Chuck Hagel’s Roadmap to Normalize Relations with Iran

Think tank Hagel chairs issued report saying Iran and U.S. are ‘natural partners’

January 12, 2013

Defense secretary nominee Chuck Hagel’s Atlantic Council predicted that Iran will one day be a natural partner for the United States and has prepared a roadmap to achieve that partnership.

Hagel was named chairman of the nonprofit Atlantic Council just one month after he left the Senate.

The Atlantic Council produced a major analytic policy compendium on U.S.-Iranian relations under Hagel’s leadership. Although he did not pen the report, it aligns with Hagel’s positions that the U.S. should engage directly with Iran and scale back economic sanctions.

The report asserts that the inconsistent history of United States sanctions against Iran "reflect[s] the lack of a clear consensus" on how to approach the strategic threat that the theocracy is "widely considered to pose" to the U.S.

The bulk of the compendium is a slew of policy documents that attempt to define the relationship between the U.S. and Iran. It contains U.S. sanctions legislation, international sanctions legislation, various policy documents, and extremely limited analysis from its author Dr. Kenneth Katzman.

However, the compendium’s final section exclusively contains Katzman’s analysis and provides a roadmap for the steps that would have to take place in the event of "a U.S. decision to normalize relations with Iran." The "Unwinding Sanctions" section argues that removing the sanctions is certainly a plausible option, though it is also careful to not endorse fully normalized relations.

The report explains that if a decision were made to normalize relations, "the process of substantially easing sanctions could be accomplished fairly rapidly." Sanctions "would need to be removed in order to promote normal U.S.-Iran commerce, facilitate U.S. and foreign investment in Iran, to permit U.S. foreign assistance to Iran, and to permit U.S. support for unrestricted international lending to Iran."

A further necessary step would be Iran's "removal from the terrorism list," a designation that triggers automatic sanctions under several different laws. Removal from the list would allow for a "substantial broadening of U.S. economic relations with Iran."

Katzman argues that Iran would need to receive substantial international investment. The first step would be opening up Iran to receive U.S. foreign aid. 

"Congress would need to also delete Iran from a list of countries barred from U.S. assistance under successive foreign aid appropriations laws," writes Katzman. "Congress could do so when it acts on foreign aid appropriations for any subsequent fiscal year by simply omitting Iran from the list of countries."

Katzman notes that many of the necessary actions could be done unilaterally. He writes that the administration would have to issue an executive order "lifting the U.S. ban on trade with and investment in Iran," noting that the "administration has substantial discretion to take this step."

The president could also use his post to "lobby other governments to approve international loans to Iran for the purpose of fostering its economic development," the report states.

Additionally, Katzman writes that the president could restore full diplomatic relations with Iran and that Congress could do little about it.

"The president has near total discretion on how to proceed in restoring diplomatic relations, if there were a decision to do so," the report states. "Congressional ability to block such steps appears to be limited. Attempts by Congress to legislatively prevent a president from establishing full diplomatic relations with any country, including Iran, are likely to falter on constitutional grounds."

Katzman even adds that an administration could choose to take all these steps before Iran deals with the serious human rights issues within its borders:

"An administration might choose to defer complete resolution of such issues, subject to further negotiations with Iran. Whether or not all outstanding human rights issues were resolved in advance of a decision to normalize with Iran, an administration would have significant discretion over how to apply some of the measures to promote democracy and human rights in Iran."