Thoughts on the Iran MOU

Elite opinion so far seems to be running against the deal, but the public may be won over. If the deal holds up, gas prices will come down. In addition, the economy will strengthen and the risk of recession will go down. 

This is why I thought Trump might just walk away from the war back in April.

The MOU is arguably worse than just walking away. If it holds up, the deal will greatly strengthen Iran politically and militarily. The economic sanctions, which have been in place for years, have apparently had a devastating effect on the Iranian economy. It seems like these sanctions will be rolled back or ended entirely, allowing the Iranian regime to consolidate power domestically and to greatly increase military spending. If you think the Iranian missile program is a problem now, just wait.  I certainly would not want to be one of Iran’s neighbors.  (And this seems like a good point at which to congratulate Benjamin Netanyahu for a job well done.)

Many critics of the deal emphasize that the real error here was starting the war to begin with. Fair enough. But should we criticize Trump for the MOU itself, or is something like the MOU justified given the current situation?

The answer, I think, is that the MOU is a failure even if we take the war as given. A competent negotiator would have gotten a much better agreement. Trump has been signaling weakness since the initial onslaught failed to result in regime change (e.g., by allowing Iran to export oil, by making threats and then not carrying through, by being highly reactive to oil prices and the stock market, etc.). He is incapable of concealing his emotions or concerns.

I suppose it is possible that Trump’s cracker-jack foreign policy team will somehow manage to improve the deal as they work out the details.  And some pieces of the deal that favor Iran may fall apart:  is anyone really going to contribute $300 billion to Iranian reconstruction?  But the ability to sell oil and access the international finance system will be sufficient to finance Iran’s economic recovery and its regional military ambitions, without the $300 billion sweetener. 

It is possible that the MOU may fall apart and we may end up in the same situation we have been in for the past few months, with oil prices high and possibly rising.  This would be bad for ordinary people everywhere.  It would also be bad for Republicans in the mid-terms, and thus for Trump, a fact that everyone on both sides is well aware of.  Trump’s bargaining position, in short, is terrible, and I expect the Iranians to push hard for a favorable deal while their leverage is at its apex.  Trump may well continue to offer major concessions, unless the domestic criticism becomes unbearable to him.