Slaying the Syria-Iran-Hezbollah Hydra

How Washington can take down three adversaries for the price of one.

Although the longstanding links between Iran, Syria and Hezbollah are indisputable, U.S. policy makers are singularly inept at connecting the dots and putting simultaneous pressure on all sides. If the Tehran regime were to fall, Assad would be isolated and forced to compromise with his Arab brethren and as well as with the United States; if Assad were to fall, the mullahs would face insurmountable hurdles in supporting Hezbollah; and with the fall of either the mullahs or Assad, Hezbollah leader Hassan Nasrallah’s days would be numbered (and with the fall of both his days would be almost over). Has Washington seized the opportunity to get the ball rolling, by simultaneously pressuring all three adversaries wherever it can? No.

Let’s start with Iran. While relations with Assad and Hezbollah are important for the mullahs, their future is most directly dependent on Iran’s economic vulnerabilities and fortunes, a fact the United States just doesn’t seem to grasp. While Washington has correctly forsaken military options against the Tehran regime and focused instead on economic sanctions, it has not pursued sanction options that could effectively back the mullahs into submission or collapse. Simply said, sanctions must impose sufficient pain on the regime to force it to change lest it be overthrown by popular domestic protests and upheaval. A little here and a little there does nothing except to cause unnecessary hardship with no meaningful payoff. Iran needs foreign exchange to finance its imports and to support its currency at what it deems the appropriate exchange rate. Thus lower oil prices, higher domestic oil consumption (leaving less available for exports) and more demands on its limited foreign-exchange earnings and reserves are the Achilles’ heels of the Tehran regime.

What should America be doing to exploit these vulnerabilities? The focus should be on deterring foreign investment in Iran, increasing the cost of Iran’s imports and escalating the private sector’s demand for foreign exchange (especially motivating them to take money out of the country). Washington has adopted some policies along these lines, resulting in a foreign-exchange squeeze (most recently attested by the inability of China and India to pay Iran in dollars for their oil imports and by the depreciation of the Iranian riyal). But it should have done better. Washington should be persuading oil exporters, especially Saudi Arabia, the UAE and Kuwait, to increase exports and exceed their OPEC quota in order to lower oil prices. As well, it was a horrible mistake for some prominent U.S. experts to call gasoline sanctions on Iran “the mother of all sanctions.” This pronouncement was just plain silly and counterproductive. The gasoline sanctions allowed Ahmadinejad to do what two of his predecessors were afraid to, namely, dramatically reduce Iran’s gasoline consumption and thus increase the availability of foreign exchange to the regime (in the process receiving accolades from the IMF). At the same time, the United States has not sanctioned the central bank of Iran; this would have helped increase Iran’s import costs and put a further squeeze on its foreign-exchange earnings. Nor has Washington pursued policies to accelerate capital flight from Iran. Iran’s economic collapse, prompted by a shortage of foreign exchange, would not only endanger the regime’s survival, but would also eliminate its ability to support Syria and Hezbollah, thus undermining these two U.S. adversaries as well.

While the Arab Spring has threatened the Assad regime, at first the White House lent support to Syria’s dictator, privately arguing that Assad’s fall would increase both instability in the region and border tensions with Israel. Such hypocrisy—backing oppressive regimes in Riyadh, Manama and Damascus while professing unquestioned support for human rights and democratic values—undermines U.S. credibility and influence in the Middle East, and further afield. It was as if the Obama administration could not see beyond its nose. Just think what Assad’s fall could do to the mullahs and Hezbollah! Washington’s missteps have afforded Assad valuable time, allowing Iran to rush support to bolster its Arab ally with intelligence gathering, protest-hardened manpower, materiel to quell demonstrations and badly needed financial aid, possibly saving the day for Assad. One thing is certain: if Assad were overthrown, the protestors and the new regime in Damascus would not forget Tehran’s support for their brutal oppressor, Iran would be isolated, less able to project regional power and more worried about its immediate neighborhood. Hezbollah would be left hanging.

It is with Hezbollah that the United States has minimal direct leverage. The Tehran regime needs Hezbollah to project power outside the confines of the Persian Gulf and to threaten U.S. interests in the broader region. The mullahs will do all they can to support Assad and Hezbollah, because without their mutual cooperation, Iran would be diminished in stature and much less of a threat to Washington’s interests. As long as Iran and Syria support Hassan Nasrallah, the United States can do little to confront and weaken Hezbollah—but as soon as they abandon him, Persian Gulf Arabs and Americans will be in a position to deal Hezbollah an existential blow.

It may not be too late to act simultaneously on two fronts to put Assad and the mullahs (and in the process Hezbollah) on the ropes. These states must be isolated—and isolated effectively.