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While scrutiny this week focused on the debate over troop strength, President Bush also used the occasion to turn up the pressure on Iran, using his speech on Thursday to stress the need to contain Iran as a major reason for the continued American presence in Iraq.

The language in Mr. Bush’s speech reflected an intense and continuing struggle between factions within his administration over how aggressively to confront Iran. Secretary of State Condoleezza Rice has been arguing for a continuation of a diplomatic approach, while officials in Vice President Dick Cheney’s office advocate a much tougher view that seeks to isolate and contain Iran, and to include greater consideration of a military strike. Mr. Bush’s language indicated that the debate, at least for now, might have tilted toward Mr. Cheney.

By portraying the battle with Iran as one for supremacy in the Middle East, Mr. Bush turned up the rhetoric another, more bellicose, notch. “If we were to be driven out of Iraq, extremists of all strains would be emboldened,” Mr. Bush said. “Iran would benefit from the chaos and would be encouraged in its efforts to gain nuclear weapons and dominate the region.” The tensions between Ms. Rice and Mr. Cheney have existed for a long time; they began during the administration’s first term, when, as national security adviser, she had to mediate turf battles between a coalition of Mr. Cheney and Donald H. Rumsfeld, then the secretary of defense, and Colin L. Powell, then the secretary of state.

 Now, as secretary of state, Ms. Rice has increasingly come to reflect the more diplomatic view advocated by the State Department, which has pushed for a more restrained tone in America’s dealings with the world in general, and Iran in particular. Mr. Cheney and hard-line hawks in his office, however, have become increasingly frustrated with the slow pace of progress in curbing Iran’s nuclear ambitions, where Ms. Rice has advocated a diplomatic approach. Allies of Mr. Cheney continue to say publicly that the United States should include regime change in Iran as a viable policy option, and have argued, privately, that the United States encourage Israel to consider a military strike on Iran’s nuclear facilities.

The testimony this week of Ryan C. Crocker, the American ambassador to Iraq, that the diplomatic talks with Iran have done little to restrain what he called Iran’s “malign” influence in Iraq, also fueled the disquiet in Mr. Cheney’s office, one administration official said. The debate between the factions will play out soon in a decision over whether to declare Iran’s Revolutionary Guard Corps, or a unit of it, a terrorist organization and subject to increased financial sanctions. While some White House officials and some members of the vice president’s staff have been pushing to blacklist the entire Revolutionary Guard, administration officials said, officials at the State and Treasury Departments are pushing for a narrower approach that would list only the Revolutionary Guard’s elite Quds Force, or perhaps, only companies and organizations with financial ties to that group.

The designation would make it easier for the United States to block financial accounts and other assets controlled by the group. The administration is still pressing ahead with other efforts to turn up the pressure on Iran. The State Department has asked top officials from the five other world powers seeking to rein in Tehran’s nuclear ambitions to come to Washington on Sept. 21 for a meeting in which R. Nicholas Burns, under secretary of state for political affairs, will press for stronger United Nations sanctions against Iran. On Sept. 28, Ms. Rice will meet with her counterparts from Europe, Russia and China to discuss the Iran sanctions issue.

Beyond its nuclear program, Iran has emerged as an increasing source of trouble for the Bush administration, American officials say, by inflaming the insurgencies in Iraq, Afghanistan, Lebanon and Gaza, where it has provided military and financial support to the militant Islamic group Hamas. In its report to Congress on Friday, the administration accused Iran of providing Shiite militias with training, money and weapons, including rockets, mortars and explosively formed projectile devices, which the administration said accounted for an increased percentage of American combat deaths. The report said that “coalition and Iraqi operations against these groups, combined with a growing rejection of Shia violence by top Government of Iraq officials, has led to some progress in reducing violent attacks from Shia extremists.” The American military in Iraq still has custody of several Iranian officials who were detained there on suspicion of involvement in providing aid to Shiite militias. Iran’s government has denied the charges.

Its supreme leader, Ayatollah Ali Khamenei, said Friday that Mr. Bush’s Middle East policies had failed and that Mr. Bush would one day be put on trial for the “tragedies” he had created in Iraq. But a belief has been growing in Iran, which administration officials have pointedly not tried to stem, that the Bush administration is considering military strikes against Iran. An Israeli airstrike in Syria last week kicked up speculation in the Iranian press that Israel, in alliance with the United States, was really trying to send a message to Iran that it could strike Iranian nuclear facilities if it chose to. “If I were the Iranians, what I’d be freaked out about is that the other Arab states didn’t protest” the airstrike, said George Perkovich, vice president for studies at the Carnegie Endowment for International Peace. “The Arab world nonreaction is a signal to Iran, that Arabs aren’t happy with Iran’s power and influence, so if the Israelis want to go and intimidate and violate the airspace of another Arab state that’s an ally of Iran, the other Arab states aren’t going to do anything.” During the talks next week, the United States, France and Britain will try to get Russia, China and Germany to sign on to a stronger set of United Nations Security Council sanctions against members of Iran’s government. The sanctions are aimed at getting Tehran to suspend its enrichment of uranium.

The international efforts to rein in Iran’s nuclear ambitions have been complicated by America’s conflict with Iran in Iraq, which Russia and some European countries argue should take a back seat to the nuclear issue. Further complicating things has been a dispute over a pact reached last month between Iran and the International Atomic Energy Agency for Tehran to answer questions about an array of suspicious past nuclear activities. Gregory L. Schulte, the American delegate to the agency, suggested that Tehran “has no intention of coming clean.”

Source: The New York Times

Tehran has overturned the death sentence of a former Mujahedin Khalq Organization member who has been held in an Iranian prison in Iran for six years.

Iran’s Revolutionary Guard is notorious in the West as the troublemaking arm of the Islamic Republic, accused of supporting Hizballah and other militant groups, destabilizing the Iraqi government, and nurturing a covert nuclear weapons program.

Inside Iran itself, however, the image of the Guards is more that of an economic powerhouse, with more influence and assets than even the Tehran bazaar, the institution whose cash has traditionally helped drive the country’s politics. To conservative supporters, the Guard’s economic clout is neither new nor troublesome. Iran’s constitution authorizes the military to play a peacetime economic role, and with the extensive engineering resources it amassed during the eight-year war with Iraq, it is only fitting, the thinking goes, for the Guard to run a vast financial empire reputedly worth billions of dollars. But to reformists, the Guard is to blame for the poor performance of Iran’s economy, as well as its tattered relations with the international community.

 ”There are elements within the IRGC [the acronym for the Islamic Revolutionary Guard Corps] that operate like a private mafia and benefit from Iran’s isolated status,” says Karim Sadjadpour of the Carnegie Endowment for International Peace. “That’s why they do their very best to torpedo efforts to improve Iran’s relations with the West.” The expanding economic influence of the Guard helps explain Washington’s reported plan to name them a “specially designated global terrorist” organization. The designation would would enable the Bush Administration to press European corporations and banks to curb business activities in Iran, so as not to run afoul of U.S. banking regulations. Though European allies have been reluctant to accede to Washington’s demands for sanctions, the limited measures adopted thus far have, nonetheless, made a dent in the Iranian economy, affecting both imports and domestic manufacturing, according to Iranian businessmen and analysts.

The IRGC’s economic activities have expanded most significantly in the past five to six years. Originally created in 1979 as a parallel military to prevent the traditional armed forces from mounting a coup against the new regime, the Guard developed its assets and engineering capability during the Iran-Iraq War, growing into a 150,000-strong force that defended the country’s borders with selflessness and revolutionary zeal. After the war, the IRGC’s resources were directed toward reconstruction activities, partly as a way of absorbing the energies of the tens of thousands of ideologically committed veterans returning from the front, preventing any disruptive political activism. Because the Guard reports to Supreme Leader Ayatullah Ali Khamenei, the bulk of its activities are not subject to parliamentary oversight. This free hand, along with their mandate to patrol the country’s borders, has helped members engage in widespread smuggling, according to Iranian analysts. Some of the goods that are smuggled in, such as alcohol, do little harm to the formal economy, as they are illegal and produced domestically only on a small, illicit scale.

More problematic is the large-scale smuggling of more ordinary goods, which enter the country without tariffs, flooding the market with cheaper versions of products produced at considerably higher cost by domestic manufacturers, spurring resentment among domestic industrialists. Since around 2000, the IRGC’s hand has extended into new and far more lucrative sectors of the economy. Most significantly, it has been awarded billions of dollars in contracts in the oil, gas and petrochemical industries, as well as major infrastructure projects. The government awards some of the no-bid contracts directly to the Guard’s engineering arm, Khatam Al-Anbia. Other times, the link is more indirect: “Sometimes you see newly established firms, indirectly owned by IRGC members, receiving the contracts,” says a director of a major engineering firm on condition of anonymity. Today, many of the firms that would once have been awarded government contracts are working as subcontractors to Guard-owned enterprises.

In 2006 alone, Khatam Al-Anbia received a $2.09 billion contract to develop phases of a natural gas field known as South Pars, as well as a $1.2 billion contract to build a line of the Tehran metro, and a $1.3 billion contract to build a pipeline linking Iran to Pakistan. The wealth accrued by high-ranking members of the IRGC by such contracts has raised concerns within the Iranian establishment, chiefly because it threatens to provoke the resentment of the organization’s young, working-class rank and file. In 2001, three-quarters of Guard members voted for moderate President Mohammad Khatami, suggesting its majority have more in common with ordinary Iranians chafing under a poor economy, than with the hard-line newly rich leadership clique. In working-class districts of south Tehran, the discrepancy is visible among members of the Basij, a voluntary paramilitary organization that overlaps with the IRGC’s membership. The sons of some elite IRGC commanders carry the latest mobile phones, attend top universities, and are as Internet savvy as teenagers in the West. The foot soldiers of the Basij, in contrast, often cobble together work as motorcycle messengers in the smoggy avenues around the Tehran bazaar, earning close to nothing.

Some analysts say the growing activities of the IRGC’s engineering arm reflect an effort by the government of President Mahmoud Ahmadinejad to extend the economic privileges within the Guard’s lower ranks. “That the President owed his election to Basij support naturally supported this trend,” says Farideh Farhi, an Iran expert and professor at the University of Hawaii.

Source: Azadeh Moaveni, Time

Iranian President Mahmoud Ahmadinejad warned Saudi King Abdullah that the “enemies of Islam” were trying to divide the Muslim community, his website said on Saturday.

The Ahmadinejad-Abdullah telephone call came amid complaints from Iran, which is majority Shiite, that Iranian pilgrims visiting Islam’s holiest sites in the mainly Sunni kingdom were being harassed. “The enemies of Islam are trying to spread disunity among Muslim nations, especially between the two governments of Iran and Saudi Arabia,” Ahmadinejad said, according to his website. Earlier this month Tehran asked Riyadh to fight against Sunni extremists who Iran said were targeting Iranian pilgrims in Mecca and Medina in anti-Shiite sermons.

“The Islamic Republic of Iran has been fully assured about the action of Saudi Arabia, especially the king, for consolidating unity among the Muslims,” Ahmadinejad said. Iran and Saudi Arabia over the past few years have tried to improve relations, which have been strained ever since the Iran-Iraq war in the 1980s when the Gulf monarchies backed Baghdad. Ahmadinejad also told the king that Iran was “ready to provide its experience in the field of nuclear technology, under the IAEA,” to Saudi Arabia, referring to the UN watchdog, the International Atomic Energy Agency. Iran is under UN sanctions for failing to suspend its controversial nuclear programme.

Source: AFP