Message wouldve been a different one to the business community. Would have been yes we are negotiating ploy might have the dl, yes there will be a deal, but dont cross these lines because this is whats going to happen. Instead, the examples given in the precedents that were in the opposite direction. The message was sanctions or is till in the law books but we are not going to implement them which is why Companies Feel comfortable even though they are so five, six months into implementation they go through the breach. The Swiss Parliament by the way feels the same way. Switzerland maybe not the biggest Global Player but it had a fruitful trade relations and a lot of the phone companies they were running to circumvent oil sanctions, procurement sanctions, to lg sanctions lifted all of its sanctions. They abolished it. They are not waiting for congress. They are not waiting for implementation. Even if you can treat sanctions as a yellow light, not a red light anymore, it is not the yellow light that comes before the traffic light turns red. The gala light in some countries comes out before the traffic light turns green. If you come from a country like mine is a recommendation and not a command. When you see the yellow light, you hit the gas in the forward. Thank you. [applause] thank you to heritage for having me. I dont have any pithy driving tips so let me tackle some of the stuff we talked around so far. I want to focus on three things. We talked a lot about the effects or processes relating to the sanction implementation with regard to iran. Lets get down to the nittygritty. Theres three things we should be thinking about what the sanctions basket of the joint comprehensive plan of action. First of all, were both come from . The myth says this is a gift from the american tax airs. It is money that iran generated from the foreign sales of oil to key consumers. China, singapore, south korea, japan, india, others. These were targeted and has been an earnest targeted and 2010 and a comprehensive fashion since the passage of a piece of legislation in 2010 which mandated all the countries began to scale back the purchases of iranian oil to show a goodfaith effort they were trying to wean themselves off of dependence we. The onetwo punch of the approach was in addition to trying to compel iranian consumers to reduce consumption of iranian oil, we also ask road, first come and made them accessible revenue generated in the interim. When you see the iranian economic effects that brought the regime to the table in the first place a great deal had to do with the fact they couldnt receive the oil benefit. Sanctions are not taxpayer dollars but they are still very important because they provide an aggregate expansion of the economy. Thats the second question. How big is it . Here in the debate in washington is an awful lot of heat but not a lot of light. President obama himself has said publicly the sanctions relief they can expect to get will be anywhere from 142100 xt alien dollars. They estimate a little bit less than 60 billion. Either way what you look at is an unprecedented scope of sanctions relief. Its always nice to go right in the middle. 100 billion to more of sanctions. This is so large a figure that i think it is actually very unhelpful because ordinary americans its hard to put in context what does that mean. But they explain to you in comparative terms what this looks like. In 2014 the iranian annual Gross Domestic Product was 415 billion so sanctions package in the direction of the Islamic Republic in the next six to eight months worth roughly a quarter of the iranian economy again. In comparative metrics this is larger than the entire Marshall Plan for the reconstruction of europe that the truman and industry should initiated from 1948 to 1952 the land known as the European Recovery Program formerly was 13 billion in 1948. Todays equivalent 120 billion. It spent four years and by the way as vacation times in europe now demonstrate that was remarkably successful in reinvigorating qualityoflife and european economies. The impact should not be understated. Youre looking at a Marshall Plan for the Islamic Republic that is going to be applied in sort of a fastforward fashion in a way thats likely to have tremendous effects for everything relating the iranian economy including domestic foreign adventures. The second comparison youve heard with regard to the sanctions package is its comparison to the u. S. Economy. The most recent estimate and it was roughly 14. 7 trillion. What youre looking not as if somebody gave us the same economic gift of the same scope it would need 4. 5 trillion. You are looking at five times the stimulus package that followed the 2008 Global Economic crisis. Think about what the United States can do with this financial windfall and you have a appreciation in comparative terms how this is perceived in tehran. That gives us a fair question. What will it be used for . The Obama Administration has expressed hopes it will use funds for domestic reconstruction of the real Marshall Plan for domestic reconstruction for Economic Stabilization theres two possibilities. And that it will. Here i think an example read a good sense of what this looks like. 1991, congress has simply known as the comprehensive Threat Reduction act of 1991 known far more popularly as nunn lugar. This is the program that is still ongoing and cars that started with the collapse of the soviet union to dismantle the strategic arsenal. Very wellintentioned program started with an initial infusion of 409 is now grown to 1. 4 billion annually. Figured out over time a lot of money sunk into helping the russians dismantle the transition their strategic arsenal. Has accelerated the pace and there is a series of investigations done by magazines like Readers Digest about what the groundlevel impact of nunn lugar was on the premise that congress and the Clinton Administration was going for that if russia had more money to dismantle missiles, to make it stop pile more manageable to do work with it. We found nothing of the sort happened. Russians allocated the Defense Budget to dismantlement and they didnt care where the money came from and if that money, 10 , 15 came from the United States, it freed up capital for them to use on other things. Theres a great article for those of you interested in looking it up from 1998 in Readers Digest about how u. S. Taxpayer dollars helped restart the russian bio weapons for this reason because they didnt widen the pie for dismantling. To use the money because money is fungible for other things. Theres a very real danger of that happening today. It is possible like the Administration Says we are going to see iranians use some of the sanctions relief for domestic reconstruction. This is an awful lot of money is at least as likely as not were so that it uses that im not rather things on two key regime priorities and heres where we enter the zone of danger. The Reagan Administration formerly listed iran as the worlds leading state sponsor of terrorism in 1984 and has held the position of her send and then the last several years it has maintained the position despite a series of sanctions increased in severity. In 2007, 05a, treasury undersecretary for terrorism and Financial Intelligence at the time said iran maintained a nine digit line item in its budget for the support of terrorism. They spend some on the order of 200 million to support hezbollah and spends as much as 25 million monthly on hamas and funds the entire annual budget for 56 billion a year currently destabilize the regime in syria to start telling the numbers in syndicates to be real dollars. This is a real expenditure and one as a result of sanctions relief is likely to grow exponentially. Iran will have more capital to do the same things that committed to doing already even when its sanctioned constraint. This gets us to irans regional ambitions. It is worth noting even as the e. U. Three plus three, p5 1 or whatever term you use, even as we were busy negotiating the nuclear deal with iran, what you saw was a rising trend in the middle east in places like serious and yemen and places like bahrain and southern lebanon. What you saw is in iran that was more and more not willing to think globally but act globally. Iranians have knocked out an ambitious global agenda to promote ideals to export revolution and do so not only in the immediate periphery but increasingly far abroad. As part of the effort, iranians have built a rather significant Online System with the worlds most troubling machines. They hope the overthrow of the government in yemen to hezbollah and hamas has expanded a threat to israel and the region by both movements. In latin america you see in iran increasingly in league with the regime of hugo chavez in venezuela as well as the regime of ava morales in bolivia, rafael or quayle and ecuador and iran has insinuated it off into the premier antiamerican geopolitical bloc known as the Bulgarian Alliance appeared in africa you see in iran has become a key sponsor for the regime of albashir and in our brand that is bankrolling the modernization of this in a way military. In a show you see in iran deepening strategic target ship with north korea on Ballistic Missiles and nuclear cooperation. Ucl at this rather troublesome Strategic Partners iran has a line and it is not a very large leap of imagination to assume that an iran no longer part of the conversation that has become the conversation because of the scope of sanctions about to receive as likely to transform from being a part or to becoming a patron of some of these regimes and what you are heading towards as heading towards that the result is an International System far more inimical to the interests of the united state and American Allies in these respective regions. This gets us to one of the reasons, probably the main reason why im skeptical about the joint comprehensive plan of action. To me the watchword of diplomacy has to be to do no harm. You should not engage in diplomacy that leads you in our National Interest to adversely affect than you were before hand. But it violates the principle and does so in a way that will affect our security and the security of our allies significant date in the years ahead. I will stop there. Okay, all right. [applause] we have about 35 minutes left. Let me give you some quick rumbles because we have a ton of people not getting questions from some of the folks online. I will acknowledge you didnt stand up, wait until my colleague gives you a microphone and tell me who you are and ask a question. Please, no speeches from the floor. We have too many folks with a lot of questions. I will give you two sentences. If i dont hear it . I will ask you to sit down. Okay, we are ready. Who has the first question . Jim phillips here at heritage comest Senior Research fellow in middle eastern affairs. To me, one of the most inexplicable aspects of sanctions relief the administration agreed to was totally outside the framework of Nuclear Sanctions in the area of Ballistic Missile sanctions and the arms embargo. This is particularly inexplicable to me. [inaudible]. Happy to go first. I think the technical answer is, well, these ambassadors were part of the u. N. Security Council Resolution that were really addressing the nonproliferation agenda of the Security Council and thats why they had to be addressed. I think that thats not an answer because you can write anything you want. The u. N. Security Council Resolution provided you have consensus, and they could have kept the arms embargo and the Ballistic Missile embargo. I think the underlying sewages here is that the nuclear deal will unlock relations between iran and the west by empowering those inside the regime who understand that iran has to change in order to remain a player in the International Community, and, therefore, the details of the deal, though important, are less critical than the deal itself. So we can make these concessions because, yes, you know, its a gamble, but in five years time when the iranians are so busy reaping the benefits of the economic windfall, which will require them to open up and well get all of these vacationing italians to come to tehran, will be more reasonable, and once theyre more reasonable, they can have their arms and once theyre even more reasonable, issue we can let them have their missiles. Now, i think that the bottom line here has to be, we need to have a discussion about how a regime that has been defiant, that has not changed an iota of it behavior and practices, that has actually become more aggressive as a result and more assertive as a result of this deal, is suddenly going to say, oh, we preserved our national pride. We preserved our assets. We cheated the International System and got reward ode for it, so now were going to change course . So that is the problem with the assumption. Just to second that, think thats absolutely right. Deals not only with the lifting of restrictions on ballistic missle and also the started nonNuclear Sanctions relief iran will get, including the delivessing of sewell man sewell man soul man any from the do not fly. The Administration Says the deal is just nucleares issue but from the way the white house is talking and positioning the deal, that this is intended to be transformational. Intended to fundamentally reset our relationship with iran, irans relations with the west, and then all good things will flow. I think thats speculative. I think thats hopeful. I would point out that hopees not a Foreign Policy. And i think that its much more useful to understand that the threat potential of iran, as a result of the various provisions of the jcpoa, including the exclusion of Ballistic Missile development, is not diminished. It is slowed but not diminished. And heres an interesting little vignette which i think that the jppoa is having an interesting Ripple Effect throughout europe and throughout the International Community. I think it took the russians seven and a half hours after the announcement of the jcpoa signing on july 14th to argue that now that the iran threat has been dealt with, theres no need for missiles in europe. That hasnt flown or at least hasnt flown yet as a persuasive argument, but one of the reasons it hasnt flown, as the russians are discovering, is because they helped facilitate the exclusion of irans back his stick missile portfolio from the scope of the negotiations. The iranians insisted this was an unacceptable demand to put on the table. We caved. The russians assisted us caving. And now the russians are discovering that the one thing they care a lot more about, which is the ability of europe to hold their strategic arsenal at risk, is not going to alter in their favor as a result of this deal. So, my sense is that there are different permutations of how favorable this deal is. Certainly for the iranians, very favorable. I think some irans International Partners in which category i put russia as well as china, i think theyre finding it may over time be less favorable. The gentleman in the back. Nude nude of [inaudible] im interested not what power we have in congress over what portion of the sanctions regime, which is arguably the most complex sanctions regime ever we have had of a rouge state. Ive counted 17 executive orders and about four dozen provisions, major legislation every couple of years since at least 1990. Some of those for nonproliferation, some human rights, some for terrorism, some are ewan lat ewan raft recall, some have a president ial waiver, some dont. Love to hear your thoughts what portion of that congress has control over, especially how it interfaces with the corker legislation. Regardless of how the disapproval vote goes. I think we have somewhat different views. Well, my sense is that theres a couple of things toen unpack here. I think the way the white house has talk about this deal, its made it appear as if its a binary choice. I Congress Disapproves of the deal and then vetoes the override, this is a path to war. This is how secretary kerry has talked about it, how the president talked about it last week in his speech at american university. I think that the is a strawman argument. Nobody wants war. But i think its worth noting that everything that i talked about with regard to the benefits of economic revenue flowing to iran from the sanctions relief is prospective. Hasnt happened yet. Doesnt happen until implementation day or thereafter. So, what youre looking at is an iran that is still sanctions constrained. You hear serious problems, serious cracks in the International Consensus over irans isolation. Remember, what were looking at is an iran that is still for the moment has diminished purchasing power. So the idea that iran sort of loses the shackles and makes a sprint toward the Nuclear Capability presumes an