Over at NRO’s The Corner they have their usual run-down of Iran news, and this bit caught my eye:
The Islamic Republic Chief Inspector Hojjat al-Eslam Pour-Mohammadi says the Chief Inspectorate and the parliament guard the foreign exchange reserve against unauthorized withdrawals.
* Parliamentarian Hadi Qavami says the government has spent 73 percent of the foreign currency reserve to cover budget deficits.
* Former Revolutionary Guards and Law Enforcement Forces commander and current parliamentarian Rouyanian promises to fund extension of Tehran Metro with financing from the foreign currency reserve.
* Kargozaran criticizes raiding foreign currency reserve to fund gasoline imports.
* Government spokesman Gholam-Hossein Elham claims that the Ahmadinejad government has not made any unauthorized withdrawals from the foreign currency reserve. (emphasis added)
Gasoline is Iran’s big vulnerability – they import most of their gasoline, and now it seems that they are using up their scanty foreign reserves to pay for their gasoline. This is the result of collapsing oil prices – which hit Iran even harder than most oil exporters because Iran’s oil, it would seem, is of a lower grade and thus not preferred if there is other oil available. So, not only are the Iranians getting less money for their oil, they are also unable to sell as much as they used to as there is currently a glut of oil on the market. Now the story I heard a couple months back of Iran renting oil tankers just to store oil looms even larger.
The opportunities here for the incoming Obama Administration are fabulous – if they have the courage to play hardball with the mullahs. We can bring the Iranians genuinely to the negotiating table with the carrot of economic aid in return for Iran giving up its nuclear program – and the club of increasingly tight monetary restrictions on Iraq if they don’t give in. The Iranian need for cash is absolute – without cash the mullahs can’t buy support from some parts of the Iranian people, nor can they pay the goon squads which keep the unbought elements in line. A cash-strapped Iran is an Iran on the verge of societal breakdown and revolution.
There is, of course, the risk that the mullahs will opt for a mad-dog attack in order to distract the Iranian people from their plight. Militarily crushing Iran is a couple year process and lots of things can happen from start to finish in such a war…and the mullahs might reason that war would give them the excuse they need to keep control of the population with the population’s grudging consent – and, meanwhile, it buys them some time to convince Russia and/or China to intervene on Iran’s behalf, thus presenting the United States with the choice of leaving Iran alone, or going to World War III. This risk is real, and must be kept in mind.
With that risk in mind, however, it is still in our best interest to press our advantage at the moment – our army in Iraq is essentially free for non-Iraqi operations; our Navy is currently barely used in the War on Terrorism; our Air Force also has vast, untapped resources which can be brought to bear on Iran. We’re holding 51 cards right now, and we should be able to use this to trump the one card Iran continues to hold. Courage and a willingness to press the mullahs can bring us a tamed Iran no longer building nukes and no longer sponsoring terrorism in Lebanon and Afghanistan. We’ll swiftly find out if Obama is up to the task – or, indeed, if he even sees his chance.