"Halliburton is not the only US corporation with foreign subsidiaries working with and in Iran. Some of its main competitors in the oil field industry, including Baker Hughes, and Smith International, also have foreign operations there. General Electric’s Canadian, Italian and French subsidiaries have also long been engaged in business deals with Iran, and there is a Swiss owned Caterpillar dealership in the heart of Tehran.
"Some 35 foreign subsidiaries of different US companies are reportedly now operating in Iran. Several, including GE, have decided to follow Halliburton’s example. They have announced they also will no longer seek new business deals with Iran. This is an interesting declaration given the fact that they have long claimed to exercise absolutely no corporate control over these subsidiaries."
-- Victor D. Comras, Attorney and Consultant Special Counsel to Eren Law Firm, in testimony before the United States Senate Committee on Commerce, Science, and Transportation, April 30, 1997
Victor Comras is cautiously in favor of yesterday's announced US plan to designate Iran's Revolutionary Guards a terrorist organization. I recommend that you read his April congressional testimony, which is clear and brief, before plunging into his analysis of the planned move. Yet after taking in both his opinions, I think the route of additional economic sanctions against Iran, which wends through negotiations with Europe, China and Russia, is very complex.
There is nothing complex about the US offer to work with Iran to help tamp down Iraq's violence. The first US committee meeting with Iran took place just days ago in Baghdad. Now we turn around and, going beyond the issue of sanctions, designate an Iranian military branch as a terrorist organization. The move ignores the situation on the ground in Iraq and mocks the US offer to work with Iran. So the move sends a loud message that the US government is not working in concert to gain Iran's help in Iraq.
The upshot is that the US presents itself as acting in such irrational fashion that Iran's so-called moderates are completely confused.
If the US were not fighting a hot war next door to Iran, it would make sense at this time to attempt to isolate Iran economically and throw at them every financial strategem the US Treasury could cook up. But hello, the top priorities are to kill Qaeda in Iraq and beat down sectarian violence. So it makes no sense to strip Iran of all face, then say, "Help us."
The curious thing is that the US annoucement about labeling the IRGC a terrorist unit comes on the heels of concilliatory noises from Iran's president:
"The terror going on in Iraq has links to foreign states that were adopting ideologies hostile to Iraq but recently they felt that supporting terror will make it spread outside Iraq to other countries," the Iraqi Premier told reporters. The Prime Minister, who just ended official visits to Turkey and Iran, told the news conference that he got pledges from Turkey and Iran to support Iraq in face of violence and providing basic services to its people [...]What is a pledge from Ahmadinejad worth? The answer depends on how his military advisors read Petraeus's counterinsurgency.
Petraeus has created virtual chaos by cutting deals with an endless parade of Iraq's Sunni and Shia tribes. One result is that Iran can no longer control Iraq's insurgency. Ergo, one reading is that it would make sense for Iran to morph into the fountainhead of helpfulness at this time.
But it's almost as if there are elements in Washington that don't want Iran to be helpful. It's as if some elements are focused on the campaign in Iraq, and other elements are focused on Iran's nuclear weapons program.
If Pundita's speculation is in the ballpark, she would suggest that President Bush settle on priorities and enforce them.
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August 17 Update
Tonight I saw that ZenPundit had weighed in on the discussion. Here is my counter-argument: The Yalta play.