Divest-Iran

From JPost, March 26 2007 Bibi's Blog: by Binyamin Netanyahu

After recent visits to Britain and France, I visited the United States last week as part of my continued efforts to focus the world’s attention on the dangers of a nuclear-armed Iran and to explain the critical importance of increasing diplomatic and economic pressures on the regime in Teheran while there is still time.

In addition to numerous media appearances that enabled me to bring this message to a wider American audience, I had the opportunity to meet and speak to American leaders of both political parties, including Vice President Dick Cheney, Deputy National Security Adviser Elliot Abrams, leading Republican presidential candidates Rudy Guliani and Jon McCain, leading Democratic presidential candidate Barak Obama, and prominent Democratic senators and congressman, including Joe Leiberman and Tom Lantos. In all my conversations, I found that these leaders not only expressed a clear recognition of the grave dangers posed by a nuclear-armed Iran, but also declared their willingness to act to thwart those dangers. Republicans and Democrats alike told me that a nuclear-armed Iran was not an option, and that economic pressures should be used to convince the regime to abandon its nuclear program, if not bring down the regime itself.

...I explained that the international community faces three options in dealing with Iran.
First, it can do nothing, in which case Iran will develop nuclear weapons. That is unacceptable. Second, it can use military means to confront Iran. While this option should never be taken off the table, it should only be used as a last resort.
Third, it can use non-military pressures, primarily economic ones.The regime in Teheran is extremely vulnerable to economic pressure. More than 80% of its government revenue comes from oil exports, the government heavily subsidizes gas for the population and the Iranian oil industry is badly in need of foreign investment and technology.

In applying economic pressure on the Iranian regime, the UN took a first step – a baby step - three months ago by placing extremely limited sanctions on Iran. Yet even these limited sanctions have exposed Iran’s economic vulnerability. Ahmadinejad has faced unprecedented criticism and his allies lost a recent round of voting for representative to Iran’s Supreme Council. The cost of some goods in Iran has increased sharply, as anticipation of further sanctions grows. Whether further UN sanctions remain possible is an open question, since Russia and China have been generally unhelpful in broadening and deepening the effort to isolate Iran. Still, the UN sanctions against Iran should be encouraged.

In addition, there is an effort, led by the US Treasury, to have the international banking system reassess the risks of doing business with Iran, and these efforts have met with some important successes.

But there is another tool, I explained, that could bring enormous economic pressure to bear on Iran: Divestment. Today, the American people are invested in Iran. Not directly, of course. That is against US law. Rather, through pensions, savings plans, and other diversified investments, American money is invested in companies - mostly European companies - that do business in Iran. By insisting that their investment dollars not be used in Iran, the American public can send a powerful and effective message. For pension funds and other savings investments, divesting from companies doing business in Iran will be relatively painless. In most cases, it will only entail substituting a few companies in a diversified portfolio. For some major European companies, a decision to pull the plug on investing in Iran will be more painful, but for most companies, Iran represents a tiny share of their revenues. These companies will adapt quickly to a divestment environment.

But for the regime in Teheran, the blow of divestment could prove fatal. Fewer and fewer companies will enter Iran. More and more will leave. Investment dollars and the technology it buys will dry up. The lifeline of the regime will be cut. Teheran will face a stark choice: Change its polices and win back investment, or maintain its policies and risk economic collapse. The effort to divest from Iran could quickly bear fruit. Few people today have any idea they are supporting a regime inciting to genocide. When they do, they will want to stop that support. There are efforts underway in a number of individual American states to divest state pension funds from Iran. Similar divestment initiatives are being pursued against Sudan, a country in which genocide is actually taking place in Darfur. I see no reason why they cannot be combined -- why those working to stop genocide and those working to stop a regime inciting to genocide cannot work together.

We in Israel must do our part as well. While the power of our investment dollars is infinitesimal compared to the US, if we hope to persuade the world to divest, we must lead by example. Therefore, I have submitted a bill in the Knesset that will outlaw investing in companies that invest in Iran and Sudan. I know that there are some who are afraid of mounting a divestment campaign since there have been attempts in the past to divest from Israel. Some are concerned that by supporting divestment, we will be establishing a precedent that will later be used against Israel.

But divestment against Israel is wrong not because divestment per se is wrong. It is wrong because it is directed against Israel -- a democratic state that yearns for peace with its neighbors. Divestment against Iran and Sudan is right for the same reason why divestment from Nazi Germany in the 30s and 40s would have been right. I said last year that it was 1938. But today, we have the lessons of the 1930s to guide us, and the power to choose a different course that will make all the difference. We must mobilize the power of the free world to confront the dangers in time. We must, as the old saying goes, put our money where our mouth is.

If we divest from Iran, we will be able to say what our parents and grandparents could not: That we acted in time, that we prevented genocide, that we preserved peace. In short, the message of my trip to the US was simple. Divest Iran. Divest Sudan. Invest in Peace.