It is enough to look at the front page of Britain’s The Economist and America’s Time magazine to understand the magnitude of the gamble that is being made on the interim nuclear deal with Iran signed in Geneva. The Economist talks about “unlocking the Middle East,” while Time magazine makes reference to “Obama’s Iran gamble.” In fact, most Western commentators and analysts adopted one of these two points of view.
All analyses that followed the deal agree that Obama’s policy on Iran involves a costly gamble. This will have a high price whether it succeeds or fails, particularly with regards to Obama’s own legacy and Washington’s foreign policy.
Those who support the deal in the US and the West think that if it culminates with a final deal preventing Iran from building nuclear weapons, it will open the door to a new Middle East that is more stable, and thus will definitely influence Tehran’s regional policy. This would allow the resolutions of a number of issues, one after another, including Syria, Hezbollah and Tehran’s relations with its neighbors. This will also ultimately serve to facilitate the Palestinian–Israeli peace process and, on top of that, avert the risk of a nuclear arms race in the region.
On the other hand, skeptics and critics of the deal—especially in the US Congress—think that Obama’s policy demonstrates a great deal of naivete and that the solution is not in rewarding Iran by easing sanctions or allowing it to buy time. Rather, they think the solution is to increase pressure on Tehran. According to them, even if Iran’s new president, Hassan Rouhani, is serious in his intentions, the hardline conservatives in Iran will not allow him to go ahead with the deal. They cite similar instances with Rouhani’s predecessors, including Mahmoud Ahmadinejad. This is because a final deal will jeopardize their influence and control.
Without doubt, there is a gamble taking place on the domestic scene in Iran, and particularly in the country’s middle class. Furthermore, it is not just Obama who is making a gamble: the same applies to Rouhani. In the same way the the US president is willing to give Tehran a chance to test how serious it is and the possible prospects for a genuine transformation taking place in Iran, the conservative camp in Iran—which still insists on hauling out the “Death to America” mantra in public demonstrations—is waiting for the moment when this deal fails. Moreover, they are waiting for any sign of Supreme Leader Ayatollah Khamenei withdrawing his blessing in order to launch their own campaigns against what they consider the “Great Satan.” But something is reining in this camp so far, namely the poor economic situation in Iran, which Rouhani talked about in his speech marking his first 100 days in power.
Rouhani said his administration inherited this poor economic situation from the Ahmadinejad government. He also held the former administration responsible, citing mismanagement that made economy shrink by over five percent in the last financial year, creating a state of stagflation that saw the currency depreciate by 80 percent.
What was remarkable is the soaring optimism in Tehran’s stock market and the rise of the local currency against the dollar even before the ink on the Geneva deal had dried. People expect that easing the sanctions will pump hard currency into the Tehran government’s resources, boosting trade and reducing insurance rates.
Iran’s middle class was harmed by the economic decline, whether it was due to mismanagement on the part of the Ahmadinejad government or the effects of the economic sanctions placed on the country in response to its nuclear program. Hoping for change, it is the middle class that supported Rouhani’s rise to power, comfortably winning the Iranian presidential elections.
A great deal of the Western gamble revolves around the creation of public support within Iran regarding the prospects of reaching a final nuclear deal through economic incentives. However, it remains unclear whether this gamble will succeed.