This article is also available on the Washington Quarterly website.
For most of 2007, concerns about Iran grew louder. This situation changed dramatically in December, with the release of the National Intelligence Estimate (NIE) on Iran's nuclear intentions and capabilities. The NIE, which assessed that Iran had ceased its covert weapons program in 2003, was widely interpreted to indicate that Iran was no longer a threat. As a result, questions were raised whether U.S.-led efforts to ratchet up financial pressure against Tehran, through both UN sanctions and unilateral measures, remained either necessary or viable.
In reality, even if Iran no longer has an active covert nuclear weapons program, there would still be plenty of reason to worry. As Iran has publicly trumpeted, it continues to move forward on its uranium-enrichment activities. The fissile material generated through enrichment could rapidly be turned into a nuclear bomb should Iran choose to resume its weaponization program. Iran's enrichment activities also remain in defiance of UN Security Council resolutions.
Although the U.S.-led campaign to increase the financial pressure has not yet achieved its overarching goals, the NIE gives cause for optimism that Iran might actually modify its behavior on its entire nuclear program in the face of the right mix of carrots and sticks. As global financial institutions have scaled back their Iranian business, there are indications that a debate is starting to take place about the wisdom of the nuclear program within Iran. . . .