President Obama may not need Congress to defang sanctions against Iran
WASHINGTON — Even if Congress rejects his final Iranian nuclear deal, President Barack Obama could use his executive pen to offer Tehran a hefty portion of sanctions relief on his own.
Lawmakers have insisted on having a say on what could be a historic accord that the U.S. and five other nations are trying to finalize with Iran. The aim is to prevent the Islamic state from developing nuclear weapons, while in return Iran would get a break from U.S., European and U.N. sanctions that are choking its economy.
Negotiators are working to complete a final deal by the end of June. Talks will resume next week in Vienna, it was announced Thursday.
In the meantime, legislation is expected to pass both the Senate and House that would block Obama from using his current authority to waive congressional sanctions against Iran for at least 30 days after any final agreement, to give lawmakers time to weigh in.
However, even if Congress rejected a final agreement, Obama could take unilateral actions that — when coupled with European and U.N. sanctions relief — would allow a deal with Tehran to be implemented.
The president could suspend some existing U.S. sanctions with his waiver authority. He could issue new orders to permit financial transactions that otherwise are banned under current law. And he could simply take certain Iranians and entities, including nearly two dozen Iranian banks, off U.S. target lists, meaning they no longer would be subject to sanctions.
Only Congress can terminate its legislative sanctions. And those are some of the toughest penalties against Iran because they target its energy sector, central bank and key segments of its economy. But experts say Obama can neutralize the effect of some of those sanctions, too, and work with the Europeans to neutralize others.
Treasury official Adam Szubin told the House last month that the Obama administration doesn’t think congressional sanctions should be terminated for years to come — long after Obama leaves the White House — so that the U.S. continues to retain leverage over Tehran years into any final agreement.
But there’s more to the story.
Says Tyler Cullis, legal fellow at the National Iranian American Council, which favors an agreement: “Some have expressed doubt whether the president can provide Iran significant sanctions relief solely on the basis of his own authority. Such doubt should be put to rest.”
He said the president “could almost gut” an entire segment of sanctions by taking Iran’s major banks off the Treasury Department’s list of Specially Designated Nationals and Blocked Persons List. Those on this list face asset freezes, and Americans are banned from doing business with them. Moreover, many U.S. and foreign banks and businesses have opted to steer clear of those on the list just to make sure they don’t violate U.S. sanctions.
If the Europeans and other nations participating with the U.S. in the nuclear talks lift their penalties against Iran, the international sanctions regime will begin to unravel, and Cullis said Obama could tell lawmakers they should work with him to join the sanctions relief campaign.
Mark Dubowitz, a leading sanctions proponent with the Washington-based Foundation for Defense of Democracies, agrees.
“It is legally possible for him to go it alone,” Dubowitz said. “He can do a lot on his own and he can do a lot with the Europeans.”
According to Dubowitz, if the Europeans lift the Iranian oil embargo, Iran could work to increase the 1.1 million barrels a day that it’s exporting now to pre-sanction levels of an estimated 2.1 million. At $50 a barrel, that would provide Iran with about $18 billion more in oil revenue every year.
Currently, those importing Iranian oil are required to pay into locked escrow accounts in a handful of countries. There’s an estimated $100 billion sitting in those accounts, and that money could be released through presidential action.
“So right way, there’s about $118 billion that Iran could access within about 12 months without Congress,” Dubowitz said.
That’s potentially in the future. Now, a bipartisan bill being ushered through Congress by Tennessee Republican Bob Corker, chairman of the Senate Foreign Relations Committee, would stop Obama from easing sanctions on his own authority for at least a month while lawmakers weighed a final deal.
If they rejected it, with a resolution of disapproval, Obama could lose his waiver authority altogether. Obama is betting, however, that he won’t.
If Congress nixes a final deal, the president will almost certainly veto that disapproval. And, as long as he can get more than one-third of the Senate to side with him, he can prevent his veto from being overridden.
Some have portrayed the Corker bill’s progress as a victory for Congress — an example of the president being one-upped. Yishai Schwartz, an associate editor at Lawfare, which is published by the Lawfare Institute in cooperation with the liberal-leaning Brookings Institution, sees it differently.
“The White House gained the high ground in any confrontation over the Iran deal the moment its lawyers discovered the sanctions regime could be dismantled by executive action,” Schwartz writes.
Some businessmen might be wary of heavily investing in deals with Iran unless sanctions are not just temporarily waived or suspended by the president but actually lifted. And there also are political reasons why Obama might not want to blatantly exercise his authority to waive or dilute sanctions that have been ordered by Congress.
For one thing, Sen. Lindsey Graham, R-S.C., said that too much unilateral action by Obama could prompt a pushback from Democrats and hurt Hillary Rodham Clinton’s chances to win the White House. “So I don’t think that’s a viable option.”
Sen. Chris Coons, D-Del., said Obama also needs to be mindful of lawmakers who believe that America’s constitutional framework “imagines congressional relevance to the conduct of foreign policy.”