Should We Bomb Iran to Save Money?

Living with a nuclear weapon is costly. Trying to stop its construction is even more so.

The high cost of war with Iran has been frequently discussed in these spaces. But what of the price of living with an Iranian bomb? In a recent Wall Street Journal oped, former senator Charles Robb, former Obama Middle East advisor Dennis Ross and Bipartisan Policy Center foreign policy chief Michael Makovsky urge those leading U.S efforts to manage Iran’s nuclear ambitions to “not dwell exclusively on the potential short-term impacts of economic pressure or military action.” The trio claims that “over the medium and long term, the economic costs of a nuclear Iran may be no less real and far more enduring.”

This is a point Geoffrey Kemp and I dwell on extensively in our forthcoming book War with Iran: Political, Military, and Economic Consequences. Robb, Ross and Makovsky are right to point out that there are substantial costs associated with a nuclear-armed Iran. Increasing tension in the region could certainly add to the security premium on Gulf oil. Fears of supply disruption increase demand for futures contracts as consumers attempt to ensure they won’t run out of oil. Further, the United States and its regional allies would have to deter and balance a more powerful Iran. This would have costs of its own: troops deployed in the region are financially and politically expensive; weapons given to Gulf allies would raise the stakes of a conflict (and of instability); resources sent to the Middle East cannot be used elsewhere, such as for America’s strategic shift to East Asia.

The trio’s argument is thus that as we approach a critical decision point on Iran, farsightedness shows that a nuclear Iran would be quite costly. They claim that those advocating “inaction” (which can only mean not going to war, given how few nonwar actions remain) are shortsightedly considering the high price of war now while neglecting the costs of instability later.

But is “action”—meaning war—really such a farsighted and strategic measure? Is there a price to be paid for peace that won’t come due with an attack? Robb, Ross and Makovsky do not address this, yet this is the most crucial question of all. Carl von Clausewitz, the great Prussian theorist of warfare, defined war as the use of force to make the enemy to do your will. This is where the case for attacking Iran begins to run into trouble, for it is not clear at all that war will make the ayatollahs do what Washington wants. The U.S. military can likely destroy all of Iran’s known nuclear facilities in a matter of days. This would be a severe blow to the Islamic Republic, which has invested many resources and borne great costs to develop the facilities; Supreme Leader Ali Khamenei would see one of his most cherished projects fail.

However, a U.S. attack could be seen as proof positive by the regime’s leadership of their need for a nuclear deterrent. This would mean that in several years, the United States would have to bomb Iran’s reconstructed nuclear facilities again—a prospect that the Israelis have acknowledged and branded “mowing the lawn.” Each iteration of conflict would carry at minimum the same risks and costs as the first, but would probably cost even more. The Iranians would be more willing to use more dastardly and aggressive forms of retaliation. America’s strategic rivals would be more willing to provide Iran with new defensive assets—the Russians, for instance, have put a hold on a contract to sell Iran relatively advanced S-300 surface-to-air missiles that would significantly complicate any future attacks. If the United States attacked Iran, Russia would have little reason not to let this sale go through. Iran could rebuild its program behind higher walls and in a more permissive international environment. “Action” thus carries a higher price than “inaction,” and only deepens the Iranian sense of insecurity and weakness that have made it want a bomb in the first place.

While Robb, Ross and Makovsky provide an interesting account of the economic impact of inaction, they give little attention to the economic cost of action, merely noting that “the disruption of oil flows would have significant economic repercussions.” It is impossible to know exactly what the economic impact of war would be—much depends on how both sides choose targets and tactics, and how successful their efforts are. But it is likely that oil would quickly spike to two hundred dollars per barrel and remain elevated for the duration of the war. With the United States consuming between eighteen and nineteen million barrels of oil per day, massive price increases can easily suck billions of dollars a week out of the economy.

If a conflict were to continue for an extended period—a decision that might be made in Tehran, not in Washington—this could easily tip the country into a recession. A slowed American economy would provide lower revenues to the federal government just as it launched its third consecutive debt-funded war; halfhearted efforts to achieve a balanced and sustainable budget would face new difficulties. The impact on Europe’s ongoing economic crisis could be worse and faltering growth in China and India would also be hit.

Living with an Iranian bomb brings new and serious risks. Yet military action might not reduce any of them, and it will certainly come at a steep price of its own. “Inaction” is expensive. It is just not clear that any of the proposed alternatives are cheaper.

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