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DIRECTIONS IN U.S. FOREIGN POLICY: ENGAGING IRAN BY BUILDING CONSENSUS FOR STABILITY IN THE CAUCASUS By Richard Giragosian and Khatchik Derghoukassian An important, yet subtle development in U.S. foreign policy in the Caucasus was virtually obscured by the flurry of announcements and press briefings of April's Key West mediation effort attempting to secure a negotiated resolution to the Nagorno Karabagh conflict. The Key West meetings between the Armenian and Azerbaijani delegations represents the first real effort at U.S. Transcaucasus summitry in the post-Clinton period of foreign relations. Demonstrating the maxim of the random nature of foreign policy challenges, the Key West talks were overshadowed by the confrontation between the U.S. and China over the downed surveillance plane and the fate of the U.S. military crew detained by the Chinese. This chance occurrence helped the State department to maintain an impressive degree of secrecy and fostered the lack of transparency essential to a frank negotiating session. In many ways, the Bush Administration is still setting its compass to steer through the shoals of international affairs. The ongoing process of formulating a concise concept of Bush foreign policy is complicated by competing power centers around the new president, each jockeying for position and influence within the inner circle. Endowed with several leading and experienced advisers, this president must sort out the often conflicting (and more often competing) counsel of these prominent advisers. Seen in this light, the U.S. initiative within the Organization for Security and Cooperation in Europe (OSCE) is an important indication of the future direction of Bush foreign policy, both in general terms as well as in its approach to the region. The announcement by the OSCE's Minsk Group co-chair, U.S. Ambassador Carey Cavanaugh, that he would brief the Iranian government on the developments reached during the Key West talks represent more than the standard courtesy of international diplomacy. This announcement holds deeper significance because the exclusion of Iran from the OSCE organization was a reflection of long standing U.S. policy. The U.S. opening to Iran through the OSCE peace process could well be an important preliminary step in a new policy of constructive engagement with Iran. Recognizing the legitimacy of Iranian interests in the region, as well as its interests in the Nagorno Karabagh conflict and the Caspian in particular, is a commendable revision to the long standing policy of isolation of Iran as a "rogue state" by the past few U.S. administrations. The essential elements of this new U.S. inclusionary move toward Iran comprise a wide range of security, economic and geopolitical considerations. The Bush Administration has initiated a covert effort designed to foster a new relationship with Iran. This initiative rests on the need to counterbalance the weakening of Turkey in the wake of the most serious economic crisis in that country's history, as well as serving to diplomatically contain and manage the burgeoning Russian-Iranian relationship marked by the sudden announcement of increased Russian arms sales to the Iranians. The U.S. is seeking to effectively counter the risk of regional instability and proliferation by taking preliminary steps toward the establishment of a cooperative partnership with Iran. Another important element is the U.S. desire to explore the Iranian option as a means toward solving the transport challenges of exporting Caspian oil to Western markets. This policy option is tied to Washington's current modification of its policies of engagement in the Balkans and the Middle East, while minimizing the risk of destabilization, and the reordering of priorities in other areas of the world. Another Earthquake Strikes Turkey The sudden loss of a strong Turkey as a regional proxy for the United States caught many administration policy makers by surprise. This weakening of Turkey's regional power and prestige, due to a significant economic crisis, has left Washington without the ability to fully rely on Ankara as a power broker in the region. Turkey was struck by an economic earthquake, which in many respects was similar to its recent natural earthquake disaster. The tremors of this economic earthquake were felt throughout the country's financial markets with aftershocks affecting all of its economy. The fault lines of this economic earthquake exposed serious weakness in the foundations and structures of the Turkish economy. Just as in its natural earthquake, the vulnerability of its foundation led to greater financial and economic damage than would ordinarily be expected in such a crisis. Following the model of the Japanese "bubble" economy, the accumulation of questionable bank loans, the inefficient pattern of cronyism and corruption throughout many leading sectors, all contributed to an abrupt collapse of the Turkish economy. This weakening of Turkey has led Washington to seek new leverage in its efforts to contain an assertive Russia and to reinvigorate plans to develop the oil resources of the Caspian Sea. In this context, Iran offers an important new avenue for U.S. engagement in the region. In the longer term, however, the new emphasis on an Iranian option does not necessarily mean an abandonment of Turkey as a regional partner. The inclusion of Iran can be seen as a diversification of options and possibilities for the formulation of a more comprehensive engagement by the United States throughout the region. Regional Shift: A New East-West Axis Amidst these first steps toward a more balanced approach in U.S. relations with Iran, there is a subtle shift underway in the Caucasus. In fact, this regional shift extends much further from Europe and the Balkans in the west, to the Middle East to the south, and along this axis into Asia. The United States is formulating policies designed to follow this eastward axis by redirecting efforts to secure stability in the Balkans and to regain a geostrategic initiative guided by the imperatives of containing China. This effort is meeting a series of obstacles of which the most pressing is the Israeli-Palestinian. The disengagement of the U.S from the region is complicated by the seemingly endless escalation of violence by the hard-line Israeli government of Ariel Sharon and the Palestinian "intifada," threatening to spillover into a broader "arc of crisis" throughout the Arab world and the spreading of anti-American sentiment. The fragility of the still fairly new regimes and monarchies of Syria, Jordan and even Morocco may be especially vulnerable to a wave of militant Arab nationalism sparked by frustration over the spiraling Palestinian conflict with Israel. This threat of regional instability must, however, be prevented from similarly affecting Iran, and thereby impeding the potential for Iran to assume a role promoting stability. A U.S. Foreign Policy in Times of Economic Slowdown The Bush administration came into office on a platform highly critical of its predecessor's liberal internationalism. Denouncing the Democrats' strategy of "engagement and enlargement" as wanting to embrace too much, the new Republican Administration was already advocating a return to a narrow national interest-focused foreign policy. The few opinions that were heard during the course of the presidential campaign suggested a withdrawal of U.S. military from the standing commitment in the Balkans and proposed a Reaganesque National Missile Defense (NMD) system as a high priority. Although not as immediate as these proposals were during the heat of the campaign, they are well on their way to fruition. These policies, however, should not be interpreted as a return to isolationism, but rather what the analyst Christopher Lane qualifies as "offshore balancing". The practical implications of the Bush foreign and security policy doctrine would mean, among other things, a major revamping of burden sharing in peacekeeping in Europe and elsewhere, a delay in NATO expansion, and a virtual rejection of the concept of humanitarian intervention (as seen in Kosovo). Even more importantly, this "offshore balancing" concept would be marked most notably by the deployment of the National Missile Defense system. As the U.S. remains the only superpower, with an annual overall defense budget equivalent to the sum of the twelve most powerful nations' annual defense budgets, this "offshore balancing" strategy is credible, despite the fact that its inherent unilateralism provokes friction, tension and even conflict with other nations - including allies. There is another factor contributing to Washington's perspective seeing itself as obliged to pursue a gradual disengagement from international commitments deemed unworthy of passing the national interest litmus test. This factor lies in the alteration in the economic landscape. The U.S. economy, despite having started its decline in the waning days of the Clinton era, poses a significant consideration to the Bush team. The economic slowdown, and its inherent threat of an eventual recession, inevitably questions the priorities of the foreign aid budget and the worthiness of U.S. contributions to multilateral organizations. The most important consideration in this case is the necessity for reordering foreign policy priorities and commitments. This scenario is further complicated by the looming confrontation between the executive and legislative branches over the reordering of priorities. The complexities and constituent-based constraints of the congressional authorization and budget process promises a difficult road ahead. The Moderation of the Powell Doctrine Given this structural context of the administration's foreign policy, it is also evident that Washington's new foreign policy has yet to find a solid course and, hence, predictability. Thus, the challenges of the low-politics agenda, - mainly trade,- and its visible and potential linkages to U.S. security did not receive much attention during the first hundred days of the administration (the Quebec meeting of the Summit of the Americas being the only exception, and a superficial one at that). Moreover, the ongoing bureaucratic competition between Secretary of State Colin Powell, Secretary of Defense Donald Rumsfeld and Vice-President Dick Cheney each trying to impose his own vision of world affairs and America's place in it is further delaying the consolidation or conceptualization of foreign policy. And while the former seem to be more prone to a hawkish (i.e. unilateralist) stance, Secretary of State Powell is following a cautious, moderate course seeking to balance his administration's gradual disengagement with the need for multilateral consensus building. Although superficially contradictory, given Powell's military background, this moderate course adheres to the tenets of the so-called "Powell Doctrine." Based on a realistic evaluation of the Vietnam experience, this Doctrine seeks to impose a new logic-based military system, opposing inefficiency and inadequacy in times of military action. According to the Powell doctrine, the use of force must obey the logic of "first cut them, then kill them" applied during the Gulf War and featuring the application of greater force, greater strength and greater intensity in every action, all designed to overwhelm and annihilate the opposing force. In strict military terms, this is the classical concept of "disproportionate use of force." A second element of the Powell Doctrine is the recognition of the necessity for an "exit strategy" following the application of force or for instances where a quick victory seems unattainable. In foreign policy terms, this would be a gradual, yet orderly, disengagement. In order to avoid perceptions of isolationism or of an "arrogance of power," this disengagement would be implemented within a multilateral framework based on consensus building. Thus, still within a realist perspective, the Powell Doctrine introduces an element of moderation buttressed by consensus building. No matter how debatable its results, the Powell Doctrine is being applied from the Middle East to the Balkans and China and, according to some analysts, seems to be serving as the core of Washington's foreign policy. Building Consensus for Regional Stability? What are the ultimate aims of the U.S. in opening to Iran through the OSCE process? While the positive step would certainly broaden the multilateral efforts, oil and strategic interests hardly are absent in this new phase. It should be noted that the announcement made in Key West comes at a crucial time for the internal dynamics of Iranian politics. Specifically, the moderate line of President Khatami is facing yet another challenge from the conservatives in the face of forthcoming elections. An additional feature in timing concerns the fact that relations between Teheran and Moscow are getting closer. This may suggest that Washington would accept a reformist Iran, under the leadership of Khatami, along with a contained Russia, as stabilizing factors in a region where the threat of a renewed cycle of violence is but too obvious. If this comes to pass, the most basic implication is that the strategic alliances that define the current balance-of-power are to be maintained and "legitimized" as key security factors. The most optimistic implication is that a framework based on a consensus to develop the Caspian cooperation can been forged to stabilize and develop the region. Only in such a case of regional consensus and inclusion would it be reasonable to expect a breakthrough in the negotiations towards mutual compromises and the discussion of the economic perspectives of both Armenia and Azerbaijan. Thus, the key to any Karabagh resolution encompasses the complex, but vital, need for regional security, stability and economic development. ---------------------------------------------------------------------- Richard Giragosian has worked as a professional staff member with the Joint Economic Committee, U.S. Congress specializing in international relations and economics in the former Soviet Union and China. He is the author of the monthly newsletter, "TransCaucasus: A Chronology." Khatchik Der Ghougassian is a Ph.D. student of International Relations in the School of International Studies, at the University of Miami. He has written as a political analyst in the Armenian and Argentinean press.