Assorted Thoughts on Iran

Here’s a story in poor timing. I’ve spent the last three years writing a dissertation on bargaining over nuclear weapons, often with Iran as substantive motivation and focus. On Saturday night, my best friend from high school was getting married. Also on Saturday night, the United States and Iran announced a preliminary agreement over Iran’s nuclear program. I didn’t even know until the next morning, and I have been playing catch up ever since.

That said, I have encountered a lot of discussion on social media about the deal. Having spent all those years analyzing the credibility of nuclear agreements, I wanted to make five quick comments about the Iranian deal and such deals in general:

1) Bargaining can work.
A common misconception about bargaining over weapons is that any deal is inherently incredible. The theory is as follows. To buy off a proliferator, the rival needs to offer concessions. But those concessions are hard to retract if the proliferator is not compliant. Thus, the proliferator can take the concessions and build weapons anyway. In turn, because offering concessions has no impact on the proliferator’s decision, the rival should not attempt a bargain.

Although I believed this intuition was true when I began my research project on bargaining over proliferation, it turns out this is wrong. Bargaining over nuclear weapons works. The reason is that a proliferator will ultimately receive some amount of concessions. The rival can just offer most of those concessions off the bat. At that point, the proliferator has no incentive to develop nuclear weapons–if it did, it wouldn’t get much more than it is already getting, but it will have to pay the costs. So bargaining can work.

2) Iran is getting an awful deal (so far).
Broadly, rivals can use one of two nonproliferation strategies. First, they can use “carrots” in the form of the concessions mentioned above. Second, they can use “sticks” like sanctions and preventive war.

Although the announced deal is only preliminary, Iran isn’t getting any carrots. The deal essentially places the United States and Iran at the status quo ex ante: the United States is lifting most of its sanctions (with some oil embargoes remaining), while Iran is agreeing to stricter weapons inspections. As the narrative goes, the “stick” has beaten Iran into submission.

If we are basically back where we started, what was the point of the last ten years of proliferation? One ad hoc story is that Iran is worried about preventive war. But why hasn’t Iran been worried about preventive war in the last ten years? Israel has consistently called for invasion, and Iran has persistently called its bluff. Meanwhile, despite Netanyahu’s desperate pleas, Obama has yet to campaign for a military option. If anything, American reluctance to intervene in Syria has signaled general war exhaustion. So preventive war does not seem to be the answer.

The other ad hoc story is that sanctions are crippling Iran’s economy. But this by itself is unsatisfying–policymakers in Iran must have foreseen that the United States would sanction Iran for noncompliance. Yet Tehran marched forward anyway–the regime must have calculated that the costs of nuclear weapons (both from sanctions and the R&D costs) were worth the end product. One way to resolve this is to assume that the United States had private information on the effectiveness of sanctions–Iran grossly underestimated the effectiveness of sanctions, while the U.S. knew they would work to perfection. If you think that sanctions were wildly more effective than anticipated, then you could reasonably expect the announced deal to be credible, and Iran will forgo proliferation so as to avoid more sanctions.

If you are skeptical that this is the case–and I am–then the United States will need to offer carrots to induce Iran’s compliance. In the absence of credible and effective “stick” options, nonproliferation agreements only work when potential proliferators receive good deals. The announced deal could not be much further from that, as Iran is getting nothing more than what it would have received had it not walked down this road at all. Perhaps these carrots will come in the second stages of negotiations. For now, however, if you think that the sanctions were not sufficiently effective, then this deal will not work until the United States gets out its checkbook.

3) Carrots must be permanent carrots.
If carrots are a part of some eventual grand bargain, they won’t come cheap. Washington won’t just be able to write Iran a one-time check for $10 billion in aid and expect the problem to go away. Rather, the U.S. will have to keep offering Iran that amount of aid year in and year out. In contrast, if concessions are a one-time gift, Iran has no incentive to maintain the deal going forward. That doesn’t mean that the United States shouldn’t pursue a deal. After all, deals are credible when structured correctly. Just don’t expect a comprehensive agreement to be on the cheap.

Along these same lines, the United States needs to make sure it will credibly give those carrots year in and year out. If Iran expects that a deal will suddenly stop at America’s whimsy–perhaps because of a new, hardline president–the deal will fail.

4) Inspections aren’t pointless.
Hardliners seem to have a mantra that inspections are useless since they can never be all-encompassing. They miss the point. Inspections aren’t always designed to create perfect information. Rather, inspections make it costlier to proliferate, since inspectors force proliferators to develop nuclear weapons via more inefficient means. Greater proliferation costs open up bargaining ranges, reducing the probability of preventive war or further investment in nuclear weapons.

Note, however, that inspections are only an intermediary step. Inspections don’t convince states to completely stop proliferation activities–that is what the carrots are for. Put bluntly, inspections without carrots won’t do much good.

5) War bargaining =/= arms bargaining.
From an IR theorist’s standpoint, it is tempting to use the bargaining model of war as a framework for nuclear negotiations. Yes, there are a number of similarities–bargaining, shadow of war, information issues, commitment problems. But nuclear weapons are not a bargaining object in themselves. No one in Tehran will look at the first Iranian nuclear weapon and think “SHINY!” Rather, nuclear weapons are an inefficient means to an end. Fearon 1995 is a good tool to start with, but we need a larger toolbox to really understand the dynamics of bargaining over proliferation.

Yes, that was a shameless plug for my dissertation.

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The bottom line here is that negotiations aren’t nearly over. The United States will likely have to make real concessions to Iran to induce Tehran to permanently end its program. Anything short of that will lead to more sanctions, preventive war, or nuclear proliferation.