5th Fleet Focus: The Buildup For Showdown Begins

The announcement on Tuesday to name the Iranian Revolutionary Guard Corps as a "specially designated global terrorist" is the latest event in what I term the Diplomatic Surge in the region against Iran that began at the beginning of August. This latest discussion centers around the Presidents role in the larger strategy the US appears to have developed in countering Iranian influence in the region. While the effectiveness of this specific move is questionable, the move is a requirement for the rest of the strategy.

As I noted last week, Stratfor's Global Market Brief contained the following.

The U.S. House of Representatives on July 31 passed legislation amending the Iran Sanctions Act (ISA) of 1996, expanding the scope of businesses subject to sanctions for investing in Iran's energy infrastructure. Further threatening Iran's commercial standing, the two largest banks in Europe that are still conducting financial operations in Iran -- Deutsche Bank and Commerzbank -- recently announced plans to halt transactions with private clients in Iran.

So what is the Iran Sanctions Act (ISA) of 1996? Robot Economist explains:

HR.2347 "Iran Sanctions Enabling Act of 2007"

The bill orders the Department of Treasury to maintain a list of foreign or U.S. persons who have invested more than $20 million in the Iranian oil industry. It then gives investors who divest themselves from a person on the Treasury list a safe harbor from civil, criminal and administrative actions and suits against the divestiture.

It also makes it the policy of the United States to support decisions by state and local governments and educational institutions to divest themselves from persons who are on the Treasury list.

The bill was passed by a hefty margin (408-6) in the House in early July and was introduced in the Senate in early August. I know socially responsible investing is really popular with folks on the left, but I bet the tangible impact of this Representative Frank's bill will be marginal.

The other two bills that are gaining all the attention is the House and Senate versions of the "Iran Counter-Proliferation Act of 2007" introduced by Rep Tom Lantos (D-CA). Robot Economist covers both bills in detail, including one of the most important parts of the bill that isn't being reported by the MSM.

Ironically, Lantos's bill would require that the executive list the Iranian Revolutionary Guard Corp as a 'specially designated global terrorist,' a 'foreign terrorist organization' and a 'weapons of mass destruction proliferator.'

Did you catch that? Robot Economist was thorough and revealed the dirty little secret.

The MSM is framing the discussion to make it appear the President is running the show, I'm not so sure. I think Lantos is the source of the Washington Post leak Tuesday, which was deliberate, just like I think Lantos is the big player in the larger game behind the scenes with the Bush administration, specifically the State Dept and the DoD. While the press is doing its typical political partisan dance, I think there is a bigger picture to the events that says a lot about the US position. While the press is reporting events as politics as usual, what we are actually seeing is a very clever bi-partisan diplomatic approach to Iran.

The Diplomatic Surge is designed to prevent a war with Iran, reestablish US credibility in the region, and stabilize Iraq by establishing a broader regional interest for stability in Iraq.

Rep Tom Lantos (D-CA) is the powerbrokeer behind preventing the war with Iran. He has been doing a lot of work in plain sight building a consensus strategy for a non-military, political offensive against Iran on a broad front, including by directly challenging Iran's supporters. Ironically, Lantos has been criticized considerably by the right recently when he joined Pelosi on that Syria trip in April.

The State Dept. has taken up the role for reestablishing US credibility in the region, and has done so by answering the requests of the regional players. A lot of people don't like the idea that military equipment is a road to peace, but in the Middle East weapons have always played a major role in preserving peace.

Finally, the ultimate goal is to establish stability in Iraq. While the building of a broader regional interest for stability falls to the State Dept, security inside Iraq falls squarely on General Petraeus. The upcoming September 15th presentation from General Petraeus is being worked up in the media as the biggest political event since the hanging chad in 2000. Virtually everything politically, for both sides, is riding on what is said. I don't know exactly what General Petraeus will say, but do believe that a good amount of that discussion is going to involve Iran.

The State Dept and the DoD have been screaming as loud as they can about Iranian weapons being utilized to kill US soldiers in Iraq for years now. For the most part, nobody has been listening. The Al Quds was first discussed as smuggling weapons as far back as October of 2005, and outright accused of killing British soldiers in August 2006. Since then a mountain of evidence has been reported to of been gathered that proves the IRGC has been operating against US troops in Iraq.

With the entire world watching, I think we should expect General Petraeus to give an Adlai Stevenson style presentation for the American people regarding IRGC involvement in Iraq. While some have highlighted the dangers of labeling a branch of a legitimate government terrorists, I see an opportunity to spark a discussion that is critical to the larger US policy in the global war on terror.

For example, the US has had to probe the edges of the Westphalian System in order to deal with the Lebanon - Hezbollah - Israel war last summer. The US is facing a similar dilemma with the Taliban in Pakistan. Now we have yet another problem, this time with the IRGC operating like a terrorist organization. As a friend of mine has pointed out, the Iranian border has become a modern day 17th parallel, can that point be leveraged without advocating war with Iran?

General Petraeus will have the platform to challenge Washington, and everyone else paying attention, regarding how the US should approach legitimate challenges that really do cut at the core of what national sovereignty is, and how the non state actors are hiding behind weak or tolerant states in challenging the Westphalian System.

And while the world is distracted by the politics of September 15th, the Navy will have quietly massed 2 Carrier Strike Groups in the Indian Ocean, plus an additional 2 Carrier Strike Groups and 2 Expeditionary Strike Groups either operating or in route to the 5th Fleet Area of Operations. I'm not even going to try to list all the Air Force and Army rotations that will be happening during that time, but in general I'll point out the US military will be mobilized for the rotations. While the paranoid may be thinking war, I'm thinking this represents a massive deterrent to war at a time of increasing political pressure against Iran.

This will provide the President and Congress momentum to take action quickly following the testimony of General Petraeus, with the announcements regarding the specifics of the arms deals to Saudi Arabia and other Gulf states either shortly before or shortly after. The US intends to build momentum and apply pressure to force Iran into making tough decisions. Stratfor has been predicting as much for awhile now, as in the recent article U.S.: Upping the Ante with Iran:

Stratfor has long contended that the negotiations between Washington
and Tehran are the key to any possible settlement on the Iraq issue, and
that if a deal is to be reached, things will look like they are
descending into chaos immediately prior. This is standard bargaining. Each
side has to appear as though it is willing to walk away from the table, to
the detriment of the other side.

Sanctions are at best an imprecise tool, but Washington's heavy leaning
on Europe has made them much more effective of late. The thought of
designating the IRGC as a terrorist organization has been floating in the
U.S. Congress for some time now, but Washington has a clear purpose in
sending strong hints to Iran that the decision is imminent at this
stage of the Iraq negotiations.

Iran is genuinely suffering from the financial sanctions, which are
generating significant domestic pressure on President Mahmoud Ahmadinejad.
By designating the IRGC a terrorist organization, the United States
has many more tools at its disposal to cut off funding to an
international network that not only fights for Iran, but also finances its fighting
through a number of business ventures, ranging from pipeline
construction to pharmaceuticals. The current sanctions regime has been
increasingly effective, and this new set of tools could put Iran's finances in
lockdown. Labeling the IRGC as a terrorist entity, rather than an
official state security apparatus, also could significantly hamper Iran's
defense deals. By homing in on the wealthiest and most senior IRGC
commanders, the United States is threatening the stability of the Islamic
Republic and Ahmadinejad's support network.

Over the next month, until the General Petraeus hearing, there is going to be a buildup of rhetoric regarding Iran. The US has been losing the propaganda with Iran for years, and I hardly expect that to change. It is accurate to describe the public affairs office of this president as a circus, not a media division, as their message comes out sounding like there is clown music in the background. The criticism of Bush's policy will be relentless, despite the fact it isn't Bush's policy, and Congress will have plenty of reasons to be skeptical of success stories in Iraq. The reality though is that Iran is in trouble, both politically and economically, and it is going to be interesting to watch Iran react as the buildup for showdown begins.