company associated with its creation.
U.S. officials would have to be out of their mind to demand this, and they would be even crazier to follow through on the threat to sanction the governments and individuals involved. It would entail putting sanctions on top British, French, and German officials, and that would precipitate a rupture in our relationships with all three. It would almost certainly sour relations with quite a few of our other European allies as well. Our top European allies set up the mechanism in such a way that sanctioning it would require a major breach with all of them at the same time. Henry Farrell spells all of this out in a very valuable thread:
5. In other words, Bloomberg is advocating all out diplomatic war against America's three most important allies, for having the impertinence to try to maintain an international agreement that the US itself negotiated and Iran has not violated.
— Henry Farrell (@henryfarrell) February 24, 2019
Critics of the “special purpose vehicle” (SPV) are remarkably hostile to something that they keep claiming can’t possibly work. On the one hand, they mock it for being ineffective or redundant, but they react to it as if they consider it to be anything but that. The danger for hawks is that the SPV is more successful than expected and it weakens the ability of U.S. sanctions to strangle Iran’s economy, and that will in turn encourage other governments to develop their own mechanisms to get out from under the onerous burden of our government’s overuse and abuse of sanctions. Because of the heavy-handed and illegitimate use of sanctions in this case, the Trump administration is damaging our government’s ability to wield clout in the future. Hawks are so hostile to the SPV because they see that it represents a lot more than the current rift over Iran, and they fear a future in which Washington can’t force our allies and other states to fall in line with misguided coercive policies. By threatening to sanction our own allies’ officials to punish them for creating this mechanism, the hawks are just hastening that outcome.
It can’t be stressed often enough that this dispute stems from the president’s irrational decision last year to jettison U.S. commitments under the nuclear deal for no good reason. The Trump administration is sacrificing good relations with major allies for the sake of throwing away a successful nonproliferation agreement and pursuing an unrealistic goal of regime change through the collective punishment of the Iranian people. Considering the irrational and destructive nature of U.S. behavior, our allies have responded as reasonably and carefully as one could have hoped, but they aren’t going to put with abuse from our government forever. None of this is in the American interest, and the costs to the U.S. in terms of weakened alliances and diminished U.S. influence will continue to grow as time goes by.