Australia/Israel Review

Scribblings: A Diplomatic Solution

Nov 3, 2008 | Tzvi Fleischer

By Tzvi Fleischer

A Diplomatic Solution

The announcement by Australian Foreign Minister Stephen Smith on Oct. 15 that Australia would impose new travel and financial sanctions against Iran, similar to those imposed by European countries, was highly significant. The sanctions, which restrict dealings with two key Iranian banks, and also place commercial and travel restrictions on 18 organisations and 20 individuals associated with Iran’s nuclear and missile programs, are in and of themselves unlikely to convince the Iranian regime to re-think its headlong, illegal drive to become a nuclear power. However, because Australia and Europe are now willing to implement these serious sanctions outside the UN framework, the world may hopefully be moving toward sanctions which do have a significant chance of achieving the ends set out by UN Security Council resolutions – an end to illegal Iranian uranium enrichment and nuclear weapons work.

Russia and China have made it clear that they are not willing to allow the UN Security Council to pass tougher sanctions than the largely token measures now in place. But there is good reason, especially now with oil prices way down (see below), to believe that sanctions that will have a genuine effect on the Iranian economy can threaten the survival of Iran’s clerical regime. Moreover, US unilateral financial measures have already demonstrated that significant pressure on the Iranian economy can be produced with sanctions that are less than universal.

With most of the developed world accepting in principle the need for sanctions outside the UN framework, hopefully there can be movement toward even tougher sanctions, and soon, which may still prevent a nuclear-armed Iran from becoming a reality. Such effective sanctions are in the interests of the whole world, but should be especially supported by anyone who wants to avoid any possibility that either Israel or the US will resort to military force to try to stop Iran’s nuclear bomb-building. A diplomatic resolution requires putting in place the means to see it succeed.

Meanwhile, given that the sanctions route is being pursued strongly, it need not be seen as a setback or problem that the Australian Government has announced that it has dropped its bold idea of exploring the possibility of indicting Iranian President Mahmoud Ahmadinejad for incitement to genocide as impractical. Such efforts, even if pursued, were never going to be more than one additional measure to increase the political and diplomatic pressure on the entire Iranian regime, with serious economic and financial sanctions always the main game.

Price Signals

Iran is especially vulnerable to sanctions at the moment because of the declining price of oil. According to Mohsin Khan, director of Middle East and Central Asia at the International Monetary Fund, Iran has a “break-even point” in terms of oil prices at around US$90 a barrel, meaning that, below this price, the government would start to be unable to pay for all the internal subsidies and other spending to which it is currently committed. As Khan explained in late September, “If prices dip below US$90 a barrel… then [the Iranians] would have to tighten their public expenditure policy, and probably cut subsidies, which would be an issue for the government there – the public would not be content.”

Currently, oil prices are around US$65 a barrel.

New York Times columnist Thomas Friedman pointed out something further on Oct. 28. The sequence of a major rise in oil prices, followed by greatly increased expenditure based on oil wealth, then a sudden sharp fall in oil prices, has contributed to bringing down several regimes, including not only the Soviet Union but also the Shah’s regime in 1978. With Iran’s economy pretty much a basket case, but the regime preventing significant unrest by using oil revenue to subsidise food, petroleum, rent and other necessities, and to create make-work jobs, Iran’s rulers must be wondering if they aren’t staring down the barrel of a similar situation.

In other words, Iran has never been more vulnerable to serious economic and financial pressure, providedAustralia, Europe, the US and like-minded countries can create sanctions with real bite in the near future.

Ivory Tower Remedy

Prof. Martin Kramer, an example of whose work appears opposite, is one of the world’s most erudite, knowledgeable and authoritative experts on Arab and Islamic history and politics. But amongst his many books, he has written one which is particularly relevant to contemporary debates about higher education in Australia.

As readers may be aware, a Senate committee is currently conducting an inquiry into academic freedom in this country, and dealing with such issues as the existence and identification of academic bias, and outside influences that may skew the performance of academic departments, institutions and disciplines.

The book in question is Ivory Towers on Sand: The Failure of Middle Eastern Studies in America, published in 2001, and it is a detailed discussion of numerous problems and developments in Middle East Studies in the US in recent decades. This is a case study not only of a whole field of study essentially taken over and detrimentally skewed by one radical viewpoint, but of the techniques used to exclude and marginalise those who do not adopt the favoured approach, of the effects of foreign government subsidies, and of the use by academic institutions of government funds for purposes never intended.

In other words, it’s a text-book examination of what can go wrong in academia when the principles of academic freedom and institutional responsibility at universities are distorted.

By happy coincidence, Kramer and the Washington Institute for Near East Policy have just agreed to make the book available as a free download at I would urge anyone interested in the subject of improving Australia’s universities to read it.




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