Iran And Its Protégées

BY RAYMOND TANTER*

What if we understood al Qaeda and the Islamic State as protégées of Iran, rather than merely its rivals? At first glance, this might seem outlandish, given that al Qaeda and the Islamic State are Sunni militant groups while Iran is a Shiite theocracy, and each nominally regards the others as theological apostates. Because the suggestion of a familial lineage between these groups and Iran flies in the face of conventional wisdom, it is necessary to test the claim by looking for indications of mutual influence, shared values, and shared goals. For example, on June 10, 2016, Tallha Abdulrazaq, a researcher at the University of Exeter’s Strategy and Security Institute, suggested, “Iran is what the Islamic State will look like if it succeeds.” He pointed to similarities in behavior between Iran and its supposed protégée: Each had committed horrendous terrorist actions and human rights violations at home and abroad in the name of Islamist militancy. Similarities in behavior, however, may not be sufficient to demonstrate family ties.

U.S. cable traffic released by Wikileaks showed links between Tehran and al Qaeda in Iraq, the predecessor of the Islamic State. A cable titled “Iraq war logs: Al Qaida’s new suicide bombing tactics,” dated November 17, 2006, and published in the Guardian on October 22, 2010, provided evidence that Tehran trained al Qaeda insurgents in Iraq to use suicide vests fitted with cameras. On March 9, 2016, the U.S. District Court, Southern District of New York in Manhattan ordered Iran to pay compensation to September 11 victims for Tehran’s alleged role in aiding the al Qaeda hijackers.

The roots of these potential links go back to 1979. “The threat of violent Sunni Islamism was essentially nonexistent until 1979,” when Iran’s revolution became a symbol of the potential power of political Islam, Andrew Peek, an expert on terrorism in the Middle East, wrote in Foreign Affairs. Not coincidentally, Sunni extremists seized the Grand Mosque in Mecca that same year. While their theological differences are real, Sunni and Shia militants both made their modern debut on the global stage that year, as violent Islamism became a new global presence.

The Islamists’ perspectives found fertile ground as radicalism prospered in soil fertilized with the blood of extremists in the post-Gulf War period. More recently, Iran’s efforts to spread its revolution to Iraq and Syria provided the oxygen for the rise of al Qaeda’s terrible descendant, the Islamic State. The Iranian regime has made indirect use of the Islamic State to bolster Syrian president Bashar al-Assad in Damascus, and to control Iraq by supporting sectarian killings by militias in places like Fallujah.

The conventional wisdom is that al Qaeda and the Islamic State are mortal enemies with Iran. But the conventional wisdom misses a deeper way in which the apparent enemies are mutually dependent and inspired by a common apocalyptic vision of Islam. They are mutually dependent as sometime adversaries who are all nonetheless sworn enemies of secular, Western values. The United States needs to defeat al Qaeda and the Islamic State, but not in a way that further empowers Iran and provides the seed for the next generation of this toxic family. Hence, President Barack Obama’s realpolitik acquiescence to Iran’s support for Shia proxies and the Revolutionary Guard in Iraq is exactly the wrong tonic.

The counterargument is that ousting Iran from Iraq might require reinsertion of U.S. ground forces, for which there is scant public support, and which would jeopardize relations with other world powers. Discussed below: options other than a massive ground force deployment.

Islamist Protégées

According to Nawaf Obaid, a visiting fellow at Harvard’s Kennedy School, the Iranian regime is seeking to overthrow a balance of power that has endured for some 1,400 years. Besides Christians and Sunnis in Syria and Iraq, Tehran’s targets include Sunnis in Saudi Arabia and other Gulf states. The Revolutionary Guard in Iraq, the Quds special forces, and Tehran’s proxies, like Hezbollah in Syria, spread the Islamist revolution of 1979 across borders. Thus, it is not a surprise that Riyadh views Tehran in an unfavorable light. The same has begun to hold true for the Lebanese and Hezbollah.

The Islamic State did not just rise up from hell. Its ascent derives from Assad’s killing of civilians. His primary sponsor is the regime in Tehran, according to Gen. Jack Keane, chair of the Institute for the Study of War. Iran is using the rise of the Islamic State to consolidate power in Syria, and to keep Iraq’s Shiites and Assad standing against well-armed and tenacious Sunni forces. 

In May, leaked documents revealed Assad-Islamic State collusion stretching back to the start of the Syrian civil war. The Assad regime and Iran nurtured the rise of al Qaeda, and then the Islamic State, in Syria. After the group had matured fully, Damascus and Tehran offered themselves as partners to the United States in the Vienna talks on Syria. On the battlefield, however, Russian and Syrian warplanes continue to provide support, while maintaining plausible deniability, for the Islamic State, as it advanced on rebel-held areas. Meanwhile, the Islamic State and pro-Assad forces mainly refrained from attacking each other in an entente cordiale.

In July 2015, just before the United States adopted the nuclear deal with Iran, a pan-Arab daily, Al-Hayat, reported that Secretary of State John Kerry, during a trip to Russia, had posed the idea of setting up a Syrian “contact group” consisting of regional and international actors. Kerry would have included Doha, Istanbul, Moscow, Riyadh, Tehran, and Washington. Tony Badran, a research fellow at the Foundation for Defense of Democracies, said in October that Washington had legitimized Iran’s local assets and means of projecting power by recognizing the country as a principal “stakeholder” in Syria.

Legitimizing Tehran as an interested party implicitly acknowledges its support for Hezbollah and interest in preserving a land bridge to Hezbollah’s base in Lebanon. Since 1997, the State Department has listed Hezbollah as a designated terrorist organization — yet the State Department advocated inclusion of Iran in a contact group.

“After many years of sanctions targeting, today Hezbollah is in its worst financial shape in decades…. And I can assure you that, alongside our international partners, we are working hard to put them out of business,” said Adam Szubin, acting U.S. Treasury undersecretary for terrorism and financial intelligence, as quoted by Jonathan Schanzer, a former terrorism finance analyst at the Treasury and now vice president for research at FDD.

But Hezbollah is a wholly owned subsidiary of Iran. Tehran bargained for and received a humongous financial windfall of some $100 billion pursuant to last summer’s nuclear deal; with such money available to Hezbollah, Schanzer wisely comments that no entity is in a position to put it “out of business” anytime soon.

The conventional wisdom that Iran is an enemy of al Qaeda and the Islamic State because they have fought each other is partly correct. But this interpretation masks areas in which cooperation is also present. The three are like “frenemies,” actors that purport to be enemies but covertly perform friendly interactions on more than an occasional basis, as has been demonstrated above.

The counterargument also assumes that even if a new U.S. president were to see the need to oust Iran from Iraq, she or he might have to authorize ground combat forces to go into Iraq and Syria. Former U.S. Ambassador to Iraq James Jeffrey suggests another way: Deter Iran while destroying al Qaeda and the Islamic State by rebuilding the CIA alignment with Sunni tribal chiefs in Anbar province.

In addition, a new political-military strategy needs to focus on the constellation of Iranian-backed militias in Iraq, to keep them in check. How? Organize a coalition of Sunni Gulf states, Jordan, Turkey, and the Kurdish Peshmerga in northern Iraq. Along with Iranian dissidents, such a coalition would increase costs to Tehran, its proxies, and Shiite militias for colluding with Islamist organizations in the destabilization of Iraq and Syria. And it would bring strategic clarity to an important but overlooked fact: America’s adversaries are militant Islamists of the Sunni and Shia variety, embodied in al Qaeda, the Islamic State, and Iran.

 * Raymond Tanter was a former member of the National Security Council staff and Representative of the Secretary of Defense to arms control talks during the Reagan-Bush Administration.

* This article was published first by Foreign Policy on 06/07/2016

Stateless And For Sale In The Gulf

By Pardis Mahdavi*

Stateless Kuwaiti Bedouin women hold up signs in their tent camp near the Iraqi-Kwaiti borders

Last year, the United Arab Emirates (UAE) handed Semira, 19, a passport for the Comoro Islands, one of the poorest nations on earth, and told her she had 11 months to leave. Although she had been stateless all her life, Semira was born and raised in Dubai and had fully embraced its cosmopolitan culture. She has never stepped foot on the tiny, tropical islands that were to become her homeland, nor did she want to, as she has no roots or family there. She doesn’t have much of a choice, though. Since she isn't even a citizen of the UAE, she is pretty much powerless to fight the government, which is paying the cash-strapped Comoros to take stateless people like her off its hands.

Semira became stateless as a result of the UAE’s confounding policies on birthright. As she understands it, her mother came to Dubai from India to work as household help but became pregnant after her employer raped her. He then denied paternity and turned her over to the police when she was near term. In the UAE, it is illegal to have sex out of wedlock, no matter the circumstance.

After giving birth, Semira’s mother served a one-year prison sentence, which ended with her deportation to India. But because citizenship passes through the father in both India (at the time Semira was born) and the UAE, which doesn’t recognize birthright citizenship, Semira’s mother was unable to procure a passport for Semira to bring her to India. She had to leave Semira behind.

If it were not for a prison guard whom Semira’s mother had befriended while in jail, Semira may have ended up at the local orphanage and would have faced a life of poverty. Instead, the guard suggested sending her to a family member of Zayed bin Sultan Al Nayan, the former president of the UAE. According to the director of one of the orphanages in Ras al-Khaimah, with whom I spoke, some 30 percent of children from the orphanages are raised at the royal palaces and provided education, food, housing, and support. The royals consider it an act of Islamic charity and these children are commonly called “children of the Emir.” At this time, it is unclear whether Semira’s connections shielded her from deportation. She has been unreachable for the last two months, which means she could either be laying low or already in Comoros.

In my recently published book, Crossing the Gulf, I document the stories of stateless people like Semira in the Arabian Peninsula, which includes some of the largest migrant-receiving countries in the world. In the UAE, migrant workers make up 80 percent of its population. In neighboring Kuwait, migrants outnumber citizens three to one. But most Gulf States refuse to offer citizenship rights and protection to them, even to those born within their borders. It is estimated that there are over 100,000 stateless individuals in the UAE alone and over 130,000 in neighboring Kuwait.

In the past decade, the Gulf has seen an increase in female migrants from Asia and Africa who take up jobs as domestic workers, nannies, beauticians, and service workers. Under the kefala system, used by many Gulf states to govern guest labor, workers are forbidden to engage in sexual relations for the duration of their contracts. Since pregnancy gives them away, it is often only the women who are punished for breaking Kefala rules and sharia law, which criminalizes zina or sex outside of marriage. Because most women who migrate to the Gulf do so during their most fertile years, and may spend five to ten years in their host countries, this form of contractual sterilization is impossible to abide by. And although some women find themselves in consensual relationships, others are exploited and raped by abusive employers.

As a result, it is sadly common for women such as Semira’s mother to give birth in jail and then have their babies sent to an orphanage after the women are deported. Not helping matters is that both the UAE and a number of sending countries only allow citizenship to transfer through the father. But if no father claims paternity—and this is often the case because coming forward would mean facing punishment for breaking zina—the child becomes stateless. With hundreds of thousands of migrants coming to the Gulf every year, dating back to the 1980s, from places such as Bangladesh, India, Nepal, Pakistan, and Sri Lanka—countries that up until recently only permitted paternal citizenship transfer—hundreds and sometimes thousands of children are born to migrant women and left behind.

The children of migrant women are not the only ones who experience the perils of statelessness. 

There are over 100,000 stateless persons known as bidoon in Kuwait, who do not have citizenship either because of bureaucratic hiccups when Kuwait became a nation state in 1961 (a portion of them failed to register as citizens) or long-standing discrimination against those who were once nationals of neighboring countries but were absorbed by Kuwait after the borders changed. As far as she knows, Rania, 21, who is a bidoon, was born in Kuwait City to a domestic worker from Ethiopia who may have been deported shortly after giving birth. She has spent her entire life living in an orphanage in the city's outskirts, but as a stateless person, she has been unable to find a job or rent an apartment. Still, Rania sees Kuwait as her home. And she was devasted when she received a Comoro Islands passport last month and was told to settle there within a year.

“This is the ultimate in unfair,” Rania told me. “I couldn’t go with my mom to her home, and now I can’t stay in the place I call home? Why don’t people even ask me what I want?”

Semira and Rania are part of deals that UAE and Kuwait signed with Comoros in 2008 and 2016. In exchange for building roads and providing development aid to the poverty-stricken island nation, Emiratis and Kuwaitis are “buying” citizenships for their undocumented residents. Initially, these deals involved only issuing new passports without requirements for holders to physically move out of the Gulf. In recent months, however, it became clear that a growing number of them will have to move to Comoros. Although the official policy remains unclear, some officials say that Comoros began asking that these new "Comorians" move to the islands, while others believe that the Gulf countries are simply trying to get rid of their stateless population.

Regardless, activists have condemned the practice, likening it to slavery—the selling of a person and the economizing of what is a human right. As the Universal Declaration of Human Rights says, “[e]veryone has the right to a nationality” and “[n]o one shall be arbitrarily deprived of his nationality nor denied the right to change his nationality.” Comorians have protested, too, feeling that the government is essentially selling their nation’s soul, while populations in the Gulf argue that this is a solution that fails to resolve the thorny issues of statelessness or citizen transfer.

On the other hand, the Philippines, from which a number of people move to the Gulf for work, has come up with alternative laws to prevent statelessness. In 1987, its government passed a law allowing Philippine citizenship to pass through both the mother and father. That allows most of the Filipina women I interviewed in the Gulf to take their children home with them if and when they have to leave. The Philippine embassy in both Kuwait and the UAE also offer shelter to children whose mothers are incarcerated or are on trial for zina and they make sure to provide passports for these new citizens.

Instead of shipping their problems off to Comoros, Gulf countries could at the very least negotiate citizen transfers with sending nations or encourage them to follow the example of the Philippines, as a start. After all, their tactic of offshoring their stateless population is unsustainable in the long run. Comoros will realize at some point that this is a bad bargain. There are nearly one million stateless people in the Gulf and the population of Comoros is only 730,000 (and the island nation is about the size of Rhode Island). It is ill equipped to deal with dramatic increases to its population and in a few years time, the Gulf countries may find themselves back to square one.

* PARDIS MAHDAVI is Associate Professor and Chair of Anthropology at Pomona College. She is the author of Passionate Uprisings: Iran's Sexual Revolution and Gridlock: Labor, Migration, and Human Trafficking in Dubai.

- This article was published first by Foreign Affairs on 30 June 2016

Economic Implications of Brexit

By Ben S. Bernanke*

After several days of market upset, a few reflections on last week’s momentous vote in Great Britain.

Even more obvious now than before the vote is that the biggest losers, economically speaking, will be the British themselves. The vote ushers in what will be several years of tremendous uncertainty—about the rules that will govern the U.K.’s trade with its continental neighbors, about the fates of foreign workers in Britain and British workers abroad, and about the country’s political direction, including perhaps where its borders will ultimately lie. Such fundamental uncertainty will depress business formation, capital investment, and hiring; indeed, it had begun to do so even before the vote. The U.K. economic slowdown to come will be exacerbated by falling asset values (houses, commercial real estate, stocks) and damaged confidence on the part of households and businesses. Ironically, the sharp decline in the value of the pound may be a bit of a buffer here as, all else equal, it will make British exports more competitive.

In the longer run, the uncertainty will dissipate, but the economic costs to the U.K. still will exceed the benefits. Financial services and other globally oriented industries, which depend on unfettered access to European markets and exchanges, will come under pressure. At the same time, the purported gains from freeing the U.K. from the heavy regulatory hand of Brussels will be limited, because Britain will likely have to accept most of those rules (without ability to influence them) as part of restructured trade agreements. Immigration is unpopular in the U.K., and slowing it was a motivation for some “leave” voters, but a more slowly growing labor force likely would also reduce overall economic growth.

The rest of Europe will also be adversely affected, even though Frankfurt and a few other cities may gain finance jobs at the expense of London. The biggest risks here are political, as has been widely noted: In particular, markets are already beginning to price in the risk that other countries or regions will press for greater autonomy from Brussels. Even those sympathetic to such demands should worry that attempts to unwind existing trade and regulatory arrangements could be highly disruptive, as they will likely be for Great Britain. A move toward exit by a member of the euro zone would be particularly destabilizing, as even the possibility that a country might leave the common currency could provoke bank runs and speculative attacks on the country’s sovereign debt and on other countries that might be thought to be next in line. The challenge for European leaders will be to keep the overall integration process on track, while finding ways to meet the concerns of potential leavers. One issue that could be revisited is the EU’s commitment to the absolutely free movement of people across borders, which seems more a political than an economic principle; the perception that the U.K. had lost control of its borders was one of the most effective arguments for “leave,” and secessionist movements elsewhere have also seized on the issue. [1]

Globally, the Brexit shock is being transmitted mostly through financial markets, as investors sell off risky assets like stocks and flock to supposed safe havens like the dollar and the sovereign debt of the U.S., Germany, and Japan. Investors are perhaps more risk-averse than they otherwise would be because they know that advanced-economy central bankers have less space than in the past to ease monetary policy. Among the hardest hit countries is Japan, whose battle against deflation could be set back by the strengthening of the yen and the decline in Japanese equity prices. In the United States, the economic recovery is unlikely to be derailed by the market turmoil, so long as conditions in financial markets don’t get significantly worse: The strengthening of the dollar and the declines in U.S. equities are relatively moderate so far. Moreover, the decline in longer-term U.S. interest rates (including mortgage rates) partially offsets the tightening effects of the dollar and stocks on financial conditions. However, clearly the Fed and other U.S. policymakers will remain cautious until the effects of the British vote are better sorted out.

Although bank stock prices are taking hits, especially in the U.K. and Europe, a financial crisis seems quite unlikely at this point. Central banks are monitoring the funding and financial conditions of banks, and so far serious problems have not emerged. (It helps that the date of the referendum has been known for months, giving authorities time to prepare. Also helpful is the substantial buildup in bank capital in recent years.) Through its currency swap lines, established during the global financial crisis, the Fed is making sure that other major central banks have access to dollars. As I’ve already suggested, the biggest risks to financial stability at this point appear to be political—specifically, the risk of further defections or breakdown in the European Union—rather than economic. The story may not be over yet.

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[1] Britain has substantial immigration from both EU and non-EU countries. The debate over Brexit sometimes seemed to confound the two, even though only the former is protected by the EU treaties.

·         Ben S. Bernanke is a Distinguished Fellow in Residence with the Economic Studies Program at the Brookings Institution and also serves as a Senior Advisor to PIMCO and Citadel. From February 2006 through January 2014, he was Chairman of the Board of Governors of the Federal Reserve System.

·         This article was published first on the Brooking Institute Web on 28 June 2018

The Paradox Of Higher Education In MENA

By Shanta Devarajan*

American University in Beirut 

The Middle East and North Africa (MENA) was the cradle of higher education.  The three oldest, still-functioning universities in the world are in Iran, Morocco, and Egypt.  The University of Al-Karaouine in Fes has been granting degrees since 859 A.D.  The Ancient Library of Alexandria, in addition to being repository of books and manuscripts, was a center of learning during the Ptolemaic dynasty, with scholars traveling to there from all around the Mediterranean and beyond.  And scholars such as Ibn Khaldoun discovered fundamental economics four centuries before Adam Smith and others. In short, all of us who have benefited from a university education owe a debt to the MENA region.

Yet, today the quality of higher education in MENA is among the lowest in the world. Only two or three Arab universities are in the list of the top 500 universities in the world (and none are in the top 200).  Employers in the region complain that university graduates lack the skills needed to work in the global marketplace. Many are not trained in science, mathematics, engineering, and other technical subjects where the jobs are. Furthermore, these graduates lack the “soft skills,” including creativity and teamwork, partly because their training has emphasized memorization and rote learning. In Egypt, despite an unemployment rate of over 10 percent, some 600,000 jobs remain unfilled. About 40 percent of university graduates in MENA are unemployed; the labor force participation of women, most of whom are better educated than the men, is the lowest in the world.  Worse, violent extremist groups have used universities as one of their sources of recruitment.

How could this have happened? How could the same region that created higher education have a system that is so dysfunctional that it’s contributing to, rather than alleviating, the problems facing MENA?  And how can the situation be turned around, so that the universities are once again the best in the world?

We can start by seeking the reasons behind the current problems of the region. To be sure, the reasons for the high unemployment rate among university graduates are manifold and have mostly to do with the investment climate and the (lack of) growth of the private sector. But there is one feature that is common to all the countries in the region:  The majority of university graduates received jobs in the public sector. The state was the employer of first and last resort.

This feature had an impact on the quality of university education:

 The subject of specialization didn’t matter as much in the public sector, so students didn’t choose to study science and engineering; they chose somewhat “easier” subjects such as literature and history.

The public sector was not demanding of soft skills. 

The nature of the curriculum, with its emphasis on memory, repeating what the professor says without questioning or debating, may have been acceptable for the public sector—but it didn’t help the private sector, which is looking for creative minds who will invent the next Uber, for example.  This curriculum may have also made it easier for radicalized groups to recruit students. 

The second, more controversial, reason has to do with the pricing of university education. Almost all the universities provided education free of charge, based on the notion that poor people should have access to higher education as a means of escaping poverty. Unfortunately, the result has been that the overwhelming majority of students in universities come from the richest parts of the population. The pattern is not unique to MENA: It is found in Asia and Africa. And the reason has to do with economics.  Whenever something is provided for free, there is excess demand. Universities ration the excess demand by requiring students to pass an entrance exam. The rich can afford to send their children to the best secondary schools to prepare them to pass the entrance exam. As a result, the universities are full of students from the richest strata of society. Put another way, free higher education confers a huge rent to those who have access to it. And the rich are better placed to seize those rents than the poor.

In fact, the problem is worse because free education gives weak incentives to improve the quality of university education. The university has little to gain by investing in improving the curriculum (since more students doesn’t mean more revenue). Meanwhile, students don’t demand better quality as much as they would if they were paying for the education and needed to recoup their investment. The experience of Tribhuvan University in Nepal is instructive. When they started charging tuition fees in their institute of engineering, the quality improved so much that they started attracting students from all over South Asia. Moreover, the reforms spread to the rest of the higher education sector in the country.

To be sure, simply charging for higher education will not solve the problems of universities in MENA.  For one thing, poor people should still be able to afford tertiary education, but this should be addressed by providing means-tested scholarships, rather than an across-the-board subsidy that, as we noted, the rich can take advantage of. For another, the transition needs to be managed because such shifts are likely to elicit a political reaction. However, the principle has to be that universities should be given incentives to invest in higher quality education, and students should have an incentive to demand higher quality instruction.

If we can bring about these two changes—a shift in the focus of higher education away from public-sector jobs and a system of financing that aligns incentives with quality—we can go a long way towards restoring the grandeur of higher education in MENA.  As I mentioned at the beginning, the whole world owes the MENA region a huge debt for having created and nurtured university education a millennium ago. It is time to repay that debt.

·         Shanta Devarajan is the Chief Economist, Middle East and North Africa, World Bank

Note: This is an English version of the keynote speech given by Shanta Devarajan at the recent MENA conference on “Paradigm Shifts in Tertiary Education” in Algiers on May 30-June 2, 2016.

Khamenei’s Counterrevolution Is Underway

Iranians thought the nuclear deal would spark a new relationship with the West. But the supreme leader had other plans.

BY Foreign Policy SPECIAL CORRESPONDENT

 
President Hassan Rouhani walk in front of Khmanei's picture

It was, in the words of the Washington Post‘s executive editor, Martin Baron, “the grimmest” of milestones. On Dec. 3, Jason Rezaian, the newspaper’s Tehran correspondent, spent his 500th day in Evin Prison. He has now been detained in the Iranian capital two months longer than the 52 Americans who were held captive in the U.S. embassy by radical students who stormed the building in 1979, heralding a revolution and the end of Iran’s formal diplomatic relations with America.

For the moment at least, the prospect of Rezaian being freed appears based more on hope than solid facts. There is no sign Iran’s judiciary, in spite of last summer’s nuclear deal with the West, is softening its stance. If anything, it has been sending strong indications that it will refuse to be influenced by outside pressure. On Nov. 22, a judiciary spokesman in Tehran confirmed Rezaian had been convicted on charges of espionage and that his punishment included jail time. The length of his prison sentence was not disclosed; the offenses are thought to carry a maximum jail term of 20 years.

Having first warned of foreign “infiltration” in September, Supreme Leader Ayatollah Ali Khamenei took an even harsher line on Nov. 25. “There is a deceitful, crafty, skillful, fraudulent, and devilish enemy,” he told commanders of the Basij militia, a volunteer paramilitary force that takes orders from the country’s powerful Islamic Revolutionary Guards Corps. “Who is that enemy? Arrogance. Of course today, the manifestation of arrogance is America.”

Khamenei went further, suggesting foreign investment and cultural influences would be the first way the West would try to bring down Iran’s Islamic system. “The most important means are two things: One is money and another is sexual attraction,” he said, warning that Iran’s “decision-makers and decision-builders” would be targeted by foreigners who want to change the beliefs and lifestyle of Iran’s people.

The comments are a world away from the pragmatism Khamenei showed in agreeing to the nuclear deal just months ago. While the supreme leader seemingly wanted a deal to end sanctions so that Iran could rejoin the global economy, his actions since suggest he doesn’t want to upset loyal elites who have been enriched in the past decade.

Basij commander Mohammad Reza Naqdi wasted little time in following the supreme leader’s cue. Two days after Khamenei’s remarks, he claimed the United States had allocated $2 billion to depose the regime in Tehran. He explicitly placed Secretary of State John Kerry, the man with whom Iranian diplomats negotiated the nuclear deal, at the center of the conspiracy. “Some $200 million out of this sum was given personally to John Kerry,” he said. “Kerry has so far headed 34 projects to depose the Islamic regime.”

Both Rezaian’s imprisonment and Naqdi’s allegations signal not only a split within Iran’s political elite over its future relations with the United States, but also a deeper divide between its politicians and long-suffering people. While the religious power center of the Islamist establishment seems more vehement than ever about the need to protect the principles of the 1979 revolution, many of Iran’s technologically savvy young population shun the mosque and look outward to the West for its entertainment and inspiration.

As such, many are still leaving the country, convinced their hopes cannot be realized. “I am not free,” said Golnaz, a 33-year-old MBA graduate who recently moved to Canada to join a tech firm. Being friends with foreigners led to her being followed and her emails being hacked. She believes President Hassan Rouhani is trying his best, but, given the resistance he faces, it is not worth the risk of continuing to waste years of her career.

Rouhani and his top officials are caught in the middle between the people and the regime. Foreign Minister Mohammad Javad Zarif initially said that he hoped Rezaian would be found not guilty but has since backed off that line when questioned about the reporter’s fate, probably sensing the backlash in an increasingly abrasive domestic climate. “The charges are serious and it’s a judiciary process,” Zarif said on Oct. 17, five days after the Washington Post first reported Rezaian had been convicted.

Rouhani, meanwhile, has openly raised the possibility of a prisoner swap, thought to involve at least three Americans, including Rezaian, for 19 Iranians convicted of sanctions offenses in the United States.

“If the Americans take the appropriate steps and set them free, certainly the right environment will be open and the right circumstances will be created for us to do everything within our power and our purview to bring about the swiftest freedom for the Americans held in Iran as well,” Rouhani said of the 19 jailed Iranians at the U.N. General Assembly in New York on Sept. 27.

His remarks, however, were followed by a sharp reminder at how little control he apparently exerts over many of his country’s security institutions. Barely two weeks later, the intelligence section of the Revolutionary Guards arrested an Iranian-American businessman, Siamak Namazi, at the home of relatives in Tehran. Around the same time it emerged that a Lebanese IT expert with residency in the United States, Nizar Zakka, had disappeared after a conference in the Iranian capital a month earlier. Adding to Rouhani’s image of powerlessness, Zakka had been invited to Tehran by the government. State television, a fiefdom of hardline conservatives who operate under Khamenei’s authority, later said Zakka was arrested for spying.

Namazi, though long based in Dubai, is well known in Iran. His family’s Atieh Group had strong business connections with the government during the presidency of Ayatollah Akbar Hashemi Rafsanjani, from 1989 to 1997. Namazi also spoke out in favor of better Iranian-American relations and, while serving as a partner of Atieh’s Tehran consultancy, had advised foreign companies on how to do business in the Islamic Republic.

The latest arrests are another embarrassment for Rouhani who has made a major play for foreign investment to rebuild Iran’s sanctions-ravaged economy. On Nov. 28, more than 100 foreign companies in the oil industry, headed by Shell, BP, Total, and Petronas, came to Tehran and heard Iran’s oil minister make a pitch for $30 billion of investment. There was undoubtedly interest among the visitors — but if the IRGC continue to arrest foreign businessmen, the enthusiasm could quickly disappear.

As harsh as Khamenei’s remarks appear, a more optimistic interpretation is that the government is willing to take symbolic actions that signal a staunch anti-American stance — while in reality having no practical effect. On Nov. 5, for instance, the Ministry of Industry, Mines, and Trade announced it would ban the import of all American consumer goods. A push “to boost national production” was necessary instead, officials said.

The announcement was greeted by laughter among many Iranians. “They are already here,” Sara Ahmadi, a 30-year-old business executive, said of foreign brands, pointing out that there are three Nike stores on one Tehran street alone. Those shops, stuffed with clothing and exercise equipment bearing the famous “swoosh” logo of the world’s largest sports manufacturer, feature genuine merchandise — not the Chinese knock-offs sold in street markets in the capital. Several of the massive malls that have opened in Tehran in recent years also have Nike stores.

But it’s instructive that those malls were all built by companies linked to the IRGC. Iran has had commerce in Western goods in recent years, but it has mostly been restricted to regime loyalists. The hiked prices of the Nike goods on sale in Tehran suggest they were smuggled in to the country, likely from Dubai or Turkey, with the cooperation, whether tacit or explicit, of the Iranian regime. The inflated prices for premium Western products also mean that only the country’s economic elite, which overlaps strongly with its political elite, can afford to buy them.

While such contradictions perturb Iran’s rapidly aging clerical leadership, they leave Rezaian and his fellow captives looking like bit part players in a much bigger puzzle.

The nuclear deal may well have made the diplomatic deals struck in the past considerably more difficult today. In 2010 and 2011, for instance, three American hikers detained by Iran were freed after Oman brokered their release. Then-President Mahmoud Ahmadinejad had ordered them to be freed, only to be temporarily thwarted when the judiciary cancelled their release.

Iranian authorities, such as the IRGC and the judiciary, seem inclined to play the same game with Rouhani. Even talk of a prisoner exchange in the aftermath of the nuclear deal seems certain to provoke hard-liners dead set against any broader opening toward the United States.

“To the hard-liners that would look like another deal with America, and they don’t want to send that signal,” said a Western diplomat in Tehran.

The growing list of people languishing in prison, including dozens of Iranian nationals on political charges, continues to dent Rouhani’s “moderate” reputation ahead of parliamentary elections in February next year, seen as a crucial test of the president’s clout and his hopes of re-election in 2017. Though most Iranians see the judiciary rather than Rouhani as the culprit, he is a potential fall guy for the frustrated.

“The government has been backed into a corner and, whatever they do, Rouhani and his people face a problem in getting out of this mess that the judiciary has created,” the diplomat said.

But more hopeful Iranians say Rouhani retains public confidence and shouldn’t buckle in the face of provocations from the most anti-Western elements of the regime. If the hard-liners are routed in the February elections, Rouhani will have a stronger mandate to pursue his agenda.

“Ahmadinejad and his cronies are not coming back,” a veteran political analyst said. “The public mood has shifted and this is the hard-liners’ last hurrah. The worst thing Rouhani could do would be to kowtow to them. But for now at least, none of that helps Jason Rezaian.”

This article was published first by Foreign Policy on 9/12/2015

Lebanon's Deal with the Devil

The Prisoner Swap with Jabhat Al Nusra

By Bilal Y. Saab

Al Qaeda-linked Nusra Front fighters carry their weapons near Lebanese soldiers and policemen during their release in Arsal, eastern Bekaa Valley, Lebanon, December 1, 2015. (REUTERS)

On  December 2, the Syrian branch of al Qaeda known as Jabhat Al Nusra freed 16 Lebanese soldiers and policemen in exchange for the release of 29 Islamists and their children, who were all imprisoned in Lebanon and Syria. Broadcast live on Lebanese and Qatari satellite television, the prisoner swap was a spectacle. More than that, its symbolism, strategic significance, and regional ramifications were immediately the topic of vigorous debate.

It didn’t take long for the Lebanese to critique the transaction. As the freed hostages were hugging their parents in Beirut upon their return, Lebanese commentators were already bemoaning the “tragedy that had just transpired.” Politicians from all walks of life couldn’t believe that their government had just completed a “deal with the devil.” Parliament Speaker Nabih Berri, for example, called the episode a “sovereignty scandal,” despite the fact that Hezbollah, with which Berri is allied, had an active role in securing the deal.

A closer look at who got what explains the general mood of anger and disillusionment among most Lebanese. 

Starting with the positives: First, by getting back its men alive, Beirut communicated to the country’s military that, no matter how long or how much it takes, it will not abandon Lebanese soldiers when they are abducted. Whether Lebanese officers will find comfort in their state’s performance is unclear, though, since several of their comrades were slaughtered by the same terrorists not too long ago. But this event’s happier ending might boost morale and maintain the unity of an army that is overstretched and under equipped and that is fighting terrorism day and night across the country, particularly along its northern borders with Syria. 

Second, even though the events are still murky, the Lebanese authorities have claimed that they refused to release any Islamist extremists from prison who have blood on their hands or active terrorism cases against them. It is hard to verify that without access to sensitive information, though.

Third, and perhaps most important, the deal was a product, or a harbinger, of political accommodation between rival Lebanese political factions, specifically between the Shia Hezbollah and the Sunni Future Movement. Indeed, the swap would have been impossible had Hezbollah secretary general Hassan Nasrallah and Future Movement leader Saad Hariri not cooperated. For instance, Hariri flew to Doha to persuade the Qataris, who acted as brokers throughout this 16-month hostage crisis, that Abbas Ibrahim, chief Lebanese negotiator and head of the country’s General Security Directorate, is someone worth trusting, despite his strong support for Hezbollah.

Meanwhile, Nasrallah convinced his ally Syrian President Bashar al-Assad to release three women and nine children imprisoned in Syria that were on Jabhat Al Nusra’s demand list (one of those women is Khalidiyya Hussain Zeiniya, the sister of Abu Malek Al Talli, the group’s commander in the Lebanese Qalamoun area). This moment of accord between Nasrallah and Hariri could facilitate the election of a new Lebanese head of state after a year and a half of political vacuum.

Yet this outcome came with heavy costs. The sight of terrorists waving black al Qaeda flags and operating in full military uniform with impunity on Lebanese soil and in broad daylight was painful and humiliating for the Lebanese people. More practically, by agreeing to the swap, the Lebanese state projected weakness, or at the very least, sent the message that it is not opposed to doing business with terrorists. That, in turn, could invite more kidnappings and longer lists of demands. The Islamic State (ISIS) holds nine other Lebanese soldiers and police members hostage; one wonders what Beirut would give up to release them. ISIS, a larger and more powerful movement than Jabhat Al Nusra, might be able to extract more from the Lebanese state should it decide to negotiate. But beyond the popular astonishment and the fears over the price tag of potential future terrorist deals, the Lebanese state’s inability to expel Jabhat Al Nusra from Lebanese territory and end its control of the northern town of Arsal is the clearest evidence of Lebanon’s failure to win in this exchange what mattered most: the protection of sovereignty and territorial integrity.

For its part, in addition to the safe haven of Arsal, Jabhat al Nusra, might have also benefited from creating an image of a terrorist group that is capable of mercy and pragmatism in ways that ISIS is not. That reputation could help it gain a political future in Syria.

To be sure, there were some costs and compromises for the group too, including the failure to release hundreds of other high-profile extremists from the Lebanese prison of Roumieh or to force Hezbollah to withdraw its men from Syrian territory. But Jabhat Al Nusra knew that the latter demand was unrealistic and the formal loss was tolerable, compared to what it was able to gain.

For a relatively small prisoner swap, this deal’s complexity was remarkable, as evidenced by the number of local, regional, and internationals players that were involved. Key to the success of the deal was Qatar. In a previous article in Foreign Affairs called “The Dishonest Broker,” I wrote about Qatar’s desire to cement its role as a go-to mediator in the region. Its active involvement in this hostage crisis, which Doha made sure to air live on its satellite channel Al Jazeera for all the world to see, is the latest example of the small country’s commitment to playing an oversized mediation role, despite serious concerns by its neighbors about its real intentions. Yet regional questions about Qatar’s good offices notwithstanding, the truth is that Western countries, including the United States, find value in Doha’s access to some of the Middle East’s bad actors. After all, if bombing terrorists and adversaries fails, somebody has to facilitate talks. 

The level of pragmatism that Doha displayed throughout the negotiations was notable. Qatar and Hezbollah have a visceral and strategic disagreement over Syria—the latter doing everything in its power to ensure Assad’s survival and the former committing to his toppling—but it didn’t stop Qatari emir Sheikh Tamim bin Hamad al Thani from cooperating with Nasrallah to secure the release of the Lebanese hostages. Specifically, following instructions from Tamim, the Qatari intelligence services convinced Jabhat Al Nusra leaders to refrain from upping their demands in the final minutes of the negotiations and go for the deal. 

But realpolitik wasn’t limited to Qatar and Hezbollah. Turkey, which provided logistical assistance by hosting talks on multiple occasions between lead Lebanese negotiator and leaders of Jabhat Al Nusra under Qatari mediation, agreed to receive some of the freed prisoners of the terrorist group. Russia and the Syrian government, who have adversarial relations with Ankara, agreed to a ceasefire between Hezbollah and Jabhat Al Nusra along the northern borders. Iran implicitly blessed the deal through Ali Akbar Velayati, a top advisor to the Supreme Leader who recently visited Beirut. And although Saudi Arabia did not have a direct involvement in the swap, its controversial and surprising approval of the nomination of Suleiman Franjieh as Lebanon’s new president, despite his close personal friendship with Assad (whom Riyadh is committed to deposing) and undeniable support for Hezbollah (which is suspected of killing Rafik Hariri, Saudi Arabia's main man in Lebanon), contributed to the overall de-escalation of tensions.  

Prisoner swaps typically require compromises by both sides. But in this particular deal, it must be said, Jabhat Al Nusra emerged as a winner. What’s tragic is that Lebanon is not in a position to correct wrongs and retake what was lost. The Lebanese army is incapable of dislodging all terrorists from the north and Hezbollah, despite its tactical successes against Sunni extremists, is busy securing its own areas in the southern suburbs of Beirut and fighting its enemies on Syrian territory. Only the end of the Syrian conflict can effectively neutralize the Sunni militant threat to Lebanon and prevent another costly swap. That sworn adversaries momentarily set aside their differences to achieve this latest deal offers hope, but it will take a much bigger dose of pragmatism and compromise to reach a solution to the civil war in Syria.

·         This article was published first by Foreign Affairs on 06/12/2015