Commentary on Political Economy

Sunday 13 August 2023



The Biden-Iran Hostage Deal

The U.S. is poised to hand over a $6 billion ransom for five Americans.

Aug. 13, 2023 4:53 pm ET

An Iranian woman walks next to an anti-US mural in a street in Tehran, June 12. PHOTO: ABEDIN TAHERKENAREH/SHUTTERSTOCK

Readers of a certain age will remember the uproar when the Reagan Administration was caught trying to trade arms for hostages with Iran. Well, the Biden Administration seems prepared to hand over $6 billion to Iran’s ruling mullahs in return for five Americans it has taken prisoner to get precisely this kind of ransom. Iran keeps raising the price for its hostage-taking, and the U.S. keeps paying it.

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The White House said late last week that Iran has moved four Americans to house arrest from Evin Prison. A fifth American was already under house arrest. “We will continue to monitor their condition as closely as possible. Of course, we will not rest until they are all back home in the United States,” White House spokeswoman Adrienne Watson said.

“Until that time, negotiations for their eventual release remain ongoing and are delicate. We will, therefore, have little in the way of details to provide about the state of their house arrest or about our efforts to secure their freedom,” she added.

This is good news for the unjustly detained people and their families. But if they are released, the mooted price will be steep. Leaks from the Administration suggest that Iran will gain access to $6 billion of its frozen assets in an account in South Korea. That’s $1.2 billion a hostage.

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White House spokesman John Kirby told CBS News on Thursday that Iran will only be able to use the $6 billion for “humanitarian purposes,” such as food and medicine. The Administration also says there will be no sanctions relief in this hostage deal.

But that’s a semantic distinction without much of a difference. Why were the funds frozen if not as a sanction against Tehran? That’s certainly how Iran sees it. “The decision on how to utilize these unfrozen resources and financial assets lies with the Islamic Republic of Iran,” said the foreign ministry in Tehran.

Money is fungible, as the White House knows, and its “humanitarian purposes” line is best understood as political cover to justify the money-for-hostages deal. In a competition for the funds between the Islamic Revolutionary Guard Corps and the public health of the Iranian people, who do you think wins?

Iran will use the cash the same way it did the money it received from the Barack Obama-John Kerry 2015 nuclear deal—to spread mayhem in the Middle East and beyond.

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Some of it will go to finance the Shiite militias in Iran that have targeted and killed Americans. Some will likely go to build more drones and missiles that Iran is delivering to Russia to use against Ukraine. The White House recently dispatched more aircraft and 3,000 Marines and Navy personnel to the Middle East to deter Iranian seizures of commercial ships.

The hostages deal would in effect finance Iranian aggression against the U.S. and its allies that the U.S. is spending billions of dollars to counter. It’s no accident that one of the five Americans currently held by Iran, Siamak Namazi, was snatched not long after that 2015 deal was struck. Tehran was grabbing new chits for its next ransom demand. “We’ve been taken for one reason and one reason only—and that’s because we’re U.S. citizens,” Mr. Namazi told CNN this year.

The hostages deal may also be the first step toward a larger agreement to revive at least some of the 2015 nuclear pact. That mooted agreement would ease sanctions on Iran in return for an Iranian promise to freeze its enrichment of uranium, which has been proceeding toward weapons-grade.

It isn’t clear from the Administration’s media leaks whether Iran would allow any new or more intrusive inspections of its nuclear sites, but don’t count on that. Iran knows Mr. Biden wants to push any crisis over Iran’s nuclear program past the 2024 election. This new informal nuclear deal sounds like a less enforceable version of the 2015 pact. Call it money and sanctions relief for promises, and don’t expect Congress to have any say in approving it.

The plight of imprisoned Americans is awful, and the decision of what to give up in return for their release is difficult for any President. We’ve been forgiving of prisoner swaps. But rewarding Iran with money for hostages amounts to financing its malign activities and encouraging it to take more American prisoners.

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