December 16, 2013: Despite the fact that the interim agreement with the rest of the world to negotiate about removing Iranian sanctions explicitly states that nearly all the sanctions continue until a final deal is agreed to, Iran is trying to stretch the terms of the interim deal. There are several examples of this already. The Assad government in Syria, which is also under a lot of international sanctions, recently ordered new food supplies and listed Iran as the guarantor of payment. The Syrians did not list one of the foreign Iranian bank accounts that are to be unfrozen by the interim agreement but instead stated that to an Iranian bank would take care of payment. This is still forbidden by the sanctions, but the Iranians were always bold and possessed of lots of initiative. In that spirit the Iranians are protesting the implementation of new sanctions authorized before the interim agreement. Actually, the interim agreement does not prevent new sanctions, something some Western politicians are calling for to give the Iranians more incentive to negotiate and implement a mutually acceptable final agreement. Iran does not see it that way, making it clear that the negotiations will be difficult and success is definitely not assured. The rest of the world is going to learn why the Gulf Arabs are so wary of Iran.

Israel is angry at the United States for making an interim peace deal with Iran that does nothing to stop the Iranian nuclear weapons program and rewards the Iranians for showing up to talks. The U.S. disagrees with this assessment and moves forward towards a more comprehensive deal with Iran. Because of that both Saudi Arabia and Israel are now openly denouncing the American negotiations with Iran. Both Israel and the Arabs see Iran as a clear and present danger and consider the Americans naïve in their treatment of the Iranian menace. To the locals, Iran is not some new terrorist threat but an ancient problem that is still aggressive, dangerous and deceptive. Old hands in the U.S. bring up the fact that Iran was seen as a regional threat even before the Islamic clerics overthrew the monarchy in 1979. It should also be noted that Iran never really adjusted to democracy and has been run by ambitious and militant tyrants for thousands of year and especially in the last century. For Israel and the Arabs giving Iran the benefit of the doubt is not a prudent move and the American policies are seen as thoughtlessly reckless.

Iranian efforts to help Syria are paying off and one obvious success is that more pro-government (non-Sunni Moslem) Syrian men are showing up for military service. The Syrian military always sought to recruit or conscript a disproportionate number young men from groups more loyal to the Assad dictatorship (Alawites, Christians, Palestinians and Druze). But once the rebellion began in 2011 even the “loyal” Syrians evaded conscription, much less volunteering. Now with Iran supplying a large number of mercenaries, and helping to organize self-defense militias among pro-Assad Syrians, the rebels have been fought to a standstill and military service no longer looks like a suicide mission. With the economy a mess, the government is using massive economic aid from Iran to reward its supporters. Families that have a son who has not shown up when conscripted is not considered friendly or worthy of economic aid. So suddenly showing up for your conscript service is seen as a shrewd move.

A senior Shia cleric, grand ayatollah Kazim al Haeri has issued a fatwa that approves of Shia men going to Syria to fight for pro-Iranian dictator Basher Assad. Haeri is an Iranian born-Arab who has long been active in Iraqi politics. He has great influence over Iraqi Shia Islamic radicals and militias. Iran has, until now, played down its role in forming a mercenary army to support Assad. But with that strategy apparently succeeding, it is apparently time to take credit and encourage more Shia men to volunteer.

Another big plus for Iran in Syria has been Russian diplomats who managed to keep Western airpower away from the Assad forces with a deal to eliminate (temporarily) Syrian chemical weapons. And then there is that growing force of mercenaries Iran has been sending in from Lebanon, Iraq, Iran and many other nations with Shia populations and young men willing to die for their beliefs. For most of 2013 these Iranian supplied fighters have made all the difference for the Assad forces. Iran has been recruiting Shia gunmen in Iraq, Lebanon and elsewhere since late 2012 and providing transportation to Syria, weapons when they arrive and regular pay. The Iranians also encourage Shia men from around the world to come join the fight against Sunni radicalism (which often results in terror attacks on Shia civilians). More than 10,000 of these Iranian mercenaries had been in action by July and more since then.

This has given the Assad forces armed fanatics to match the Islamic radicals among the rebels who have often been a key element on the battlefield. Iranian cash also props up the ragged economy in parts of the country the Assad government still controls. The reinforced and reinvigorated Assad forces have recently made gains in the cities of Damascus, Homs and Aleppo. Rebel victory is no longer imminent. But many of the Iranian mercenaries (except for the Hezbollah men) are not under any centralized control although Iran tries to exercise some control via threats to hold back on payments and supplies for groups that appear to be going rogue or simply not cooperating. The civil war, like most civil wars, has resulted in a lot of armed groups going freelance and operating like bandits and organized looters. Even the Syrian Army has allowed its troops to loot in pro-rebel villages and neighborhoods. It’s good for morale.

The Saudis noted the success of the Iranian mercenaries and tried to respond in kind. The Saudis sought permission to recruit Pakistani soldiers to be trainers and combat support specialists for their new rebel army. Pakistan was attracted to the prospect of some high paying jobs, but ultimately forbade Pakistanis to participate because Iran made it clear that retribution would be certain and severe if Pakistan helped to support the Syrian rebels. While Pakistan has only a small border with Iran, in centuries past most of Pakistan was part of one Iranian empire or another on several occasions. Staying on good terms with Iran was preferable to a little cash and making the Saudis happy.

The Assads believe they can win and that victory will come in 2014. In addition to battlefield successes, w ith the help of Russia and Iran the Assads have been successful in depicting the rebellion as an effort by al Qaeda to establish a new base in Syria. That scares the West. While this al Qaeda threat is real, the Islamic terrorist groups are a small part of the rebel force and often more disruptive than helpful to the rebel cause. The Assads see the rebel lack of unity and coordination as an opportunity to put down the rebellion.

Iran has increased its defense budget 26 percent (to $5.9 billion) this year. Adjusting for the high Iranian inflation the defense spending is up 4.7 percent. Spending is up for the regular military and down for the Revolutionary Guard (whose loyalty is to the clerics who run the country) and the Basij (a part time militia used by the clerics to terrorize the population into obedience). The Iranians get the most for their money because the Arab states across the Gulf are spending much more and still fear Iran. Saudi Arabia alone spends $67 billion a year on defense. 

Iranian oil exports increased 12 percent in November, to 850,000 barrels per day. In November Iran produced 2.71 million barrels a day, up about one percent from October. Iran also cut the amount of oil it has stored in tankers off shore from 37 million barrels at the end of October to 22 million barrels at the end of November. Before the current sanctions began 18 months ago Iran was producing 3.5 million barrels a day and exporting much of it. Something Iran does not like to discuss publically is the fact that its oil production would have declined even without the new sanctions. That’s because other sanctions have made it impossible to maintain and expand Iranian oil fields, production capabilities and refineries (for internal consumption). These sanctions have been in place for two decades and the Iranian oil infrastructure has been falling apart. Iran wants the sanctions lifted so that it can rebuild and expand its oil industry, a process that would take five years or more.

Despite the bad Iranian financial situation Western negotiators believe Iran is not willing to give up much to get sanctions lifted. Many Iranians, both senior leaders and the population in general, want nuclear weapons and are opposed to even a temporary halt in efforts to produce nuclear material suitable for a bomb. Iran appears to have taken care of the electro-mechanical aspects of a nuclear bomb. An examination of the electronic and other items (like special metals) that Iranian smugglers have succeeded in obtaining over the last decade read like a shopping list for a nuclear weapon. Some of this stuff was dual use, but a lot was not. The only missing element is nuclear material sufficiently potent to make a bomb work.

Despite the popularity of the nuclear program, the number of Iranians unhappy with their government continues to increase. In response the government has become more violent against reformers and those who openly complain. For most Iranians this means unpleasant encounters with the secret police, the religious police or groups of Basij who roam the streets attacking “enemies of the state.” For the most visible or effective opponents of the religious dictatorship there is death. So far this year about 530 people have been officially executed. Unofficial deaths are more difficult to get an accurate count of. Most of the executions have taken place since the new president (the kinder and “more moderate” Hassan Rouhani) took office four months ago.

The growing use of terror has not helped solve a major long-term problem; the declining birthrate. Since the beginning of the 21^st century t he birthrate has rapidly declined and is now below the replacement rate . T he population is 75 million (double what it was when the Shia clerics took over in the 1980s) and most Iranians are under 35 . T oo many younger Iranians are unemployed and unhappy with the government. The clerics encouraged births during the 1980s war with Iraq, but now most ( over 70 percent) Iranians live in cities where it's impossible to support a family if you don't have a job. Younger Iranians don't want to have kids while the country is ruled by a corrupt and inefficient religious dictatorship.  Few of these young Iranians want to return the countryside and subsistence farming. Alarmed at the sharp slowdown in the population growth rate over the last decade, the government has cut spending on birth control and is offering cash bonuses for new babies. The government wants to double the current population, to 150 million so that Iran will be a stronger military power. That does not seem likely to happen. Since 2000 the birth rate declined sharply .  The government officially describes this as a successful government population control program, but young couples say otherwise .  Meanwhile, the government continues that repression, shutting down any media deemed potentially dangerous and sending more dissidents and reformers to prison.

Another long term result of the stubborn Iranian dictatorship is closer cooperation between Israel (which both Iran and most Arab nations officially want destroyed) and the Arab Gulf states. Over the last 60 years Israel has always sought to improve relations with Arab states and has made slow, but steady progress. Now, with Arabs in general (and especially in Arabia) terrified of Iran, the pro-Israel attitudes are growing as is unofficial and discreet cooperation between Israel and  the Arab Gulf states on matters of mutual interest (like restraining Iran). The United States has always encouraged these relationships and recently reaffirmed its commitment to the security of Israel and the Arab Gulf states. But the Arabs and Israelis want more than words from America.

December 14, 2013: Iran has told Pakistan that it cannot deliver on a pledge to loan Pakistan $500 million so that Pakistan could build its part of a $4 billion natural gas pipeline from Iran to Pakistan. This is disappointing to Pakistan, which has been an ally of Iran and was ignoring American threats of sanctions by agreeing to the pipeline deal. But Iran was losing faith in Pakistani ability to get their portion of the pipeline built and feared that a loan would largely be stolen by infamously corrupt Pakistani officials. Each country was to pay for half of the pipeline. Pakistan believed that part of the deal was Iran providing loans so that Pakistan could build its half. Iran now says that this was never agreed to and the sanctions have left Iran unable to loan Pakistan the cash needed to build the Pakistani half of the pipeline. Iran has already invested quite a lot of cash on its portion of the pipeline so this loan decision is seen as a temporary setback. The natural gas pipeline between Pakistan and Iran would enable to Pakistan to get around the sanctions by importing Iranian natural gas and paying with goods (barter). But even without the sanctions Pakistan is a natural customer for Iranian gas.

December 13, 2013: In northeastern Iraq, just across the Iranian border, gunmen shot to death 17 men working on the recently agreed on Iraq-Iran natural gas pipeline. Fifteen of the dead were Iranians and Sunni Islamic terrorists are suspected of this attack although no one immediately took credit.

December 9, 2013: In another foreign policy victory Iran has officially resumed diplomatic relations with Hamas, the radical Palestinian group that runs Gaza in much the same way that the Iranian clerics run Iran. That’s not all, as the severe economic problems in Gaza has led Hamas to order its military commanders to cooperate with Israeli security forces to keep more radical Islamic terrorist groups from trying to attack Israeli troops along the border fence. This has lowered the number of violent incidents along the Gaza border. What aid Gaza still gets often comes via Israel and peace on border is necessary to keep that route available. Hamas also depends on Arab Gulf states for financial support but that was already threatened by Hamas support for the Egyptian Moslem Brotherhood, which attempted to turn Egypt into a religious dictatorship and was removed from power in July by a popular uprising and the army. Hamas feels more comfortable with the Iranian clerics, who will now resume financial aid.

December 5, 2013: The Iranian Navy’s “28th fleet” visited Mumbai in India and Sri Lanka. The 28^th fleet consists of a Russian made Kilos class submarine, a 1,500 ton British built frigate (from the 1970s) and am equally elderly 4,400 ton supply ship with a helicopter landing area and the ability to carry a helicopter. This vessel was described by Iranian media as a “helicopter carrier.”

December 3, 2013: In Lebanon a senior Hezbollah commander, who has been active in Syria was assassinated. Hezbollah blamed Israel but it was more likely the work of Lebanese Sunnis who oppose Hezbollah and support the Syrian rebels. Hezbollah was formed in the 1980s with the assistance of Iran and has been financed by Iran ever since.

November 30, 2013: Iran announced that despite the November 24^th interim agreement over the international sanctions, Iran would never dismantle any of its nuclear facilities.