Iran’s growing state of desperation
by Fareed Zakaria
The Washington Post
In fact, the real story is that Iran is weak and getting weaker. Sanctions have pushed its economy into a nose-dive. The political system is fractured and fragmenting. Abroad, its closest ally and the regime of which it is almost the sole supporter — Syria — is itself crumbling. The Persian Gulf monarchies have banded together against Iran and shored up their relations with Washington. Last week, Saudi Arabia closed its largest-ever purchase of U.S. weaponry. Meanwhile, Europe is close to approving even more intense sanctions against Tehran.
The simplest measure of Iran’s strength is its currency. When Barack Obama became president, you could buy 9,700 rials with one dollar. Since then, the dollar has appreciated 60 percent against the rial, meaning you can buy 15,600 rials. Iranian President Mahmoud Ahmadinejad told parliament recently that the latest sanctions were “the most extensive . . . sanctions ever” and that “this is the heaviest economic onslaught on a nation in history . . . every day, all our banking and trade activities and our agreements are being monitored and blocked.” The price of food staples has soared 40 percent the past few months, Reuters reported this week.
Comments
Fareed Zakaria, as usual, is wrong.
Politically Iran is in the cat-bird seat. Besides being the big winner of OIF, and owning its old enemy Iraq, and tweaking Uncle's nose in the Gulf, it enjoys the support of most of the world for its legal nuclear program.
The US, seeking unbridled ME hegemony, with scary references to Iran as a "world threat," has western Europe in its pocket. But Iran is in Asia, where the growth is. Iran's best friends and continued trading partners, needing Iran's petroleum and gas, are not observing economic sanctions.
The sanctions are a joke, with the U.S. claiming that Iran is isolated. Far from it. As the United States and its allies continue to pressure Iran through targeted economic sanctions in an effort to force the Islamic Republic to abandon a non-existent nuclear weapons program, Asian countries such as China, South Korea and Malaysia are aiding Iran by providing it with access to international financial markets. Japan has signaled that it will continue to buy Iran petroleum.
Iran has other powerful friends: Russia, Turkey, Brazil, Venezuela -- and even Saudi Arabia wants to restrain petroleum production to keep the price high. The US- and Israel- led economic war on Iran is not a success so far. Iran’s central bank says that the Iranian economy grew some 5.5% in 2010-2011, which is excellent in the current world economy.
Things are not as bad as they are painted in the Western MSM.
True, matters are unsettled in Syria. But thanks to OIF, Iraq was "delivered" to Iran. And the GCC nations can buy as many weapons as they like. That still doesn't make them a threat to a nation the size of Alaska and populated by over 70 million.
And as for the currency swing against the dollar, here's the best explanation offered so far by a University professor at Virginia Tech:
http://djavad.wordpress.com/2012/01/03/the-fall-of-the-iranian-rial-too…