By Dan Calabrese ——Bio and Archives--June 6, 2018
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John Kerry always said he wanted the mad mullahs to trust him, and bragged that this was how he got deals done that lesser diplomats could not pull off.
There’s one caveat, it turns out. In order to keep his word to Iran, he has to break it to everyone else, especially the U.S. Congress.The report by the Senate Permanent Subcommittee on Investigations revealed that under President Barack Obama, the Treasury Department issued a license in February 2016, never previously disclosed, that would have allowed Iran to convert $5.7 billion it held at a bank in Oman from Omani rials into euros by exchanging them first into U.S. dollars. If the Omani bank had allowed the exchange without such a license, it would have violated sanctions that bar Iran from transactions that touch the U.S. financial system. The effort was unsuccessful because American banks – themselves afraid of running afoul of U.S. sanctions – declined to participate. The Obama administration approached two U.S. banks to facilitate the conversion, the report said, but both refused, citing the reputational risk of doing business with or for Iran. “The Obama administration misled the American people and Congress because they were desperate to get a deal with Iran,” said Sen. Rob Portman, R-Ohio, the subcommittee’s chairman. Issuing the license was not illegal. Still, it went above and beyond what the Obama administration was required to do under the terms of the nuclear agreement. Under that deal, the U.S. and world powers gave Iran billions of dollars in sanctions relief in exchange for curbing its nuclear program. Last month, President Donald Trump declared the U.S. was pulling out of what he described as a “disastrous deal.”
The license issued to Bank Muscat stood in stark contrast to repeated public statements from the Obama White House, the Treasury and the State Department, all of which denied that the administration was contemplating allowing Iran access to the U.S. financial system. Shortly after the nuclear deal was sealed in July 2015, then-Treasury Secretary Jack Lew testified that even with the sanctions relief, Iran “will continue to be denied access to the world’s largest financial and commercial market.” A month later, one of Lew’s top deputies, Adam Szubin, testified that despite the nuclear deal “Iran will be denied access to the world’s most important market and unable to deal in the world’s most important currency.”Why would Obama do this and then lie about it? Well that’s an easy one. In public, he needed to insist that he was really being tough on Iran and wasn’t making untoward concessions. Behind closed doors, however, he and Kerry were desperate to get Iran to agree to a deal and believed that could not happen unless they made far greater concessions than they were publicly willing to admit they would consider. Iran’s lack of access to the U.S. banking system was one of the things that made the sanctions somewhat effective. In modern financial markets, access to capital is expected to be quick and easy, and when you have to work through intermediaries and wait on deliveries, you not only deal with delays but you’re also more accountable for what you do with the money. Allowing Iran access to U.S. banks raised the possibility that they could engage in all kinds of manipulation that the actual deal – at least as it was sold to the public – would not have allowed.
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Dan Calabrese’s column is distributed by HermanCain.com, which can be found at HermanCain
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