Hassan Rouhani’s savvy nuclear politics

Over the past week, there has been growing concern that domestic politics in both the U.S. and Iran may derail the opportunity for a historic nuclear deal. A flurry of articles noted that the recent action by the U.S. Office of Foreign Asset Control to sanction an additional 28 Iranian entities on Aug. 29 may indicate a breakdown in U.S. diplomacy. Pressure from special interest groups and members of Congress opposed to an Iran deal may be thwarting the ability of Barack Obama’s administration to set the stage for an agreement. The day after the announcement of new sanctions, Iranian President Hassan Rouhani held a large press conference in which he went out of his way to slam them, taking a newly aggressive tone.

These inauspicious events led the Eurasia Group’s Cliff Kupchan to revise his odds that the two countries reach an agreement from 60-40 to 40-60 and declare that there is no indication that Iran is “preparing its elite for a deal.” He based this shift on Rouhani’s recent declaration that “we should resist such an aggression with all might and power,” as well as on other defiant statements by Iranian officials on the topic.

The problem is that statements like these are notoriously unreliable markers of the Islamic Republic’s true intentions. Iran is a country where hyperbolic remarks belie what is in actuality a highly pragmatic style of governance. Behind the noise, Rouhani is setting the scene for a grand bargain with his domestic rivals. 

Iran’s political economy has its own logic of checks and balances. But for American observers, the complicated arrangement of councils, offices, ministries and assemblies that constitute the state apparatus can be daunting, especially compared with the oversimplified idea that the U.S. government is composed of three equal branches.

It isn’t as complicated as it seems. The key question in the nuclear deal is whether Iran’s executive branch, represented by Rouhani and his Cabinet, can corral two groups in particular: the Majlis (the parliament) and the Islamic Revolutionary Guards Corps (IRGC ) — a part of the armed forces that has in the last two decades come to control a significant portion of the country’s economic institutions.

Actions such as the impeachment of Rouhani’s science minister suggest that hard-liners in the Majlis, who oppose a potential deal with the U.S., are unlikely to change their position. And the abduction of Washington Post journalist Jason Rezaian and his wife, Yeganeh Salehi, was likely carried out by a body associated with the IRGC — another worrying sign that they are unwilling to play nice.  

While Western observers often assume that these acts indicate the resolve of hard-liners to prevent Rouhani’s government from signing a deal, these actions in fact reflect political and economic gamesmanship. The hard-liners in Iran are raising their voices not because they are categorically opposed to a deal but because they want to ensure that any deal is delivered only after particular concessions are made to their camp. 

The case of the IRGC makes this phenomenon very clear. Any agreement that includes sanctions relief will necessarily reduce the share of Iran’s economy that the IRGC controls as the private sector recovers from years of hardship. The loss of economic means will reduce the political might of the IRGC, which has become a kind of state within a state that offers access to education, social services and career opportunities for otherwise socially disadvantaged young men. If these young men find better employment prospects as Iran returns to economic growth, the IRGC will begin cede ground to more traditional civil society institutions.

Rouhani’s Cabinet ministers are well aware of this fact — and they don’t want the IRGC to lose face or power. So to cast the achievement of a nuclear deal as something other than purely disempowering for the IRGC, Rouhani has taken advantage of chaos on Iran’s border. The rise of the Islamic State in Iraq and Syria has given Iran’s president a superb opportunity to direct the energies of the IRGC toward more traditional military aims. By proclaiming in his press conference that “any innocent human being killed anywhere in the world means that humanity has been slaughtered” and that all countries “should fight this phenomenon everywhere in the world,” his administration provided political cover for the increasing engagement of IS militants by IRGC soldiers in Iraq. 

Similarly, the recent conflict in Gaza has allowed Rouhani to step up his rhetoric in support of the Palestinian cause, but this time without a great political cost: Negative sentiment toward the Israeli offensive this summer has become widespread even in the West as a result of the number of civilian causalities. In Iran the responsibility to support Hamas is under the purview of the IRGC. Some would argue that to denounce terrorism and to support Hamas is contradictory, but it is entirely consistent with the potential role being carved for the IRGC in a post-sanctions Iran.

For Rouhani, neutralizing internal opposition to a nuclear agreement means managing Iran’s politics. If a deal is struck and the Iranian political economy naturally shifts from a position of sanctions-induced autarky back to one of global engagement, not too many political groups in Iran will lose — not even the IRGC. Thanks to Rouhani’s maneuvering, if the IRGC loses primacy in the domestic economy, it will gain stature as a regional military force. Its forces will able to deploy outside Iran to combat the Islamic State to the west and Al-Qaeda and the Taliban to the east. Iran may thereby take on counterterrorism responsibilities that not even the U.S. and its allies are willing to bear.

Not only does this allow the IRGC to keep face; it may also allow its members and related companies to gain legitimacy. In a few years, IRGC entities could then be removed from the United States’ specially designated nationals (SDN) sanctions list. After all, U.S. logic dictates that those who fight terrorists cannot be terrorists themselves. So it’s not a stretch to imagine that American politicians could come to regard Iranian generals as a means to prevent Iraq’s further deterioration if they step in to bolster the unstable Iraqi government.

Already, IRGC forces and U.S. assets are on the same side of the battlefield — an amazing reversal of the previous geopolitical orientation. This might very well prove a sufficient reward for the IRGC to come on board with Rouhani’s plan to make Iran a global power broker. The situation recalls what happened with Myanmar, where a military junta sacrificed a degree of domestic absolutism in order to gain a new global profile as a counterweight to a perceived Chinese threat.  

During Rouhani’s press conference, there was a very telling turn of phrase. He repeatedly referred to his administration’s commitment to seeking a “win-win” solution for the nuclear agreement. He was speaking not to the United States but to his domestic audience — the hard-liners in the IRGC, the Majlis, the revolutionary councils and the ministries alike. Rouhani was preparing domestic political elites for the successful conclusion of the nuclear agreement.

U.S. actions, on the other hand, are less encouraging. It is difficult to present the new sanctions and continued congressional opposition as a win-win in Washington. Détente with a country that was once spoken of as America’s greatest enemy is not politically expedient for any U.S. politician, even at a time when both Democrats and Republicans have gone months without winning any political battles at all.

Western observers should give Rouhani and his Cabinet greater credit for their efforts, however convoluted they might seem to observers in the United States. But with Obama and Congress ever at odds, the inability of U.S. policymakers to develop cohesive foreign policy presents the greater risk to the completion of a deal. Today few American analysts are willing to diagnose that their own government may be the one to squander a historic agreement toward reconciliation. As often is the case with U.S. foreign policy, we may realize our ineptitude only after it is too late.