The Presidential Inbox: Iran's Nuclear Program

Experts discuss the internal and external factors that have spurred dialogue between the United States and Iran.

This meeting will be part of a series on the U.S. presidential inbox that examines the major issues confronting the administration in the foreign policy arena.

CAROL GIACOMO: Welcome to today's Council on Foreign Relations meeting with James Dobbins, William Fallon and Karim Sadjadpour. You all have their bios, I believe, in your packet. Jim Dobbins is one of the pre-eminent diplomats of his generation, and Admiral Fallon holds a similar position within the military establishment. Karim is an expert on Iran.

This meeting is part of a series on the U.S. presidential inbox that examines the major issues confronting the administration in the foreign policy area.

I would also like to welcome CFR members around the nation and the world participating in this meeting through the live stream and teleconference. We'll hear from them during the question-and-answer session.

So this event comes at a very fortuitous time given the meetings that concluded in Almaty, Kazakhstan, recently. And I would first like to ask our panel, what do you think really happened there? And do you see any potential for a real deal?

Why don't we start with Jim?

JAMES DOBBINS: Well, I think the intent on both sides was to keep the dialogue going at least through the Iranian presidential election. I don't think many people expect substantial progress until they've gone through that.

I think the U.S. and the other permanent members of the Security Council sweetened the deal somewhat from the last conversation, offered to shed a few more sanctions, although largely sanctions at the margins rather than the core of the sanctions regime, also lightened their demands on Iran slightly for an interim step, for instance, asking that they suspend operations at their underground enrichment facility rather than that they close it down entirely, not as part of a final deal but just a part of a first stage toward a final deal. And the Iranians responded by saying, this is interesting; it seems to represent progress; let us go back and think about it. I think the elections -- Karim will know, but I think they're scheduled for early summer.

KARIM SADJADPOUR: June.

DOBBINS: June. And so I wouldn't expect breakthroughs till then. But I think we've successfully pushed off any major confrontation until after that.

GIACOMO: Admiral Fallon?

ADMIRAL WILLIAM FALLON: Not a whole lot to add to that. I think there -- the two pieces have to fall into place. One, the elections here in the U.S. that have already occurred, the Iranian elections, so that the main discussants have a foundation -- political foundation underneath them. And then we'll see what happens.

One would think that from the U.S. side, after almost 35 years of this head-butting with Iran that at some point in time we know there's going to have to be a negotiation to reach some kind of a settlement to try to come close to normalizing relations. The nuke thing, of course, is the big polarizing event and the catalyst for all the near-term issues here.

So I think nothing's going to happen until later on in the year, and hopefully the combination of a realization that at the end of the day there's going to have to be a discussion to make some progress -- and I think the other factor that's kind of energizing things here is that the combination of sanctions has begun to bite pretty significantly in Iran, and that's probably providing some motivation here.

GIACOMO: Karim, the assumption here is that Iran does really want to engage in some kind of a negotiation that could lead to an agreement. Is that a valid -- do we know that that's true?

SADJADPOUR: I think the perennial challenge we've always had with Iran is that those Iranian officials who are interested and that deal with America really can't deliver, and those who can deliver aren't really interested in a deal with America.

You've had here up on this stage at the council the current foreign minister, Salehi, someone who was educated at MIT. I think he genuinely wants to see a resolution to the U.S.-Iran conflict. The Iranian ambassador to the United Nations, Mr. Khazaee, I think probably wants to see a resolution to this conflict.

But you have a person in charge, Ayatollah Khamenei, who has been supreme leader since 1989. He hasn't left Iran since 1989. And I would argue that for Khamenei -- Khamenei is kind of a -- the best historic analogy for him, I would argue, is Brezhnev. He's this kind of apparatchik who's frozen in time. And I would say for Khamenei, the ideals of the revolution and the ideals of the Islamic republic can be distilled to three fundamental pillars. And that is hostility towards the United States or rejection of U.S. hegemony, hostility toward Israel and the veil, the hijab for women, which symbolizes Islamic piety.

I think that the challenge which Khamenei has is that his hostility towards the U.S. is cloaked in ideology, but I would argue it's driven by self-preservation. And what that means is that for years, so many of us, including, I think, in this room, most (ably ?) the Iran Project, which is Ambassador Bill Luers and Tom Pickering and others and myself and Jim, and so many others have argued -- and Gary Sick, who's in the audience -- that if we engage Iran, if the U.S. engages Iran and reintegrates Iran into the international community, reintegrates Iran into the global economy, this is going to facilitate political change and political reform within Iran.

I happen to believe that's a correct argument. But I think we're naive to think that Ayatollah Khameini is oblivious to that argument and he's going to embark on this path, which I would argue would be inimical to his own interests and the interests of the regime. So I think that's the fundamental challenge we face as the United States. How do you go about reaching a modus vivendi with the regime in Tehran, which needs you as an adversary for their own internal legitimacy?

GIACOMO: What's the answer?

SADJADPOUR: Listen, I think that one of the best lines, I think, about foreign policy came from Jon Stewart. (Laughter.) And Jon Stewart once said about Dubai -- he said that Dubai is what happens when Las Vegas and Saudi Arabia have a baby. (Laughter.) And if I had to use that Jon --

GIACOMO: Right. That's a good line.

SADJADPOUR: -- that Jon Stewart formulation about Iran, I'd say, the Islamic Republic of Iran is kind of like a hybrid between the Soviet Union and the Taliban. It's not a superpower like the Soviet Union. It's a regional power. It's not as Islamist as the Taliban, but listen, they still stone women to death for adultery, so they do have that strong Islamist ideological undercurrent.

But I think the takeaway from that analogy is that I don't see us being able to reach a grand bargain with Iran. But I also don't think we need to go to war with Iran like the analogy to Nazi Germany implies, that this regime is messianic and it can't be contained. I think the utility of dialogue and engagement with Iran isn't necessarily to resolve our differences but to contain our differences, to manage them until this regime is eventually forced to change and transform under the weight of its own internal contradictions and economic malaise.

GIACOMO: Has the United States put enough on the table at this moment to really grease the process in any meaningful way?

DOBBINS: Well, I think it put enough on to do what I think it intended to do this round, which is kick the can down the road, ensure that the Iranians stay short of our red lines for some kind of military action and open the prospects for more meaningful dialogue once their own internal politics settle down slightly.

I share Karim's view that the vision of a grand bargain in which we settle all of our differences as part of one large package is not very realistic. I do believe that there have been a number of opportunities over the last 20, 30 years for dialogue with Iran that we've missed, and we've missed them because their politics and ours are out of sync, and each side sees engagement with the other side as a concession that it's making to the other side. And so when they're ready to make that concession -- and there have been several quite stark offers on their side -- we weren't ready for engagement; we were in a different cycle. And when -- and when we're ready, they're not. So Obama has sent messages to the supreme leader. It's pretty clear he's ready for some level of engagement, and at the moment, they're not.

My own view is we should stop seeing engagement as a concession we make to them. We should have a flat statement: We're ready to talk to Iranian officials anytime, anywhere, on any subject they're willing to talk about. And so when their opportunity comes, we won't have to make a decision. We'll be ready to talk to them rather than this -- you know, each being so out of cycle and the two never matching.

GIACOMO: And you don't -- go ahead, Admiral.

FALLON: Just a thought here, that -- you've hit the nail on the head in my book, that self-preservation is the factor that's kind of come to the fore. So we could row back in time 30-some years, and when Khomeini came to power and the revolution swept through Iran, the U.S. was a pretty obvious whipping boy for this. And so if the fundamentals of the revolution were anti-secular and anti-Western -- and anti-Western is not so much as, you know, L.A. or the West Coast; it's the culture, the Western culture, which they think is the antithesis of their religious dogma. So these are the pillars of the revolution.

What's changed? Nothing. Except the position of the ruling elites, the clerics in the country, I think is different now. And I would have to think that the Arab Spring, for lack of a better term, has got these guys thinking not so much that goodness and democracy are going to suddenly sprout out, but the real fundamental motivator for this -- what's happening in the Middle East and North Africa is economic. And so Iran is not in the best of economic situation right now. And the sanctions are making that more and more difficult, so maybe this is a motivator.

So I agree -- I doubt there's any grand bargain in the air any time soon, but self-preservation -- if we don't do something to take the pressure off, we may be on the outside for other reasons that have more to do internal than external. So that could be -- it could be a factor here. So there's a reason for them at least rope-a-doping this thing and having some kind of a discussion, it seems to me.

GIACOMO: All right. The question of sanctions. You seem to indicate that you think that they have at least been somewhat influential in getting the Iranians to this point. Should the United States keep piling on sanctions? There's an effort in Congress now to impose some more draconian penalties on Iran, and I wonder if you think that this is an opportune moment to do that or not.

Admiral?

FALLON: Sure, I'll take a crack. First, I don't think the sanctions of and by themselves are going to solve the problem. It's a tool. There's a lot of history here of sanctions being not effective, but nonetheless, there's some pressure being applied, no doubt about it.

I think the effectiveness of the sanctions is the issue. And so if we can get more people to play along -- frankly, it's a one-trick pony in Iran economically, and that's oil and gas. And interestingly enough, another motivator for them potentially having a reason to want to chat about these things is that there are more options coming available every day: in our own country, the potentials to use the fracking and other things to make us a lot less dependent on other people in the world; Iraq oil production I expect to see dramatically increase here soon; the amount of gas that's discovered in other places. So there are a lot of external factors to Iran that make their position a little bit questionable going forward.

So I think maybe effectiveness in sanctions, keeping the pressure on, I believe you got to work both sides of it. So the carrots and the sticks, effectively that's what our policy's been.

Jim, you probably want to -- have a -- (inaudible) -- view on that one.

GIACOMO: Well, wait, let me just stay with you for a minute. So are you saying that you would -- you would just do a better job enforcing the sanctions that exist or that you would put new ones on?

FALLON: At least going into it -- you know, I don't know what new ones may be. I don't think anybody has any great new ideas here, but making what we have a little bit more effective, not to just expect this is going to suddenly make them say, OK, uncle, we give up, we'll go do it. But at the same time, on the other side, to give them a way out. At the end of the day, they're people, they're humans, they need to have a way out; you can't lock them in a box; there's got to be a light at the end of the tunnel. So, this is not good; we can continue this for quite a while; wouldn't you like to do something else? Maybe there's a way out of this.

GIACOMO: Jim?

DOBBINS: I think we have to understand that we have no trade with Iran. We have no commercial relations. We have no financial relations with Iran. So U.S. sanctions are essentially sanctions on our friends, threatening them with penalties if they trade with Iran.

Now, that works as long as our friends are willing to go along with it, are willing to say, yeah, you're probably right, we will accede to this. We don't like the principle of extraterritorial sanctions, but we share your objective and so we're willing to cut our financial and other ties with Iran, stop buying Iranian oil, et cetera, because -- not because we're afraid of your penalties, but because we agree with you and you're giving us an excuse to do something we think's probably a good idea.

So the limitation on the utility of these U.S. sanctions is the degree to which our friends are willing to go along with them. And they've been willing to go along with them to a remarkable degree in recent years. So I would have to say I'd have to look at whatever Congress is currently looking at and saying is this something that our friends are probably going to be willing to go along with, because as I said, we no longer have any U.S. instruments to affect it.

I think it's important to understand that sanctions have a lot of utility quite beyond the degree to which they affect Iranian policy. First of all, they affect Iranian capacity. They limit Iran's capacity to get nuclear technology. They limit Iran's capacity to get civil -- to get conventional military technology. They weaken Iran's capacity to project influence in the region. So, quite aside from whether they change their policy on nuclear, they definitely are a very effective way of restraining Iranian influence, mostly pernicious, in its immediate region.

They're also an objective lesson to other countries that might be considering violating the NPT and developing nuclear weapons despite their formal agreement not to do so. So even if they don't work with Iran, to the degree they discourage Saudi Arabia or Egypt or South Korea or Japan from going down that same road, they also serve some utility.

They probably have some marginal effect on Iranian willingness to negotiate under current conditions. And as I said, if what the Congress is considering are sanctions that most nations trading with Iran would be prepared to go along with, then I wouldn't object to them under current circumstances. But we do have to be in a position of being willing to take sanctions off when we get some reciprocal movement and to do so in a -- in a fairly agile way, not to say, you do this, and then we'll go back to Congress and see if we can get them; you have to give the president enough leeway so that -- so that in a tit-for-tat, slow-moving process, he can reciprocate quickly to meaningful changes on their part.

GIACOMO: Karim?

SADJADPOUR: Well, the challenge also with sanctions vis-a-vis Iran is that we're dealing with a regime which has long been willing to subject its population to pretty severe economic hardship rather than compromise on the political and ideological goals. I mean, this was a regime which prolonged a pretty bloody war with Iraq for several years for its own internal legitimacy. That's one challenge.

But I think it's useful to contemplate the situation that the supreme leader, Ayatollah Khamenei, is currently in. As I said, he's been leader since 1989, and his modus operandi essentially has been to try to preserve the status quo, the status quo that was given to him by Khomeini, by avoiding transformative decisions. And he's now put himself in a situation in which Iran is faced with unprecedented international economic and political pressure.

And I see two doors, two exit doors, for him to reduce that pressure. Exit number one is a nuclear deal. Exit number two is a nuclear bomb.

Exit number one, a deal -- his other modus operandi is that when you're under pressure, never compromise, because if you compromise under pressure, that's not going to alleviate the pressure; it's going to project weakness and encourage even more pressure. So he's long been averse to compromise. The lesson he learned from recent history was that when Gadhafi gave up his nuclear program, that made him vulnerable to NATO intervention. So he's averse to compromise.

But the second door is equally perilous to him -- I mean, the door number two, a nuclear weapon. I mean, when I was based in Tehran in my previous job, with the International Crisis Group, I used to interact with some of these Revolutionary Guardsmen, who drew this, you could argue, facile lesson from Pakistan, and that was, well, when Pakistan actually detonated a bomb, what did that do? It turned outside pressure into outside engagement. The world was forced to deal with them. It became, you know, fait accompli that they were a nuclear power.

But I think that Khamenei's exit door number two is also quite complicated because he's forced to take a very deliberate approach -- they're not making a nuclear sprint; it's a nuclear brisk walk, you could argue -- so it's a deliberate approach, because he knows that if he were to try to break out, he would likely get bombed. But he then has to calculate if this system can sustain the type of pressure it is right now in the time it takes them to acquire a nuclear weapon, which could be several years.

So he's put himself in a very uncomfortable position, and going back to the issue of sanctions, I honestly think it's really the least bad option we have at the moment.

GIACOMO: You know, the American have gone to great extent to say that the sanctions are not targeted at the Iranian people and that things like humanitarian supplies, medical supplies are exempt from these penalties.

But there are some people who say that in fact even if it's not intentional, these items do get caught up in this web. And I wonder if the three of you agree with that. Do you think that there is something that needs to be done to -- I mean, if you think that that's one of the adverse effects, that there's something that has to be done to correct it?

SADJADPOUR: Because -- I compare sanctions to chemotherapy: You're trying to target the tumor, you're trying to target the regime and not kill the body politic. And that's not possible with chemotherapy, and it's not possible with sanctions. You can't perfectly target the regime and avoid hardship on the people.

So anything we can do that eases humanitarian suffering on -- specifically on medicine and these types of things, I think we need to do everything in our power to do that.

But I have to say -- and this is anecdotal; there's no scientific evidence about this -- but when I was based in Tehran and you would engage Iranians about their lives, 9 -- 10 out of 10 people would tell you the bigger problem in their life is economic malaise: Younger generation doesn't have employment prospects. Rampant inflation. Underemployment.

And if you asked the follow-up question to them and said, well, why is Iran's economy so lousy? Because it's -- you know, it's a nation which has -- it's incredibly rich in natural resources and human resources. Why is Iran's economy so lousy? It's very rare that someone says it's because of the sanctions, and if only the sanctions were removed, then the mullahs would be doing a very good job running the country. Invariably they'll respond with corruption, with mismanagement, et cetera.

So I don't believe that somehow sanctions are rallying the population around the regime. That said, I do think we need to do everything in our power to focus the sanctions against the regime and avoid popular suffering. But it's much easier said than done.

GIACOMO: I'd like to hear from all of you on this. How do you think President Obama is doing handling this issue?

Start with Jim?

DOBBINS: Well, I -- no, I mean, I think there was an initial effort to engage the Iranian regime. I think it was somewhat cautious and a bit inept. You know, Obama had gotten two messages from President Ahmadinejad, who clearly wanted the dialogue with him, and instead, Obama responded by sending his message to the supreme leader, A, because the supreme leader's more important, and B, because he's less controversial than Ahmadinejad. So there were good sort of, you know, reasons, but nevertheless, he had someone who wanted to talk to him, and he chose somebody else.

And it was -- it was sort of the obverse of the Clinton administration. They had a president who was acceptable, Khatami, a reformer, and they had a supreme leader they didn't like, and so they made overtures to the president while at the same time dissing publicly the supreme leader. Well, you can't gain the Iranian system that way and expect a profit. You don't understand it well enough. So it's better to be responsive to overtures when you get them than to try to game their system. So I think that was an inept effort.

But it was a genuine effort. And I think there probably was a window then. And I think that the window is not open at the moment. It may open again in a few months. It's quite -- it's quite possible.

Personally, I think that the threats to engage in military action of a pre-emptive nature in Iran are probably not, on the balance, productive. And, I think, actually crossing that threshold -- and the president has pretty much boxed them in -- would be quite counterproductive.

You know, the president has said, we're not for containment of Iran. That's kind of a silly statement. Our policy has been containment of Iran since 1979. Iran tries to subvert, overthrow and threaten all of its neighbors, not just Israel but lots of them, and we try to prevent them. That's called containment.

What he really means is, he's not for deterrence. In other words, he's for pre-emption rather than deterrence.

But I think that if you're worried about Iranian influence -- and nobody's worried about Iran invading and overthrowing their governments. It hasn't done it for several hundred years. It's not equipped to do it. What they're worried about is that an Iran with a bomb would have more prestige, more influence and be capable of more subversion, more support for terrorism.

But I think you have to ask the question in terms of the Middle East polity. Which Iran has more influence: an Iran that has suffered an unprovoked attack by the United States or an Iran that has a nuclear weapon? I think it's the first of those that actually would gain an influence with neighboring populations.

GIACOMO: Admiral?

FALLON: The only comment I'd make, I think, is that we have a tendency to personalize all these things, so it's Obama's issue versus the Iranians or it was Bush's issue versus Ahmadinejad.

GIACOMO: Well, he is the president.

FALLON: I understand that. But, you know, there is a -- there is a whole apparatus of government that is in place to actually think through and to formulate and then to carry out policies. And since this is something that didn't pop up yesterday, this is three decades-plus of challenge -- there's been an awful lot written about it, a lot said about it -- and the challenge in my mind is to actually craft something that will try to accommodate the vagaries of the current political winds and try to move forward. Nobody said it's easy, same we've already beaten the grand scheme thing to death here, but some progress to try to move forward.

I think you're -- I absolutely agree with Ambassador Dobbins from my interaction with the countries in the Middle East that it's a subversion issue. It's the proselytizing of the Shia minorities -- or majorities, depending where you are -- and the support that they get from Iran, Iran's penchant for using surrogates to carry out their activities -- this is really unsettling to the other countries, and so this is what we've got to deal with.

GIACOMO: Karim.

SADJADPOUR: When Obama came to office in January of 2009, it was clear from the get-go that Iran was central to six core U.S. foreign policy challenges: Afghanistan, Iraq, Israeli-Palestinian conflict, terrorism, energy security and the nuclear issue, which is taking most of the time.

And I think he began with the premise that ignoring Iran is no longer an option. Bombing Iran is going to exacerbate each of those issues, not to mention the ramifications that would have in Iran internally. And so they tried, I would argue, a policy of engagement, which went further than any U.S. administration since 1979, trying to put aside, you know, the last few decades of this adversarial relationship.

But I think their ambitions -- their ambitions in the first term were to resolve this issue. I think their ambitions in the second term are not to resolve U.S.-Iran relations but to avoid a military conflict. Yeah.

And I would argue that this national security team he's now assembled, between, you know, Obama himself, Vice President Biden, Secretary of State Kerry, Secretary of Defense Chuck Hagel, is the most pro-Iranian-engagement national security team since 1979. So I fear that if this administration isn't able to reach some type of a mini-deal -- I'm not ambitious about a big deal, but kind of a mini-accommodation -- I'm very pessimistic about what the next administration is going to be able to do.

GIACOMO: I could keep going, but the rules are that I have to let everybody else jump in. So who has questions? Evelyn.

QUESTIONER: Thank you. Evelyn Leopold, independent journalist at the United Nations, former colleague of Carol's. (Chuckles.) Do you -- do any of you believe that the elections in Iran are going to make any difference on this issue and other large foreign policy issues? And what is your feeling -- you can't really know, but what is your estimate of whether the population is behind getting a nuclear weapon? Because there's a certain macho thing about it in many countries.

SADJADPOUR: I have two kind of sound bites on Iranian elections. The first is that they're unfree, unfair and unpredictable. And the second, and particularly with regards to this election, is that it's going to be one man, one vote. And that man is Ali Khamenei, Ayatollah Khamenei. (Scattered laughter.) So the next president of Iran, I would argue, is going to be someone who is a real Khamenei loyalist and is not going to make a significant or, I would say, even a minor difference on how Iran runs the nuclear file.

Now, it may improve the atmosphere to have someone other than Ahmadinejad, who has denied the Holocaust and called for Israel to be wiped off the map. It may make it easier on our end to offer overtures. But in terms of who controls the nuclear file, I would argue it's not going to make a difference in Tehran. And your second question was about how --

QUESTIONER: The population.

SADJADPOUR: -- yeah, whether the population -- you know, it's often argued that the population is very supportive of this nuclear program.

And my experience was -- again, it was anecdotal, but it was a bit different, and for a couple reasons. One is that -- you know, that you have to remember this is a population which suffered one of the bloodiest wars of the second half of the 20th century with Iraq. So no one really romanticizes the prospect of further militarization.

Second, for a decade now this population has been hearing about this nuclear program as, you know, a technological advancement (on path ?) with landing on the moon, an economic panacea. But during that time people's quality of life -- standard of living has deteriorated. So it's had enormous costs for people but really uncertain benefits.

So, you know, I don't think people waking up in the morning in Shiraz or Kerman say, you know, if only we could enrich uranium to 20 percent today -- (laughter) -- our lives would be so much happier. I think that it's a population which -- the problem is that the regime has always -- has never allowed for open discussion or open debate about this. But I think if you present it to the population, a deal which appeared equitable -- I don't think this is a program which is popularly driven. It's driven by the government.

DOBBINS: I'd say one thing about whether or not a new president would facilitate dialogue, and that is that if Karim is right that the new president will be somebody much more in tune with the supreme leader than Ahmadinejad is, it'll reduce friction within the government.

I mean, the supreme leader has called for the suppression of the office of the presidency. The president has called for all power to the president and none to the supreme leader. They've been undercutting each other, prosecuting each other, accusing each other. I'm not talking about the supreme leader and the president so much as their acolytes and supporters -- putting each other in jail. There's been extreme tension within the government. And there have been times when we've come close to an agreement with them -- a partial agreement but an agreement nevertheless -- when it's been sabotaged as a result of those debates, and nobody willing to give anybody else credit for any particular advance in the relationship. So if you got a more unified voice, it's possible that when one got close to an agreement, that side would be capable of closing the deal.

GIACOMO: Admiral?

FALLON: The only thing I'd add on that one is that of the few things that I think I've learned in trying to understand and deal with Iran is that we have very limited knowledge about the actual influence of the various people within the elites, how it comes together. So as the clock moves on, things change. People change. So exactly what combination of figures in what positions might add to the movement in the direction we'd like to see -- we can only hope. That's not a national strategy, of course, but I think we know very little about the dynamics beneath the surface of what goes on.

GIACOMO: Sir.

QUESTIONER: Thank you. I'm Kenneth Bialkin, Skadden Arps. This is one of the most sophisticated and informative panels we have, and I thank you very much.

I'd like if we could project the argument you began, Mr. Dobbins, project the situation (where the ?) dialogue goes on and on, a time arrives when Iran clearly has achieved capability, and nobody attacks them. U.S. doesn't attack them and Israel doesn't attack them. And so the world now has Iran with nuclear capability; whether it's implemented or not, we don't know.

What is in your opinion the consequence on the geopolitical situation when Iran has an atomic bomb, the Saudis don't, the Turks don't, the Shias don't, other people don't -- does that open up a worldwide nuclear race, a competition where nuclear facilities will move to weaker hands? And what are the implications of that if it occurs? No wars, no bombs, no fighting, but Iran is nuclear.

DOBBINS: Well, everybody may have their own answers to this. I think it's clearly a highly undesirable condition. I think it's one we should do our best to prevent.

On the other hand, I don't think that one should exaggerate its -- the automaticity of some of these consequences. I mean, Egypt, Turkey, Saudi Arabia lived an Israeli bomb for 50 years, and at least a couple of them were at war with Israel, at least technically. They're not at war with Iran. They never have been. So why would one prompt an immediate, automatic response and another not? Iran, with or without a bomb, is a pariah state. It's under massive international sanctions. It's penalized. It's limited. It's isolated. Why would any country want to go down that road? Which of those countries is likely to volunteer for putting itself in a similar situation?

So I think the proliferation risk is a real risk, but it's one that we would have to deal with and could deal with, I think, in the aftermath. It might call for more extensive American security guarantees to some of those states and other things such as the kinds of assurances that we've extended which have led to Japan, South Korea and other countries to forgo having nuclear weapons, even when their neighbors, who are dedicated enemies -- North Korea, for instance, have nuclear weapons. I don't think an Iran that has nuclear weapons is a more potent threat in terms of its capacity for subversion in terms of the kind of support it can provide Hamas, Hezbollah and others. There are no effective limits on that support at the moment, except what you can physically interdict. And I don't think that's going to change.

So an Iran with a nuclear weapon is a highly undesirable case. It'll make containment more difficult. But it won't make it impossible.

GIACOMO: Anybody else want to take a crack at it?

OK. Jeffrey.

QUESTIONER: Jeff Laurenti, Century Foundation.

At the outset, Karim, you had noted that Khamenei's dominance is reminiscent of the autumn of the patriarch, Brezhnev, and all that, and any life insurance actuary would tell you, ain't many more years left in this dog, whether he pulls a Benedict or waits till he dies. (Scattered laughter.) And even with Bill Fallon's warning that we really don't know too much about the internals of how the regime operates, what would be the groups that would have influence over the selection of a successor? Are these kinds of issues -- the nuclear, Syria or Afghanistan -- the kinds of things that they talk about among themselves? Is it going to be a clerical or a clerical plus military plus whomever kind of process? And what become the prospects at that point if Khamenei remains frozen and -- for the foreseeable future at a more dramatic change on any of these fronts or the larger issue of relations with the U.S.?

SADJADPOUR: It's a great question. I would say, first, I think Adm. Fallon's advice that we should be humble about what we know about Iran internally I think is well-taken.

I would say as a -- as a macro observation, it is pretty clear that the institution of the Revolutionary Guards has eclipsed the institution of the clergy in terms of both their domestic influence in the Iranian political sphere and the Iranian economic sphere but also, very importantly, in the Iranian foreign policy. The Revolutionary guards are the ones who are running the Iranian foreign policy in the places that really matter for them, whether that's the Levant, the Gulf, Afghanistan and elsewhere -- it's not the Iranian foreign ministry -- and they're the ones who are also in charge of the nuclear program.

So I think the institution of the Revolutionary Guard -- in some ways, I tell people that Khamenei's robe and turban are in a -- are somewhat misleading. He would be more aptly dressed in military fatigues, because I think he's really -- the thing about him is that when he inherited power in 1989, he wasn't an ayatollah. He was ayatollah overnight, you know? He had the clerical equivalent of a master's degree, so he always kind of lacked the legitimacy of the seminary, so he sought the legitimacy of the barracks. And so you've seen this institution of the military become empowered.

And I see the next decade or two in Iran really being one in which the military is in charge, and that's good, and it's bad. I mean, it's bad in that I'm not optimistic that Iran is going to transition into some type of a Jefferson democracy anytime soon. But on the other hand, I think, like military folks everywhere -- Admiral Fallon maybe can agree or disagree with me here -- that military folks are oftentimes less ideological than their civilian counterparts. And so you may have kind of a Revolutionary Guard regime which begins to put economic interests ahead of ideological interests or national interests ahead of ideological interests. So I -- if I had to make a prediction about kind of Iran's future, which is never wise, I would say that it's going to, on a macro level, kind of transition in more of a military direction.

GIACOMO: Admiral.

FALLON: This is great speculation for the analysts in Washington -- (laughter) -- and all over the world and intelligence agencies. So, you know, the chicken or the egg, and how much is motivating whatever? So to what extent Khamenei has kind of pulled the IRGC in to sustain and support him, make sure that he stays around, that's -- I'd probably give a -- 51 percent of the vote to that thought, that -- but the more he does that, these guys may, in fact, end up wagging the dog here. How that all plays out, who knows?

But it seems, from what I've read and studied here, that the IRGC is very much into economics. And so not unlike some other examples in the world, they get into power, and they like it a lot, and they want to look around and see how they stay there. And so having a few -- a few coins in our pockets is usually pretty good. The extent to which that corrupts other decisions, blah, blah, blah, who knows?

I agree. These characters are in a much more dominant position today than they may have been a couple of decades ago, and how this all spins out is very interesting. Again, it gets back to the what do we really know behind the scenes, and what deals have been made -- likely to be made, et cetera?

GIACOMO: We have a question from Daniel Matazusky (sp) in Monterey, California: Are we seeing a replay of the dubious runup to the 2003 invasion of Iraq with as much, quote, evidence, unquote, and certainty about Iran's capabilities and intentions?

Jim.

DOBBINS: Well, I'll make one pretty firm prediction, which is we're not going to invade Iran. (Laughter.)

GIACOMO: In the back. Oh.

QUESTIONER: Jamie Rubin (sp).

GIACOMO: Yes, Mr. Rubin (sp).

QUESTIONER: Jim, thank you for beginning the discussion of what the consequences of military action would be. Perhaps you could elaborate, and Admiral, you could jump in. The president has made a very clear threat. The vice president has said, great powers don't bluff. So if we were to conduct the military operation that's been discussed of some form, what are the consequences in the region and for the world?

DOBBINS: Let me just say one thing and then ask the admiral, because I've already gone on about this. I -- on senior Israeli official I've heard quoted as saying that Netanyahu thinks that Obama is bluffing, Obama thinks Netanyahu's bluffing, and the Iranians think they're both bluffing. (Laughter.)

FALLON: I think what we're seeing here is some verbal deterrence -- (laughter) -- and -- but I wouldn't snicker, because, frankly, when it comes to military capabilities, we have quite a -- quite a significant capability, and it dwarfs Iran's. That said, it's not in our interest, nor, I believe, anybody else's to get into a military dustup.

So the challenge here in this business of deterring or dissuading the kind of bad behavior that everybody's going to regret is to ensure that we have a credible capability, so for my previous positions, making sure that if we ever had to do something to execute national policy, that we are in a position to do it and that we make sure that those who would be on the other end of that thing are understanding of what we can do, not a threat, not an intimidation, just the facts. We have a capability; don't put us in this box.

And by the way, there's already been an episode or two in history of this with this regime. Back in the late '80s, you may recall the infamous tanker wars at the tail end of the Iran-Iraq War in which they both decided, well, we'll get at the other side by economically attacking the tanker lifelines. And it was tit-for-tat until finally the U.S. stepped in and said, OK, we'll flag the tankers; now you have to attack us. And they did. And the Iranians got slapped around pretty severely in a relatively minor way.

One would hope that that lesson didn't go away, that they might remember that. Again, it's not to try to intimidate them, but just to let them understand we have a tremendous capability and, you know, we don't want to be pushed into having to use something.

DOBBINS: Let me just add that -- I mean, one negative consequence, Jamie, of an American preemptive strike is that the Iranians break out of the box they're in, that countries of the world begin to say, well, maybe they need a nuclear deterrent; and so they are less isolated, they're less penalized, they're less of a pariah, particularly if they respond temperately rather than go over the top in reaction.

I mean, we worry a lot about what they might do in reaction. Suppose they do very little? That may be the worst situation because they can then get access to the world economy, they can get access to even nuclear technology from states that might be friendly to them in the aftermath of an attack. So I think breaking out of the box they're in is the main danger.

FALLON: I think that's what's going on now or what I think the strategy may be here, is to kind of keep the pressure on, try to get the most coherent and collective international view of this that the Iranians are more in the wrong than anybody else here in terms of their behavior in moving towards nukes. And so doing something that would upset that, I think, is just asking for trouble.

GIACOMO: The woman far in the back, in blue.

QUESTIONER: I'm Tessa Burbon (ph). I'd like to ask that -- Israel representatives and American supporters went to Congress this week to ask for tougher sanctions on Iran that include -- should include other products rather than oil or gas only. Should the U.S. support this? Why or why not?

DOBBINS: Well, I mean, I think again, since we don't supply any of those things, the real question is whether or not the rest of the world would go along with a congressionally mandated sanction of that sort. If they would, then it's probably another effective pressure point. If they won't, then it just makes us look feckless and we begin to sanction our friends for trading with Iran. So I think it's a rather technical judgment of how far you can push these things.

GIACOMO: The woman in black.

QUESTIONER: Thank you. Teladilla Chahi (ph). Karim, the U.N. ambassador for Iran just said a couple weeks ago that the U.S. should have a policy of non-intervention in the domestic affairs of Iran. I wanted to know your thoughts in terms of Iran being able to sort out its vast human rights abuses and its domestic affairs on its own, or whether the international community should be involved.

SADJADPOUR: That's a great question. And when it comes to -- when they talk about non-interference, and when Khomenei talks about -- he's always said that the U.S.'s underlying goal with Iran is not behavior change, it's regime change. And the regime-change strategy, he believes, that the U.S. is employing is not based on hard power or military action; it's soft power, a velvet revolution, soft revolution. And he believes that whether it's support for human rights, being vocal about human rights in Iran, or in particular on Persian language media, whether that's, you know, BBC Persian or Voice of America, are all part of this strategy of this soft overthrow strategy.

And, listen, I think that we're never, ever going to be able to reassure Khomenei that our approach isn't regime change, because we're never going to silence -- you know, if you were to ask him, OK, how can we reassure you that the U.S. policy isn't regime change, I think he would probably say, well, shut down Human Rights Watch, shut down Amnesty International, shut down Hollywood, which has very subversive films, like "Argo." We're never going to be able to do that, nor should we.

And this is kind of a more macro-point, maybe, which goes to Jamie's question as well, about military action. I think the fundamental problem we have with Iran is the nature of this Iranian regime, not the Iranian nation. Kissinger once said there are few nations in the world with whom the United States has more common interests and less reason to quarrel than Iran.

So our fundamental goal should be to have some type of a representative government in Iran. I would argue military action against Iran is going to only prolong the shelf life of this regime. But that means that we do have to be very vocal about these issues of human rights.

And I think the best way we can really forward the cause of change in Iran is through an effective media strategy, just trying to -- you know, what we saw in the Arab world over the last few years probably wouldn't have happened without Al Jazeera and satellite television and Facebook. And I think we just -- there's one thing we need to do vis-a-vis Iran, it's inhibit the Iranian government's ability to control communication and information. I think we actually could be doing a much better job of doing that.

GIACOMO: There's a gentleman in the back.

QUESTIONER: Thank you. Averil Powers (sp). I'd like to follow up on Jamie's (sp) question. In light of relatively recent events in the last few years, if we could focus on cyberwarfare as a particular component of the military question that Jamie (sp) asked, particularly in light of what's not only happened, but I think Iran, after maybe China and Israel, as a foreign power, has pretty significant capability itself. So if you could just comment -- assuming the status quo, as you've implied, is likely to stay as it is going forward, what you each think of the -- of the prospects of there being other events there.

FALLON: OK, I'll try this one first. I think that you're seeing a reality that as the world becomes more and more dependent upon computers and -- for communication, information exchange, and for the empowerment of almost every device that we have, there's no free lunch. There's -- there are built-in vulnerabilities, and you're seeing that playing out.

So if you were to accept the fact, as some have postulated, that the problems with the Iranian enrichment program had something to do with somebody infecting the mechanisms that drive these things, you might say, that's pretty interesting; what's the -- what's the next step? If you believe that the recent difficulties with Aramco in Saudi Arabia might have been caused by -- so I think we kind of have our opinions about what's going on here.

And I think this reflects just the reality of technology moving forward, and it's a double-edged sword. It's a way for people to put pressure on the other side, but we're also realizing that we're quite vulnerable to these things. So it's probably, in my opinion, likely to continue and likely to move out into areas that we really haven't thought about too much in the past. But it also is a way that might be a lot less damaging than some other options, like overt military action.

So I think you're seeing just the recognition that as these capabilities become more defined in the world, you're going to probably see them put into -- put into operation. And so it's going to put a premium on nations and corporations, institutions around the world to take a look at how they're structured, how they perform the basic functions they are organized to do and how they can -- how they can protect themselves. But it's a different area altogether.

GIACOMO: OK. Anybody else? In the back.

QUESTIONER: Curious if you could comment on the effect of a nuclear Iran on global oil prices and thereby on the global economy. And I'm thinking specifically -- just over a year ago one of the Iranian generals threatened to shut the Straits of Hormuz, and Secretary Panetta responded very forcefully, sent greater force into the region to assure that the straits would remain open. And I wonder, if Iran had a nuclear weapon, if we would have had the same response and if Iran might not have been a little bit more aggressive in its response to our response.

DOBBINS: Well, you know, the Soviet Union had 20,000 nuclear weapons and threatened to take Berlin. And we just lined up some tanks and said, try it. So I mean, I -- the -- I don't think it would make a difference.

It -- the one thing that a nuclear -- one thing that Iranian possession of nuclear weapons would do would mean that it would no longer be a realistic option for the United States to invade and overthrow the government and occupy the country, because then they would use nuclear weapons. But that is the only situation in which they would use nuclear weapons, given our overwhelming superiority, both conventionally and in the nuclear (form ?). So we'd lose that option.

But it's not an option anyway. Nobody's ever envisaged it. Nobody is going to envisage it. Iran's three times bigger than Iraq. It's not going to happen. So we would have lost one option, and I think that's the -- it -- that's the effect of it.

I mean, we get those kinds of threats all the time from North Korea. They don't stop us from doing whatever we're doing. They just said they're going to start a war again if we go ahead with an exercise next week in North Korea. They're going to declare the armistice over and go back to war. And we're just ignoring it and going ahead with the exercise.

GIACOMO: Karim?

FALLON: If --

SADJADPOUR: No, go ahead.

FALLON: If -- the challenge with these things is taking a speculative comment and dropping it into some, you know, context a year or two or three or four -- who knows how many -- what's happened in the interim, but the specific issue of the -- blocking the strait, if that were to occur, almost certainly we would not allow that to persist very long. And the problem with that is that to effectively clear the straits, which is well with our capability, we would probably take steps that would expand military action beyond the immediate strait, in a practical manner.

Does this mean we're going to go to a nuclear war? Absolutely not. But the fact is that there's going to be some expansion of activity. It's not going to be one little tiny -- this island or this particular 10 miles of waterway, because I wouldn't -- if I were the commander, I certainly wouldn't want to put my forces at risk of being subjected to attack from other places in the Gulf.

So we wouldn't allow that to happen. They could -- they could make that move. I think they would regret it pretty quickly, and I think that's what the secretary had in mind when he made his comments.

So the fact that they might have a nuclear weapon doesn't mean that we would just sit there and say, oh, gee, I guess we can't do it.

QUESTIONER: But just go to the premise of my question. Do you think, though, that oil prices would rise in any --

FALLON: Oh, oil prices jump up and down every time somebody sneezes today. So I don't know what -- of course they're going to jump up.

But I think there are other factors in the world that are at play here that might make that a little less of a -- of a gut-wrenching heart-stopper, as they seem to be at least speculative about today.

GIACOMO: Quick response from Karim.

SADJADPOUR: I just think that closing the Strait of Hormuz is the tactical equivalent of a suicide bombing for Iran. They're going to harm a lot of others, but they're going to harm themselves the most. They're going to cut off 80 percent of their export revenue, which is oil, and they're going to alienate their major strategic and commercial patron, which is China. That oil coming out of the Strait of Hormuz is not coming to the U.S. It's going to Asia.

And last, I think with this shale oil revolution, increasingly the oil from the Strait of Hormuz is going to be less and less important. So I think, you know, half-jokingly, we should encourage them to close the Strait of Hormuz --

QUESTIONER: (Laughs.)

SADJADPOUR: -- because they're going to hurt themselves above all. (Laughter.)

FALLON: It makes no sense.

GIACOMO: I know we have more questions, but we really have to wrap up. Thank you very much to everybody. It was a great discussion. (Applause.)

CAROL GIACOMO: Welcome to today's Council on Foreign Relations meeting with James Dobbins, William Fallon and Karim Sadjadpour. You all have their bios, I believe, in your packet. Jim Dobbins is one of the pre-eminent diplomats of his generation, and Admiral Fallon holds a similar position within the military establishment. Karim is an expert on Iran.

This meeting is part of a series on the U.S. presidential inbox that examines the major issues confronting the administration in the foreign policy area.

I would also like to welcome CFR members around the nation and the world participating in this meeting through the live stream and teleconference. We'll hear from them during the question-and-answer session.

So this event comes at a very fortuitous time given the meetings that concluded in Almaty, Kazakhstan, recently. And I would first like to ask our panel, what do you think really happened there? And do you see any potential for a real deal?

Why don't we start with Jim?

JAMES DOBBINS: Well, I think the intent on both sides was to keep the dialogue going at least through the Iranian presidential election. I don't think many people expect substantial progress until they've gone through that.

I think the U.S. and the other permanent members of the Security Council sweetened the deal somewhat from the last conversation, offered to shed a few more sanctions, although largely sanctions at the margins rather than the core of the sanctions regime, also lightened their demands on Iran slightly for an interim step, for instance, asking that they suspend operations at their underground enrichment facility rather than that they close it down entirely, not as part of a final deal but just a part of a first stage toward a final deal. And the Iranians responded by saying, this is interesting; it seems to represent progress; let us go back and think about it. I think the elections -- Karim will know, but I think they're scheduled for early summer.

KARIM SADJADPOUR: June.

DOBBINS: June. And so I wouldn't expect breakthroughs till then. But I think we've successfully pushed off any major confrontation until after that.

GIACOMO: Admiral Fallon?

ADMIRAL WILLIAM FALLON: Not a whole lot to add to that. I think there -- the two pieces have to fall into place. One, the elections here in the U.S. that have already occurred, the Iranian elections, so that the main discussants have a foundation -- political foundation underneath them. And then we'll see what happens.

One would think that from the U.S. side, after almost 35 years of this head-butting with Iran that at some point in time we know there's going to have to be a negotiation to reach some kind of a settlement to try to come close to normalizing relations. The nuke thing, of course, is the big polarizing event and the catalyst for all the near-term issues here.

So I think nothing's going to happen until later on in the year, and hopefully the combination of a realization that at the end of the day there's going to have to be a discussion to make some progress -- and I think the other factor that's kind of energizing things here is that the combination of sanctions has begun to bite pretty significantly in Iran, and that's probably providing some motivation here.

GIACOMO: Karim, the assumption here is that Iran does really want to engage in some kind of a negotiation that could lead to an agreement. Is that a valid -- do we know that that's true?

SADJADPOUR: I think the perennial challenge we've always had with Iran is that those Iranian officials who are interested and that deal with America really can't deliver, and those who can deliver aren't really interested in a deal with America.

You've had here up on this stage at the council the current foreign minister, Salehi, someone who was educated at MIT. I think he genuinely wants to see a resolution to the U.S.-Iran conflict. The Iranian ambassador to the United Nations, Mr. Khazaee, I think probably wants to see a resolution to this conflict.

But you have a person in charge, Ayatollah Khamenei, who has been supreme leader since 1989. He hasn't left Iran since 1989. And I would argue that for Khamenei -- Khamenei is kind of a -- the best historic analogy for him, I would argue, is Brezhnev. He's this kind of apparatchik who's frozen in time. And I would say for Khamenei, the ideals of the revolution and the ideals of the Islamic republic can be distilled to three fundamental pillars. And that is hostility towards the United States or rejection of U.S. hegemony, hostility toward Israel and the veil, the hijab for women, which symbolizes Islamic piety.

I think that the challenge which Khamenei has is that his hostility towards the U.S. is cloaked in ideology, but I would argue it's driven by self-preservation. And what that means is that for years, so many of us, including, I think, in this room, most (ably ?) the Iran Project, which is Ambassador Bill Luers and Tom Pickering and others and myself and Jim, and so many others have argued -- and Gary Sick, who's in the audience -- that if we engage Iran, if the U.S. engages Iran and reintegrates Iran into the international community, reintegrates Iran into the global economy, this is going to facilitate political change and political reform within Iran.

I happen to believe that's a correct argument. But I think we're naive to think that Ayatollah Khameini is oblivious to that argument and he's going to embark on this path, which I would argue would be inimical to his own interests and the interests of the regime. So I think that's the fundamental challenge we face as the United States. How do you go about reaching a modus vivendi with the regime in Tehran, which needs you as an adversary for their own internal legitimacy?

GIACOMO: What's the answer?

SADJADPOUR: Listen, I think that one of the best lines, I think, about foreign policy came from Jon Stewart. (Laughter.) And Jon Stewart once said about Dubai -- he said that Dubai is what happens when Las Vegas and Saudi Arabia have a baby. (Laughter.) And if I had to use that Jon --

GIACOMO: Right. That's a good line.

SADJADPOUR: -- that Jon Stewart formulation about Iran, I'd say, the Islamic Republic of Iran is kind of like a hybrid between the Soviet Union and the Taliban. It's not a superpower like the Soviet Union. It's a regional power. It's not as Islamist as the Taliban, but listen, they still stone women to death for adultery, so they do have that strong Islamist ideological undercurrent.

But I think the takeaway from that analogy is that I don't see us being able to reach a grand bargain with Iran. But I also don't think we need to go to war with Iran like the analogy to Nazi Germany implies, that this regime is messianic and it can't be contained. I think the utility of dialogue and engagement with Iran isn't necessarily to resolve our differences but to contain our differences, to manage them until this regime is eventually forced to change and transform under the weight of its own internal contradictions and economic malaise.

GIACOMO: Has the United States put enough on the table at this moment to really grease the process in any meaningful way?

DOBBINS: Well, I think it put enough on to do what I think it intended to do this round, which is kick the can down the road, ensure that the Iranians stay short of our red lines for some kind of military action and open the prospects for more meaningful dialogue once their own internal politics settle down slightly.

I share Karim's view that the vision of a grand bargain in which we settle all of our differences as part of one large package is not very realistic. I do believe that there have been a number of opportunities over the last 20, 30 years for dialogue with Iran that we've missed, and we've missed them because their politics and ours are out of sync, and each side sees engagement with the other side as a concession that it's making to the other side. And so when they're ready to make that concession -- and there have been several quite stark offers on their side -- we weren't ready for engagement; we were in a different cycle. And when -- and when we're ready, they're not. So Obama has sent messages to the supreme leader. It's pretty clear he's ready for some level of engagement, and at the moment, they're not.

My own view is we should stop seeing engagement as a concession we make to them. We should have a flat statement: We're ready to talk to Iranian officials anytime, anywhere, on any subject they're willing to talk about. And so when their opportunity comes, we won't have to make a decision. We'll be ready to talk to them rather than this -- you know, each being so out of cycle and the two never matching.

GIACOMO: And you don't -- go ahead, Admiral.

FALLON: Just a thought here, that -- you've hit the nail on the head in my book, that self-preservation is the factor that's kind of come to the fore. So we could row back in time 30-some years, and when Khomeini came to power and the revolution swept through Iran, the U.S. was a pretty obvious whipping boy for this. And so if the fundamentals of the revolution were anti-secular and anti-Western -- and anti-Western is not so much as, you know, L.A. or the West Coast; it's the culture, the Western culture, which they think is the antithesis of their religious dogma. So these are the pillars of the revolution.

What's changed? Nothing. Except the position of the ruling elites, the clerics in the country, I think is different now. And I would have to think that the Arab Spring, for lack of a better term, has got these guys thinking not so much that goodness and democracy are going to suddenly sprout out, but the real fundamental motivator for this -- what's happening in the Middle East and North Africa is economic. And so Iran is not in the best of economic situation right now. And the sanctions are making that more and more difficult, so maybe this is a motivator.

So I agree -- I doubt there's any grand bargain in the air any time soon, but self-preservation -- if we don't do something to take the pressure off, we may be on the outside for other reasons that have more to do internal than external. So that could be -- it could be a factor here. So there's a reason for them at least rope-a-doping this thing and having some kind of a discussion, it seems to me.

GIACOMO: All right. The question of sanctions. You seem to indicate that you think that they have at least been somewhat influential in getting the Iranians to this point. Should the United States keep piling on sanctions? There's an effort in Congress now to impose some more draconian penalties on Iran, and I wonder if you think that this is an opportune moment to do that or not.

Admiral?

FALLON: Sure, I'll take a crack. First, I don't think the sanctions of and by themselves are going to solve the problem. It's a tool. There's a lot of history here of sanctions being not effective, but nonetheless, there's some pressure being applied, no doubt about it.

I think the effectiveness of the sanctions is the issue. And so if we can get more people to play along -- frankly, it's a one-trick pony in Iran economically, and that's oil and gas. And interestingly enough, another motivator for them potentially having a reason to want to chat about these things is that there are more options coming available every day: in our own country, the potentials to use the fracking and other things to make us a lot less dependent on other people in the world; Iraq oil production I expect to see dramatically increase here soon; the amount of gas that's discovered in other places. So there are a lot of external factors to Iran that make their position a little bit questionable going forward.

So I think maybe effectiveness in sanctions, keeping the pressure on, I believe you got to work both sides of it. So the carrots and the sticks, effectively that's what our policy's been.

Jim, you probably want to -- have a -- (inaudible) -- view on that one.

GIACOMO: Well, wait, let me just stay with you for a minute. So are you saying that you would -- you would just do a better job enforcing the sanctions that exist or that you would put new ones on?

FALLON: At least going into it -- you know, I don't know what new ones may be. I don't think anybody has any great new ideas here, but making what we have a little bit more effective, not to just expect this is going to suddenly make them say, OK, uncle, we give up, we'll go do it. But at the same time, on the other side, to give them a way out. At the end of the day, they're people, they're humans, they need to have a way out; you can't lock them in a box; there's got to be a light at the end of the tunnel. So, this is not good; we can continue this for quite a while; wouldn't you like to do something else? Maybe there's a way out of this.

GIACOMO: Jim?

DOBBINS: I think we have to understand that we have no trade with Iran. We have no commercial relations. We have no financial relations with Iran. So U.S. sanctions are essentially sanctions on our friends, threatening them with penalties if they trade with Iran.

Now, that works as long as our friends are willing to go along with it, are willing to say, yeah, you're probably right, we will accede to this. We don't like the principle of extraterritorial sanctions, but we share your objective and so we're willing to cut our financial and other ties with Iran, stop buying Iranian oil, et cetera, because -- not because we're afraid of your penalties, but because we agree with you and you're giving us an excuse to do something we think's probably a good idea.

So the limitation on the utility of these U.S. sanctions is the degree to which our friends are willing to go along with them. And they've been willing to go along with them to a remarkable degree in recent years. So I would have to say I'd have to look at whatever Congress is currently looking at and saying is this something that our friends are probably going to be willing to go along with, because as I said, we no longer have any U.S. instruments to affect it.

I think it's important to understand that sanctions have a lot of utility quite beyond the degree to which they affect Iranian policy. First of all, they affect Iranian capacity. They limit Iran's capacity to get nuclear technology. They limit Iran's capacity to get civil -- to get conventional military technology. They weaken Iran's capacity to project influence in the region. So, quite aside from whether they change their policy on nuclear, they definitely are a very effective way of restraining Iranian influence, mostly pernicious, in its immediate region.

They're also an objective lesson to other countries that might be considering violating the NPT and developing nuclear weapons despite their formal agreement not to do so. So even if they don't work with Iran, to the degree they discourage Saudi Arabia or Egypt or South Korea or Japan from going down that same road, they also serve some utility.

They probably have some marginal effect on Iranian willingness to negotiate under current conditions. And as I said, if what the Congress is considering are sanctions that most nations trading with Iran would be prepared to go along with, then I wouldn't object to them under current circumstances. But we do have to be in a position of being willing to take sanctions off when we get some reciprocal movement and to do so in a -- in a fairly agile way, not to say, you do this, and then we'll go back to Congress and see if we can get them; you have to give the president enough leeway so that -- so that in a tit-for-tat, slow-moving process, he can reciprocate quickly to meaningful changes on their part.

GIACOMO: Karim?

SADJADPOUR: Well, the challenge also with sanctions vis-a-vis Iran is that we're dealing with a regime which has long been willing to subject its population to pretty severe economic hardship rather than compromise on the political and ideological goals. I mean, this was a regime which prolonged a pretty bloody war with Iraq for several years for its own internal legitimacy. That's one challenge.

But I think it's useful to contemplate the situation that the supreme leader, Ayatollah Khamenei, is currently in. As I said, he's been leader since 1989, and his modus operandi essentially has been to try to preserve the status quo, the status quo that was given to him by Khomeini, by avoiding transformative decisions. And he's now put himself in a situation in which Iran is faced with unprecedented international economic and political pressure.

And I see two doors, two exit doors, for him to reduce that pressure. Exit number one is a nuclear deal. Exit number two is a nuclear bomb.

Exit number one, a deal -- his other modus operandi is that when you're under pressure, never compromise, because if you compromise under pressure, that's not going to alleviate the pressure; it's going to project weakness and encourage even more pressure. So he's long been averse to compromise. The lesson he learned from recent history was that when Gadhafi gave up his nuclear program, that made him vulnerable to NATO intervention. So he's averse to compromise.

But the second door is equally perilous to him -- I mean, the door number two, a nuclear weapon. I mean, when I was based in Tehran in my previous job, with the International Crisis Group, I used to interact with some of these Revolutionary Guardsmen, who drew this, you could argue, facile lesson from Pakistan, and that was, well, when Pakistan actually detonated a bomb, what did that do? It turned outside pressure into outside engagement. The world was forced to deal with them. It became, you know, fait accompli that they were a nuclear power.

But I think that Khamenei's exit door number two is also quite complicated because he's forced to take a very deliberate approach -- they're not making a nuclear sprint; it's a nuclear brisk walk, you could argue -- so it's a deliberate approach, because he knows that if he were to try to break out, he would likely get bombed. But he then has to calculate if this system can sustain the type of pressure it is right now in the time it takes them to acquire a nuclear weapon, which could be several years.

So he's put himself in a very uncomfortable position, and going back to the issue of sanctions, I honestly think it's really the least bad option we have at the moment.

GIACOMO: You know, the American have gone to great extent to say that the sanctions are not targeted at the Iranian people and that things like humanitarian supplies, medical supplies are exempt from these penalties.

But there are some people who say that in fact even if it's not intentional, these items do get caught up in this web. And I wonder if the three of you agree with that. Do you think that there is something that needs to be done to -- I mean, if you think that that's one of the adverse effects, that there's something that has to be done to correct it?

SADJADPOUR: Because -- I compare sanctions to chemotherapy: You're trying to target the tumor, you're trying to target the regime and not kill the body politic. And that's not possible with chemotherapy, and it's not possible with sanctions. You can't perfectly target the regime and avoid hardship on the people.

So anything we can do that eases humanitarian suffering on -- specifically on medicine and these types of things, I think we need to do everything in our power to do that.

But I have to say -- and this is anecdotal; there's no scientific evidence about this -- but when I was based in Tehran and you would engage Iranians about their lives, 9 -- 10 out of 10 people would tell you the bigger problem in their life is economic malaise: Younger generation doesn't have employment prospects. Rampant inflation. Underemployment.

And if you asked the follow-up question to them and said, well, why is Iran's economy so lousy? Because it's -- you know, it's a nation which has -- it's incredibly rich in natural resources and human resources. Why is Iran's economy so lousy? It's very rare that someone says it's because of the sanctions, and if only the sanctions were removed, then the mullahs would be doing a very good job running the country. Invariably they'll respond with corruption, with mismanagement, et cetera.

So I don't believe that somehow sanctions are rallying the population around the regime. That said, I do think we need to do everything in our power to focus the sanctions against the regime and avoid popular suffering. But it's much easier said than done.

GIACOMO: I'd like to hear from all of you on this. How do you think President Obama is doing handling this issue?

Start with Jim?

DOBBINS: Well, I -- no, I mean, I think there was an initial effort to engage the Iranian regime. I think it was somewhat cautious and a bit inept. You know, Obama had gotten two messages from President Ahmadinejad, who clearly wanted the dialogue with him, and instead, Obama responded by sending his message to the supreme leader, A, because the supreme leader's more important, and B, because he's less controversial than Ahmadinejad. So there were good sort of, you know, reasons, but nevertheless, he had someone who wanted to talk to him, and he chose somebody else.

And it was -- it was sort of the obverse of the Clinton administration. They had a president who was acceptable, Khatami, a reformer, and they had a supreme leader they didn't like, and so they made overtures to the president while at the same time dissing publicly the supreme leader. Well, you can't gain the Iranian system that way and expect a profit. You don't understand it well enough. So it's better to be responsive to overtures when you get them than to try to game their system. So I think that was an inept effort.

But it was a genuine effort. And I think there probably was a window then. And I think that the window is not open at the moment. It may open again in a few months. It's quite -- it's quite possible.

Personally, I think that the threats to engage in military action of a pre-emptive nature in Iran are probably not, on the balance, productive. And, I think, actually crossing that threshold -- and the president has pretty much boxed them in -- would be quite counterproductive.

You know, the president has said, we're not for containment of Iran. That's kind of a silly statement. Our policy has been containment of Iran since 1979. Iran tries to subvert, overthrow and threaten all of its neighbors, not just Israel but lots of them, and we try to prevent them. That's called containment.

What he really means is, he's not for deterrence. In other words, he's for pre-emption rather than deterrence.

But I think that if you're worried about Iranian influence -- and nobody's worried about Iran invading and overthrowing their governments. It hasn't done it for several hundred years. It's not equipped to do it. What they're worried about is that an Iran with a bomb would have more prestige, more influence and be capable of more subversion, more support for terrorism.

But I think you have to ask the question in terms of the Middle East polity. Which Iran has more influence: an Iran that has suffered an unprovoked attack by the United States or an Iran that has a nuclear weapon? I think it's the first of those that actually would gain an influence with neighboring populations.

GIACOMO: Admiral?

FALLON: The only comment I'd make, I think, is that we have a tendency to personalize all these things, so it's Obama's issue versus the Iranians or it was Bush's issue versus Ahmadinejad.

GIACOMO: Well, he is the president.

FALLON: I understand that. But, you know, there is a -- there is a whole apparatus of government that is in place to actually think through and to formulate and then to carry out policies. And since this is something that didn't pop up yesterday, this is three decades-plus of challenge -- there's been an awful lot written about it, a lot said about it -- and the challenge in my mind is to actually craft something that will try to accommodate the vagaries of the current political winds and try to move forward. Nobody said it's easy, same we've already beaten the grand scheme thing to death here, but some progress to try to move forward.

I think you're -- I absolutely agree with Ambassador Dobbins from my interaction with the countries in the Middle East that it's a subversion issue. It's the proselytizing of the Shia minorities -- or majorities, depending where you are -- and the support that they get from Iran, Iran's penchant for using surrogates to carry out their activities -- this is really unsettling to the other countries, and so this is what we've got to deal with.

GIACOMO: Karim.

SADJADPOUR: When Obama came to office in January of 2009, it was clear from the get-go that Iran was central to six core U.S. foreign policy challenges: Afghanistan, Iraq, Israeli-Palestinian conflict, terrorism, energy security and the nuclear issue, which is taking most of the time.

And I think he began with the premise that ignoring Iran is no longer an option. Bombing Iran is going to exacerbate each of those issues, not to mention the ramifications that would have in Iran internally. And so they tried, I would argue, a policy of engagement, which went further than any U.S. administration since 1979, trying to put aside, you know, the last few decades of this adversarial relationship.

But I think their ambitions -- their ambitions in the first term were to resolve this issue. I think their ambitions in the second term are not to resolve U.S.-Iran relations but to avoid a military conflict. Yeah.

And I would argue that this national security team he's now assembled, between, you know, Obama himself, Vice President Biden, Secretary of State Kerry, Secretary of Defense Chuck Hagel, is the most pro-Iranian-engagement national security team since 1979. So I fear that if this administration isn't able to reach some type of a mini-deal -- I'm not ambitious about a big deal, but kind of a mini-accommodation -- I'm very pessimistic about what the next administration is going to be able to do.

GIACOMO: I could keep going, but the rules are that I have to let everybody else jump in. So who has questions? Evelyn.

QUESTIONER: Thank you. Evelyn Leopold, independent journalist at the United Nations, former colleague of Carol's. (Chuckles.) Do you -- do any of you believe that the elections in Iran are going to make any difference on this issue and other large foreign policy issues? And what is your feeling -- you can't really know, but what is your estimate of whether the population is behind getting a nuclear weapon? Because there's a certain macho thing about it in many countries.

SADJADPOUR: I have two kind of sound bites on Iranian elections. The first is that they're unfree, unfair and unpredictable. And the second, and particularly with regards to this election, is that it's going to be one man, one vote. And that man is Ali Khamenei, Ayatollah Khamenei. (Scattered laughter.) So the next president of Iran, I would argue, is going to be someone who is a real Khamenei loyalist and is not going to make a significant or, I would say, even a minor difference on how Iran runs the nuclear file.

Now, it may improve the atmosphere to have someone other than Ahmadinejad, who has denied the Holocaust and called for Israel to be wiped off the map. It may make it easier on our end to offer overtures. But in terms of who controls the nuclear file, I would argue it's not going to make a difference in Tehran. And your second question was about how --

QUESTIONER: The population.

SADJADPOUR: -- yeah, whether the population -- you know, it's often argued that the population is very supportive of this nuclear program.

And my experience was -- again, it was anecdotal, but it was a bit different, and for a couple reasons. One is that -- you know, that you have to remember this is a population which suffered one of the bloodiest wars of the second half of the 20th century with Iraq. So no one really romanticizes the prospect of further militarization.

Second, for a decade now this population has been hearing about this nuclear program as, you know, a technological advancement (on path ?) with landing on the moon, an economic panacea. But during that time people's quality of life -- standard of living has deteriorated. So it's had enormous costs for people but really uncertain benefits.

So, you know, I don't think people waking up in the morning in Shiraz or Kerman say, you know, if only we could enrich uranium to 20 percent today -- (laughter) -- our lives would be so much happier. I think that it's a population which -- the problem is that the regime has always -- has never allowed for open discussion or open debate about this. But I think if you present it to the population, a deal which appeared equitable -- I don't think this is a program which is popularly driven. It's driven by the government.

DOBBINS: I'd say one thing about whether or not a new president would facilitate dialogue, and that is that if Karim is right that the new president will be somebody much more in tune with the supreme leader than Ahmadinejad is, it'll reduce friction within the government.

I mean, the supreme leader has called for the suppression of the office of the presidency. The president has called for all power to the president and none to the supreme leader. They've been undercutting each other, prosecuting each other, accusing each other. I'm not talking about the supreme leader and the president so much as their acolytes and supporters -- putting each other in jail. There's been extreme tension within the government. And there have been times when we've come close to an agreement with them -- a partial agreement but an agreement nevertheless -- when it's been sabotaged as a result of those debates, and nobody willing to give anybody else credit for any particular advance in the relationship. So if you got a more unified voice, it's possible that when one got close to an agreement, that side would be capable of closing the deal.

GIACOMO: Admiral?

FALLON: The only thing I'd add on that one is that of the few things that I think I've learned in trying to understand and deal with Iran is that we have very limited knowledge about the actual influence of the various people within the elites, how it comes together. So as the clock moves on, things change. People change. So exactly what combination of figures in what positions might add to the movement in the direction we'd like to see -- we can only hope. That's not a national strategy, of course, but I think we know very little about the dynamics beneath the surface of what goes on.

GIACOMO: Sir.

QUESTIONER: Thank you. I'm Kenneth Bialkin, Skadden Arps. This is one of the most sophisticated and informative panels we have, and I thank you very much.

I'd like if we could project the argument you began, Mr. Dobbins, project the situation (where the ?) dialogue goes on and on, a time arrives when Iran clearly has achieved capability, and nobody attacks them. U.S. doesn't attack them and Israel doesn't attack them. And so the world now has Iran with nuclear capability; whether it's implemented or not, we don't know.

What is in your opinion the consequence on the geopolitical situation when Iran has an atomic bomb, the Saudis don't, the Turks don't, the Shias don't, other people don't -- does that open up a worldwide nuclear race, a competition where nuclear facilities will move to weaker hands? And what are the implications of that if it occurs? No wars, no bombs, no fighting, but Iran is nuclear.

DOBBINS: Well, everybody may have their own answers to this. I think it's clearly a highly undesirable condition. I think it's one we should do our best to prevent.

On the other hand, I don't think that one should exaggerate its -- the automaticity of some of these consequences. I mean, Egypt, Turkey, Saudi Arabia lived an Israeli bomb for 50 years, and at least a couple of them were at war with Israel, at least technically. They're not at war with Iran. They never have been. So why would one prompt an immediate, automatic response and another not? Iran, with or without a bomb, is a pariah state. It's under massive international sanctions. It's penalized. It's limited. It's isolated. Why would any country want to go down that road? Which of those countries is likely to volunteer for putting itself in a similar situation?

So I think the proliferation risk is a real risk, but it's one that we would have to deal with and could deal with, I think, in the aftermath. It might call for more extensive American security guarantees to some of those states and other things such as the kinds of assurances that we've extended which have led to Japan, South Korea and other countries to forgo having nuclear weapons, even when their neighbors, who are dedicated enemies -- North Korea, for instance, have nuclear weapons. I don't think an Iran that has nuclear weapons is a more potent threat in terms of its capacity for subversion in terms of the kind of support it can provide Hamas, Hezbollah and others. There are no effective limits on that support at the moment, except what you can physically interdict. And I don't think that's going to change.

So an Iran with a nuclear weapon is a highly undesirable case. It'll make containment more difficult. But it won't make it impossible.

GIACOMO: Anybody else want to take a crack at it?

OK. Jeffrey.

QUESTIONER: Jeff Laurenti, Century Foundation.

At the outset, Karim, you had noted that Khamenei's dominance is reminiscent of the autumn of the patriarch, Brezhnev, and all that, and any life insurance actuary would tell you, ain't many more years left in this dog, whether he pulls a Benedict or waits till he dies. (Scattered laughter.) And even with Bill Fallon's warning that we really don't know too much about the internals of how the regime operates, what would be the groups that would have influence over the selection of a successor? Are these kinds of issues -- the nuclear, Syria or Afghanistan -- the kinds of things that they talk about among themselves? Is it going to be a clerical or a clerical plus military plus whomever kind of process? And what become the prospects at that point if Khamenei remains frozen and -- for the foreseeable future at a more dramatic change on any of these fronts or the larger issue of relations with the U.S.?

SADJADPOUR: It's a great question. I would say, first, I think Adm. Fallon's advice that we should be humble about what we know about Iran internally I think is well-taken.

I would say as a -- as a macro observation, it is pretty clear that the institution of the Revolutionary Guards has eclipsed the institution of the clergy in terms of both their domestic influence in the Iranian political sphere and the Iranian economic sphere but also, very importantly, in the Iranian foreign policy. The Revolutionary guards are the ones who are running the Iranian foreign policy in the places that really matter for them, whether that's the Levant, the Gulf, Afghanistan and elsewhere -- it's not the Iranian foreign ministry -- and they're the ones who are also in charge of the nuclear program.

So I think the institution of the Revolutionary Guard -- in some ways, I tell people that Khamenei's robe and turban are in a -- are somewhat misleading. He would be more aptly dressed in military fatigues, because I think he's really -- the thing about him is that when he inherited power in 1989, he wasn't an ayatollah. He was ayatollah overnight, you know? He had the clerical equivalent of a master's degree, so he always kind of lacked the legitimacy of the seminary, so he sought the legitimacy of the barracks. And so you've seen this institution of the military become empowered.

And I see the next decade or two in Iran really being one in which the military is in charge, and that's good, and it's bad. I mean, it's bad in that I'm not optimistic that Iran is going to transition into some type of a Jefferson democracy anytime soon. But on the other hand, I think, like military folks everywhere -- Admiral Fallon maybe can agree or disagree with me here -- that military folks are oftentimes less ideological than their civilian counterparts. And so you may have kind of a Revolutionary Guard regime which begins to put economic interests ahead of ideological interests or national interests ahead of ideological interests. So I -- if I had to make a prediction about kind of Iran's future, which is never wise, I would say that it's going to, on a macro level, kind of transition in more of a military direction.

GIACOMO: Admiral.

FALLON: This is great speculation for the analysts in Washington -- (laughter) -- and all over the world and intelligence agencies. So, you know, the chicken or the egg, and how much is motivating whatever? So to what extent Khamenei has kind of pulled the IRGC in to sustain and support him, make sure that he stays around, that's -- I'd probably give a -- 51 percent of the vote to that thought, that -- but the more he does that, these guys may, in fact, end up wagging the dog here. How that all plays out, who knows?

But it seems, from what I've read and studied here, that the IRGC is very much into economics. And so not unlike some other examples in the world, they get into power, and they like it a lot, and they want to look around and see how they stay there. And so having a few -- a few coins in our pockets is usually pretty good. The extent to which that corrupts other decisions, blah, blah, blah, who knows?

I agree. These characters are in a much more dominant position today than they may have been a couple of decades ago, and how this all spins out is very interesting. Again, it gets back to the what do we really know behind the scenes, and what deals have been made -- likely to be made, et cetera?

GIACOMO: We have a question from Daniel Matazusky (sp) in Monterey, California: Are we seeing a replay of the dubious runup to the 2003 invasion of Iraq with as much, quote, evidence, unquote, and certainty about Iran's capabilities and intentions?

Jim.

DOBBINS: Well, I'll make one pretty firm prediction, which is we're not going to invade Iran. (Laughter.)

GIACOMO: In the back. Oh.

QUESTIONER: Jamie Rubin (sp).

GIACOMO: Yes, Mr. Rubin (sp).

QUESTIONER: Jim, thank you for beginning the discussion of what the consequences of military action would be. Perhaps you could elaborate, and Admiral, you could jump in. The president has made a very clear threat. The vice president has said, great powers don't bluff. So if we were to conduct the military operation that's been discussed of some form, what are the consequences in the region and for the world?

DOBBINS: Let me just say one thing and then ask the admiral, because I've already gone on about this. I -- on senior Israeli official I've heard quoted as saying that Netanyahu thinks that Obama is bluffing, Obama thinks Netanyahu's bluffing, and the Iranians think they're both bluffing. (Laughter.)

FALLON: I think what we're seeing here is some verbal deterrence -- (laughter) -- and -- but I wouldn't snicker, because, frankly, when it comes to military capabilities, we have quite a -- quite a significant capability, and it dwarfs Iran's. That said, it's not in our interest, nor, I believe, anybody else's to get into a military dustup.

So the challenge here in this business of deterring or dissuading the kind of bad behavior that everybody's going to regret is to ensure that we have a credible capability, so for my previous positions, making sure that if we ever had to do something to execute national policy, that we are in a position to do it and that we make sure that those who would be on the other end of that thing are understanding of what we can do, not a threat, not an intimidation, just the facts. We have a capability; don't put us in this box.

And by the way, there's already been an episode or two in history of this with this regime. Back in the late '80s, you may recall the infamous tanker wars at the tail end of the Iran-Iraq War in which they both decided, well, we'll get at the other side by economically attacking the tanker lifelines. And it was tit-for-tat until finally the U.S. stepped in and said, OK, we'll flag the tankers; now you have to attack us. And they did. And the Iranians got slapped around pretty severely in a relatively minor way.

One would hope that that lesson didn't go away, that they might remember that. Again, it's not to try to intimidate them, but just to let them understand we have a tremendous capability and, you know, we don't want to be pushed into having to use something.

DOBBINS: Let me just add that -- I mean, one negative consequence, Jamie, of an American preemptive strike is that the Iranians break out of the box they're in, that countries of the world begin to say, well, maybe they need a nuclear deterrent; and so they are less isolated, they're less penalized, they're less of a pariah, particularly if they respond temperately rather than go over the top in reaction.

I mean, we worry a lot about what they might do in reaction. Suppose they do very little? That may be the worst situation because they can then get access to the world economy, they can get access to even nuclear technology from states that might be friendly to them in the aftermath of an attack. So I think breaking out of the box they're in is the main danger.

FALLON: I think that's what's going on now or what I think the strategy may be here, is to kind of keep the pressure on, try to get the most coherent and collective international view of this that the Iranians are more in the wrong than anybody else here in terms of their behavior in moving towards nukes. And so doing something that would upset that, I think, is just asking for trouble.

GIACOMO: The woman far in the back, in blue.

QUESTIONER: I'm Tessa Burbon (ph). I'd like to ask that -- Israel representatives and American supporters went to Congress this week to ask for tougher sanctions on Iran that include -- should include other products rather than oil or gas only. Should the U.S. support this? Why or why not?

DOBBINS: Well, I mean, I think again, since we don't supply any of those things, the real question is whether or not the rest of the world would go along with a congressionally mandated sanction of that sort. If they would, then it's probably another effective pressure point. If they won't, then it just makes us look feckless and we begin to sanction our friends for trading with Iran. So I think it's a rather technical judgment of how far you can push these things.

GIACOMO: The woman in black.

QUESTIONER: Thank you. Teladilla Chahi (ph). Karim, the U.N. ambassador for Iran just said a couple weeks ago that the U.S. should have a policy of non-intervention in the domestic affairs of Iran. I wanted to know your thoughts in terms of Iran being able to sort out its vast human rights abuses and its domestic affairs on its own, or whether the international community should be involved.

SADJADPOUR: That's a great question. And when it comes to -- when they talk about non-interference, and when Khomenei talks about -- he's always said that the U.S.'s underlying goal with Iran is not behavior change, it's regime change. And the regime-change strategy, he believes, that the U.S. is employing is not based on hard power or military action; it's soft power, a velvet revolution, soft revolution. And he believes that whether it's support for human rights, being vocal about human rights in Iran, or in particular on Persian language media, whether that's, you know, BBC Persian or Voice of America, are all part of this strategy of this soft overthrow strategy.

And, listen, I think that we're never, ever going to be able to reassure Khomenei that our approach isn't regime change, because we're never going to silence -- you know, if you were to ask him, OK, how can we reassure you that the U.S. policy isn't regime change, I think he would probably say, well, shut down Human Rights Watch, shut down Amnesty International, shut down Hollywood, which has very subversive films, like "Argo." We're never going to be able to do that, nor should we.

And this is kind of a more macro-point, maybe, which goes to Jamie's question as well, about military action. I think the fundamental problem we have with Iran is the nature of this Iranian regime, not the Iranian nation. Kissinger once said there are few nations in the world with whom the United States has more common interests and less reason to quarrel than Iran.

So our fundamental goal should be to have some type of a representative government in Iran. I would argue military action against Iran is going to only prolong the shelf life of this regime. But that means that we do have to be very vocal about these issues of human rights.

And I think the best way we can really forward the cause of change in Iran is through an effective media strategy, just trying to -- you know, what we saw in the Arab world over the last few years probably wouldn't have happened without Al Jazeera and satellite television and Facebook. And I think we just -- there's one thing we need to do vis-a-vis Iran, it's inhibit the Iranian government's ability to control communication and information. I think we actually could be doing a much better job of doing that.

GIACOMO: There's a gentleman in the back.

QUESTIONER: Thank you. Averil Powers (sp). I'd like to follow up on Jamie's (sp) question. In light of relatively recent events in the last few years, if we could focus on cyberwarfare as a particular component of the military question that Jamie (sp) asked, particularly in light of what's not only happened, but I think Iran, after maybe China and Israel, as a foreign power, has pretty significant capability itself. So if you could just comment -- assuming the status quo, as you've implied, is likely to stay as it is going forward, what you each think of the -- of the prospects of there being other events there.

FALLON: OK, I'll try this one first. I think that you're seeing a reality that as the world becomes more and more dependent upon computers and -- for communication, information exchange, and for the empowerment of almost every device that we have, there's no free lunch. There's -- there are built-in vulnerabilities, and you're seeing that playing out.

So if you were to accept the fact, as some have postulated, that the problems with the Iranian enrichment program had something to do with somebody infecting the mechanisms that drive these things, you might say, that's pretty interesting; what's the -- what's the next step? If you believe that the recent difficulties with Aramco in Saudi Arabia might have been caused by -- so I think we kind of have our opinions about what's going on here.

And I think this reflects just the reality of technology moving forward, and it's a double-edged sword. It's a way for people to put pressure on the other side, but we're also realizing that we're quite vulnerable to these things. So it's probably, in my opinion, likely to continue and likely to move out into areas that we really haven't thought about too much in the past. But it also is a way that might be a lot less damaging than some other options, like overt military action.

So I think you're seeing just the recognition that as these capabilities become more defined in the world, you're going to probably see them put into -- put into operation. And so it's going to put a premium on nations and corporations, institutions around the world to take a look at how they're structured, how they perform the basic functions they are organized to do and how they can -- how they can protect themselves. But it's a different area altogether.

GIACOMO: OK. Anybody else? In the back.

QUESTIONER: Curious if you could comment on the effect of a nuclear Iran on global oil prices and thereby on the global economy. And I'm thinking specifically -- just over a year ago one of the Iranian generals threatened to shut the Straits of Hormuz, and Secretary Panetta responded very forcefully, sent greater force into the region to assure that the straits would remain open. And I wonder, if Iran had a nuclear weapon, if we would have had the same response and if Iran might not have been a little bit more aggressive in its response to our response.

DOBBINS: Well, you know, the Soviet Union had 20,000 nuclear weapons and threatened to take Berlin. And we just lined up some tanks and said, try it. So I mean, I -- the -- I don't think it would make a difference.

It -- the one thing that a nuclear -- one thing that Iranian possession of nuclear weapons would do would mean that it would no longer be a realistic option for the United States to invade and overthrow the government and occupy the country, because then they would use nuclear weapons. But that is the only situation in which they would use nuclear weapons, given our overwhelming superiority, both conventionally and in the nuclear (form ?). So we'd lose that option.

But it's not an option anyway. Nobody's ever envisaged it. Nobody is going to envisage it. Iran's three times bigger than Iraq. It's not going to happen. So we would have lost one option, and I think that's the -- it -- that's the effect of it.

I mean, we get those kinds of threats all the time from North Korea. They don't stop us from doing whatever we're doing. They just said they're going to start a war again if we go ahead with an exercise next week in North Korea. They're going to declare the armistice over and go back to war. And we're just ignoring it and going ahead with the exercise.

GIACOMO: Karim?

FALLON: If --

SADJADPOUR: No, go ahead.

FALLON: If -- the challenge with these things is taking a speculative comment and dropping it into some, you know, context a year or two or three or four -- who knows how many -- what's happened in the interim, but the specific issue of the -- blocking the strait, if that were to occur, almost certainly we would not allow that to persist very long. And the problem with that is that to effectively clear the straits, which is well with our capability, we would probably take steps that would expand military action beyond the immediate strait, in a practical manner.

Does this mean we're going to go to a nuclear war? Absolutely not. But the fact is that there's going to be some expansion of activity. It's not going to be one little tiny -- this island or this particular 10 miles of waterway, because I wouldn't -- if I were the commander, I certainly wouldn't want to put my forces at risk of being subjected to attack from other places in the Gulf.

So we wouldn't allow that to happen. They could -- they could make that move. I think they would regret it pretty quickly, and I think that's what the secretary had in mind when he made his comments.

So the fact that they might have a nuclear weapon doesn't mean that we would just sit there and say, oh, gee, I guess we can't do it.

QUESTIONER: But just go to the premise of my question. Do you think, though, that oil prices would rise in any --

FALLON: Oh, oil prices jump up and down every time somebody sneezes today. So I don't know what -- of course they're going to jump up.

But I think there are other factors in the world that are at play here that might make that a little less of a -- of a gut-wrenching heart-stopper, as they seem to be at least speculative about today.

GIACOMO: Quick response from Karim.

SADJADPOUR: I just think that closing the Strait of Hormuz is the tactical equivalent of a suicide bombing for Iran. They're going to harm a lot of others, but they're going to harm themselves the most. They're going to cut off 80 percent of their export revenue, which is oil, and they're going to alienate their major strategic and commercial patron, which is China. That oil coming out of the Strait of Hormuz is not coming to the U.S. It's going to Asia.

And last, I think with this shale oil revolution, increasingly the oil from the Strait of Hormuz is going to be less and less important. So I think, you know, half-jokingly, we should encourage them to close the Strait of Hormuz --

QUESTIONER: (Laughs.)

SADJADPOUR: -- because they're going to hurt themselves above all. (Laughter.)

FALLON: It makes no sense.

GIACOMO: I know we have more questions, but we really have to wrap up. Thank you very much to everybody. It was a great discussion. (Applause.)