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Decision Brief                                       No. 06-D 22                           2006-04-27


(Washington , D.C.): At a moment when U.S. and world leaders are trying to decide what to do about Iran and its emerging capacity to act upon apocalyptic threats made by senior Iranian leaders, the House of Representatives yesterday created important new options. These options are a response to the mullahs’ support of Islamofascist terror aimed at American interests and allies around the world, their pursuit of nuclear weapons and their repression at home.


Formidable New Tools


By a sweeping, bipartisan vote of 397-21, the House adopted the Iran Freedom Support Act (IFSA) – which would replace the Iran and Libya Sanctions Act (ILSA) of 1996 which is set to expire in July – that is aimed at “hold[ing] the current regime in Iran accountable for its threatening behavior and to support a transition to democracy in Iran .” Among the many important provisions of the Act, several deserve special mention:


Section 202 expands the sorts of transactions that would subject corporations to economic sanctions for helping to develop Iran ‘s petroleum sector . Importantly, for the first time, the enablers of such transactions – “a private or government lender, insurer, underwriter, or guarantor” – would also be susceptible to sanctions.


Section 206 urges government and private sector investors to divest any company with holdings of at least $20 million in Iran ‘s energy sector , and requests that the President publish a list of those companies in the Federal Register. It also asks investment managers to make detailed information widely available on divested holdings.


Section 207 calls on the Securities and Exchange Commission’s Office of Global Security Risk to issue a report on companies’ exposure in Iran that includes legal, political, economic and financial risk analyses .


Section 301 encourages the President to withhold foreign assistance to any country whose companies will invest more than $20 million in Iran ‘s energy sector.


Section 402 permits the President to “provide substantial financial and political assistance to foreign and domestic individuals, organizations and entities that support democracy and the promotion of democracy in Iran.”


Will IFSA Become the Law of the Land?


Despite the broad support IFSA enjoys in the House, this legislation faces an uncertain future in the Senate – thanks, in part, to stiff opposition from the Bush Administration. The opposition ostensibly is animated by fear that provisions of the House bill would strain U.S. relations with other countries.


Other, more cynical considerations also appear to be operating. The lead sponsor of the legislation in the Senate is Republican Senator Rick Santorum of Pennsylvania . Democrats who might otherwise support even robust legislation on Iran appear to be hanging back, anxious to avoid handing Sen. Santorum a significant legislative accomplishment in the midst of a hotly contested re-election campaign. Some – perhaps on both sides of the aisle – may calculate that inaction on IFSA will be tantamount to a repeal of the Iran-Libya Sanctions Act, possibly clearing the way for new business opportunities for favored constituents.


Let us be clear: Should the Senate and the Bush Administration prevent the adoption of an Iran Freedom Support Act along the lines of the House version, the practical effect will be to abet the Islamofascist nuclear wannabes in Tehran by denying the United States tools it will increasingly need in its escalating crisis with the Iranian regime.


The Bottom Line


The prospect that ILSA might be allowed to expire is bad enough; the signal of unraveling U.S. resolve and the appearance of business interests trumping strategic ones can only further embolden the mullahs. Matters would be made still worse if that undesirable signal is greatly amplified by the spectacle of the leader of the Free World recoiling from measures that might greatly strengthen its hand, by curbing vital economic and financial life-support being provided to our enemies by other Free World governments and investors.


In short, the practical effect of opposing the House version of IFSA – and, thereby, eliminating options that could prove effective in thwarting, or at least checking, Tehran’s malevolence – could well be to reduce the United States to a true Hobson’s choice: Acquiesce to an Islamofascist, terrorist-sponsoring regime armed with nuclear weapons (and willing to share them with others) or use military action to try to prevent such a frightening prospect.


 

Frank Gaffney, Jr.
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